Sunday, February 28, 2010

Survival Alternatives

NOTE: This article was originally published – in part – on Associated Content (2/6/10) and is expanded in the version below.

In our economy, people are paid for “added value” -- creating new things, improving existing things, or keeping existing things from deteriorating. They are rewarded most for providing value that few others can provide, but which more people want (maximizing the ratio of demand to supply that determines prices), thus making it more attractive to create new things than to repair existing things. As the potential for making new things declines due to diminishing resources, increasing prices will be unable to be lowered by increasing supply, so demand will need to drop.

One indicator of demand is per capita disposable income, and 2008 saw the U.S. income grow at a lower rate than the cost of living for the first time since World War II. This decline in the income growth rate has been in progress since about 1980, so it is clearly the result of a systemic problem that cannot be totally blamed on the misdeeds of a few in recent years (although the particular timing can be). My own projections of available natural resources show a clear linear correlation with both income and cost of living (becoming strongest in the 1990s when the U.S. adopted rapidly globalizing trade policies) implicating limited resources as the main culprit.

If resources were not an issue, a simplistic way to deal with reduced demand would be to make more income disposable. This approach is promoted by pro-business interests who seek to decrease taxes. Besides the fact that only a limited amount of income can be recouped in this way (currently about 12%), it threatens to sabotage the entire economic system. This is because taxes support government that builds and maintains infrastructure that enables resources to be efficiently extracted, moved, and processed.

The most direct way to deal with the problem is to increase availability of resources.

A simple approach is to decrease regulation, giving businesses more latitude to find and exploit the resources we currently depend on. This is supported by the same interests who want to decrease taxes, and leads to a similar outcome because regulation (when done right) reduces inherent negative consequences of such behavior, such as conflict, theft, health risks, and over-exploitation.

Alternatively, we can find and use different resources (“substitution”). These resources can be nonrenewable, such as nuclear power and “clean” coal. They can be renewable, such the various types of “green” resources (such as solar energy, wind power, and biofuel) whose use is growing rapidly but is still practically insignificant in terms of total consumption. Or they can be reusable, modeled on life’s highly efficient use and reuse of mass and energy, and exemplified by the growing permaculture movement.

Using other nonrenewable resources can briefly extend the amount of time before depletion and waste effects pose a similar threat as fossil-based resources do now. The renewable approach can be used much longer with fewer negative effects, but it will take much more time to make universally available since it requires creating a new economy, complete with different physical and social (including legal) infrastructure. The reusable approach can be physically implemented quickly, but it stands to meet the most resistance to adoption since it depends on a radically different kind of demand that is based on efficiency and responsibility rather than waste and narcissism.

No comments: