Bitcoin Forum

A thought experiment:

(And, by "capital" I mean actual physical capital, not artificial "capital" ie. money.)

In a perfect society, capital is both abundant and highly-valued.  This contradicts the law of supply and demand.  In the free market, a thing can either be abundant or highly-valued, but not both.  Thus, a free-market is incompatible with a perfect society.

Gold is, in a sense, a near perfect form of capital, in that it can be used to create many other things, and is very difficult to destroy.  In the past, societies have subsidized the production and accumulation of gold, to the detriment of other forms of capital.  This was beneficial, yet non-optimal.

Therefore, in a perfect society, there must be a mechanism in place to artificially bolster both the abundance and value of all forms of capital, but especially the best forms, according to their rank.

Discuss...

How many times have I said here that free markets destroy natural capital which undergoes a non-reversible process for consumption? Answer: I have said it many times.

A diminishing resource results in higher prices. This draws ever more effort and technology to harvest said resource to its end.

You're forgetting the fact that in free markets, the people who are destroying the natural capital in our current society wouldn't be allowed to destroy it, because it isn't their land and there's no government to let them do it.

You say that like it's a bad thing. Why is more efficient use of resources a problem?

I think you are conflating value with price. People still value the utility of their mobile phones as they did 20 years ago, but the price has come down dramatically.

I disagree with the premise. In a free market capital is abundant and cheap, due to the innovations that result from voluntary trade.

+1

Your question is meaningless without clarifying what the efficient use of resources are. You have two choices:

1. Efficient use of resources for enabling the harvesting of another resource.
2. Efficient use of the harvested resource.

You're ignoring the following facts:

1. Resource harvesting often ignores property boundaries regardless of property ownership.
2. Most of the biosphere's structure lacks a static position in space and time, including atmosphere, water, fauna, and even minerals.
3. Different people and organizations have different agendas with regard to the final vision of what they own.

I see no problem with either one, and achieving both would be optimal.

Except that's not the case in real life. Case #1 usually doesn't occur. Instead, it's almost the opposite. As for case #2, it sometimes does happen, but it lags.

Except case 1 is exactly what you're complaining about. Increased technology means more efficient harvesting. Case 2 does lag, that's true, but again, the price going up is exactly what drives that increased efficiency in use.

It means more efficient harvesting of a resource increasingly more difficult to harvest. But if the more efficient harvesting does occur, that is actually unfortunate, as it exacerbates the depletion of the resource, something which is not desirable, especially since we are discussing a diminishing resource which once harvested, is transformed into something else.

Now, I just have one question: What good is the resource doing anyone or anything, still sitting in the dirt?

Providing ecosystem services. Do we need a refresher course on what those are?

Actually, the resource is doing three things sitting in the dirt:

1. Providing ecosystem resources.
2. Not producing toxins, pollution or waste through the transformation it undergoes upon harvesting and consumption.
3. Remaining available for the future in the event it can be utilized more efficiently.

OK, let's take this from a generality to a specific example.

Tell me what "Ecosystem services" crude oil provides while in it's natural state.

That's an excellent example. I'm not aware of what the science says on the matter. It might be something, but let's assume it provides no ecosystem services. However, the extraction of oil requires the destruction of the environment to some degree, and those ecosystem services are lost. Examples range from infrastructure development to oil spills.

We can adjust the list accordingly:

1. Providing ecosystem resources.
2. Not producing toxins, pollution or waste through the transformation it undergoes upon harvesting and consumption.
3. Avoiding environmental destruction (and thus loss of ecosystem services) during the harvesting stage.
4. Remaining available for the future in the event it can be utilized more efficiently.

OK, let's try that again:

Tell me what "Ecosystem services" crude oil provides while in it's natural state.

Why are you asking me a question I just answered in the second and third sentences of my last post? I have given you the benefit of the doubt here, yet that still leaves the following:

1. Providing ecosystem resources.
2. Not producing toxins, pollution or waste through the transformation it undergoes upon harvesting and consumption.
3. Avoiding environmental destruction (and thus loss of ecosystem services) during the harvesting stage.
4. Remaining available for the future in the event it can be utilized more efficiently.

The other three can be met by efficiently and cleanly harvesting it and retaining it in tankers.
So, I ask again:
Tell me what "Ecosystem services" crude oil provides while in it's natural state.
What is lost to the environment when there is no more oil left in the ground?

I will not continue this discussion if you're going to say non-truths.

Case 2: Clearly not, given the emissions produced.
Case 3: Clearly not, given the Gulf oil spill.
Case 4: Clearly not, given the trajectory of fuel economy of engines over time.


I already answered that question. In my last post, I directed you to where that answer resides. However, I would now like to point you to the first sentence in this post for your consideration.

case 2: If it's retained, then it's not burned. If it's not burned, it doesn't produce emissions.
case 3: You cannot cite an accident and say "That's why you can't retain it." An accidental release is, by definition, not retaining it.
case 4: If it's retained, it's available for future use.


"I'm not aware of what the science says on the matter. It might be something, but let's assume it provides no ecosystem services."

Ah. OK, just wanted to make sure that's your answer on the matter. "None."
Now, just one more question. What's your problem with it being harvested, if it provides no benefit where it is?

I didn't say none. I don't know whether it is none or not. Do you?


The problems would be Cases 2, 3 and 4.

Case 2: If you're only going to retain it, harvesting it is a waste.

Case 3: You have maligned case 3. There is the risk of accident. The Gulf Oil Spill did not occur due to it being stored. It occurred during harvesting. What kind of imbecile are you? And even without an accident, we have certain environmental destruction due to the infrastructure of harvesting.

Case 4: It's already retained in the ground.

Your arguments are rather absurd, and are indicative of one who is a little desperate. Furthermore, it does nothing to bolster any point you'd like to make regarding the harvesting of resources which undergo transformation during harvesting or resources which do provide ecosystem resources.

Well, you're the one who is supposed to know all about ecosystem services. Presumably you have the research resources to find out what ecosystem services crude oil provides while in the ground. Saying you don't know is tantamount to saying none. If you believe there to be some service it provides, do the research, and present it. I've never turned away solid evidence. Your problem was with the "ever more effort and technology to harvest said resource to its end." not with what happens after the harvest.

Now, as to those other resources, the ones which undergo transformation or which do provide ecosystem resources. Could you provide examples?

Carbon sequestration.

It provides that same benefit in holding tanks.

And I think you are conflating utility with value.  People throw away mobile phones every day, along with the rare-earth minerals used to produce them.

Yeah, because they're abundant and cheap. This is the whole point of economic growth; producing more for less. The economy grows fastest when trade is free.

Consumption grows when trade is free.  Savings do not grow.  That was the point of this thread.

Savings grow when money is stable or deflationary. Guess what will help with that?

Fair enough.

+1

Whoa whoa just a sec!  Trade is free?  Where?  What do you mean by "economic growth"? 
Producing more what for less what? 

Economic growth is not sustainable. Economic growth is in fact not desirable. It's a horrific solution which is exactly analogous to living off your principle rather than your interest. The biosphere is our principle. The goal is to live off its interest.

I think you need a refresher course on ecosystem services. If you're smart, you'll be able to look at the ecosystem services themselves, and then work your way backwards (or forwards) to determine which resources those are that are providing the ecosystem services. As for ones which undergo transformation, just imagine various processes such as: burning, eating, and destruction of the environment that other resources are dependent on.

Here's your refresher course: http://en.wikipedia.org/wiki/Ecosystem_services

A simple "no" would have sufficed.

What an unnecessary comment. The answer to your question would be "yes", not "no". However, I'm not interested in being your slave teacher. Educate yourself for a change. I'm not going to call you what you should be called, because I'm going to refrain from that, although you deserve it completely.

I just don't get you, man. You say you want to educate us, but then when we ask questions, you say "go learn it yourself". You say you want to defend the environment, but when asked for methods, all you offer is killing and enslaving people. I don't think you fully understand the philosophy you preach.

But hey, thanks for that link, I found an Ecosystem service Crude Oil provides: https://en.wikipedia.org/wiki/Energy

Of course, you have to harvest it, first...

[resources in] X [economic efficiency] = [resources out]

economic growth is an increase in [economic efficiency]. eg, I buy an excavator and now I need 100 less people to dig dirt. My out/in ratio has increased. Technological innovation (the invention of the excavator) has created economic growth.

We don't have completely free trade and never will as long as the state exists.

Great. Now you're hugely more efficient at converting an ecosystem that provides ecosystem services into something else.

You've also created more centralization and risk.

Thanks for your answer.  An interesting idea.  So then, a large increase in [resources in] is NOT economic growth.  There are some issues in the definition you give such as [efficiency of what task?]  Does it matter what you do to the dirt?  Or is the important part just that there are more unemployed people?  I don't have the answer, but I like your answer better than the standard definition of economic growth which as far as I can make out is "an increase in distribution of counterfeit monies". 

Ultimately, the only thing that will work is a Steady State Economy.

In other words, kill as many people as possible.

Do you understand what a Steady State Economy is, why it is proposed, what metrics are used to evaluate it, and why it is necessary?

As an example, how does a waste management company fit into a Steady State Economy?

Well, economic growth can also be attributed to the manifestation of new resources, such as discovering a coal deposit or an increase in the population, but all else being equal growth is an increase in efficiency.

What you do with the dirt matters, but this will be determined by prices in the market. A business will produce [resources out] based on whatever configuration yields the most profit, considering those prices. This process maximises the total subjective value of all resources.

People who lose their jobs due to their work being made redundant will get jobs in other fields. The money saved from the new efficiencies will be freed up for other things. These newly unemployed people will have to provide these other things. Having 100 men dig a hole when 1 man + machine can do it is just a waste. There is no point being inefficient just for the sake of jobs. Remember, we want stuff, not work.

The end result is that quality of life goes up for all. And of course the environment is completely destroyed due to edge effects, because the environment has 0 value ;-)

I think you have an incomplete theory of modern economic theory.

Start thinking of the economy as an organism which inputs energy and raw materials to digest, and outputs products and waste. The digestive system is where production occurs. This organism (the economy) must coexist within its environment, and is dependent on its environment for survival.

There comes a point though (that time has already arrived) where continued growth of the organism's size must stop, else it will destroy its own host environment. A key point to recognize is whether the organism's waste is not being absorbed back into the environment effectively, and equally important, is if the organism's consumption moves beyond living off the interest produced by the environment, and is instead chewing into the environment's principle.

The key problem with your theory is that you assume that earth remaining humanity's only home is desirable. It is not. Remaining here ensures our extinction, sooner or later. It doesn't matter how pristine the environment is when the meteor smacks into the planet. You say I am not thinking long term. On the contrary, I am thinking in longer terms than you. This planet has a limited time span. We need to get off and set up shop in more places before that time runs out.

I'm not saying you're not thinking long term. Just the opposite - you're thinking too long term, which is moot if we don't address the short term.

99.9999 percent of the population is not going anywhere off this planet for a very long time. We'd be lucky if we get 1,000 people off this planet in the next 100 years. We need to address the next 100 and next 500 years as if nobody is going anywhere. Believe me, you're talking to someone who probably regularly follows the science behind solar system colonization and interstellar travel way more than you. I suggest you read Zubrin's Entering Space and every blog entry you can on centauri-dreams.org: http://www.centauri-dreams.org/

The problem is, a steady-state economy, by it's very nature, is a flatline. It doesn't have room for space colonization. Yeah, it's going to be hard. It's going to be expensive. It's going to take considerable energy, both human and environmental, to get those people out there. But it needs to be done, to preserve the species.

You have no evidence of this. Ultimately, space exploration will harness the resources of the Moon, the Sun, the asteroids and the atmosphere of Jupiter. To jumpstart that will require mostly funding for research - not raw resources here on Earth.

Funding for research. Where does that funding come from? Where does the material to make the launch vehicles come from? Yeah. The raw resources. Your complaint that "ever more technology applied to the harvest of those resources" is moot, because that "ever more technology" will include space exploration and exploitation of the belt's resources, when the price gets high enough to justify the cost.

Regarding funding - I would argue that efficient vehicles would eliminate the need for wars in the Middle East, which would free up massive amounts of money.

Regarding material for launch vehicles - that's silly and is not worth bringing up, as it's a drop in the bucket compared to other stuff we do.

There are a lot of things that would remove the "need" for wars in the middle east, the least of which is more efficient vehicles. Talk about "drop in the bucket."

Maybe so. I'm not talking about a boost in mileage from 25mpg to 35mpg though.

Neither am I. I'm talking about removing the entire reason for war. (Hint: it's not "dependence on foreign oil")

Well I like the idea that quality of life could come into play in an economic indicator, but this is tough to quantify.  Some indicators of quality of life such as people "not being depressed" or "not having cancer" correlate inversely with the counterfeit-money-distribution index (GDP).  There are also reasons to believe that your quality of life will be better if you get out and dig a ditch once in while rather than letting a machine do it every time.  And as for "we want stuff".. I am hopeful we can move past that.  Stuff is good for filling landfills, for example making giant piles of crushed automobiles seems to be an indicator to some of "economic growth".  But are giant floating island of garbage really what we're after?  For many an epiphany in their view of "stuff" comes from having a family member pass away and being in charge of "getting rid of the stuff".  Hoarding is an instinct that does not always serve us well.  As for the environment, we are the environment.  Quality of life is a nice phrase but I think survival is even more basic, (QOL requires L), and makes it more obvious that our extended bodies (the environment) are crucial.     



 

I'll take a guess.  Mental illness? 
http://www.rtbot.net/play.php?id=TJoMMpFFBFs

Ecological Economics (Herman Daly: Steady State Economics) makes it a point, that when the economy is viewed as an organism that produces waste, it's important to subtract the costs of waste services, environmental cleanup, etc., rather than add them into the GDP: http://www.theoildrum.com/node/3941

All those services paid for to clean up the Gulf Oil Spill? A lot of economic theories actually add those in to calculate GDP. Ridiculous.

Yeah, not far off.

Quality of life just means the things you value have a lower price. You don't have to "hoard". You could just work less and achieve the same basic necessities. Materialism is an orthogonal issue.

Imagine you can buy all the food and shelter you need and basic utilities, while working 1 day a week. Think of the Jettsons, where George had a nice place, family, robot maid and worked 2 days a week just pressing a button. This is a society with high efficiency. So optimised that pressing a button generates wealth to support a family.

The problem we have now is that the vampire squid called the state is sucking the life out of the economy as fast as it can grow. Why are first world nations experiencing stagnant growth, with all our technological advancements? Because the government is constantly piling on new taxes and regulations and stealing through inflation.