Can Capitalism continue?

nazarbaz

There's no such thing as a natural limit or foundation to capitalism. It's not a natural fact but a technology : its limitations are social and political.

H2Bro

I like this way of looking at it, Capitalism as technology or just a cultural innovation.

The question becomes how we can sustain a high level of symbolic economy using as little physical substrate as possible, i.e., the most number of value added services or innovative software which doesn't actually use much resources beyond electricity per unit of product, with as little coal, steel, lumber, etc, as possible.

The problem of how to increase efficiency gains in infrastructure and manufacturing or vehicles, things that use raw physical inputs and are actually scarce, is one that will be addressed as inputs rise in price automatically. Thats the nature of the capitalist allocation algorithm. It is, in a sense, a dynamically robust system.

enosis_

Hasn't US GDP remained less than 2% for the past few years?

Jim Kata

Capitalism maybe extremely capable at adaption, but it seems terrible at planning ahead. I just look at this global warming debacle. The fossil fuel industry will not respond until it is probably too late and the modern world we know is destroyed. The short term profit motive which drives corporate capitalism around the world is completely unsustainable, as far as its wasteful use of non renewable resources, and it seems that it will only change if absolutely forced to. As long as the profit motive is the driving force behind it, I don't see the system changing. If the system does not become more sustainable in its use of resources and stewardship of the environment, I think the human species maybe in trouble.

The pessimistic side of me says this is the way it is and just don't have children and hope you die before things get too bad.

The optimistic side hopes the system can be changed into a more sustainable one.

enosis_

Aren't you confusing progress with Capitalism?

Jim Kata

I'm not sure what you mean by progress? If the extinction of the human race is progress, then I guess so.

enosis_

The industrial revolution, indoor plumbing and heat, mechanized farming, and motorized transportation all seem to be progress - the cost is not necessarily "the extinction of the human race" - is it?

Jim Kata

What is ignored by this analysis is that the exponential progress the human race has made since the industrial revolution has been due to an exponential depletion of natural resources. When the resources that have made this progress possible are expended the progress will halt. I do not know the affects global warming or massive habitat destruction will ultimately have, but I don't imagine they will be good. The current global economic system doesn't seem to be planning for these effects and it may prove impossible to reverse these effects. I do not see unfettered capitalism as a system well built for dealing with issues such as proper stewardship of the environment.

enosis_

I find your use of the words "unfettered capitalism" interesting. I don't think this system exists anywhere except in textbooks - the real world has regulations. The exception to this statement could be in a communist system - where environmental regulations might be considered counter-productive?

nitsuj

I am curious what natural resources are being depleted. All I can think of is stuff we burn, so oil, gas & coal.

That stuff has been around for a long time and has little to do with progress and everything to do with producing "work".

How can you view the depletion of those natural resources as a bad thing?

Kinda rhetorical question considering your comment "The fossil fuel industry will not respond until it is probably too late and the modern world we know is destroyed."

Jim Kata

Well, there are many resources such as helium and rare earth metals used and high tech manufacturing processes, but more worrying is the collapse of fisheries, forestries, disappearing fresh water supplies, and the vanishing of arable land for food production, to name a few. You think fossil fuels have nothing to do with progress? Do you need power to run a manufacturing plant? Do you need fuel to ship these manufactured goods to market? Where does the majority of this power come from? Can an economy function without access to a cheap abundant energy source? If you're not sure, look at Iran and the oil sanctions they are under.

I may have speculated too much on the effects a 4 degree centigrade raise in the average earth's temperature will have, but I don't think I'm the only one who is uncomfortable with the thought of living through the hottest period the earth has been during human existence.

enosis_

Can you please explain how ending capitalism would change anything you've described - please be specific?

Jim Kata

I won't be presumptuous enough to claim to have the answer, but I will say that the short term profit motive exasperates many of these problems. To your previous question about regulation, I will say that the short term profit motive incentivises companies to try and skirt, through outsourcing to less regulated countries, or lobby against many of the regulations that maybe required to try and mitigate environmental destruction, such as the Kyoto protocol, because it affects their profits. The good news is there are people thinking about these problems such as environmental economist, steady staters, and so on. I created this post as question not a proselytization, but too many people here believe the evangel of the current economic system to propose alternatives.

Jim Kata

Since you wanted policy suggestions, I will give you one, put caps on greenhouse emissions for all major industrial countries including the United States and China.

enosis_

This was your original post and topic of the thread.

enosis_

Why don't we refocus?

http://www.merriam-webster.com/dictionary/capitalism

"Definition of CAPITALISM

: an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market"

enosis_

To go back to the OP - why can't Capitalism survive with less than 3% GDP growth?