The end of growth?

[MSTRS:Me]

Grazing pastures are a resource.

And renewable.

Oh goody! We can all eat grass.
The world doesn't want our meat. 40-odd years of Britain 'turning it's back on us in the colonies', little headway in finding other markets that will take all/more than we produce, with the subsequent drop in sheep numbers from some 70M to around 40M, is proof enough of that.

[NighthawkNZ:Me]

Movies, Revelations and other religious text, books (1984 etc), history, are all studies in the nature of the people who crave power. It's not a conspiracy in that those who are willing to work that hard and sacrifice that much to get to those positions believe they are therefore special and deserving and the rest of us are just fodder to feed their ambitions. The UN was probably set up to bring about world peace etc but wouldn't take much for ambitious people with domination desires to subvert. Not a conspiracy, just individuals and groups working to the same aim incidentally assisting each other to bring the world back to a version of serfdom, and the rest of us accidentally frustrating their desires.

sounds about right to me...

[avgas]

This post on another thread got me thinking:
I haven't researched the current thinking on economic growth but the standard view throughout my lifetime has been that each nation must grow its economy every year. That growth improves total wealth and the standard of living.
The problem is that now we are hitting the limits. Peak oil. Food prices rising. Water for irrigation and drinking is becoming more scarce. Desertification and salination are removing fertile soils. Fish stocks are disappearing.
Sooo....just thinking about NZ, do we really need to "grow" our economy in the normal sense?

Errrr we do export more than physical/tangible things........you seem to missing this rather large element out of your economy.
We don't need to grow our economy, no one NEEDS to.
It is a want.

[mashman]

Errrr we do export more than physical/tangible things........you seem to missing this rather large element out of your economy.
We don't need to grow our economy, no one NEEDS to.
It is a want.

doesn't the global "marketplace" force the need for growth in every country?

[avgas]

doesn't the global "marketplace" force the need for growth in every country?

If you wish to partake, yes.
If not, nope.
It is most humbling to see a village in China or elsewhere where they don't give a fuck what happens 50km away from their village.

[racefactory]

Errrr we do export more than physical/tangible things........you seem to missing this rather large element out of your economy.
We don't need to grow our economy, no one NEEDS to.
It is a want.

Mashman is right. it's not a want, it's actually a requirement with this economic paradigm. the amount borrowed in any year has to be at least equal to the amount being paid to reduce old loans plus the banks retained earnings. assuming that the banks are not distributing all their profits, this means that the amount borrowed has to grow year by year but since a steadily increasing amount of borrowing cannot be supported by a stationary or declining economy, this means that the economy has to grow too to prevent the level of indebtedness rising continually in relation to national income.

[oneofsix]

Mashman is right. it's not a want, it's actually a requirement. the amount borrowed in any year has to be at least equal to the amount being paid to reduce old loans plus the banks retained earnings. assuming that the banks are not distributing all their profits, this means that the amount borrowed has to grow year by year. But since a steadily increasing amount of borrowing cannot be supported by a stationary or declining economy, this means that the economy has to grow too to prevent the level of indebtedness rising continually in relation to national income.

and so endif the lesson on capitalism

[mashman]

Mashman is right. it's not a want, it's actually a requirement with this economic paradigm. the amount borrowed in any year has to be at least equal to the amount being paid to reduce old loans plus the banks retained earnings. assuming that the banks are not distributing all their profits, this means that the amount borrowed has to grow year by year. but since a steadily increasing amount of borrowing cannot be supported by a stationary or declining economy, this means that the economy has to grow too to prevent the level of indebtedness rising continually in relation to national income.

and the only way to break that cycle is to work smarter, together, almost the same as a village in China

[Banditbandit]

and so endif the lesson on capitalism

Not quite. The Marxist prediction for capitalism is frightening - it's all cyclic ... and simplified, it goes like this ...

As the western countries' cost of employment gets higher, companies will move their producton pants to countries where wages are lower and the cost of employment is lower - guaranteeing them better profits. We have seen this in New Zealand as clothing manufacture was moved to Fiji - China - Pakistan (and our call centres to pakistan, India) and in the US as car plants moved south of the border to Mexico.)

In these countries with new opportunities for employment, the workers will spend their excess money getting themselves and their children an education. With more wages the Governments will earn more taxes - meaning they can afford to improve the health and education systems as well as the country's infrastructure. The education then raises the cost of employment as people start to ask for higher wages ...

Meanwhile, in the frmer developed countries, the higher rates of unemployment mean fewer and fewer people will get an education .. and wages will go down, meaning a rise in poverty, people struggling, etc etc ... Governmetns will have less taxes and therefore less to spend on education, health, police - etc etc ...

Eventually, the countries which were once poor and had few industries, will become the developed countries, with good education, good health services and higher wages. Higher wages will mean less need for corruption and this will dwindle away. The once-developed countries will suffer from poverty, poor education ...

Then the large companies will realsie that they can get cheaper employment in the once-developed countries (such as New Zealand/US/Australia) and will move their production plants back to those countries, as wages will be chaeper than in the now-deveoped countries, such as Mexico, Fiji, Pakistan, China ...

And the cycle will continue ..

[NighthawkNZ:Me]

I blame the Aliems ... then pesky darn Aliems

[oneofsix]

Not quite. The Marxist prediction for capitalism is frightening - it's all cyclic ... and simplified, it goes like this ...

As the western countries' cost of employment gets higher, companies will move their producton pants to countries where wages are lower and the cost of employment is lower - guaranteeing them better profits. We have seen this in New Zealand as clothing manufacture was moved to Fiji - China - Pakistan (and our call centres to pakistan, India) and in the US as car plants moved south of the border to Mexico.)

In these countries with new opportunities for employment, the workers will spend their excess money getting themselves and their children an education. With more wages the Governments will earn more taxes - meaning they can afford to improve the health and education systems as well as the country's infrastructure. The education then raises the cost of employment as people start to ask for higher wages ...

Meanwhile, in the frmer developed countries, the higher rates of unemployment mean fewer and fewer people will get an education .. and wages will go down, meaning a rise in poverty, people struggling, etc etc ... Governmetns will have less taxes and therefore less to spend on education, health, police - etc etc ...

Eventually, the countries which were once poor and had few industries, will become the developed countries, with good education, good health services and higher wages. Higher wages will mean less need for corruption and this will dwindle away. The once-developed countries will suffer from poverty, poor education ...

Then the large companies will realsie that they can get cheaper employment in the once-developed countries (such as New Zealand/US/Australia) and will move their production plants back to those countries, as wages will be chaeper than in the now-deveoped countries, such as Mexico, Fiji, Pakistan, China ...

And the cycle will continue ..

Teach me to be flippant
Actually Banditbandit's lesson is more the flip side that the spin doctors would prefer we didn't see. And as long as the money peoples and power brokers are multi-national they don't care which country they source their cheap labour from, but they do seem to need to control a reasonably wealthy country or two as their base of operations.
Oh well our own Prime minister has said where he thinks NZ is in the cycle.

[Winston001]

Its many years since I did economics so I'm a bit hazy on the details. I assume "growth" means making/selling a few more widgets than last year. The increased income allows you to buy more stuff, get a better bike etc.

Is zero growth impossible - or a problem? What if I make movies to sell to the world. This year the technology is better than last year so my latest epic is made in 10 months instead of 12. Plus the technology is smarter and faster thus cutting costs. My gross income remains the same but costs are less and the product better.

This happens in reality. Home appliances today use half the energy they did 30 years ago. We sell information over the net instead of trudging down to the Post Office.

[avgas]

Mashman is right. it's not a want, it's actually a requirement with this economic paradigm. the amount borrowed in any year has to be at least equal to the amount being paid to reduce old loans plus the banks retained earnings. assuming that the banks are not distributing all their profits, this means that the amount borrowed has to grow year by year but since a steadily increasing amount of borrowing cannot be supported by a stationary or declining economy, this means that the economy has to grow too to prevent the level of indebtedness rising continually in relation to national income.

That used to be the process in explaining growth. Most text books still refer to this.
China blew that all out of the water in 2006. They had no debt - so growth required by international economics was almost zero. Growth required due to population wants far exceeded international growth needs.
So be careful what you read in english....... as now the strongest information about successful growth in economic development are coming from India and China.

[avgas]

and so endif the lesson on capitalism

Exactly....... because capitalist counties own SOOO much of the international economy right now.........

[mashman]

Its many years since I did economics so I'm a bit hazy on the details. I assume "growth" means making/selling a few more widgets than last year. The increased income allows you to buy more stuff, get a better bike etc.

Is zero growth impossible - or a problem? What if I make movies to sell to the world. This year the technology is better than last year so my latest epic is made in 10 months instead of 12. Plus the technology is smarter and faster thus cutting costs. My gross income remains the same but costs are less and the product better.

This happens in reality. Home appliances today use half the energy they did 30 years ago. We sell information over the net instead of trudging down to the Post Office.

Only if you have enough money

No to both imho. You would need to price freeze everything that requires the use of money... inflation would have to be set to zero and never rise, component/commodity prices would have to freeze, the market that allows people to make money off of money would have to cease and many many more. You'd need a total global price freeze. That's my understanding, more than happy to be corrected as per usual. No wage rises anywhere. No more profit than you already have. No creation of new jobs if it means price rises.

The technology that you have, will have depreciated and there is always a premium price tag on new technology... so you'll probably end up paying more for the new stuff than you paid for the old stuff (commodity prices supply and demand), just to stay ahead of the game. Great if you have the spare cash and if it really matters to your consumers.

You may have more efficient home appliances, but to keep the profit margins up, the price of electricity has got to rise too, which all but negates the new appliance running costs... You use less, but pay more, go figure .

Tis just my simple view of it and I'm not an economist oddly enough .