The Economy and Global Warming in a Nutshell

It seems to me that the capital of our planet is the total of its resources maintained by the energy received from our sun. A balance is kept among these resources by the laws of nature. If an imbalance, for example, overpopulation occurs, it is culled by nature. Over time, a balance is maintained in all species of plants and animals (including the human animal) in this manner. And, since the pictures from the moon show our planet in a vast sea of emptiness—it is obvious that its resources are finite.

Whether by intuition or conscious design, some earlier societies, the Native American Indian for example, lived in renewable harmony with nature. Our present-day society, on the other hand, is living on mined resources. We are not in balance and without major changes to our systems, we can never be. If we, on a planet wide basis, do not cure our imbalances and get in renewable step with our worlds’ resources, nature will do it for us—and I am sure we won’t enjoy her methods. The laws of nature and physics do not compromise, they are what they are and our wants and desires will not be considered.

I have written before that unrestrained capitalism only works because of an expansion of itself. How often have you heard the refrain—”to create jobs and get out of this recession we must expand (or grow) the economy”.

Speculation in an economy is expansion on the cuff: If it is introduced and balanced out in the near term, you have expanded the economy. If it causes a retraction, you have created a recession or, if severe and prolonged, a depression.

The bursting of the debt bubble built up by the manic speculation in the 1920’s brought The Great Depression because, as people attempted to reduce their debt there was less spending in the general day-to-day economy and therefore, jobs were lost and unemployment rose.

Neoclassical economists of that day said, to increase employment you need to cut money wages. But that, of course, would just make it harder for an, in debt, worker to pay off their debt and increase the time before they could begin to consume more in the day-to-day economy. And, if their wages were cut to zero (unemployed), how could they do either.

Sadly, the conservatives of today espouse the same failed policy—cut programs and pay off the debt. (I wonder how many of the ones saying this are unemployed—conservatives in congress we know are not. And the Tea Party puppets who are having their strings pulled—do they want their government benefits cut, their Social Security and Medicare perhaps).

The Neoclassical method does not work, history has shown that. What does work is the Keynesian Model, inflationary government spending (either by borrowing or printing) to create aggregate demand in the economy and thereby create jobs—it ended the Great Depression and it would have ended the current deep recession if the conservatives had allowed enough spending—but, of course, they didn’t. I have written about this in a previous E-pamphlet: “Empirical Evidence for Keynesian Model”.

Now comes the big caveat: as I said above, unrestrained capitalism only works if it can expand.

Is there room for more expansion?—maybe, in an economic sense, if the developed nations keep taking more and more of the world’s resources unto themselves. But, this, business-as-usual path, the path that the conservatives insist on taking, will only bring on the dire consequences of runaway global warming and in the end we will all perish.

The other path, the one I hope we travel down, is the one where we phase out, very quickly, the use of fossil fuels (unless and until we are able to capture and sequester the pollutants in them) and switch to all nonpolluting renewable sources.

I realize that a world running on renewable sources may not support the existing population, if and when we get there, but if our species and millions of others are to survive, there doesn’t seem to be another choice—nature will do the culling.

There is a ray of hope though, if humanity is able to pull this off, it will be by stringent government regulations, ones that will change the way unregulated capitalism now operates. And, instead of the few having such a large claim on the world’s resources, more will be made available to others and nature will have less culling to do.

Young people! please get actively involved in all elections, you are the ones who will suffer the most if there is not massive change in the way we treat our environment.

Support only progressive Democrats, they are the ones who try to make the changes in regulations that are needed if the United States is to do its part in saving the planet from dire global warming consequences.

And join 350.org in their worldwide effort to save our planet.