What I learned from steady-state economist Herman Daly – Resilience

Herman Daly, the dean of the steady-state economists, died recently at age 84. His view that the Earth could only support a steady-state economy in the long run—rather than the perpetual growth economy imagined by most of those alive today—was based on an understanding he came to early in his career. As a doctoral student Daly became convinced that the economy was a system like any other in the universe and therefore governed by physical laws.
So here are three important things I learned from reading Herman Daly and hearing him once at a conference long ago:
Once scattered or burned, they cannot be economically retrieved for reuse. That is, these processes cannot be reversed (except locally by creating more entropy).
To build a civilization that could remain functioning indefinitely, we humans would have to 1) live in a way that does not exploit renewable resources faster than they can be replenished (think: trees and fish), 2) use nonrenewable resources at a rate that does not surpass our ability to find renewable substitutes before these nonrenewable resources become prohibitively expensive or inaccessible altogether, and therefore 3) limit consumption (and thus ultimately population) to a level that will allow this balance. This would be the steady-state economy.
Some say that such a society would be stagnant. This is not the case as over time businesses would die and other businesses would replace them. Innovation would continue but would be focused on technology and practices that would allow humans to do more with less throughput of resources and energy. Intellectual achievements would continue in the arts and sciences. Style in the design of buildings, clothing and manufactured goods would shift over time with the changing vision of designers and the needs of consumers. Ideally, physical products would be fully recyclable.
But establishment economists refuse to recognize the downsides of perpetual growth. They thereby violate their own precepts by endorsing perpetual growth while never acknowledging that the costs of growth must eventually exceed the benefits (and have almost certainly done so already). This could be because most economists are dependent on the wealthy for the salaries they make in the financial industry or for the endowments and research funds that support their professorships. And the wealthy generally become wealthy because of the dynamics of growth and wealth inequality inherent in our system of perpetual growth.
Perhaps Daly’s most famous piece of writing is “Economics in a Full World,” which appeared in Scientific American in September 2005. Seventeen years on Daly’s message is even more relevant in that nothing has been done to rein in the growth juggernaut.

By developing a clear blueprint for a sustainable society, Daly has shown that rigor in economic thinking is possible. Unfortunately, the policy-making institutions of our society remain largely in thrall to establishment economists who have a natural incentive to please their paymasters in the financial, political and academic worlds.
The result is policy that speeds us toward an inevitable cliff of disruption as natural systems ultimately fail to keep up with the needs of our growing population and consumption. The cascading dangers that we are seeing in climate are only one manifestation of many breakdowns occurring in the natural systems we rely on for survival.
Humans will one day live in steady-state economies. Physical laws assure this. For now, it’s looking more and more like human societies will arrive at such a steady state involuntarily as a result catastrophic disruptions rather than intelligent planning.
Image: An image of the Earth taken from the VIIRS instrument aboard NASA’s Earth-observing research satellite from a low orbit of about 826 km altitud (2012). Author: NASA/NOAA/GSFC/Suomi NPP/VIIRS/Norman K. Via Wikimedia Commons https://commons.wikimedia.org/wiki/File:North_America_from_low_orbiting_satellite_Suomi_NPP.jpg
Kurt Cobb is a freelance writer and communications consultant who writes frequently about energy and environment. His work has appeared in The Christian Science Monitor, Common Dreams, Le Monde Diplomatique, Oilprice.com, OilVoice, TalkMarkets, Investing.com, Business Insider and many other places. He is the author of an oil-themed novel entitled Prelude and has a widely followed…
Resilience is a program of Post Carbon Institute, a nonprofit organization dedicated to helping the world transition away from fossil fuels and build sustainable, resilient communities.

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