I’d just like to run through a few basics of modern economics, to explain the underlying problem.
- The economy must grow! This is accepted as gospel, and for good reason. If the market stops growing and starts shrinking, that means people become less well off.
- There are only two ways of growing an economy. Either you have more people (more consumers of the pie), or you innovate - so the available pie grows.
- Emerging markets expand the available supply of consumers and are therefore good.
- Sometime this century, the global population is expected to stabilise… and then fall.
So, what happens when the number of humans starts to shrink? Logically, so does the economy unless the world becomes more equitable in its distribution of wealth and raises everyone up to ‘Western’ standards. Some problems with that:
- Current economic powers do not want new powers to take over (such as China).
- If all 10 billion projected people live like the average Australian, then our planet’s finite resources will disappear even more quickly!
- Maybe item 2 can be addressed by ‘space mining’ - or even colonisation. Maybe.
Item 3 above is one form of ‘innovation’ by which the economy may be kept growing. Other innovations may include the improved use of computers and AI, quantum computing, and game-changers that we cannot yet envision.
Finally, it has been suggested that current generations may be the last that will die; science expects to solve this minor blip in the roadmap of life over the next 50-odd years. That would mean that the world population may not start shrinking.
Yes, absolutely! Unfortunately, most rich countries find this politically repellent. “We’re falling behind”, and such jingoism. The IMF and the World Bank have done very well at keeping certain countries ‘in their place’. France insisted that Haiti pay its ‘independence debt’ - which was finally cleared in 1947 but kept the country in poverty. As for improvement of welfare, this seems to be against the interests of our political paymasters - and I have no doubt the situation is similar in poorer countries.
those of us who currently have a lot (comparatively) will need to make some major sacrifices to find a level of resource usage that is sustainable across the global population. Alternatively, we will need to find ‘a better way’ (i.e. innovate).
Our current politicians are looking at the next year, or the next election (or the next chance to knife a PM in the back). They can’t even deal sensibly with climate change! The global economic challenges that are coming, while some are due to or exacerbated by climate change, put climate change problems to shame. I cannot see them being dealt with by existing systems of government - whether local, national or international.
Unfortunately, if these challenges are not resolved by international consensus, then humanity will likely wipe itself out in a struggle over the last remaining resources.