We need to combine the critique of financial Ponzi with resource and environmental Ponzi, and see them as related. Both involve negative externalities based on rent-seeking behavior. They are directly related to MMT in the MMT is concerned with both availability of real resources and monetary economics, which includes finance.
“We created a way of raising standards of living that we can’t possibly pass on to our children,” said Joe Romm, a physicist and climate expert who writes the indispensable blog climateprogress.org. We have been getting rich by depleting all our natural stocks — water, hydrocarbons, forests, rivers, fish and arable land — and not by generating renewable flows.
“You can get this burst of wealth that we have created from this rapacious behavior,” added Romm. “But it has to collapse, unless adults stand up and say, ‘This is a Ponzi scheme. We have not generated real wealth, and we are destroying a livable climate …’ Real wealth is something you can pass on in a way that others can enjoy.” [from an interview of Joe Romm by Thomas Friedman]There are two related issues here. The first is climate change, which the overwhelming evidence suggests artificial warming resulting from carbon-based fuels as a significant causal factor if not the chief cause.
The second is environmental pollution, which is a health and quality of life issue in addition to an economic one, along with resource depletion which is not renewable in a timely way, costing the future.
Climate Science
Global Ponzi Scheme Revisited: How Climate Inaction Betrays Our Children And Future Generations
Joe Romm
"and not by generating renewable flows."
ReplyDeleteThat's an interesting point. I wonder if the human condition makes it hard for us to think in terms of renewable flows.
Because if you think about it that is precisely the problem the monetary system has got into. It isn't run properly and that means it doesn't generate a sufficient renewable flow.
If everyone is a libertarian Neil, there is no one or no institution to authorize the continuous flow...
ReplyDeleteIt doesn't "create itself"...
It may not be the 'human condition', it perhaps is the 'libertarian condition', I.e. 'no one is in charge'...
RSP,
Neil Because if you think about it that is precisely the problem the monetary system has got into. It isn't run properly and that means it doesn't generate a sufficient renewable flow.
ReplyDeleteMatt: there is no one or no institution to authorize the continuous flow...
Fear of inflation rules it out. TPTB always desire to control the flow in order to prevent inflation, and they are usually successful, even in a non-convertible floating rate system through politically imposed restraints.
It could aslo have to do with what Rodger has been pounding on recently — the artificially induced wealth gap that makes the top of the town feel like they really are special.
"I wonder if the human condition makes it hard for us to think in terms of renewable flows."
ReplyDeleteProbably, given the physical laws under which life develops in our current universe.
Entropy tends to increase if there are not new constant external flows of energy into the system, and that would make life impossible.
Basically any organism only knows one condition under which it can develop, and that is by increasing energy flows. No such this as recycling the flows of energy.
The use of language is misleading, and there isn't, in reality, such thing as "renewable flows". There is just a more intelligent use of the flows available to us, currently not exploited (due tot eh lack of knowledge, organization or technology). Funny enough there would not be renewable flows if the Sun didn't keep sending energy every day.