Can We Redefine Prosperity? - Herman Daly - Towards a Steady State Economy

As the holidays approach we will probably be highlighting some of our better content from years past. The below essay, on the day of Fed Chairman Bernanke's reappointment, is perhaps an apppropriate example of such. Originally from May 2008 the essay is written by Herman Daly, who popularized the term "Steady State Economy" over 3 decades ago. (Professor Daly subsequently contributed another TOD essay on the credit crisis). Just as Paul Volcker's recent comments are a refreshing departure from the garbage of Greenspan (who has been saying that market reflation creates its own wealth),

Somedays I think Theoildrum would have had more impact on education, change and understanding if all we did was post essays and thinking from folks like Herman Daly, Catton, Hubbert, Hardin, etc. Though the analysis here is fresh most of the ideas being put forward for significant change of our socio-economic system have been circulating for decades, or longer. It is doubtful we can adequately inform energy policy without addressing the linkages between equity, the environment, finance, and our end goals. I post this on Theoildrum not only because Herman is one of my tribal elders but because his eloquence, courage and foresight on these issues have historically been, and continue to be, ahead of the curve. During his resignation speech from the World Bank, Herman recommended the Bank take "a few antacids and laxatives to cure the combination of managerial flatulence and organizational constipation giving rise to such a high-pressure internal environment." To improve interactions with the external world he prescribed "new eyeglasses and a hearing aid."

Nearly 15 years later, here is Professor Daly's current synopsis of the state of economics and his prescriptions for change. As with most guest essays, I don't agree with all of the prescriptions but with most (e.g. I'm not sure a steady-state is in our nature). Herman has been writing these ideas for 40 years - would that todays leaders had the courage and wisdom to implement some of these changes, instead of going back to the same policies that brought us to this precipice. Elinor Ostrom won the Nobel award for economics this year - I expect such mainstream recognition for Herman Daly isn't far behind...

Sustainable Development Commission, UK (April 24, 2008)

A Steady-State Economy

(Editors note: underlined words are in original; bold, italicized, hyperlinks and images added by NH.)

A failed growth economy and a steady-state economy are not the same thing; they are the very different alternatives we face. The Earth as a whole is approximately a steady state. Neither the surface nor the mass of the earth is growing or shrinking; the inflow of radiant energy to the Earth is equal to the outflow; and material imports from space are roughly equal to exports (both negligible). None of this means that the earth is static—a great deal of qualitative change can happen inside a steady state, and certainly has happened on Earth. The most important change in recent times has been the enormous growth of one subsystem of the Earth, namely the economy, relative to the total system, the ecosphere. This huge shift from an “empty” to a “full” world is truly “something new under the sun” as historian J. R. McNeil calls it in his book of that title. The closer the economy approaches the scale of the whole Earth the more it will have to conform to the physical behavior mode of the Earth. That behavior mode is a steady state—a system that permits qualitative development but not aggregate quantitative growth. Growth is more of the same stuff; development is the same amount of better stuff (or at least different stuff). The remaining natural world no longer is able to provide the sources and sinks for the metabolic throughput necessary to sustain the existing oversized economy—much less a growing one.

Economists have focused too much on the economy’s circulatory system and have neglected to study its digestive tract. Throughput growth means pushing more of the same food through an ever larger digestive tract; development means eating better food and digesting it more thoroughly. Clearly the economy must conform to the rules of a steady state—seek qualitative development, but stop aggregate quantitative growth. GDP increase conflates these two very different things.

We have lived for 200 years in a growth economy. That makes it hard to imagine what a steady-state economy (SSE) would be like, even though for most of our history mankind has lived in an economy in which annual growth was negligible. Some think a SSE would mean freezing in the dark under communist tyranny. Some say that huge improvements in technology (energy efficiency, recycling) are so easy that it will make the adjustment both profitable and fun.

Regardless of whether it will be hard or easy we have to attempt a SSE because we cannot continue growing, and in fact so-called “economic” growth already has become uneconomic. The growth economy is failing. In other words, the quantitative expansion of the economic subsystem increases environmental and social costs faster than production benefits, making us poorer not richer, at least in high consumption countries. Given the laws of diminishing marginal utility and increasing marginal costs this should not have been unexpected. And even new technology sometimes makes it worse. For example, tetraethyl lead provided the benefit of reducing engine knock, but at the cost spreading a toxic heavy metal into the biosphere; chlorofluorocarbons gave us the benefit of a nontoxic propellant and refrigerant, but at the cost of creating a hole in the ozone layer and a resulting increase in ultraviolet radiation. It is hard to know for sure that growth now increases costs faster than benefits since we do not bother to separate costs from benefits in our national accounts. Instead we lump them together as “activity” in the calculation of GDP.

Ecological economists have offered empirical evidence that growth is already uneconomic in high consumption countries (see ISEW, GPI, Ecological Footprint, Happy Planet Index). Since neoclassical economists are unable to demonstrate that growth, either in throughput or GDP, is currently making us better off rather than worse off, it is blind arrogance on their part to continue preaching aggregate growth as the solution to our problems. Yes, most of our problems (poverty, unemployment, environmental degradation) would be easier to solve if we were richer-- that is not the issue. The issue is: Does growth in GDP any longer really make us richer? Or is it now making us poorer?

For poor countries GDP growth still increases welfare, at least if reasonably distributed. The question is, What is the best thing for rich countries to do to help the poor countries? The World Bank’s answer is that the rich should continue to grow as rapidly as possible to provide markets for the poor and to accumulate capital to invest in poor countries. The steady state answer is that the rich should reduce their throughput growth to free up resources and ecological space for use by the poor, while focusing their domestic efforts on development, technical and social improvements, that can be freely shared with poor countries.

The classical steady state takes the biophysical dimensions— population and capital stock (all durable producer and consumer goods)— as given and adapts technology and tastes to these objective conditions. The neoclassical “steady state” (proportional growth of capital stock and population) takes tastes and technology as given and adapts by growth in biophysical dimensions, since it considers wants as unlimited, and technology as powerful enough to make the world effectively infinite. At a more profound level the classical view is that man is a creature who must ultimately adapt to the limits (finitude, entropy, ecological interdependence) of the Creation of which he is a part. The neoclassical view is that man, the creator, will surpass all limits and remake Creation to suit his subjective individualistic preferences, which are considered the root of all value. In the end economics is religion.

Accepting the necessity of a SSE, along with John Stuart Mill and the other classical economists, let us imagine what it might look like. First a caution—a steady-state economy is not a failed growth economy. An airplane is designed for forward motion. If it tries to hover it crashes. It is not fruitful to conceive of a helicopter as an airplane that fails to move forward. It is a different thing designed to hover. Likewise a SSE is not designed to grow.

Following Mill we might define a SSE as an economy with constant population and constant stock of capital, maintained by a low rate of throughput that is within the regenerative and assimilative capacities of the ecosystem. This means low birth equal to low death rates, and low production equal to low depreciation rates. Low throughput means high life expectancy for people and high durability for goods. Alternatively, and more operationally, we might define the SSE in terms of a constant flow of throughput at a sustainable (low) level, with population and capital stock free to adjust to whatever size can be maintained by the constant throughput that begins with depletion of low-entropy resources and ends with pollution by high-entropy wastes.

How could we limit throughput, and thus indirectly limit stocks of capital and people in a SSE? Since depletion is spatially more concentrated than pollution the main controls should be at the depletion or input end. Raising resource prices at the depletion end will indirectly limit pollution, and force greater efficiency at all upstream stages of production. A cap-auction-trade system for depletion of basic resources, especially fossil fuels, could accomplish a lot, as could ecological tax reform, about which more later.

If we must stop aggregate growth because it is uneconomic, then how do we deal with poverty in the SSE? The simple answer is by redistribution—by limits to the range of permissible inequality, by a minimum income and a maximum income. What is the proper range of inequality—one that rewards real differences and contributions rather than just multiplying privilege? Plato thought it was a factor of four. Universities, civil services and the military seem to manage with a factor of ten to twenty. In the US corporate sector it is over 500. As a first step could we not try to lower the overall range to a factor of, say, one hundred? Remember, we are no longer trying to provide massive incentives to stimulate (uneconomic) growth! Also, since we are not trying to stimulate aggregate growth, we no longer need to spend billions on advertising. Instead of treating advertising as a tax-deductible cost of production we should tax it heavily as a public nuisance. If economists really believe that the consumer is sovereign then she should be obeyed rather than manipulated, cajoled, badgered, and lied to.

Free trade would not be feasible for a SSE, since its producers would necessarily count many costs to the environment and the future that foreign firms located in growth economies are allowed to ignore. The foreign firms would win in competition, not because they were more efficient, but simply because they did not pay the cost of sustainability. Regulated international trade under rules that compensated for these differences (compensating tariffs) could exist, as could “free trade” among nations that were equally committed to sustainability in their domestic cost accounting. One might expect the IMF, the World Bank, and the WTO to be working toward such regulations. Instead they vigorously push both free trade and free capital mobility (i.e., deregulation of international commerce). Protecting an efficient national policy of cost internalization is very different from protecting an inefficient firm.

The case for guaranteed mutual benefit in international trade, and hence the reason for leaving it “free”, is based on Ricardo’s comparative advantage argument. A country is supposed to produce the goods that it can produce more cheaply relative to other goods, than is the case in other countries. By specializing according to their comparative advantage both trading partners gain, regardless of absolute costs (one country could produce all goods more cheaply, but it would still benefit by specializing in what it produced relatively more cheaply and trading for other goods). This is logical, but like all logical arguments comparative advantage is based on premises. The key premise is that while capital (and other factors) moves freely between industries within a nation, it does not move between nations. If capital could move abroad it would have no reason to be content with a mere comparative advantage at home, but would seek absolute advantage—the absolutely lowest cost of production anywhere in the world. Why not? With free trade the product could be sold anywhere in the world, including the nation the capital just left. While there are certainly global gains from trade under absolute advantage there is no guarantee of mutual benefit. Some countries could lose.

Now comes the problem. The IMF preaches free trade based on comparative advantage, and has done so for a long time. More recently the IMF has started preaching the gospel of globalization, which, in addition to free trade, means free capital mobility internationally—exactly what comparative advantage forbids! When confronted with this contradiction the IMF waves its hands, suggests that you might be a xenophobe, and changes the subject.

The IMF-WB-WTO ( Washington Consensus) contradict themselves in service to the interests of transnational corporations. International capital mobility, coupled with free trade, allows corporations to escape from national regulation in the public interest, playing one nation off against another. Since there is no global government they are in effect uncontrolled. The nearest thing we have to a global government (IMF-WB-WTO) has shown no interest in regulating transnational capital for the common good. Their goal is to help these corporations grow, because growth is presumed good for all—end of story. If the IMF wanted to limit international capital mobility to keep the world safe for comparative advantage, there are several things they could do. They could promote minimum residence times for foreign investment to limit capital flight and speculation, and they could propose a small tax on all foreign exchange transactions (Tobin tax). Most of all they could revive Keynes’ proposal for an international multilateral clearing union that would directly penalize persistent imbalances in current account (both deficit and surplus), and thereby indirectly promote balance in the compensating capital account, reducing international capital movements.

One problem for the SSE already raised by the demographic transition to a non growing population is that it necessarily results in an increase in the average age of the population—more retirees relative to workers. Adjustment requires either higher taxes, older retirement age, or reduced retirement pensions. The system is hardly in “crisis”, but these adjustments are surely needed to achieve sustainability. For many countries net immigration has become a larger source of population growth than natural increase. Immigration may temporarily ease the age structure problem, but the steady-state population requires that births plus in-migrants equal deaths plus out-migrants. It is hard to say which is more politically incorrect, birth limits or immigration limits? Many prefer denial of arithmetic to facing either one.

The SSE will also require a “demographic transition” in populations of products towards longer-lived, more durable goods, maintained by lower rates of throughput. A population of 1000 cars that last 10 years requires new production of 100 cars per year. If more durable cars are made to last 20 years then we need new production of only 50 cars per year. To see the latter as in improvement requires a change in perspective from emphasizing production as benefit to emphasizing production as a cost of maintenance. Consider that if we can maintain 1000 cars and the transportation services thereof by replacing only 50 cars per year rather than 100 we are surely better off—the same capital stock yielding the same service with half the throughput. Yet the idea that production is a maintenance cost to be minimized is strange to most economists. Shifting taxes from value added to throughput would promote this minimizing effort. One adaptation in this direction is the service contract that leases the service of equipment (ranging from carpets to copying machines), which the lessor/owner maintains, reclaims, and recycles at the end of its useful life.

Although the main thrust of reforms for the SSE is to bring newly scarce and truly rival natural capital and services under the market discipline, we should not overlook the opposite problem, namely, freeing truly non rival goods from their artificial enclosure by the market. There are some goods that are by nature non-rival, and should be freed from illegitimate enclosure by the price system. I refer especially to knowledge. Knowledge, unlike throughput, is not divided in the sharing, but multiplied. Once knowledge exists, the opportunity cost of sharing it is zero and its allocative price should be zero. International development aid should more and more take the form of freely and actively shared knowledge, along with small grants, and less and less the form of large interest-bearing loans. Sharing knowledge costs little, does not create unrepayable debts, and it increases the productivity of the truly rival and scarce factors of production. Existing knowledge is the most important input to the production of new knowledge, and keeping it artificially scarce and expensive is perverse. Patent monopolies (aka “intellectual property rights”) should be given for fewer “inventions”, and for fewer years.

What would happen to the interest rate in a SSE? Would it not fall to zero without growth? Not likely, because capital would still be scarce, there would still be a positive time preference, and the value of total production may still increase without growth in physical throughput—as a result of qualitative development. Investment in qualitative improvement may yield a value increase out of which interest could be paid. However, the productivity of capital would surely be less without throughput growth, so one would expect low interest rates in a SSE, though not a zero rate.

Would it be possible to have qualitative improvement (e.g. increasing efficiency) forever, resulting in GDP growth forever? GDP would become ever less material-intensive. Environmentalists would be happy because throughput is not growing; economists would be happy because GDP is growing. I think this should be pushed as far as it will go, but how far is that likely to be? Consider that sectors of the economy generally thought to be more qualitative, such as information technology, turn out on closer inspection to have a substantial physical base, including a number of toxic metals.

Also, if expansion is to be mainly for the sake of the poor it must be comprised of goods the poor need—clothing, shelter, and food on the plate, not ten thousand recipes on the Internet. In addition, as a larger proportion of GDP becomes less material-intensive, the terms of trade between more and less material-intensive goods will move against the less material-intensive, limiting incentive to produce them. Even providers of information services spend most of their income on cars, houses, and trips, rather than the immaterial product of other symbol manipulators. Can a SSE maintain full employment? A tough question, but in fairness one must also ask if full employment is achievable in a growth economy driven by free trade, off-shoring practices, easy immigration of cheap labor, and widespread automation? In a SSE maintenance and repair become more important. Being more labor intensive than new production and relatively protected from off-shoring, these services may provide more employment. Yet a more radical rethinking of how people earn income may be required. If automation and off-shoring of jobs increase profits but not wages, then the principle of distributing income through jobs becomes less tenable. A practical solution (in addition to slowing automation and off-shoring) may be to have wider participation in the ownership of businesses, so that individuals earn income through their share of the business instead of through fulltime employment. Also the gains from technical progress should be taken in the form of more leisure rather than more production—a long expected but under-realized possibility.

What sort of tax system would best fit a SSE? Ecological tax reform, already mentioned, suggests shifting the tax base away from value added (income earned by labor and capital), and on to “that to which value is added”, namely the throughput flow, preferably at the depletion end (at the mine-mouth or well-head, the point of “severance” from the ground). Many states have severance taxes. Taxing the origin and narrowest point in the throughput flow induces more efficient resource use in production as well as consumption, and facilitates monitoring and collection. Taxing what we want less of (depletion and pollution), and ceasing to tax what we want more of (income, value added) would seem reasonable—as the bumper sticker puts it, “tax bads, not goods”. The shift could be revenue neutral and gradual. Begin for example by forgoing $x revenue from the worst income tax we have. Simultaneously collect $x from the best resource severance tax we could devise. Next period get rid of the second worst income tax, and substitute the second best resource tax, etc. Such a policy would raise resource prices and induce efficiency in resource use. The regressivity of such a consumption tax could be offset by spending the proceeds progressively, by the limited range of inequality already mentioned, and by the fact that the mafia and other former income tax cheaters would have to pay it. Cap-auction–trade systems will also increase government revenue, and auction revenue can be distributed progressively.

Could a SSE support the enormous superstructure of finance built around future growth expectations? Probably not, since interest rates and growth rates would be low. Investment would be mainly for replacement and qualitative improvement. There would likely be a healthy shrinkage of the enormous pyramid of debt that is precariously balanced atop the real economy, threatening to crash. Additionally the SSE could benefit from a move away from our fractional reserve banking system toward 100% reserve requirements.

One hundred percent reserves would put our money supply back under the control of the government rather than the private banking sector. Money would be a true public utility, rather than the by-product of commercial lending and borrowing in pursuit of growth. Under the existing fractional reserve system the money supply expands during a boom, and contracts during a slump, reinforcing the cyclical tendency of the economy. The profit (seigniorage) from creating (at negligible cost) and being the first to spend new money and receive its full exchange value, would accrue to the public rather than the private sector. The reserve requirement, something the Central Bank manipulates anyway, could be raised from current very low levels gradually to 100%. Commercial banks would make their income by financial intermediation (lending savers’ money for them) as well as by service charges on checking accounts, rather than by lending at interest money they create out of nothing. Lending only money that has actually been saved by someone reestablishes the classical balance between abstinence and investment. This extra discipline in lending and borrowing likely would prevent such debacles as the current “sub-prime mortgage” crisis. 100% reserves would both stabilize the economy and slow down the Ponzi-like credit leveraging.

A SSE should not have a system of national income accounts, GDP, in which nothing is ever subtracted. Ideally we should have two accounts, one that measures the benefits of physical growth in scale, and one that measures the costs of that growth. Our policy should be to stop growing where marginal costs equal marginal benefits. Or if we want to maintain the single national income concept we should adopt Nobel laureate economist J. R. Hicks’ concept of income, namely, the maximum amount that a community can consume in a year, and still be able to produce and consume the same amount next year. In other words, income is the maximum that can be consumed while keeping productive capacity (capital) intact. Any consumption of capital, manmade or natural, must be subtracted in the calculation of income. Also we must stop the asymmetry of adding to GDP the production of anti-bads without first having subtracted the generation of the bads that made the anti-bads necessary. Note that Hicks’ conception of income is sustainable by definition. National accounts in a sustainable economy should try to approximate Hicksian income and abandon GDP. Correcting GDP to measure income is less ambitious than converting it into a measure of welfare, discussed earlier.

The logic of the SSE is reinforced by the recent finding of economists and psychologists that the correlation between absolute income and happiness extends only up to some threshold of “sufficiency,” and beyond that point only relative income influences self-evaluated happiness. This result seems to hold both for cross-section data (comparing rich to poor countries at a given date), and for time series (comparing a single country before and after significant growth in income). Growth cannot increase everyone’s relative income. The welfare gain of people whose relative income increases as a result of further growth would be offset by the loss of others whose relative income falls. And if everyone’s income increases proportionally, no one’s relative income would rise and no one would feel happier. Growth becomes like an arms race in which the two sides cancel each other’s gains. A happy corollary is that for societies that have reached sufficiency, moving to a SSE may cost little in terms of forgone happiness. The “political impossibility” of a SSE may be less than it previously appeared.

Nevertheless it is one thing to imagine the possibility of a SSE, but something else to chart a transition thereto from a failed growth economy. Can one transform an airplane into a helicopter without first landing, or perhaps crashing? In order even to take such a task seriously one has to realize that the growth economy is heading for a big crash. Whether the measures suggested above are sufficient to convert the growth airplane to a steady-state helicopter is hard to say, but I do think they are probably necessary, and at a minimum would be useful guides for reconstruction after the crash. They also may prove capable of being applied gradually in mid air. For example, a cap-auction-trade system could begin with a generous cap followed by a gradual pre-announced schedule of tightening. The limits to income inequality could begin far apart, and be gradually tightened. Ecological tax reform could substitute at first only the worst value added taxes by the best throughput taxes, as mentioned earlier. Compensatory tariffs to protect national costinternalization policies could be imposed and raised gradually. Reserve requirements for banks could be raised gradually to one hundred percent. Patent monopolies could be gradually reduced and knowledge gradually restored to its proper status as a non rival good. Downsizing of the IMFWB- WTO from a servant of global integration in the interests of transnational capitalist growth to something closer to Keynes’ nationbased multilateral clearing union for international payments—this would be more difficult to do gradually. But nations may begin individually to withdraw from these institutions as it becomes more evident that they have abandoned the federated internationalist nature of their Bretton Woods Charter in favor of an economically integrated globalist vision of capital-dominated growth, and are as yet incapable of conceiving the possibility, much less recognizing the reality, of uneconomic growth.

While these transitional policies will appear radical to many, it is worth remembering that, in addition to being amenable to gradual application, they are based on the conservative institutions of private property and decentralized market allocation. They simply recognize that private property loses its legitimacy if too unequally distributed, and that markets lose their legitimacy if prices do not tell the whole truth about costs. In addition, the macro-economy becomes an absurdity if its scale is structurally required to grow beyond the biophysical limits of the Earth. And well before that radical physical limit we are encountering the conservative economic limit in which extra costs of growth become greater than the extra benefits.

Ten Point Policy Summary

1. Cap-auction-trade systems for basic resources. Cap limits to biophysical scale according to source or sink constraint, whichever is more stringent. Auction captures scarcity rents for equitable redistribution. Trade allows efficient allocation to highest uses.
2. Ecological tax reform—shift tax base from value added (labor and capital) and on to “that to which value is added”, namely the entropic throughput of resources extracted from nature (depletion), through the economy, and back to nature (pollution). Internalizes external costs as well as raises revenue more equitably. Prices the scarce but previously unpriced contribution of nature.
3. Limit the range of inequality in income distribution—a minimum income and a maximum income. Without aggregate growth poverty reduction requires redistribution. Complete equality is unfair; unlimited inequality is unfair. Seek fair limits to inequality.
4. Free up the length of the working day, week, and year—allow greater option for leisure or personal work. Full-time external employment for all is hard to provide without growth.
5. Re-regulate international commerce—move away from free trade, free capital mobility and globalization, adopt compensating tariffs to protect efficient national policies of cost internalization from standards-lowering competition from other countries.
6. Downgrade the IMF-WB-WTO to something like Keynes’ plan for a multilateral payments clearing union, charging penalty rates on surplus as well as deficit balances—seek balance on current account, avoid large capital transfers and foreign debts.
7. Move to 100% reserve requirements instead of fractional reserve banking. Put control of money supply and seigniorage in hands of the government rather than private banks.
8. Enclose the remaining commons of rival natural capital in public trusts, and price it, while freeing from private enclosure and prices the non rival commonwealth of knowledge and information. Stop treating the scarce as if it were non scarce, and the non scarce as if it were scarce.
9. Stabilize population. Work toward a balance in which births plus immigrants equals deaths plus out-migrants.
10. Reform national accounts—separate GDP into a cost account and a benefits account. Compare them at the margin, stop growing when marginal costs equal marginal benefits. Never add the two accounts.

Herman E. Daly
School of Public Policy
University of Maryland
College Park MD 20742 USA

(**Editor's Note: the Sustainable Development Commission is a body set up to advise the UK Government on sustainable development. Herman's essay was commissioned as part of their ongoing ‘Redefining Prosperity’ efforts.)

Nice choice for an encore.
That is the article that led me to TOD.
I was googling around with the "economy subset of the ecology" idea in my head and found this and obviously much, much more.
There must be a bunch that I missed and I am interested to see your other "TOD Classics" picks.

Unlike many here I don't think it is too late to land this thing without having World War III.

well - 'TOD Classics', like beauty, would be in the eye of the beholder. My list might be sufficiently different than Stuarts or Euans that there would be little overlap - but I'm working on compiling such a list as a University professor has asked me for it as a teaching aid.

Glad to see that a Professor wants to use this sites stuff.

Not to sound like a jerk but I think that the biggest problem with this type of information's inability to penetrate the pop culture (other than that no one wants to hear it) is that most people lack the basic education to absorb even the more simplistic concepts and relationships.
That is either a deliberate or accidental failure of our primary education system or a combination of of the two.

No the real problem is that "redefining" does nothing. Words are just words. If you change the words, you have merely changed what they mean, not the economy.

If you redefine "steady-state" economy as "prosperity" that's great. It will be called "prosperity". It will also necessarily create medieval conditions.

You see prosperity meaning growth of the economy (in VALUE not in money) makes behavior possible that is called "pareto efficient behavior". Meaning you do not take any action if you reasonably think that action disadvantages another.

This behavior, although certainly not universal, is what enables economic growth under the right conditions, and creates a feedback loop : more of this behavior creates a better economy, which lowers the price of this behavior, which ... The problem is that this only goes for the people who enrich themselves (ie. the middle class). Dependants (pensioners, kids, unemployment benefit dependants, employees, (historically) slaves, ...) don't evolve to be more generous. The way things can blow up, again historically, is for the group of dependants to grow much, much larger than the middle class. This situation, if allowed to happen, has never failed to produce a civil war. Ironically the way to stop an evolution like this is to (at least partially) stop helping, or even kill (think Spartacus) the "poor". Note that "poor" is between brackets because it does not have anything to do with living standards. Very, very rich "poor" dependants have revolted (e.g. the French aristocracy has done so several times. This was certainly not due to lacking living standards).

If prosperity means "steady-state" economy, we're in another ballpark : we're in Nash-equilibrium-ville. You take ANY action that advances your own intrest, no matter how it affects others, because that's the only way you get ahead : you can only win if someone else loses.

And now let's look at a few decisions people might have to make on the streets :
1) I can overpower and steal from this guy
a) current "prosperity" : you don't
b) nash-equilibrium "prosperity" : you do (and please not that if you do stuff like increasing the punishment, you're merely causing extreme behavior. Muslims punish thieves by cutting off body parts, the result, exactly as Nash equilibrium predicts, is that thieves in the middle east will attempt to kill any witnesses)

2) you walk across the street and you see a beautiful woman. She's alone. You are certainly capable of overpowering her
a) current "prosperity" : you walk past. Even better, you try to politely talk to her
b) nash-equilibrium "prosperity" : you rape the woman (again increasing the punishment will simply guarantee lethal violence against the woman. The only solution is to force women to make this impossible by massively increasing the violence against rape VICTIMS, making sure they seek appropriate "protection". Said protection, obviously, carries a price, and the result is "allah says you can beat women" (which is, incidentally, a true statement). Note that obviously, the fact that I mention allah is a play on the contemporary situation, it is patently and obviously untrue only muslims abuse women)


The problem with steady-state economy is simple : it turns Bush into Bin Laden. And no matter the number of romantic notions you may have about whatever you think is righteous about struggle, you would NOT like the result of that. States would commit massacres in foreign lands simply to guarantee sufficient food supply for their own people. Wars would both be unavoidable, and they'd be matters of life and death : war becomes the ONLY possible way for a country to improve it's economy, and the "default" action of the victor would be to exterminate the defeated. Prisoners of war can only receive one treatment : extermination, for exterminating them enables more babies for the home front, and it's the ONLY way to enable having more babies on the home front.

And if you think "morals" can protect us against these economic effects, read some history. Especially middle eastern history or history of what is called the "dark ages" will be very enlightening indeed. Don't forget, both middle easterners and dark age Europeans put much more stock in good morals than we do today. Read their books. If we are pushed into a situation like this, we will behave a LOT worse than they did. In addition to that, we have much better weapons, enabling much greater damage.

The list goes on.

A wonderful exposition of the dominant ideology, complete with all the usual boogey men, oel. I'm sorry you find medieval history so distressing. I am something of a scholar of the period, and while of course there were wars and invasions and disorders of various sorts, most historians agree that most people most of the time lead quiet lives farming and carrying on various types of crafts. Written history does not tend to record such everyday realities compared to the relatively rarer (and so more noteable) disturbances. They also produced many important inventions and great literature.

But if you insist on dismissing the whole period as one long bloodbath, I guess that's your prerogative--such a skewed view certainly helps support your blindly followed ideology, so you better hold it close.

I presume that you think there is no problem with infinite growth, then? And that it has raised all boats equally? That it has prevented all conflicts?

The ethics and practice of helping the poor far predate the recent ideology of limitless growth. Were all those supporting such a ethics fools?

Your conclusions are, of course, inevitable if one starts out with the usual presuppositions of nearly all economists--that of homo-economicus--that humans can be completely reduced to little self maximizing individualists. This is in fact only a good description of only a narrow subset of humans, namely economists and the capitalists whose ideology they promote, as Daly has amply shown.

If you are not interested in considering the possibility of another system, please find another puddle to play in.

Good points dohboi. Further, Business as Usual in our globalized world has plenty of bloodbaths in the service of keeping the lords on the hill (that is us in the first world) in the money. Many in the third world today would probably find the peasant life in the middle ages a great improvement in lifestyle. Just as a recent example look at the bloodbath in Iraq that obviously had nothing to do with weapons of mass destruction and everything to do with oil and other first world interests. Besides all those killed there is a generation or two who will feel the effects of all the Depleted Uranium spread all over that ancient land.

You know I can live with that. This is, in a nutshell, your argument.

IF people work to advance their own self-intrests*
THEN a steady state economy would lead to near-ubiquitous theft, rapes and genocide wars between neighbors (whether they be neighboring states, cities or even actual neighbors)

* the same could be stated as :
-> Darwin is correct, and therefore biology
-> economics theory is correct
-> there is a reason so very many people seem to come to a climate conferences in a private jet
-> ...

I would also claim that if these assumptions are wrong. There's a LOT of money to be made in proving them wrong, not to mention a few nobel prizes. I guess that effectively sharing this magic insight you have is a bit of a problem for this.

Also, by now half of our science is based on this assumption, of course, since economics has large, very large crossovers in just about any science.

I do not think the middle ages were one long bloodbath. I do however think things like rapes, thievery and murder were near-ubiquitous, and I think the reason was the economic system. I even think I'm justified in thinking so. Even in "high society", you were essentially dependent on finding "protection lords", and any and all power was firmly in the hands of the person with the biggest sword. If you interpret such a statement as "a long bloodbath", then that's your way of looking at it, but it's no more of a constant bloodbath than, say, Iran currently. I realise that a majority of Iranians peacefully live out their lives, neither bothering anyone else, nor being bothered themselves.

I see a LOT of problems with near-infinite growth, financial, social, engineering, energy generation, ... no shortage of problems at all. I do, obviously, see these problems as problems to be solved, and I'm not ready to capitulate, which you seem to do even in advance. Are you French, perhaps ? You might even say I'm prepared to risk quite a bit on the theory that we will find a solution before shit hits the fan. And there are many possible solutions to our problems. The only real commodity we're running out of that's acutely problematic is energy (a "systemic" risk, you might say. "Too big to fail" and all that). And there are over 20 credible research directions in energy generation that could solve those problems. Several of these, including solar panels, space based power generation, and even fusion work in laboratory conditions. I am not ready to assume all of these will fail, and I do NOT like the thought of anyone, even a state, controlling energy supplies through force.

I also feel strengthened by history : there has been no shortage of loonies like yourself, predicting doom for all sorts of reasons. I studied Greek in high school, and we translated a text from 400 B.C. that read very much like a post of yours. Everything was going to fall apart because ... (a long list of reaons, some reasonable, some patently ridiculous, unless, of course, you believe in the urgent need to sacrifice virgins (your own children) by throwing them into a geiser). Needless to say, despite a distinct lack of upturn in the number of virgins thrown in volcanoes, the city continued. Some predicted disasters from that letter did indeed occur, like the collapse of the ground below the lighthouse of the city, necessitating the digging of a new harbor access route, but it did not destroy the city of Athens at all. That wouldn't occur for close to another 1000 years after that letter was sent, and due to reasons very distant from anything alleged in the lettres. Or the ice age predictions of the 80s. Or the global warming predictions of the 70s. Or the nuclear scare from the 60s. Or ...

So no, I am not ready to go live as a medieval peasant today, just because it'd make you feel better. I will even be so bold as to say you're not ready to do this either. I am not ready to accept Jehova's witnesses' alike predictions of doom and gloom that seem to be delayed every time we get close to a date.

So no, I am not ready to go live as a medieval peasant today, just because it'd make you feel better. I will even be so bold as to say you're not ready to do this either.

I find it amusing - frequently when someone predicts that civilization is going to collapse someone will say "I am not ready (willing, going to) live that way." Words written on a discussion site won't make something happen. But if the collapse of civilization happens not being willing or ready to live in whatever circumstances occur won't prevent you from having to live that way. Your wishes and wants are not magic.

Lots of doom has been predicted that didn't happen. That doesn't mean that doom doesn't happen - lots of civilizations have collapsed all throughout history. Probably someone predicted most all of them. The fact that some predictions don't come true doesn't mean that all predictions don't come through. For example I predict oelewapperke that within the next 80 years you will die. I predict that in 40 years or less I will die. I predict that within 100 years almost all of the 6 billion people now alive will die. I think I have a pretty good chance of being right on those predictions of doom.

Besides peak oil, global warming, species extinction, etc. civilizations do collapse. Joseph Tainters theory is that complexity is the road to doom. "According to Tainter, societies become more complex as they try to solve problems. Social complexity can include differentiated social and economic roles, reliance on symbolic and abstract communication, and the existence of a class of information producers and analysts who are not involved in primary resource production. Such complexity requires a substantial "energy" subsidy (meaning resources, or other forms of wealth). When a society confronts a "problem," such as a shortage of or difficulty in gaining access to energy, it tends to create new layers of bureaucracy, infrastructure, or social class to address the challenge."

His book The Collapse of Complex Societies might help you understand why many think collapse of this global civilization is highly likely. Some who see it coming see it as a rescue of the planet from total devastation by humans and would like to see it happen as soon as possible. For those BAU is the doom scenario. I am more and more leaning in that direction....

Well, I seem to not only be a loony but a Frenchman to boot! Sacrebleu!

Oel is committed to his to his narrow dogma and nothing that I or anyone else can say will sway him from the conviction that any other dogma will lead to the most horrific of calamities.

I am left wondering, if economics is such a perfect science, why so very few economist accurately predicted the greatest global economic contraction since the Great Depression. Given the enormity of this near-universal failure, many in the field are starting to ask deep questions about their assumptions, but not, apparently, oel, yet?

If you think our only, or even greatest, problem is energy supply, I guess we are going to have to agree that we see things quite differently.

very few economist accurately predicted the greatest global economic contraction since the Great Depression.

I think that might be unrealistic. Google Paul Volcker.

Note that I did not say, "No economists..."

I know. But...I think if you look carefully, you'll find it wasn't really a case of the profession of economics not sounding the warning. After all, Paul Volcker's warnings were very widely known, and he spoke for a lot of others.

The problem was that the banking and business communities and government ignored the warnings, because they interfered with BAU.

"The problem was that the banking and business communities and government ignored the warnings, because they interfered with BAU."

Well, that is certainly true.

Glad to see that a Professor wants to use this sites stuff.

In fact I am seeing increasing interest in TOD even far outside of traditional "peak oilers". For example we were mentioned several times in the blog of Kate Mackenzie, a Financial Times energy expert.

Which led me to this brilliant piece of work:

If the intervention in Iraq was indeed "a war for oil," then some of that war's more positive consequences were to be seen in Baghdad last week. The country's oil minister, Hussain al-Shahristani, presided over an auction at which development rights for seven major oil fields were awarded in competitive bidding among several international consortia. Three features of the outcome were worthy of note. The auction was to award service contracts rather than the production-sharing agreements that the major corporations prefer. The price was set at between $1.15 and $1.90 per barrel, as opposed to the $4 that the bidders originally proposed. And American corporations were generally not the winners in an auction where consortia identified with Malaysia, Russia, and even Angola did best. (ExxonMobil and Occidental have, in previous negotiations, been awarded contacts in other Iraqi oil fields.)

Thus, the vulgar and hysterical part of the "war for oil" interpretation has been discredited.

uh-huh. And climate gate makes AGW a hoax.

Sorry. Getting off topic here...

So it doesnt matter who develops the fields as long as the oil is made available for the world economy?

Could you publish your reading list for the rest of us, too? Given the comment in the introduction to this article about the impact on education, I was about to suggest that a reading list for educators might be put together.

We've started to think about the impacts of energy and climate change on the future of Higher Education, in a few blog posts collected here:

You'll see that I put together 'an energy crisis reading list' a few weeks ago while beginning my research in this area:

My colleague is starting to think about 'resilience' in terms of the future of educational provision and how to build resilience into curricula: &

My interest is more around the impact on institutions, business continuity and the low energy transition that a high-tech dependent educational system will have to make over the next few decades.

i.e. &

Bear in mind we're pretty fresh to all of this and we're not coming from a background of the sciences, but rather as researchers in education. The blog posts are the start of our note taking on what the impacts of an energy crisis and climate change might have on the educational system.

If anyone else specifically shares these interests and would like to see material on the Oil Drum 'curated' towards teaching and learning, please let us know. Thanks.

There must be a bunch that I missed and I am interested to see your other "TOD Classics" picks.

My nomination

Locabucks: Are local currencies a way to escape the liquidity trap ?

Actually our world ie dry land, is shrinking - since we passed peak land area a few million years ago.

This article and reading Volkers comments lead me back to the early 80's when I was in the military and Reagan was leading the charge to financial de-regulation. I never liked Reagan much (felt he was dangerously short-sighted) but I liked his support of the military and that my pay went up after he took office. I remember a debate I had with my mother at the time when she talked about his moves to de-regulate banks and credit markets. She said that he was just kicking the can down the road and that the changes he was implementing would put us on a path that other Presidents would be bound to follow. I told her that no-one can predict the future and that it was good for the economy, near-term. She quietly told me to give it 20-30 years. A few years later I read an article ( I think it was this one from 1987: ) which put things into better perspective. I realize now that what my mother was telling me then falls into the category of prophecy now. In a way I'm glad she passed 7 years ago. She was never one to say "I told you so". The people who think Reagan was one of our greatest Presidents are the same people who deny GW and support bank bailouts. They have no idea of the damage they do.
We were warned!

Reagan was the biggest disaster to ever strike and anyone that doesn't think he was an idiot is a bigger idiot the he was!
If no oil was discovered that was not under control of OPEC or the Soviets then Carter would have been one of the greatest presidents.
Timing is everything in life.
By the way I was Navy from 1984-1992 and also bought all the propaganda like a young and naive kid will.

Reagan, along with Haber and Borlaug and a few others, fits into my most single most dangerous organism that has existed category.
Although an ignorant B actor, he caused mass destruction.

The fact that Volker (the guy Reagan fired, giving us Greenspan) has been tapped by the Admin puts a couple of points in the Obama column, IMO. Volker will be the first to say that, at this point, anything we do now will just be damage control. I'm sure he's told Obama that. I'ld like to be a fly on that wall: "Mr. President, we're screwed. At this point it's just a matter of how bad it'll get and how much time we can buy before our money is worthless."

Yeah but at least the banksters are showing some holiday spirit!

Citi to suspend foreclosures for 30 days

"We want our borrowers to have a much less stressful time, to spend their time with their families during the holidays as opposed to worrying about their homes," Sanjiv Das, head of the company's mortgage division, said in an interview.

Ah, how sweet. They really deserve a bonus for comming up with that one

The banksters just wanted some time off to spend the bonuses they've already gotten.

Sad to say so but in retrospect you have the high ground.

But if you had been in any of those guys shoes -in the same situation , faced with the same problems, working from the same knowledge base, surrounded by the same advisers,the odds are not bad that you would have made about the same decisions that they did.

This is not to say that they had the ENLIGHTENED best interests of thier country or the world at heart but that they did what they thought was best at the time to ensure the survival of thier country (if Haber and Bosch were thinking in those terms is imo debateable to say the least) and the people who put them in thier laboratories and in the White House.

I have read a lot of opinions to the effect that Reagen was totally in the pocket of certain interest groups and that he put thier welfare above the survival of the country but that is of course hogwash-the multinationals and the military industrial complex depend on the survival of this country as we are the richest feeding ground for parasites of this sort.

The country might very well be destroyed by miscalculation on the part of the banksters who seem to have the upper hand these days but never on purpose-where the hell could they expect to run to other than here when the going gets really rough?

"But if you had been in any of those guys shoes -in the same situation , faced with the same problems, working from the same knowledge base, surrounded by the same advisers,the odds are not bad that you would have made about the same decisions that they did."

Good point. As despicable as these characters actions seem, focusing on the individuals misses the point. This is not a problem of individual greed as much as it is a problem of a financial system that rewards recklessness.

And we are doing precious little to change this system, so expect much much more of the same in the coming years and decades.

I judge the individual by who their followers are and what their dogma is. I don't usually have trouble spotting the fools, because of their minions.

How bout we blame it on Anyn Rand? For some holiday cheer see

Thanks and happy holidays, oxidatedgem and TOD! More holiday econoparody cheer:

"IT'S BEGINNING (TO LOOK A LOT MORE RISKLESS)," a parody of "It's Beginning To Look A Lot Like Christmas." About the Great Recession's swine queue. On our site at; on YouTube at

"OH, CRE (Oh, Commercial Real Estate)," a parody of "O Christmas Tree (O Tannenbaum)." About commercial real estate. On our site at; on YouTube at

Wishing the best of the season to all.

Your welcome, and thanks to all at Versusplus for some humor in the midst of all we are facing.

Edit: The above link refers to an article from @1987 that I can't find. I'll keep looking.

A great overview of an SSE. Thanks for posting it, Nate. Thanks to Mr. Daly for writing it.

Much of this article relies on the premise that some authority (or authorities) will be used to determine quantifiable numbers, amounts, limits, and such. While the ideas presented (which I agree with in large part) are far outside the mainstream, I fear that the much larger issue would be coming to an agreement on who or what authorities to use for the above determinations.

Would the entire world population need to agree, or only a majority? Even if it is only a majority (3+ billion), would the governments of nations speak for their entire population, or does everyone have a vote?

I greatly appreciate the depth of thought that was put into this article, and fervently hope that it is viewed and understood by more people.

However, I cannot escape the conclusion that our species would fail in this undertaking before we even got started, since we would not agree on the authority to use to determine the necessary quantifiable numbers detailed in the 10 point Policy Summary.

COP15 shows that our species does not give up its superiority over others very easily (or, at all).

In my view, the ideas (like the ones presented here) are the easy part. The difficulty is in trying to implement these ideas against the biases in our species.

Has any advanced human society ever operated in a steady-state?
Are human's hard-wired for growth and exploitation?

Remember that humans are brand new in terms of evolutionary history and as such are still emerging( and will always be) hence adaptable to anything.

Leanan linked to this article on the Edo period in Japan, in an earlier Drumbeat. I'm currently reading the book that the article is based on here and here.

To me, it looks like they had a good version of a SSE, with many of the qualities listed in the article above by Mr. Daly.

But, they did not "power-down" and "population-down" to get there, which we would need to do.

Very interesting, thanks for the weblinks!
I think that at least a few of these SSE techniques were practiced in many other parts of the world, too. For example repairing and recycling. Some time ago I was impressed to read how incredibly expensive our throwaway materials (paper, glass, iron etc.) were in medieval times. You can be sure that even they were reused and recycled as much as possible.

Even 100 years ago, there were good livelihoods to be gained in gathering bottles, rags, bones, etc.

Even 45 years ago, when I was a child in the UK, I remember the rag-and-bone man coming round the neighborhood with his horse-drawn cart to collect scrap metal and old clothes.

Dont forget the classic 'Steptoe and Son'.

COP15 shows that our species does not give up its superiority over others very easily (or, at all).

In my view, the ideas (like the ones presented here) are the easy part. The difficulty is in trying to implement these ideas against the biases in our species.

Seeing the insane "teabagger" reaction to a weak-kneed centrist democrat in the white house, it is inconcievable to me that the present US population would stand for this. I think that is probably the unstated reason why such forces are massively attacking any messengers of limits in growth, somewhere under the covers they realize that something like this is inevitable once limits are recognized. For this reason it is clear that Daly will be viciously villified. In the current climate it takes real guts to tell the truth.

Perhaps the real issue here is more closely linked to simple competitive advantage, rather than a new reality of internalizing the costs of 'naturally-occurring' feedback.

The idea that we, as a society, can fully capture the environmental impact of each measure of economic growth is not the point. Unless of course, you wish to convince us that it is, so that it can be capitalized and sold to the highest bidder, in the same manner as any other resource.

Now I ask you, who historically has benefitted from that mechanism?

The idea that humans are banging their heads against a carbon ceiling is the only thing really man-made. The 'requirement' that we now recognize this and pay for it, is simply a cover for something much more basic.

Over the years, I have become convinced that changing our financial system is central to charting a path that has any remote hope of a non-totally-catastrophic future.

Unfortunately, the west fought and won a long cold war, which included many hot wars of course, basically to protect the financial system we have. And that bad system has only gotten worse, concentrating more and more power into the hands of fewer and fewer individuals and multinational corporations.

At this point, though, steady state won't do. We need an economic model for a world of shrinking resources, shrinking ecological sinks, shrinking habitability, and as pointed out above even shrinking land mass.

I rather doubt that the best economic system for such a situation is the same one that got us to this point. I don't think it has been imagined yet. Perhaps devising an economic system for a shrinking world is something we could collectively start to do here?

I rather doubt that the best economic system for such a situation is the same one that got us to this point. I don't think it has been imagined yet. Perhaps devising an economic system for a shrinking world is something we could collectively start to do here?

As much as I would like to believe that an economic system that might work under our current constraints could actually be imagined, devised and implemented I don't think it can.
And if it could, my guess is, that like Groucho Marx I probably wouldn't want to be a part of it.

Sure we can come up with plenty of thought experiments and scenarios of what ifs and some of us will actually be involved in real life transition experiments. Though I think what will happen will be a sort of Darwinian evolution of many different local systems that will compete and the end result will be something completely unplanned unpredictable and probably nothing like any of us could possibly imagine from where we now sit.

Whatever system evolves it will be a sustainable steady state system by definition because the alternative is non survival.

Having said that I'm all for starting a discussion of possibilities. I'd recommend that nothing be considered taboo or too off the wall. If anything it is time to really think outside the box now.

Gentlemen start your imaginations...

Whatever system evolves it will be a sustainable steady state system by definition because the alternative is non survival.

Or we will blow ouselves back to the stone age and start this whole mess over again.

Since we were talking systems, being blown back to the stone age means that "the system" didn't survive. That doesn't preclude a few individuals surviving and starting from absolute scratch.
And that certainly is a distinct possibility along with complete extinction.

I tend to agree with all you said, mag, but note that even your reference to localism is a kind of plan. There are surely any number of ways to create a sustainable system--small, traditional societies have been doing so for millennia. There is really only one system--industrialism based on endless growth (whether capitalist, communist, or other)--that doesn't seem to work.

One larger question is what level of complexity is sustainable long term. Ultimately I guess this is the same question as how local an economy should be. City states might be one model from the past to look to without dipping all the way back to the Neo- or Paleo-lithic (though I do think cave men are vastly under-rated).

(though I do think cave men are vastly under-rated)

You and Geico

Geico wanted $2000 a year for basic insurance for a 250cc motorcycle. The other major insurance co's, online, also quoted amounts between $1700 and $2500.

Meanwhile, my walk in State Farm office, dealing face to face, it's under $100 a year.

Geico (and the rest of 'em) have pretty much lost my business for life.

Anyway, I do see us going back to Neolithic. Remember there are, in traces, happy Neolithic cultures around now. Civilized folks, when and where they could, would run off and join 'em preferentially.

I read some of de Tocqueville's 18th c. Democracy in America and was struck by how often there were stories, usually in footnotes, of Europeans who abandoned their "civilized" ways to live with one or another Indian tribe, even when this (as was often the case) meant living with all sorts of physical deprivation. Given the choice people certainly do not always choose the more "civilized" way of life.

Many years ago I read a book that said that the level of sustainable complexity (in general) was driven by locality, and was
subject to the 10 mile rule. If the "ingredients" to build or maintain weren't within 10 miles it wasn't sustainable. I was
struck by this years later when I was fixing three buildings in a village of Pennsylvania built at the end of the 19th century.
Everything in those buildings (minus the glass windows possibly) had been gleaned from the local area, stone, shakes, wood, horse hair
plaster, whitewash etc. (Pennsylvania may be a slightly odd duck given it has coal, iron, limestone etc). On my farm I have
two houses, a modern cape where I live, and a two hundred plus year old farm house which i rent for a song to a local pastor.
I could actually fix almost all of that farmhouse from materials on the farm, but it would be impossible for me to fix the
vinyl sided, etc cape.

Based on these readings, and experiences, when I goto Africa to the villages and work on projects, I work on things that are "native", and when I find a whiteboy/1stworld issue that has penetrated, I go on the attack. On my last trip I fought the introduction of propane (that was "easier") and focused on gathering the materials to build wood fires inside fireplaces that were 90% more efficient for the
wood they gathered. I also went after high heal shoes. I built a church with flooring that was gapped decking that made it impossible
for the women to wear them, as they would use 1/3 of their discretionary income to buy something that was worn for two hours once a week and was impossible to make anywhere in the country let alone locally.

Take a step function down or even a soft landing down by 25-50% economically and look around you, what could be maintained with the local people and materials even over a trivial period of time - say 25 years? Even if through dieoff/abandonment there might be
equipment to "mine" out of suburban track homes, I have my doubts about say hvac components, including the thermostats surviving more than 20 years (I happen to have a wood boiler so fuel isn't the issue). I have more faith in the old pot belly stove sitting in reserve in the Barn.

I would rather say that local is within about 15 kilometers of any railway station or harbour. Its quite cheap in € or jouls to ship goods via rail or boat.

The structures on this island were built with even more local materials and they've lasted over a millennium.

You have to crash the existing economy first. If a local economy was set up that worked and then was adopted in other areas, one example would be using local currencies, this would cause a drain on the overall economy. State polititians would very quickly pass legislation to prevent this drain and scuttle the local projects.

i worked early in my career as a fish biologist. Almost all species of significance had limits of harvest. We noted that some of the most competitive people in the world are fisherman. Nothing will make them squirm more than seeing their fishing partner catching more fish. Setting a "bag limit" protects the resource but it also sets a legal limit on competition. got some young neighbors who have just returned from an early morning fishing trip with their limits and they are strutting around drinking beer and getting ready to watch some football. Now if there was no limit, they would still be out there fishing away. I know they would. they remind me of Daniel Plainview in There Will Be Blood, there is just a competition in them. Got to set limits.

Wish some of the things listed in this excellent article could be implemented. But, i am afraid we are so far into overshoot that not much is going to be done. Hell, look what's happening in the health care debate. Gutted and Gilled as we fish heads use to say.

Nice point on limits. To students and others who denigrate hunters and fishers, I point out that they are some of the few in our society who have agreed to a system that has limits (beyond their checkbook). Most shoppers would howl if they were told that there was a daily catch limit on what they could buy. But really, those "catches" are as or more damaging than individual deer or fish catches. But the damage is not local (mostly) so it is unseen and therefore not considered (most of the time).

Most traditional societies have a complex system of taboos, many of which having to do with restricting hunting and land use in various ways. It strikes me that one thing that has been missing since coal and oil were discovered is any sense of propriety about the amounts that should be extracted or the rates at which they should be produced.

It is long past time that we start instituting very strong "taboos," which in modern societies mostly takes the form of regulation, on both the extraction and the use of these super-powerful, limited sources of power. Any such suggestion will make the rabid right howl with indignation--Drill, baby, drill...etc. And the the wealthiest corporation in the world, among others, will spend billions to lobby against any such notion (and probably launch yet another campaign of deception and lies to discredit it in the public eye.)

"Agreed to limits" must be delusional.
The limits are enforced. Do you think they held a meeting and agreed amicably? Throughout history we have hunted every edible animal to extinction. The rest we hunted to extinction for their hides, pelts, ivory, bones, horns, feathers, penis' and "fun".

Recreational fishers are not the major problem for the fisheries. If they took only what they needed we could manage. Commercial enterprises have destroyed our fishing grounds. They dynamited the reefs of South east Asia to get the remaining squibs. Factory ships have plundered the oceans. There is absolutely nothing for the human race to be proud of.

Do not think for one minute that any "enlightened" ideals will prevent the total destruction of the animal kingdom, especially if it comes down to "them or us".

"From such crooked wood as that which man is made of, nothing straight can be fashioned." -Immanuel Kant. you are of course correct Bandits. wish i could think of a good example of some action humans have taken to include other forms of life in our equations. But, it just ain't in our nature. Them of us that got the avarice gene ain't gonna stop till its all gone. Unless we have a quick steep crash that leaves a few of us, we hope, so the others can begin again. reminds me of a little cartoon i once saw which had two little one cell creatures talking with a mushroom cloud in the background. the caption was, "ok, lets start over, and this time no brains."

got one more row of onions to hoe before dark, the birds to feed, fire wood to get in, then to the sour mash. Life is good down here just north of the cody scarp.

Rube....I'm of the opinion that until we as individuals and as a race accept our fallibilities we will not be able to overcome our destructiveness.

While we continue to see good and grandeur in the things we build and in cherry picked aspects of our nature, we are doomed to reap the seed of our delusions.

We have to understand ourselves before we can save the planet, it's as plainly simple as that.

Nichiren Buddhist - it it possible to transform as long as the self wants to do so
Now wanting is a part of desire and desire unenlightened causes more suffering.

If we have to understand ourselves before we can save the planet, we have lost.

That said I think you are correct, that would be the only hope. But our brains evolved to deal with the life of a hunter-gatherer. They also evolved a strong denial mechanism. We are in the end animals and I believe our fate is out of our control no matter how much control we think we have. We cannot be other than we are and thus we will either crash ourselves back to the stone age or extinct ourselves. If we avoid extinction we will find ourselves in a very depleted world and will have to put our energy into getting by day by day. That should keep us out of trouble.

Heh heh, Vonnegut: "We could have saved the earth, but we were too damned cheap."

Vivir Bien,No mejor .... A new paradigm from South america.. Evo Morales

"Throughout history we have hunted every edible animal to extinction. The rest we hunted to extinction for their hides, pelts, ivory, bones, horns, feathers, penis' and "fun"."

If you mean by "we" modern industrial society, I would agree. And some other traditional societies have done similar things on smaller scales. But many at various times have come to live in a way that did not degrade their environs over time.

I am as grim as the next guy about how infinitesimally small the likelihood is of avoiding absolute disaster. Still, in what time we have, I find it a solace to consider how we might have done things differently, and might still.

No I mean by forever...............
No human society has lived consciously in a sustainable manner. In the past their "world" was small, no walls or fences, it was sustained by a much larger "world" they did not consider.
To cope with our utter destructiveness, episodes in history will be cherry picked to show that we are really not "bad".

Just as we cherry pick "heroes" to show we, as in "whoever you want represented" individuals, families, communities countries and our race are not bad. It's how we cope, it's how we deal with our plight. It's been fed to us "religiously" literally, for as long as history can remember.

As I have said and Rube above, we are who we are and until we "know" where we are heading and what we really are capable of we have no chance of preventing our extinction.

We have to accept the "bad" in us. When we accept that, we can deal with our behavioural consequences.

There are many who will argue. They will question and demand a definition of "bad". We should define bad, as behaviour which is detrimental to the planet and other lifeforms and therefore in turn detrimental to us. We cannot act sustainably with the world as populated as it is now.

There is much to say on this topic and many have said and can say it better than I can.
Limits To Growth, The Thirty Year Update is a good start.

I think it is not the "bad" in us but rather the "animal" in us that we have to accept. The reason we have not lived in a consciously sustainable manner is because no animal lives that way. They live in balance and unbalance and over time evolution finely tunes that and things are sustainable for a while until some unbalance comes about (ie. new species arrives on a land area where it has no natural predator). In Australia when man arrived it was unbalanced and things changed, until it became balanced again. Sometimes regaining balance means the new has to go or change and sometimes it means that the old has to go or change. Carbon man has changed invaded in a sense a land that is not used to an animal with such rapacious power that a huge inbalance has occurred in a very short time.

If we understood that we were animals (and thus operating mostly on instincts) we could try to understand what our programs are programed to do and override them. Sometimes we are able to do that, most usually indirectly (ie I will shop on a full stomach so I don't buy too many goodies that I won't be able to resist if I bring them home). But to truly recognize our animal nature means recognizing our limits - we are not all powerful and we are not immortal. And then get the other 5.99999 billion people on planet earth to do the same in the few short years we have between now and catastrophe for our species. The earth has lots of time to recover and new balances of reproducing creatures will occur. We don't have time. Too bad for us....

Well, Bandits, you have obviously done deep research into every human society that has ever existed and know for certain every detail of how and why they interacted with their environment. I bow to your obviously superior knowledge on this matter.

"We cannot act sustainably with the world as populated as it is now."

I'm inclined to agree. What pop level do you think is sustainable?

The open sphere (I can't be bothered counting the sides and looking up the correct name) enclosing the trees grabs me somehow in a way that a great piece of art affects some people.

For a long time I tried very hard to come up with a scheme to get rich.Somewhere along the line reading sci fi about people living in giant trees I started having a recurrent dream about grove of giant white oaks just far enough apart for thier crowns to expand to the open ground shperical shape typical of white oaks but close enough for thier limbs to intermingle.Such trees have lateral branches as big as ordinary trees .

So the trees are full of nice little open decks forty feet up in the branches, railed in of course, scattered artfully about , reached by stairs, with comfortable chairs , tables, and waiters to fetch the drinks and food.Golf course and the rest of the country club built around the grove as the focal point of course.

I found a suitable grove of oaks but that's as far as the dream ever went.

For those who have never tried it I strongly reccomend finding a comfortable perch well up in the canopy of a mature forest of any kind when the weather is nice , where you can just barely see the ground and the sky ,and just sit there for a few hours,contemplating the world our ancestors left behind when they came down to the ground.

It is the most restful and soothing experience I have ever had. Of course when I have tried to explain this to my friends they have replied that they are well aware that I am a throwback neanderthal of some sort but that I'm worse off than they thought and be sure to stay away from thier daughters. ;)

That sounds like Lothlorien:

I spent much of my youth up in tall trees. It is a feeling hard to explain to those who haven't tried it. It sometimes occurs to me that the most useful thing we could do today is teach kids to climb trees. I rarely see kids in trees today. Touching trees (or knocking on wood, touchons de bois in French) has long been associated with being blessed or having luck.

I was thinking we would blow ourselves back to the stone age. You guys have us all the way back to swinging in the trees. Geez!

OFM, I agree. I have had the privilege of sitting high in the rain forest canopy in Brazil, it's a whole nother world up there. Though I still think floating weightless over a coral reef in crystal clear water ain't a bad experience either.

Re the artist's rendition, I have been a long time student of Bucky Fuller and have built a few geodesics from scratch. This particular rendition of a tensegrity sphere appears to be an Esheresque distortion of a frequency 2 icosahedron but there is a lot of artistic license in it, hey its art, not an engineering drawing ;-)

suggest you folks sit on the edge of a swamp, with your fingers in the mud and listen to the sounds of nature at sun rise. the real primordial nature of your being will become clear. Just saying.

Rube I have spent many a late afternoon sitting and thinking, watching the birds and beavers, looking out over the closest thing to a real swamp to be found around here-a flooded bottom land occupied by beavers, listening to the symphony orchestra courstesy of the thousands of frogs.Except for the contraials I could be five hundred or five thousand years back into the past.

But I must say the misquiotos take a little something away from the experience even when using plenty of repellent.

some very interesting thoughts along the lines of this post can be found in the latest missive by the Archdruid.

For the benefit of those reading at a later date, the aforementioned article will be archived here:

A comment elsewhere about the Edo period in Japan brought to mind the guilds mentioned here:

I agree with a number of the diagnoses, but the SSE prescription?

A global economic AND ecological totalitarian communism ruled by omniscient tyrant(s) equipped with a comprehensive, universal moral code (and enforced the only way these things are ever enforced, with threats and violence) that produces an anti-entropic, anti-evolutionary, egalitarian bubble in space time. See also: Alchemy.

If there are tough times ahead, and I would agree there are, do we really want one, single, centrally planned solution?

Also, does anyone think a helicopter is more efficient than an airplane? That's just a terrible analogy.

I think that this is one of the great cruxes of our times--much of what we do is to localize in nearly every sense. Yet, since these are global problems, we also need to have global cooperation.

It took nearly 100 years to win, but capitalism won as the dominant world paradigm. A new green, low/no/neg growth paradigm needs to become globally dominant on a much faster track. That doesn't have to mean top-down control in many cases, but it does imply a whole lot of people and societies reconsidering their basic assumptions all over the world at about the same time.

A global economic AND ecological totalitarian communism ruled by omniscient tyrant(s) equipped with a comprehensive, universal moral code (and enforced the only way these things are ever enforced, with threats and violence)

If you replace "communism" with "bureaucracy", this is pretty much inevitable, barring catastrophe.

Thomas Homer-Dixon describes the process quite well in The Upside of Down: A problem appears. The authorities ignore it, then pretend it isn't a problem, then say that its consequences are small; and finally they set up a structure to manage it, and they extend their compliance-enforcement bureaucracies to incorporate the new regulations.

And so the bureaucracy grows. With each new problem -- and we're causing ourselves plenty of those -- it grows and extends its reach, and grows some more. It forms "working arrangements" with bureaucracies in other countries; eventually, these are formalised by the creation of supra-national organisations - the WTO, the World Court, the ISO, the EU, ASEAN, ...

Every time there is a decision to be made, the logical, humane, balanced, and, most of all, efficient thing to do, is to extend and strengthen the bureaucracy.

Left unchecked, this process will end in an all-powerful global bureaucracy. Whether it's labelled "communist" or "capitalist" or "militarist" won't change what it is or what it does, although the rhetoric and uniforms would be different.

If you don't want this, then you'd better explain how we can --peacefully and quietly -- get a different result. The only plausible alternative I have seen that is even remotely in line with human nature is that of the Four Horsemen.

A single, centrally planned solution just might be better less bad than the alternatives.

A single, centrally planned solution just might be better less bad than the alternatives.

After going through the evidence for many years, I tend to agree. It's not optimal, but may be most optimal..However the problem then becomes: Quis custodiet ipsos custodes?

I suspect that will never happen and conversations of sustainability will eventually devolve to 'sustainability for whom'...that our cooperative natures will only emerge en masse after the competitive natures of some have flashed brightly.

vivir bien,no vivir mejor

Depends, "mejor" compared to what?

Every time there is a decision to be made, the logical, humane, balanced, and, most of all, efficient thing to do, is to extend and strengthen the bureaucracy.

I disagree. This is simply a matter of collectivist faith with no more evidence than my across the isle individualist conviction. I personally would rather be left to prepare as I see fit than wager on a bureaucrat's promise.

Organisms and ecosystems butt heads with limits to growth all around us everyday, constantly. I wouldn't want to downplay the life and death nature of that, but I don't think PO is really that UNIQUE of a situation, and most of the centrally planned SOLUTIONS suggested above strike me as creating even more tyranny, corruption, malinvestment, and out-of-whack pricing.

I wonder if growth dependence is the ghost that is haunting the Copenhagen talks. China and India see no way to improve the living standards of their rural poor without burning billions of tons of coal. The West also needs conventional economic growth to keep unemployment low and consumption rising along with investment such as new housing.

However it is gradually become clearer that what is counted in growth may have major costs. For example Australia boasts about the success of education of international students. These students pay high fees for diploma courses (some of questionable worth) then many apply for Australian residency upon graduation. Therefore part of that industry is a scam. The college fees get counted towards GDP but not the long term costs of increased population.

The problem is that increased economic activity (even war) always looks good short in the short run because the cost counting is postponed. We need to try to match benefits with costs. Thus when productive farm land gets subdivided for a housing estate it's all good news; nobody wants to think about the downside just yet. That should change ie think about costs and benefits at the same time.

Yes,the growth mentality is certainly THE enemy.I can't see anything but a crash curing that and maybe not even then.

India has undergone impressive growth without seeing any of it help most of its poorest citizens. Hundreds of millions in China have also mostly been left out of their capitalist bonanza. The major powers trot out their poor and their workers as reasons they need this or that, but they really don't give a sh*t about them, by and large.

Good points about short term (apparent) gain versus long term costs.

It seems clear to me that growth is now tied directly to demand destruction.

Eventually, and sooner rather than later, it will take a significant amount of demand destruction just to stay even.

Glad to see this great essay here again.

I have been noticing a few articles in the press that are beginning to address this topic. The latest from George Monbiot in The Guardian (UK) is perhaps the most eloquent and I have added a link below. In essence the commentary is that the old democratic divide that has Democrats, Labour, socialists etc on one side and Conservatives, Republicans, capital etc on the other side is now irrelevant. That is why politics has become moribund. Politics is meant to represent societal fault lines and it no longer does. New fault lines are becoming apparent and they are between those who understand and accept limits (climate, oil, growth population, environment etc etc) and those who do not. The latter group are not a pretty bunch - for the most part deluded, ignorant, greedy and arrogant. But they have recognised the field of battle better than the limiters. Their methods are effective and we have railed against them on this site for years. We call them the MSM, the "Iron Triangle", sceptics, deniers etc etc.

I have come to the conclusion that we as a species must meet our fate. A die off is inevitable because the deniers don't have to win the battle to "win" the war. All they have to do is prevent the limiters from doing anything; and they are doing that well.

I'm been posting snippets of Monbiot on my Facebook status as a nod to the talks in Copenhagen. I've always "enjoyed" his crusade against flight, a good that most of us in the "middle class" claim to need. This "need" generally has to do with seeing friends and families in far away places, but is accompanied by a failure to recognize that either those distances or the relationships themselves only exist because of a combination of the ability to fly and flights taken in the past. That my friends chide me for attempting to guilt them over this behaviour, along with my own admission that I have already booked my own flight home for the holidays, has convinced me that nothing of consequence will happen during this round. Of course, none of this is really much different from our need for cars, given the existing infrastructure. Unilaterally changing one's behaviour is not an easy task. Maybe I understand why Nate's "enlightened phase" has involved the loss of friends from his previous life.

Monbiot recently ended his own abstinence from flight, apparently as a result of some delusion that he is influential on this side of the Atlantic. Perhaps his best quote, which I believe is from his book "Heat," is the following:

"For the campaign against climate change is an odd one. Unlike almost all the public protests which have preceded it, it is a campaign not for abundance but for austerity. It is a campaign not for more freedom but for less. Strangest of all, it is a campaign not just against other people, but also against ourselves."

The latter group are not a pretty bunch - for the most part deluded, ignorant, greedy and arrogant. But they have recognised the field of battle better than the limiters. Their methods are effective and we have railed against them on this site for years. We call them the MSM, the "Iron Triangle", sceptics, deniers etc etc.

I have come to the conclusion that we as a species must meet our fate. A die off is inevitable because the deniers don't have to win the battle to "win" the war. All they have to do is prevent the limiters from doing anything; and they are doing that well.

I wish I didn't agree with that. But, it seems a very concise desciption of what I see happening. The "admit to no limits" crowd has armed themselves with the best psychological propaganda techniques, (as well as buying up the message machine) and has been making massive headway. As collateral damage science, and rational thinking is being destroyed.

First class analysis & synthesis!

I have already read many criticisms about our growth-addicted economy, but this is the first contiguous list of receipts how to cure it.
Sadly I fear that it will still take a while until mankind will make use of these advices. For example the advice "the rich should reduce their throughput growth to free up resources and ecological space for use by the poor" seems to be a loooong way to go considering the current beg-my-neighbour behaviour in the Copenhagen Climate Conference.
But I don't say that this will never happen. Just remember that until 70 years ago people beg-my-neighbour behaviours was commonplace all over the world - and probably no one could imagine that eventually there would be something as peaceful and cooperative as the European Union.
And things like the shift from consumption economy to maintenance economy will be inevitable anyway with Peak Fossil due to physical restrictions (interestingly, exactly these thoughts struck me today when I repaired my bicycle).

BTW: How about re-introducing the rating system (I don't understand why it was abandoned) and creating a "Highest Rated" list. I bet that this story would be on this list, too.

Although the main thrust of reforms for the SSE is to bring newly scarce and truly rival natural capital and services under the market discipline, ...

9. Stabilize population. Work toward a balance in which births plus immigrants equals deaths plus out-migrants.

Births are a special problem for this discussion. The activity is clearly rival in that there must be a limit on the total number of births in order to keep the population stable. OTOH, the activity that leads to a birth, is clearly non-rival and ought not to be under any restriction, most particularly a market discipline.

IMHO, this article makes a lot of sense. But, I wonder --- can Prof. Daly make some more specific suggestions as to how the non-rival and the rival aspects of man-woman pairwise activity can be treated separately in policy?

In the historical context, prosperity means having an adequate diet and shelter. Only in the last few decades has this been possible for a significant portion of the population on a worldwide basis, including Europe well into the 19th Century.

There was significant malnutrition in the US in the early 20th Century, even though the US was considerably better off than most other places.

Also, until recent times people worked so hard they actually wore themselves out. According to the Encyclopedia of the History of Technology, a laborer digging a canal was expected to handle about 18 tons of earth in a 14 hour day. This is not too far off from the folk song:

You load sixteen tons, and what do you get?
Another day older and deeper in debt.

Paul, we have offshored malnutrition, poverty etc. so we don't have to see it. We don't see the conditions people live and work in who mine our copper in SA (average lifespan for miners is about 45 years), our gold and diamonds, our irridium, or who make our clothes in China or India. In Brazil the workers who cut cane to make ethanol are expected to cut 12 tons of cane a day by machete. How many years do you think they can keep that up. The cane is sharp, cuts the legs that are then prone to infection. Those who can't get work may end up living on the dumps outside Brazilian cities, foraging for trash and raising their children there. Just because we don't see it in the first world anymore doesn't mean it doesn't occur.

Hunter-gatherers on the other hand worked about 4 hours a day for food and shelter. More children died young but the adults did allright.

God bless Herman Daly! I wish we had hundreds more like him! The fact that he has not been awarded the "Nobel" prize for economics tells you all you need to know about that particular award.

The one thing in his essay that I might take ever so slight an exception to is his presumption that there are only two possible scenarios: either our economy crashes and burns, and then we rebuild applying his SSE principles, or else his SSE principles are applied in a top-down fashion by suddenly enlightened national governments, anxious to avoid an uncontrolled crash. I would suggest that there are other possible scenarios.

I begin the the assumption that we WILL end up with an SSE, simply because there will be no other alternatives. Once the non-renewable resources are sufficiently depleted, we will have nothing left but renewables, and there will be no possible way to overshoot the limits of that carrying capacity.

Given that this is going to be our future, I would suggest that we need not worry about how to make it happen, but simply focus on how to best navigate the transition. Assuming that "let it just crash, then rebuild" is going to result in a lot of pain and destruction, it is worthwhile to try and see if we can't do better and arrange some sort of managed transition that is at least a little less painful and destructive, if possible.

I would also suggest that past behavior is the best predictor of future behavior. On that basis, there is little reason to hope that there is going to be a sudden change in thinking and mode of operation in Washington or any other national capital. Best to not assume that anything helpful will be coming from there, and to look elsewhere. If we are to hope for anything, it should be that those in charge of central governments will at least not be successful in their efforts to sustain the unsustainable, and will put minimal obstacles in the path of those actively trying to lead the way in transition. The good news is that the peaking of non-renewable resource extraction, and of debt, credit money supplies and and notional economies, and of global populations, will necessarilly be followed by long-term economic decline, and that this will necessarilly result in large-scale de-funding of central governments. They will shrink in budgets and power and importance, leaving the field clear for more effective transitional initiatives at the regional, local, and household level.

Thus, I am inclined to think that the transition strategy to SSE that is most likely to actually work really is a "bottom up" strategy of localized sustainability initiatives. The beauty of this is that there is nothing to wait for, nothing stopping anyone. Everyone who sees the necessary inevitabily of an SSE future, and who desires to try to navigate the transition in a manner which avoids as much pain as possible, can and should get started right now.

What to do? One other thing with which I would slightly take issue with Daly on is that he doesn't come right out and honestly say what to me is obvious: the SSE future is not going to be able to support lifestyles anywhere as "rich" materially as what we in the US and all the OECD countries have enjoyed. Transitioning to an SSE economy is going to have to mean transitioning to a less rich lifestyle. While Daly rightly criticizes our present GDP methodology, it is approximately good enough to make one point: on a per capita GDP basis, people living in the US are going to have to end up declining by at least 75% from where we are now. (Similar, but perhaps not identical, declines are likely to be necessary for all the other OECD countries as well). I have been saying for some time now that the 21st century is going to be one long exercise in giving up things. There can be considerable advantages in getting ahead of the curve, and simplifying, downsizing, and powering down one's life before one is absolutely forced by circumstances to do so. Culitivating the right attitudes that lead one to this mode of living just happen to have very much in common with quite a few of the world's religious and philosophical schools of thought, and I'm inclined to think that this is no accident. It is a wise way to live, and always has been, and it should be no surprise that the few wise people who have lived in various times and places should have pointed that out to us. We've had them to tell us this all along, we really don't need the government to tell us to do it. We just need to get serious, and start doing the right things - for ourselves, and for humankind's future.

I was recently reading Daly's essay in Sustainable Planet in which he makes another policy recommendation based on the observation that counting natural resources (land in the old "Factors of Production") as Expense rather than Asset (capital) is an accounting error. I would argue that counting humans (labor, in the old FOP) as Expense is also an accounting error.

I'm also concerned with the notion of a steady-state (homeostatic) economy. The term, as used, is making its way into the meme-ry of Sustainability. I'm sure Daly has elaborated this, or Georgescu-Roegen has, but it's worth re-stating.

The economy can never be homeostatic. Self-organizing and -sustaining systems beyond the simplest ones are homeorhetic, exhibiting fluctuations within a range of tolerances rather than reaching "equilibrium." The Transition movement has helped us define resilient systems, and to prefer them over stable systems as a goal for sustainability. A pane of glass is a stable system – some of the windows in my house are over 100 years old – but not resilient in absorbing the shock of the proverbial baseball.

I'm familiar with most of these ideas, and the majority make sense.

One thing I don't understand is the lack of discussion of the transition from quantitative growth to development in the OECD.

In the US, for instance, vehicle sales peaked in the 1970's, and have been pretty stable since (they've been completely flat, if you measure per capita); appliance sales and new homes are the same way (not counting the recent bubble, of course). OECD nation fertility rates are below replacement - some quite a bit below.

I'd say it's pretty clear that the transition from quantitative growth to development is a natural thing, and will happen. I don't think there are many traditional economists who would disagree. Obviously we may have a problem bringing poorer nations up to OECD consumption levels (and OECD fossil fuel consumption needs to be drastically reduced), but philosophically that's a different thing - no one's talking about infinite consumption growth in a finite planet - that appears to be quite outdated.

What am I missing here?

I haven't commented here in a long time but I have vacation. So I've been in the net again.

The analysis is a good scientific look at our society with possible solutions. However if we look at the current global system it was based on winning a big war and imposing a unilaterally democratic capitalism on the losers and the communist bloc split off and isolated itself until a later time. The civil war had a one sided winner who also imposed its system unilaterally. Rome was somewhat less merciful in its defeats, carrying the people off as slaves. US civilization has been growing, expanding the markets for its goods and banks.

Usually new systems are imposed by winners on losers. Germans and Japanese, slaveholding in the South, British colomialism in North America all defeated. When resources are short there will be wars and the winner will impose a solution. If there are good reasons for leniency (we can let them live and exact more tribute that way) then it will be leniency. The Anglo/American system of banking and expansion spread now globally seems to be peterig out due to lack of resources. It will become unstable in many places and there will be wars, perhaps a WWIII of some sort. The winners, or least losers, would have to extremely powerful to impose any globally universal system (Even USA post 1945 could not manage that) such as that described by Mr. Daly in the post above. More likely are various empires such as we have now with various political and economic systems in Europe / Russia /Americas /East Asia. All will try to getz the most resources for the top people there. Any fair system among alöl these regions would be at adisadvantage and would lose out first and go under.

I'm glad to see Herman back at TOD. I don't know what part of Daly's thesis Nate doesn't subscribe to because it seems eminently sensible. What I find odd is that Daly din't carry his ideas one step further and state that before free fossil energy, his SSE was probably the status quo in the world. The biggest obstacle to a SSE in my opinion is the fact that the transnational corporations control the entire society of the developed world and they will fight tooth and nail to save their own "comparative advantage" of income and power disparity. People wont relinquish power or money voluntarily. It will have to be pried out of their hands by one form or another. The obvious headlong train crash to collapse could be slowed or even stopped and reversed by many of his ideas. Anyone have any ideas how this could happen without a 2X4 upside the head?