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Exergy for Resource Accounting

EXERGY FOR RESOURCE ACCOUNTING

Written by Dr. Andrew Wallace PhD BEng(hons) EurIng

INTRODUCTION

Since its beginning, the technocracy movement has advocated a thermodynamic interpretation of economics [Tec]. This comes from foundation works in thermodynamics and the works of Professor Soddy [Sod] .

In thermodynamics, we can model all processes as converting energy from one form to another and in the process generating work or forming structures of low entropy. Nothing gets done without the conversion of energy. We lose no energy but we done change the form of the energy and as we do so the resulting energy forms have less use [YoFr].

Although originally scientists developed thermodynamics for heat engines such as steam trains the laws of thermodynamics have much wider application. We can apply them to the human body and to society as a whole and to information [Cha, Geo]. It was from this realisation that the technocrats in the US used thermodynamics as a way to interpret economic and resource allocation system.

Since the 1930s science has progressed and a number of concepts have become unified in a thermodynamic understanding. For example, we can understand information as a form of entropy as well as economics and social history and life (as processes that try to maximise low entropy).

EXERGY

Entropy measures a negative concepts; disorder or the uselessness of energy. The higher the entropy the more the disorder and the less use we can obtain from a given quantity of energy. We can look at this another way and measure the amount of useful energy we have; the negentropy or exergy [Wall]. The term “Exergy” means external energy; its a measure of our ability to do work. Our ability to do work has a dependence on the environment. For example, if we have a high temperature difference between a heat source and the outside world we can gain more work than if we have heat at a lower temperature and if we had heat at the same temperature as the surrounding environment we could get no work out of it. Thus, exergy has a relationship to environment and a relationship to value. Ice in the desert has a higher exergy content and thus higher value. Ice in the Arctic has low exergy and low value.

The entropy concepts allows us to capture a number of other concepts in thermodynamics such as Gibbs energy and Helmholz energy which measure useful energy in relation to heat and heat and pressure reservoirs. We can also measure exergy content of materials through measuring the Gibbs energy in relation to the environment form of a material and the concentration of that material.

We can extend exergy to measure information. Entropy was linked to information in the work of Shannon [Sha]. The more states a system has the greater the potential the system has for storing information and, thus, the more useful the system from an information perspective. Thus a system with high information potential has low entropy or high exergy. The information potential also has a link back to the environment as known information (information that matches the environment) has no value but information that differs from the environment (from what we know) has value.

EXERGY AND RESOURCE ACCOUNTING

In energy accounting we measure the production capacity, in terms of energy, we have for personal use and then divide that with the number of people we have. We then issue Energy Credits (ECs) to each person for them to allocate to production. In the system we produce and then consume energy credits. Actually, we really measure the amount of useful energy used in production not the energy itself; we measure the amount of exergy consumed in production.

A resource allocation system, however, does more than just allocate energy for production; it also allocates materials. Each item produced takes a certain amount of raw materials to produce it and this needs taken into account when managing the system. Exergy offers a way we could do this in common with energy used in production. In using exergy as a measure we not only measure more closely what we do in production but also have a common unit to measure the materials used as well. As a hi-tech society not only consumes exergy but also utilises information, exergy also gives us a common unit of measure for measuring information. Thus exergy gives us a common unit of measure for energy usage, materials and information.

CONCLUSION

As we can use exergy as common unit for energy usage in production and materials as well as information the exergy concept becomes a possible accounting method for a energy accounting system or a resourced based economy.

REFERENCES

[YoFr] “University Physics”. Young and Freedman. Addison Wesley

[Wall] “Exergetics.” Göran Wall. Bucaramanga 2009

[Geo] “The Entropy Law and the Economic Process”. Nicholas Georgescu-Roegen. Harvard University Press. 1971.

[Cha] “The Physical Foundations of Economics”. Jing Chen. World Scientific Printers. 2005

[Sha] “The Mathematical Theory of Communication” C. Shannon. The Bell Systems Technical Journal. 27, 379-423, 623-653.

[Sod] “Wealth, Virtual Wealth and Debt” George Allen & Unwin. Frederick Soddy. 1926

[Tec] “Technocracy Study Course”. M. King Hubbert et al. Technocracy Inc.

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Thermoeconomics: The use of Exergy in Alternative Socioeconomics

Thermoeconomics: The use of Exergy in Alternative Socioeconomics

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Abstract

As our current socioeconomic system does not have a sustainable nature thus, it will collapse. This paper presents an alternative to today’s system that utilises exergy as a common accountancy unit for a sustainable resource base socioeconomic system.  An item’s cost, in terms of exergy, reflects the physical cost of the item. The system utilises management techniques such as optimisation, Life Cycle Analysis and Cost Based Analysis to produce items efficiently and minimise their exergy and environmental cost.

Introduction

Our current socioeconomic system comes with a number of attributes that results in the system having an unsustainable nature.  The system uses a fiat money system; where banks create money, out of nothing, which they then lend out. The borrowers then pay back the money with interest. Thus our money supply takes the form of debt and we always have more debt in the system than money due to the need to pay interest and for companies to acquire profit. “Beneath” the world of economics lies the actual psychical system of resources, production and goods which we use the money system to regulate. However, the money does not represent a physical variable of the system. Instead it has a subject nature.  The fiat nature of our money system and its disassociation form the physical world necessitates and allows the system to drive constants exponential growth. However, no physical system can sustain exponential growth. Although banks can create money ad infinitum, the physical world cannot keep up and our system with either collapse, change over to an alternative sustainable system or we will “cut back” the system through wars, disease, famine or other natural disasters to allow more growth.

Other reasons for the unsustainability of our current system included the dependence on finite energy sources such as oil and nuclear power as well as the liner form of production we use (from resources to production to disposal) rather than a sustainable cyclic system (from resources to production to recycling / reuse to resources) [Ekins, GowWal].

This paper presents and alternative, sustainable, economic system  using exergy as a foundation.

Economic systems as a resource allocation system

Economic system represent a type of resources allocation system. In an economic system we have a set of resources, R, and set of production facilities, P, which produce a set of goods, G, used for consumption. Such a system requires energy to run. Actually, the system requires a set of energy producers that make available a supply of usable energies (exergy), Ex. People (H), though demands for goods, then drive the system.

The system then becomes:

Where D represents the demands and M the manufacturing capacity to meet those demands. We can regulate such a system using variables that represent the state of the system. Exergy forms one such variable. 

Exergy as a common accountancy unit

The term “exergy” refers to the usable energy for a physical system and follows from the second law of thermodynamics; we cannot full change heat to work. Energy comes in different forms such as potential, chemical, kinetic and electrical energy. Not all forms of energy have the same potential to produce work. We can convert electrical energy completely to work  but cannot convert heat energy fully to work [Wall].

As any socioeconomic system requires energy to work we can measure how much available energy (as exergy) we have  and that will give us a measure of the system’s ability to produce.

A socioeconomic system not only needs energy but also materials. We can also use exergy as a measure of materials. This follows from the materials having a chemical potential. Thus, the exergy, Ex, we have becomes:

In addition, information can also have an exergy value. This follow from the application of statistical mechanics and information theory where we can define a particle as have one bit of information.

As we can use exergy to measure usable energy, materials and information that a socioeconomic system utilises, exergy, therefore, forms a common accountancy unit for any socioeconomic system.

Exergy has an additional property of use for a socioeconomic system; exergy has a relationship to the environment. The greater the difference a system exhibits between itself and the surrounding environment the greater the exergy becomes. Thus ice in the tropics has a higher exergy value than ice in the Arctic. Heating has a higher exergy cost in the winter than in the summer [Wall].

As exergy forms a common accountancy unit and has a relationship to the environment we can use exergy as a control variable for a resource allocation system such as a socioeconomic system.

Overview of an Exergy Based Socioeconomic System

A socioeconomic system based on exergy becomes a resources allocation system where we would have a system that uses state variables to control the system. The system would use exergy to measure the production cost of an item so each item produced would have a cost that reflects the physical cost of that item rather than a subjective monetary value. A society would also have a certain amount of exergy available for the production of each item and the processes that go into maintaining and running society. The resource allocation problem then becomes one of allocating exergy to production based on the user initiated demand for goods and the maintenance requirements of the system. We could do this through calculating how much exergy we would have available for the system, within a given time period, as a whole allocate x amount for the system maintenance and large common projects then distribute the remainder equally among the user base as “Energy Credits” (EC). The ECs effectively represent production capacity and the users can then allocate  EC to production to acquire personal items.

Management of the Resource Allocation System

The resource allocation will need management to efficiently control the system and to minimise production and environmental damage, if we wish to have a sustainable system, as well as determine the cost of an item.

 
Figure 1. Macro-economic model of an exergy based socioeconomic system

G = goods M = materials E = energy / exergy Ec = Energy Credits

Determining an item’s cost

Physical variables determines the cost of an item in the presented system rather than the subjective valuation of a (free) market. We express the cost in terms of exergy so each item has an exergy value giving the amount of exergy consumed in the items production. We can use Life Cycle Analysis (LCA) as a method for determining an items cost.

The term LCA refers to a method of determining the processes and their impact for the production of an item from the beginning of production until the disposal of the item. From the acquisition of the raw material to the production of the parts to the production of the final item and then later the disposal of the item. LCA assess the contribution to environmental damage and resource depletion but it could also recode how much exergy the process of producing an item consumed at each stage. How much in acquiring the raw materials? In transporting the parts? In producing the whole? and in disposing of the item?

LCA analysis begins with defining goals and boundaries for the study. It then goes on to perform an inventory analysis. During the inventory analysis the assessors collect data on the system for the items production as well as model the whole process.

After data collection, the assessors evaluate the impact of the process in various categories. We can then evaluate these impacts and determine the  actual physical cost in terms of exergy for a given item.

Cost Benefit Analysis

Cost Benefit Analysis forms a technique for assessing the pros and cons of the production of a item. Normally, a CBA states the costs in monetary terms. For a socioeconomic system based on exergy the CBA would use exergy as the unit of cost. This gives a more objective assessment as exergy directly relates to the physical state of the system, whereas money does not [RahDev, Owen]. Also, the use of exergy enables the assessors to fully assess the costs of an item as all benefits and cost would utilise the same accountancy unit. So, for example, the environmental impact  would have an exergy cost which would lead to a more realistic assessment of costs compared to a monetary based assessment where assessors can ignore much of the environmental cost if it doesn’t have any direct money value (such as if the polluter doesn’t have to pay).

Optimisation

Management of the system aims to minimise impact on the environment and maintain a sustainable system. To do that, the management process would need to optimise the production of goods so that production  use the minimum amount of materials and energy for the maximum amount of life expectancy. [Fran]

The optimisation problem involves a set of functions to optimise and a set of boundary criteria. An exergy based socioeconomic system would have the optimisation functions:

maximise life expectancy (L)

minimise material and energy (exergy cost)

Where and represent the optimisation functions.

Subject to the follow constants:

within the limits of the available energy and material supply as well as environmental impact (I).

For example, an item car, requires a certain amount of material of a given type; steel, aluminium or plastic. Each possibility for construction has a certain cost for production in terms of exergy; exergy using in extraction of the raw material, referencing and production of the base material as well as transportation. Each material will also have an associated life expectance. So, the optimisation problems comes down to maximising the life expectance for the minimum exergy cost such as a plastic construction might have a lower exergy cost but shorter life expectance than steel and aluminium might last longer than steel but have a higher exergy cost. At some point we would have the optimal material for a given cost.

Engineers have a variety of optimisation methods available, which include the following:

1. Calculus (max and min)
2. Pinch method
3. Convex optimisation

Calculus (max and min)

Calculus forms the basic method for optimising functions through first and second derivatives to find the maximum or minimum point of the function.  Engineers could use calculus to find the point of maximum life expectancy and the points of minimum material and exergy usage as well as minimum environmental impact.

Pinch method

The pinch method forms an example of a widely used optimisation method, specially adapted for heat energy systems and engineers use the method of optimising large scale industrial processes [Pinch]. Two phases compose the pinch method; an analysis phase and a synthesis phase.

The analysis phase involves the collection of data form measurements of the actual system and simulations. The analysis phase also uses site expertise to validate the data. From the data, engineers develop models of proposed changes. They then assess the impact of the proposed changes. The analysis phase involves iteration around a loop.

The synthesis phase aims to effect actual improvements in the system.

Convex Optimisation

The term convex optimisation refers to a set of techniques which includes least square fit and liner optimisation. Once defined as a convex problem, engineers can often find the solutions for optimising a certain criteria within given limits using well known methods such as  solving simultaneous equations.

Summary

Our current socioeconomic system does not have the property of sustainability and, therefore, will collapse. If we wish to maintain a good standard of living then we will need to find an alternative to our current system. This paper presents one such alternative.

A socioeconomic system represents a form or resource allocation where we allocate raw materials to the production of goods. Such a system forms an example of a physical system. We can control such a system through measuring the physical variables of the system. Exergy forms a common accountancy unit for such control as exergy measures not only the usable energy of a system but we can also measure the materials in the system as well as information with exergy. The system would then need management to maintain the system in a state of dynamic equilibrium within the limits nature imposes to keep the system sustainable.

Items produced would have an associated exergy cost to produce that item. We can use LCA and CBE (in exergy terms) to evaluate an item and determine its exergy cost. Energy Credits (ECs) represent the production capacity in terms of exergy. Citizens could then allocate ECs  to production to acquire items they want.

Managers and engineers would use various optimisation methods to assess the optimal production method for required items. They would aim to minimise environmental impact through minimised material and exergy utilisation as well as maximising life expectancy.  For optimisation, we can use exergy as a common accountancy unit for  assessing both the benefits and costs of production in more realistic terms than a  money based approach.

References

[Ekins] Paul Ekins, (2006), THE FUTURE OF SUSTAINABLE DEVELOPMENT, in Dimensions of Sustainable Development, [Eds. Reinmar Seidler, and Kamaljit S. Bawa], in Encyclopedia of Life Support Systems (EOLSS), Developed under the Auspices of the UNESCO, Eolss Publishers, Oxford ,UK, [http://www.eolss.net] [Retrieved March 12, 2010]

[GowWal] John M. Gowdy, Marsha Walton ,(2008),SUSTAINABILITY CONCEPTS IN ECOLOGICAL ECONOMICS, in Economics Interactions With Other Disciplines, [Ed. John M.Gowdy], in Encyclopedia of Life Support Systems (EOLSS), Developed under the Auspices of the UNESCO, Eolss Publishers, Oxford ,UK, [http://www.eolss.net] [Retrieved March 12, 2010]

[Wall] Göran Wall. Exergetics.

[ RahDev]SM Osman Rahman, Stephen Devadoss, (2005), ECONOMIC ASPECTS OF MONITORING ENVIRONMENTAL FACTORS : A COST-BENEFIT APPROACH, in Environmetrics, [Eds. Abdel H. El-Shaarawi, and Jana Jureckova], in Encyclopedia of Life Support Systems (EOLSS), Developed under the Auspices of the UNESCO, Eolss Publishers, Oxford ,UK, [http://www.eolss.net] [Retrieved 5 February, 2010]

[Owen] Anthony D. Owen, (2004), ENERGY POLICY, in Energy Policy, [Ed. Anthony David Owen], in Encyclopedia of Life Support Systems (EOLSS), Developed under the Auspices of the UNESCO, Eolss Publishers, Oxford ,UK, [http://www.eolss.net] [Retrieved 5 February, 2010]

[Fran] C. A. Frangopoulos, (2004/Rev.2008), OPTIMIZATION METHODS FOR ENERGY SYSTEMS, in Exergy, Energy System Analysis, and Optimization,[Ed.Christos A. Frangopoulos],in Encyclopedia of Life Support Systems(EOLSS), Developed under the Auspices of the UNESCO, Eolss Publishers, Oxford ,UK, [http://www.eolss.net] [Retrieved 12 March, 2010]

[Pinch] Pinch Analysis: For the Efficient Use of Energy, Water and Hydrogen. ISBN: 0-662-34964-4

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Growth, Globalization and the Future

Growth, Globalization and the Future

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Introduction

The discourse surrounding globalization has often been shrill, repetitive and emotional – on all sides of the aisle. The proponents point out how trade and growth have increased GDP and living standards, while the critics point out that inequality has grown and the poignant fact that the global biosphere has seen better days, upon which the proponents may claim that the detractors want to deny the developing world the opportunity for raised living standards. There might be acknowledgements that there have been bad effects, but the foundation for the current development is seldom questioned.

Both sides definitely have points, but where our focus must be centred is on the fact that our current way is inherently unsustainable, and grows more unsustainable with every passing year due to our glaring inability to come to terms with quantitative environmental problems. While many of those in power are worrying for ageing, unemployment, integration or lagging growth numbers within the next two years, the reality we are facing on a global scale is that of an approaching Sixth Mass Extinction Event. In comparison, all other problems appear as minor nuisances.

This article is intended to discuss globalization in terms of different aspects, which can be termed the Good, the Bad and the Ugly – but also try to explore the issue connected to the wider issue of global resource flows. Ultimately, what we all need to do is to let go of our presupposed positions, untangle the web of preferences, aesthetics and politics and look at our world – the only one we have – from a physical perspective. Then, the ways where we can go will reveal themselves.

n short, we need to acquire ourselves a sober, technocratic view on the subject. What we also need is to iterate our line as an organisation on globalisation from our perspective and from the point of view of our ideology and our knowledge about the reality we all are inhabiting.

TL;DR

  • Globalization is not a new concept, but is a process which has begun from the moment civilization emerged.
  • The current phase of globalization began during the 1970’s with the ascent of new information technologies.
  • Like the industrial revolution of the 19th century, it has vastly improved the lives of billions of people.
  • Like the industrial revolution of the 19th century, it has also led to increased inequalities across the spectrum within countries – but a convergence between the first world and the developing world.
  • Another aspect of globalization is the establishment of multinational corporations with political clout sometimes exceeding that of states.
  • Is it likely that this process can continue for the remainder of the 21st century?
  • No.

Globalization – one process, many aspects

One could say that globalization, roughly speaking, has several aspects. For the purpose of this article we are going to focus on three of its aspects – the technological, economic and political. All of these different developments in their turn have sub-aspects which can affect the world in conserving or disruptive ways. It is also paramount that we understand that globalization is a partially intentional and partially emergent process, much alike most policies enacted by human polities – but on a much grander scale. Therefore, for the sake of clarity, I am going to investigate the three aspects on their own.

The technological aspect

The technologies which are cultivating globalization are generally emerging as innovations within the fields of communication and transport. The first major disruptive technologies within this area were engineered during the early part of the 19th century, with the appearance of the telegraph and railways. These technologies allow the faster transmission of information, people and resources, and are hugely disruptive as they often overhaul local economies and allow for rapid urbanisation and industrialisation. Secluded local economies are connected to the outside world, fostering a process of creative destruction. Meanwhile, it fosters innovation and an opportunity for trading, thus fostering innovation and increased prosperity and opportunities for a larger share of the population, providing – for the first time – choice to people previously relegated to being farmers to build their own lives and change their paths.

Today, the major disruptive technologies are within the sphere of Information and Robotics technologies, which on one hand is de-centralising information spreading and turning every content consumer into a potential content creator (imagine for example the impossibility of such a phenomenon as “Ugandan Knuckles” arising during the 1960’s, when content could only get through more centralised hands).

It must be stated that the technological development of the last two centuries have had many undoubtedly positive effects for human well-being, for health, longevity, child survival rates, maternal care, nourishment, education and living standards, at least for a significant part of the planetary population. That is a proven fact, and our organisation – which strives that human beings should have dignified lives – is viewing the benefits of industrialisation, technological progress and growth in largely positive terms.

The economic aspect

It can be argued that prosperity is a combination of technology, in terms of our ability to harness external energy sources (whether renewable or non-renewable) and the dynamics of an economy. To a large extent, it cannot be denied than the access to cheap credit made possible by the fractional reserve banking system has been a determining factor in creating an environment where investments into innovation have been feasible. This, coupled with public policies of investments into infrastructure, education and healthcare, has during the last 200 years led to an unprecedented increase in the world’s gross product per capita, despite the population growing more than seven-fold since the beginning of the 19th century, and with the exception of a few Sub-Saharan African countries nearly every country on Earth is wealthier today than it was in the year 1818.

This is of course, to a large degree, one of the main reasons why all the health indicators in generally are higher today than in the early 19th century, though it should be stated that even in medium-income countries like Russia, Mexico and Turkey, the average worker today is living a life with better health indicators than most aristocrats did as late as the 18th century, due to better medical technology. That is undeniable.

What, sadly however, also is undeniable, is that economic growth nearly always is following the Pareto principle – that 80% of the new growth is generally tilted towards the one fifth of the population which already is the most economically privileged. This rule is not only prevalent in countries with significant problems of corruption, but in nearly all countries, including most of the large, developed countries. There might be multiple reasons for this, but in general people who have more capital will be more well-connected and have greater options to invest and greater time to judge their options. Wealthier people also in general suffer less stressors which might decrease their performance rate in the economy.

Usually, the political conflict which has dominated the discourse in most democratic states for the last century, has been one between market-oriented liberals and conservatives, who want to grow the economy by free trade and low taxes, and socialists and social liberals on the other side, who want to redistribute wealth from the economically more privileged to the low-income segments of society.

However, the main problem with our current situation from our perspective is more focusing on some key ecological ramifications, which mostly are attributable to how 4100% in global economic growth during only the last century has affected some key ecological ramifications. We will however revisit that.

Lastly, it should be mentioned that according to economic orthodoxy, human needs are perceived as seen through consumption power, which is dependent on a person’s income and savings. All needs are also seen as subjective – so from a purely orthodox viewpoint a Malian woman needing water and rice to survive a month and the “need” of a European male to own a farting clock or a mechanic fish that sings are seen as equal.

The political aspect

Politically, there has since the 1980’s largely been a consensus centred around the market liberal position, that states should ensure that countries open their borders as much as possible for trade, that tariffs must be scrapped and that public companies are inherently less profitable and efficient than private companies exposed to fierce competition. Underlying this has been the presupposition that states must attract and compete for investments, and thus should make their markets as attractive as possible for investors, either through good infrastructure, a well-educated work force or laxer regulations than other countries. The goal is to maximise growth and prevent stagnation, which is a necessity when the monetary systems are built on fiat, and thus are debt based.

The basis for these policies were laid already during the 19th century, with the discovery of Ricardian comparative advantages, and proponents often state that these policies will serve to maximise economic growth and also create a convergence in prosperity between countries.

A lot of the contemporary free trades treaties are doing more than removing trade barriers and deregulating. To a large degree, they are actually restricting the national sovereignty of states by introducing new regulations which often are intended to benefit multinational corporations, with for example increased severity on real and perceived copyright infringements, the so-called ISDS mechanisms (recently declared violating the foundations for European law by the European Court), which means that companies could sue governments for legislation which can harm the profitability of said companies, as well as supranational arbitration courts often very heavily biased towards multinational companies.

Often, this free trade regime incentivises environmental destruction at local and regional levels, and human rights abuses such as sweatshops, child labour, debt slavery amongst rural workers and that natural resources – even vital ones such as fresh water – are owned by foreign companies.

On the other hand, countries like China, India and Brazil have become economic powerhouses thanks to increased investments and mobilization of their resources thanks to foreign capital and the utilisation of their comparative advantages.

Courtesy, Lonely Planet

While Shanghai, Mumbai and Lagos have benefitted from increased trade, traditional industrial centres in the western world, such as Ruhr, the Rust Belt, Detroit and Liverpool have declined. These free trade policies have accentuated the effects of creative destruction, which have led to increasing inequality within every country involved, giving rise to reactions in the form of left- and right-wing populism. The awareness of this political challenge has prompted the World Economic Forum to recently focus more on social issues, but that focus should be seen as an icing on a cake, or more appropriately said a balm to protect the status quo.

Normatively, these policies are founded both on ideology and on necessity. The necessity is of course the fact that debt is growing faster than the global economy and that the structural imbalances revealed by the 2007-2009 economic crisis still are existing in the economy – coupled with the deeper, inherent self-contradictions of a fiat-based system.

The inherent problem with growth, investments and debt

Most western economies have on general seen their growth rates decrease when the gross domestic product per capita increases. Some countries, such as Japan, seem to already have plateaued, while others are still growing at a modest rate, especially countries with strong markets in real estate and finance. This is not the entire image however, for while a country like Germany may experience a year with 0,5% growth and a country like Ethiopia might experience 5% growth, the 0,5% growth represents – in absolute numbers – far more new economic activity on the side of the developed country. Yet, investments in high-risk high-growth markets yield a higher return for investors, which – together with the comparative benefits of a higher labour pool and often, sadly, less environmental and social regulations, a market attractive for investments.

The reason why larger, developed economies have a lower growth is because investments represent a much smaller share of the entire pie, and also because people stop increasing their consumption exponentially when they reach a certain level of per capita income (which may differ between countries due to differences in cultural preferences).

While the growth in the developed world remains at a modest rate and is slowing down in developing countries such as China, the amount of debt have grown far more during the 2010’s than during the preceding decade. This also accentuates the need for continued growth, because the economies have a desperate need to generate the wealth to pay the interest rates – the inherent problem of a fiat-based global economy (also increasingly challenged by crypto-currencies, though that is a different subject).

In short, even if there were no ecological limitations on our usage of the planet which could impede growth in the future, it is unlikely that growth could go on indefinitely on an infinite planet, except for driven by population growth (which will plateau as well when a country reaches a certain level of development). As infinite planets do not exist (at least not in our Universe) that is just a thought game to entertain.

Courtesy, USA Today

The Sixth Mass Extinction Event

It is impossible to deny that species are disappearing at an alarming rate, that increased urbanisation is a driver for industrial monocultures which today cover more than a third of the Earth’s land surface, that trawling is devastating to oceanic eco-systems, that the climate is affected by our continued reliance on fossil fuels and fossil-based fertilisers, that insect populations are collapsing and that the amount of forests on the planet are shrinking.

A lot of environmental problems are based on the reliance of certain chemicals and substances which can relatively easily be banned. For example the addition of hormones from medicines and contraceptives into water, the utilisation of neonicotinids (if they are proven without a doubt to be dangerous) and dangerous mine sludge poisoning water reserves can be seen as qualitative problems which can be attributed to practices which can (and often have) been changed by simple political interventions through specific regulations which can be implemented without rocking the foundations of the current system.

You can however not regulate everything and expect to keep the current pro-growth consensus within international bodies. A study by the United Nations show that if we introduced fully compensatory regulations globally, the hundred most profitable industries of today would go bankrupt, and this would run counter to all the ideological values and political judgements by the entire establishment.

The EOS is arguing that the need to transform vibrant ecosystems into high-yield linear mono-cultural production systems is driven by the economic orthodoxy in general and by the foundation of fractional reserve banking in particular, which is based on credit, debt and interest and expects new value to be created. It is also largely a myth that information technology and miniaturization has decreased our resource usage, rather it is still increasing (albeit at a slower rate, but that can equally well be attributable to the fact that growth tends to plateau). Our usage of the world’s surface and resources have also in general increased with growth.

The EOS is also arguing that the destruction of the world’s forests, oceanic habitats, food soils and freshwater reservoirs is increasingly putting humanity before a “global Easter Island scenario”, one where the biosphere is increasingly devastated, creating a convergence of crises and a domino effect where vulnerable regions are turned into collapsed states, and neighbouring countries are increasingly destabilised until billions of human beings are affected. This could, if not amended by Transitionary policies, lead to a new dark age for humanity, with an uncontrolled reduction of living standards, health, democracy and all the values we have learnt to cherish.

According to studies by renowned ecological institutes and universities, we are currently using far more resources than the Earth can renew every year, creating an overshoot and an ecological deficit. Orthodox economists of the neoliberal and libertarian varieties tend to appreciate the ideas of financial budget ceilings. Maybe a global ecological budget ceiling wouldn’t be a bad idea at this point?


Courtesy, Massachusetts Institute of Technology

The mainstream debate

Though the debate has generally improved and somewhat sobered up following the increasing awareness of how serious our current situation is, the issue of exponential growth and the global biosphere of Earth are still largely treated as mutually independent factors in discourse – politicians can still learn that if we don’t change our relationship with the planet and try to become more sustainable, we will create a collapse, and yet the same evening learn that if we deregulate and globalise further everyone and their mother will be a millionaire by the 2050’s.

These two worldviews are – from any reality-based perspective – incompatible. You have to believe either that growth is decoupled from conversion of environmental areas into linear production areas, that our usage rate of the planet’s surface and of its soil and water has no adverse effects, or that a global environmental collapse would have little impact on our standards of living.

Another popular argument championed by the proponents of the status quo is usually – as my predecessor used to say – “the technology fairy”. The idea in its most inane form is that new technologies will emerge which will solve all the problems, usually by utilising energy more effectively. Jevons’ Paradox, discovered already during the 19th century, shows that the introduction of more energy effective practices often rather can exacerbate resource usage by making it more effective and thus make new and vaster areas accessible for exploitation and assimilation (just look at fracking for example).

Another appeal, in its most crude form is that critics “hate the poor” and do not wish to see increased living standards in the developing world. In its more eloquent, refined form, this critique states that countries need to reach a certain level before the population can start to care about the environment by developing a satisfied and content middle class which cares about conservation. This argument also claims that by focusing on growth, we will have a cheaper and less intrusive transition twenty or thirty years ahead, when new technologies which can clean the air and provide us with virtually free fusion energy can transform the Earth into a green paradise.

Thing is, these claims were made already twenty to thirty years ago, often by the very same proponents of the status quo.

The main problem with that argument is however that the environment is not some kind of staple in a computer game which you can increase and decrease at whim, as if the biosphere was an aspect of human society. It is not just a policy area, such as healthcare, education and infrastructure, where you can cram it into our economy. Rather, our economy is embedded into a roughly speaking 65 million year old natural ecological economy, and is both dependent on it and destroying it.

You cannot near-completely ravage complex, million-year old systems, and then expect to restore everything when you feel sufficiently wealthy to do so. Not unless you live in a world where all environmental systems are just dependent on chemicals, hormones, gasses and pollution – which in reality are not the main problem (excluding our addition of fossil-based carbon).

The socialist alternative

The Alt-globalization movement of the 1990’s had a higher degree of awareness of many of these environmental problems, often coupled with critique regarding the injustices inherent in rising inequality, unemployment and sweatshops. It gathered broad and diverse elements from the entire world who felt threatened by the disruptive effects on both the environment and on the social safety nets.

This movement has lost a lot of its cohesion and steam for the last decades, partially due to what can be labelled “glaring self-contradictions” and the lack of a coherent vision.

  • The interests of first world labour laid off from various rust belts are generally not compatible with third world labour which wants to either migrate to the first world to compete for work or export their goods and services to the more capital-rich first world. The Alt-globalization movement tried to unite these disparate interests, but eventually large segments of the unemployed first world proletariat instead moved to the nationalist camp because these were perceived as more exclusively beneficial to their interests.
  • While aware of the ecological implications, the Alt-globalization movement selectively chose to ignore these facts when it came to envisioning policies. For example the statement “the current food production of the world can feed x times more billion people than are living on the world today, yet one billion is starving” may be true, but ignores the fact that a significant amount of our current food production is unsustainable.
  • Equally, when it came to industry, the Alt-globalization movement simultaneously protested the closure of old factories in the western countries, while condemning pollution caused by factories. They condemned consumerism while vocally defending the right of labour to have professions which were dependent on consumerism for their sustenance.

These self-contradictions were based upon two facts, namely that 1) this “movement” was really an umbrella structure of numerous movements and groups which different and sometimes even conflicting group-egoistical competing interests and 2) that many within the “intelligentsia” of said movement tried to use every conceivable argument they could in the service of ideological (and sometimes emotional) anti-capitalism, ignoring whether the arguments taken together were compatible or even sensible, and maximising the support both amongst workers and environmentalists. This (largely failed) populist strategy could mobilise hundreds of thousands of protesters, but was unable to formulate a coherent alternative.

The EOS critique on globalization

We should, as a movement always strive for the truth.

And the truth is, globalization has brought benefits to billions of human beings worldwide, creating innovation, increasing income, making available the resources for education, healthcare, infrastructure and safety. Neither is globalization a new concept, it began even before the industrial revolution, arguably already during the Ancient era with the establishment of the Silk Road.

As a movement, our Ideology is based on helping Life thrive – and human life and dignity is the central aspect of that. We want every human being to be able to reach their highest potential on a sustainable Earth. We desire for every person on this planet to live their lives knowing they will not become homeless, that they should always be able to go to bed without an empty belly, that their health should be cared for, that they should live without the fear of being oppressed, beaten or exploited and that they should have access to the knowledge and tools they need to realise themselves.

In this regard, we are opposed to inequality when inequality is so stark that it creates a sub-class of excluded or exploited people whose conditions are so damnable that they are threatening to their physical and mental health. In this regard, we should be opposed to all conditions where human beings are deprived of access to what they need to sustain their very lives. Sweatshops and child labour, as well as situations where workers are exposed to dangerous substances, should not exist in the future.

The truth, in today’s world, however, is that the choice for a Chinese factory worker is not between a 12 hour day’s work at Gloxconn and an eight-hour with double the wage and full health benefits, but between Gloxconn and starving unemployment and foreclosure on the countryside.

Before industrialisation, poverty was near universal. And despite the fact that roughly speaking 80% of the growth has gone to the 20% who already have the most decent lives, one cannot deny that life in the beginning of the 19th century was brutish and short, and ridden with toothlessness and early aging for most human beings. That most were illiterate and oppressed farmers who were taught that their only solace lied in death – if they obeyed the spiritual and feudal powers of the elites.

However, the fact that industrialization and globalization clearly have had positive effects, do not mean that we are morally obliged to continue these policies, or that these policies can continue uninterruptedly in the same pace as for the last two centuries.

In fact, our organisation argues that:

  • We are transforming the surface of the Earth so much that we are threatening to cause a Sixth Mass Extinction and living beyond our means.
  • The reason for that is because we have a fiat-based economic system dependent on debt-on-credit, which forces us to try to increase exponential growth at no matter what cost.
  • That exponential growth will always lead to an increase in areas converted into monocultures and linear systems for primarily human usage.
  • That the SXE will lead to a global loss of complexity for human societies, driving us down into a new dark age, a Pandora’s box of unforeseeable consequences.

We argue that this is a reality-based assessment of our current situation, and is the single most important issue Humanity has ever faced. The greatest political challenge is to try to establish a balance between our species and the rest of the biosphere it must be a part of if it wants to inhabit this Earth and have a socially, economically and ecologically sound future.

We argue that this can only be accomplished through three criteria.

  • A global ecological budget ceiling.
  • A global circular blue economy.
  • A global covenant of Humanity, that each human being has a right to life and to access for the necessities of life – freedom, housing, food, water, education and healthcare.

In short, the EOS argues that the only way to preserve and create a sustainable basis for our long-term prosperity and happiness as human beings is to make these three criteria the basis of our future civilization.

In my opinion, what logically follows from this outlook is the following positions regarding the three aspects of globalization we talked about in this article.

  • Technological progress – we are definitely sympathetic towards technological progress.
  • Economic growth – we are not against economic growth, we are against the continued conversion of the Earth’s surface into areas intended to support linear production flows.
  • Political globalization – this aspect is problematic, because policies intended to maximise growth and investments are bringing us further away from a genuine Transition. In order to have a necessary Transition, we need a different set of policies with other aims. Our primarily goal should be that the cost of all products should be determined according to their environmental footprint. Policies to increase economic growth in western countries today make little sense, as the populations are stagnating (meaning in the long run that costs on infrastructure maintenance will diminish) and increased incomes have little effect on a population’s happiness when prosperity is growing beyond a certain income level – especially as further increases most likely will mean a heavier weight on the planet and therefore a steeper and much more radical Transition in the long run. There is one aspect of political globalization we should embrace, and that is when we strive towards deeper political integration of regions, and theoretically we should be willing to support the political unification of the entire Northern Hemisphere within maybe a generation.

In short, we are sympathetic to the emergent and organic aspects of globalization, we are critical to our overshoot above the planetary carrying capacity and therefore policies which will increase that impact, albeit unintended. Instead we need a conscious Transition shaped around the fulfilment of the Three Criteria.

Having written that, we should avoid the sloppy broadside critique represented by for example elements of the old Alt-Globalization movement, where globalization is defined wholly by its most repugnant characteristics, the criticism is both progressive and conservative simultaneously and thus irreconcilable with itself and the main ethos seems to be anti-capitalism beyond everything.

Our movement should be defined by love for Life and Humanity, expressed by the aforementioned Three Criteria. As long as we are sustainably capable of reaching the Three Criteria, the exact forms of governance should be determined by their ability to reach the goals, rather than any emotional or aesthetic-optical considerations.

For Life, Love and Light!

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