Archive for the ‘The Economy and the Planet’ Category

Capitalism, green or otherwise, is ”Ecological Suicide”

July 22, 2015 2 comments

Green Capitalism: The God that Failed is essential reading for
anyone opposed to planetary suicide.”

from Truthout and David Klein

Green Capitalism: The God that Failed, by Richard Smith,
World Economics Association eBooks

The climate crisis is the greatest threat humanity has ever faced. At the current rate of global greenhouse gas Industrial pollutionemissions, warming of the planet will shoot past two degrees Celsius by mid-century and reach 4°C to 6°C beyond pre-industrial averages by 2100. The magnitude of the impending catastrophe was eloquently described by Hans Schellnhuber, director of the Potsdam Institute for Climate Impact Research, when he said, “the difference between two and four degrees is human civilization …” Adding to that, the biosphere faces massive pollution, resource depletion, species extinctions, ocean acidification, among other looming dangers.

But can we save ourselves? In his new book, Green Capitalism: The God that Failed, Richard Smith argues compellingly that “sustainable production is certainly possible but not under capitalism” and even more forcefully, “capitalism and saving the planet are fundamentally and irreconcilably at odds.” To this central question, Smith brings an impressive command of economics and an engaging conversational style of writing. He explains and illustrates with devastating clarity the key mechanisms of capitalism that force it to grow unendingly, and these explanations are supported with a broad array of examples of corporate and national economic practices from around the world.  read more

War and peace and the steady-state economy

May 2, 2015 6 comments

from Herman Daly

My parents were children during WW I, the so-called “war to end all wars.” I was a child in WW II, an adolescent in the Korean War, and except for a physical disability would likely have been drafted to fight in the Vietnam War. Then came Afghanistan, Iraq, the continuous Arab-Israeli conflict, ISIS, Ukraine, Syria, etc. Now as a senior citizen, I see that war has metastasized into terrorism. It is hard to conceive of a country at war, or threatened by terrorism, moving to a steady state economy.

Peace is necessary for real progress, including progress toward a steady state economy. While peace should be our priority, might it nevertheless be the case that working toward a steady state economy would further the goal of peace? Might growth be a major cause of war, and the steady state a necessity for eliminating that cause? I think this is so. Read more…

An economics fit for purpose in a finite world

March 4, 2015 6 comments

from Herman Daly

Causation is both bottom-up and top-down: material cause from the bottom, and final cause from the top, as Aristotle might say. Economics, or as I prefer, “political economy,” is in between, and serves to balance desirability (the lure of right purpose) with possibility (the constraints of finitude). We need an economics fit for purpose in a finite and entropic world.

As a way to envision such an inclusive economics, consider the “ends-means pyramid” shown below.

Ultimate Political Economy

Read more…

Three Limits to Growth

January 22, 2015 8 comments

from Herman Daly

As production (real GDP) grows, its marginal utility declines, because we satisfy our most important needs first. Likewise, the marginal disutilitiy inflicted by growth increases, because as the economy expands into the ecosphere we sacrifice our least important ecological services first (to the extent we know them). These rising costs and declining benefits of growth at the margin are depicted in the diagram below.

3 Limits Graph

From the diagram we can distinguish three concepts of limits to growth.  Read more…

Why growth?

December 15, 2014 8 comments

World War Two was followed by a period of economic growth. Yet in 1968 many young people in developed Western nations were questioning the lifestyles provided by their societies. They wanted a more meaningful lifestyle, and recognised that it had become physically possible to provide universal social services and good living conditions, including well-paid employment for all with liberal conditions and ample leisure time within a workweek of 30-35 hours. The leisure society beckoned.

At the same time, through the late 1960s and the decade of the 1970s, a considerable body of information described looming global problems. Since evidently all was not well, many decided to search deeper, to ask the major questions of the time and find the answers. Modern society, with its rapacious desire for never-ending growth, was foolishly pushing against limits on a finite planet while increasing inequality and joblessness within a consumer society tightly controlled by ubiquitous advertising.  Read more…

Europe doesn’t need America’s fracked natural gas

March 27, 2014 3 comments

from Dean Baker

In the wake of the Russian takeover of Crimea, there havebeen a number of calls for weaning Europe from dependence on Russian natural gas. Some have suggested that Europe would abandon environmental restrictions on drilling for oil and gas to increase domestic production. To help, the U.S. would continue to massively increase production of oil and gas as well as its capacity to liquefy natural gas and transport it to Europe.

The weaners seem to have the impression that this is yet another case in which the United States has to come to the rescue of those weak Europeans. After all, while we were drilling everywhere, the Europeans were fiddling around with wind and solar energy, all the while making themselves vulnerable to Russian President Vladimir Putin’s machinations.

Reality-based fans of arithmetic see matters differently. The reality is that Europe, especially Germany, has done a huge amount over the last two decades to reduce its consumption of fossil fuels, including natural gas, from Russia. The reduction in fossil fuel use swamps the impact of the drill-everywhere strategy in the United States.

If Europe had not been aggressively pushing to reduce its energy use, there is no way that gas from Russia could be replaced by domestically fracked gas or imports from elsewhere. In addition, Europe’s efforts to reduce fuel consumption have the advantage of slowing global warming.

Read more…

Five economic policy changes for 2014 that could boost employment and reduce climate disruption

January 27, 2014 5 comments

from Mark Weisbrot

The U.S. economy is still weak, with 7 percent unemployment, many millions more underemployed and less people employed in November than there were six years ago. At the same time – and not unrelated – we are still devolving along a path toward increasingly ugly inequality, with 95 percent of the income gains since the Great Recession going to the top 1 percent of the income distribution.

Meanwhile, the crisis of global climate change is moving toward more irreversible catastrophic damage each year that the United States, which is responsible for more of the cumulative carbon emissions than any other country, procrastinates in making the necessary changes to reduce fossil fuel consumption.

There are feasible policy changes that can address all of these problems – and we don’t have to sacrifice employment or a more just and decent society in order to make progress on climate change. Here are five of them: Read more…

The productivity dividend for dummies: Raising pay while working less

February 14, 2013 11 comments

from David Rosnick

I am greatly pleased to see such interest in CEPR’s recent report on work hours and climate change.  All evidence points to the idea that gradually reducing annual labor hours per worker will reduce the amount of climate change with which the world will have to cope.  But this does not mean that ordinary workers will have to make a sacrifice.  Rather, this is about how workers may choose to enjoy the fruits of increased productivity—if only they are given the chance to share fully in economic progress.

Throughout the 1950s, workers in the United States enjoyed fewer hours of labor than almost every country in Western Europe.  On average, an employed American worked 1,909 hours in 1950.  Only Sweden—at 1,871 hours—worked less.  By contrast, Greeks averaged 2,712 hours that year; the Irish put in 2,753.

Today, workers in Greece are second only to Poland for the longest working hours in all Europe and labored 330 hours longer in 2012 than their American counterparts.  However, productivities of these countries have climbed dramatically since 1950 as hours have fallen.  In each hour of work in 2012, each American produced 3.2 times as much as in 1950.  This allowed workers to build 2.9 times as much in each year— and do so in 200 fewer hours than in 1950.  In this way, American workers labored a bit less and still prospered materially.

These same Americans might have enjoyed a little more time off and still produced far more than did workers in 1950.  Over those same 62 years, the average French work-year fell by 684 hours and still workers produce 4.7 times as much in a year. Read more…

Saving the Planet or ‘Fixing’ the Debt

November 12, 2012 3 comments

from Dean Baker

Imagine Japan attacked at Pearl Harbor in December of 1941 and our political leaders responded by debating the best way to deal with the deficits projected for 1960. This is pretty much the way that Washington works these days.

The political leadership, including the Washington press corps and punditry, were already intently ignoring the economic downturn that is wreaking havoc on the lives of tens of millions of people across the country. Now, in the wake of the destruction from Hurricane Sandy, they will intensify their efforts to ignore global warming. After all, they want the country to focus on the debt, an issue that no one other than the elites view as a problem.  Read more…

The D.C. Blackouts and Global Warming

July 13, 2012 10 comments

from Dean Baker

Millions of people across the East Coast are sweltering in near-record temperatures. In the Washington area, tens of thousands are dealing with the heat without air conditioning or power due to a storm the prior weekend. The remarkable part of this story is that almost no one is talking about global warming.

Of course no specific weather event can be directly tied to global warming, just as any individual person’s heart attack cannot be directly attributed to the fact that they don’t exercise and are 50 pounds overweight. In both cases it is a question of probabilities. And the fact that greenhouse gas emissions are raising the planet’s temperature substantially increases the probability that we will get long stretches of extraordinary heat like the one that hit the Midwest and Northeast over the last 10 days.

In short, this is what global warming looks like, or least what it looks like in the United States. If there were an environmental movement in the United States, they would be screaming at the top of their lungs about the harm to life and property from this heat wave and power outage.

These costs are likely to be considerable. Hundreds of thousands of people had to discard food in their refrigerators and freezers as a result of the power outages. Many gathered their family together and went to stay with friends or spend time in a hotel. There were likely hundreds of thousands of days of lost work.  Read more…

Proletarianisation under neoliberalism in the Arab world*

April 24, 2012 12 comments

from Ali Kadri

Between 1980 and 2010 the share of the rural to total population in the Arab world dropped significantly from about 60 percent to around 40 percent. In absolute terms, an estimated seventy million people left the countryside to urban centres at home.[1] This conservative estimate is nearly equivalent to the total number of rural-urban migrants since the beginning of the twentieth century until 1980. While this exodus was occurring, the regional rate of unemployment was rising and the share of labour in the form of wages fell to around a quarter of national income.[2] By 2007, the Arab League declared that more than half the Arab population was living at less than the two-dollar per day benchmark.[3] Basic food production was decreasing and food imports were rising in this high per capita food dependent and scarcest-water area globally. Around half the population in the Arab world was spending more than half of its income on purchasing food.[4] When speculation reached the commodity market and basic food prices rose, scuffles before bakeries in Egypt resulted in several fatalities.[5] The agricultural sector was shrinking relative to the economy. The productive economy, in turn, was de-industrialising and retreating relative to oil and geopolitical rents.[6] The deconstruction sustained by the agricultural sector, in particular, led to massive dislocation throughout the neoliberal age.

The explanation of this phenomenon afforded by the class of neoclassical economy models known as dual-economy models are unfitting tools for understanding why and how this process could undergo unchecked for three decades. Read more…

Do Environmentalists Have An Interest In Who Controls Oil Resources?

March 3, 2012 3 comments

from Mark Weisbrot

Environmentalists seem to realize that they have some stake in a fight such as the Ecuador-Chevron lawsuit. In that case, which Chevron has recently moved to an international arbitration panel in an attempt to avoid a multi-billion penalty handed down by Ecuadorian courts, it is about whether a multinational oil corporation will have to pay damages for pollution, for which it is responsible. Most environmentalists figure that would be a good thing.

But what about fights between multinational oil giants and the governments of oil-producing states, over control of resources? Do people who care about the environment and climate change have a stake in these battles? It appears that they do, but most have not yet noticed it. Read more…

Australian Government Agency Admits Ban on Heterodox Economic Analysis

December 1, 2011 8 comments

from Peter Earl

In some of the first posts on this blog I reported on  how Australia’s Commonwealth Scientific Research Organization (CSIRO) was attempting to censor and ban from publication Clive Spash’s peer-reviewed paper ‘The Brave New World of Carbon Trading”. Though Spash eventually resigned from CSIRO and the paper was published in New Political Economy in 2010 (vol. 15, no. 2), CSIRO’s attitude towards dissenting views has recently become even clearer and more disturbing.

CSIRO, a government funded public research agency that employs about 6,500 people, was required to answer a series of questions Read more…

The re-colonisation of the Arab world

September 27, 2011 1 comment

from Ali Kadri

Despite vast financial wealth, natural and human resources, the Arab World remains underdeveloped and more than half the population is condemned to a life of poverty. Instead of underdevelopment, a more fitting concept that would capture the recent historical phase would be that of reverse development or de-development. De-development represents a combination of retrogression in the build-up of physical capital and a denial of the right of people to struggle to build a better life by repression and absolute authoritarianism. Although capital accumulation entails a blend of expansion of market driven forces (commodity realisation) and development by encroachment and dispossession (control by violent means including imperial plunder of third world resources), in the Arab world, the latter pattern of accumulation held primacy, hence, determining the pace of development altogether. Read more…

Political economy and the outlook for capitalism

August 11, 2011 6 comments

Call for papers

The collapse of Lehman Brothers on 16 September 2008 has opened a new stage of economic history, ushering in the world’s worst recession since WWII. The trajectory of global capitalism has been diverse but, after three years of deep crisis, protracted economic problems persist and are even intensifying, notwithstanding accelerated growth in a number of large developing countries.  Read more…


from Edward Fullbrook

There is a letter of mine in the current issue of the London Review of Books.  It is as follows.

Old Blue Banger

In 1963 I backpacked through Southern Sudan. So, naturally, reading Jonathan Littell’s ‘A Journey in South Sudan’, I tried to make connections between there then and there now (LRB, 30 June). I wasn’t very successful. Place and tribe names remain the same, but today’s referents seem to belong to a different anthropological period from the ones I knew. Littell writes: Read more…

How long will it last? — 4 graphs

from Edward Fullbrook

If you have time, I recommend reading “The three crises: oil prices, climate change and international debt” on  But here are four graphs regarding oil and natural gas from the article that illustrate some  of the difficulties that we face. Read more…

Graph of the week: World’s Liquid Fuels Supply

February 19, 2011 1 comment

This alarming graph comes from a report titled:  Read more…

Chart of the week: Peak oil in 2005?

January 18, 2011 5 comments

Global average annunal crude oil production 2001 – 2010  Read more…

Debate: Should GNP growth no longer be a goal in advanced economies? – Phase 2

January 18, 2011 7 comments

from Edward Fullbrook

Climate scientists are divided over whether “the tipping point”, the point at which positive feedbacks make climate change accelerate and irreversible, thereby endangering the survival of the human species, has been reached.  But the pessimists do not claim to know for sure and so agree that humankind should act to diminish the possibility of civilization’s point of no return ever being passed.  True, some elements of the general public do not regard the possibility of future generations beyond the next one or two as a matter of much importance. But people idealistically inclined do.   Read more…

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