Thursday, December 13, 2012

Chapter 1.5 – One-sided growth delusion

Excerpt from the book »Gradido – Natural Economy of Life«

» Germany, it's about growth.«
- Angela Merkel
Chancellor of Germany

Living nature is growing constantly. Every cell and every plant, every animal and every human being, they all have one thing in common and that is growth. All the cells of our bodies replace themselves every seven years. That is one half of the truth and here is the other half: living nature is in constant decay. The old cells die to the same extent as new ones grow. We call this process the cycle of life, the cycle of growth and decay. If there was no transience our earth would have burst at the seams long ago. The cycle of growth and decay is a guarantee that, on the one hand, there is enough of everything and, on the other, that everything superfluous vanishes. It is a self-regulating system.

What has the economy learnt from this? Unfortunately nothing at all! The one-sided growth delusion leads to increasing exploitation, destruction of the environment, cut-throat competition – and to war about the fewer and fewer remaining natural resources. This one-sided growth may still have been sensible when the earth had only a small number of inhabitants. In that way they were able to spread out over the whole globe. But we know that natural systems have to adapt themselves when they reach the limits of their growth. If they try to keep on growing, they collapse. 

Nature shows us how it works in this respect as well. Symbiosis is the magic word. The various members of an eco-system cooperate for the good of all, thus maintaining their common existence. This is so obvious but so little understood by us humans. Politicians still eulogise economic growth as the highest good. They even praise competition concerning growth among the nations: a country with high rates of growth enjoys a high reputation in the world and a good credit-standing with banks.

The expression »economic growth« naturally does not mean the cycle of growth and decay. For according to the zero-sum principle decay would be removed from growth. A company that grows and shrinks simultaneously, meaning that it constantly renews itself and thus stays healthy, would not be perceived as growing in the balance but as stagnating. And stagnation means regression in a market ruled by competition.

»Growth for growth’s sake is the ideology of a cancer cell.«
Edward Abbey
American natural scientist, philosopher and writer

You will certainly be familiar with the exponential function. Perhaps not by name, but you know its effects. Imagine a slice of bread lying in the bread bin. A spore of mould has settled on it and the fungus starts to grow. Let’s assume that it doubles in size in one hour. After two hours it has increased fourfold, then eightfold, sixteen-fold, thirty-two-fold and then after ten hours a thousand-fold. Its size increases a thousand-fold after it has doubled ten times.

Perhaps nothing can be seen so far. But it goes on: two thousand, four thousand, eight thousand… and after a total of twenty duplications we have reached a million. At some time the point is reached when we can see the first mould. From then on it cannot be stopped and it is not long before the bread is completely covered with mould.

The exponential function has three phases:

  1. First nothing is to be seen for a long time
  2. Then we begin to see something
  3. Then it proceeds very quickly – to the limits of growth. 

Here is another example. In spring a bird drops something into a beautiful lake. It contains the seed of an aggressive type of water lily. The water lily has the property of doubling itself within a week. First it is one, then two, then four… and after ten weeks a thousand water lilies. Everything still looks very nice. But after a total of five months – it is now August – there are already a million lilies. Approximately 3% of the lake is covered with water lilies and 97% of the water surface is still free. But now the process goes on really fast: 6%, 12%, 24%, 48%, 96%: - boom! At the end of September the entire lake is covered with water lilies and there is no longer any free area of water. However, everything looked fine two weeks before: three-quarters of the water area was still free. It was not until the last few days that the full extent of the disaster became visible. A clever observer would have been able to predict the outcome as early as April, at a time when it would have been possible to take counter-measures. But such a person would probably have been decried as a scaremonger. 

It is exactly the same with economic growth. The process is the same, it just goes a bit more slowly. Five percent growth doubles itself after fifteen years. After thirty years fourfold, after forty-five years eightfold… and after a hundred and fifty years a thousand-fold.

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