The author makes the assumption that economic growth has to come from an increase in material output, resources consumed etc. when it can very well be the opposite. "Number of atoms in the universe" has nothing to do with anything, and is just used to (incorrectly) turn their subjective argument into a scientific one.
You can reduce emissions and grow the economy, stabilize your population and grow the economy, move from physical goods to digital and grow the economy, reduce number of hours worked and grow the economy. Heck a few thousand years in the future we could all wire up our brains directly into hyperspace and still grow at 1% per year.
OP takes a historical view about the actual economy, and where it in real life can go from here. Your argument – a very common one and very influential in today's society – however is purely theoretical. As John O'Neil points out:
"It is logically possible to have increasing GDP and a decreasing physical and energy throughput in an economy. However, it is a fallacy to move from claims about what is logically possible to claims about what is physically possible and another from what is physically possible to what is empirically actual."
If you actually look at the coupling of environmental pressure with historical empirical economic growth measured by GDP, we can't go on like this for even a few decades more, if we want to avoid complete ecological collapse. Trusting humankind's future on theoretical armchair economics magically becoming a reality, despite decades of evidence to the contrary, is complete madness.
This apparent decoupling in western nations is an illusion made possible by globalization, where resources are extracted from the global South. When you count in production, no more decoupling can be found.
This is a very important aspect, we really must stop looking at country specific environmental impact (and some other metrics) without its attached outsourced production.
Popular or not, there is a lot of merit to that view. After all a lot of the emissions are driven by manufacturing of goods for export to the West, thus it makes sense for us to take some responsability for them
You must understand that the emissions problem is global : western countries are shrinking their emissions because they are totally outsourcing polluting activities to other countries.
CO2 is totally diffuse in atmosphere and the climate change is global. Outsourcing pollution has no effect on this issue. And the fact is, global CO2 emissions are at an all time high year after year.
87% of Chinese emissions are attributable to domestic consumption. The remaining 13 % is the rest of the world, not just the West. So it doesn’t seem like what you’re saying is accurate.
[1] seems to imply it is context dependent. China is shown to be an insourcer of emissions while the trend of many Western countries (except some Nordic ones) is outsourcing emissions.
“Taken as a collective, developed countries are found to be outsourcing emissions to developed economies; however, this is largely due to the U.S. and China”
The relationship between the distance a good travels and the amount of emissions produced by that travel is not linear. Further it's a mistake to underestimate the reduction in emissions that come from productivity.
Emissions aren't the only thing you need to measure - you would also need to factor in resource consumption for manufacturing. The conjecture that the economy can continue growing on virtual goods is an interesting idea, but you can't eat virtual goods and if the economy growing also depends on population growth, something will break at some point.
Note: I'm not entirely convinced economic growth depends on population growth, but historically that has been the case in most countries that haven't exhausted their windfall natural resources like oil and have healthy export markets.
There's a limit to the physical quantity of non-virtual goods you can eat, as well. If you switch from eating a $3 burger to a $100 steak with the same nutritional content, that contributes to economic growth with no change in resource consumption.
There are limits to how far you can take the price of these marginal quality improvements.
At some point you get into side grades and Veblen status goods, which also have limits - their positioning relies on scarcity.
Plus, the $100 steak is more environmentally expensive too, even if lab grown.
A $3 burger is made from mechanically reclaimed scraps with a high level of automation. A $100 burger is made from prime cuts by hand by skilled butchers. It's not inconceivable that the resource consumption is 30x more.
And 2005-2016 saw a sufficient deterioration of conditions for the US public to vote in Donald Trump (!) on a platform of ... there wasn't a lot of agreement on what the platform was, but "the economy is terrible and you're all getting screwed, it must be foreigners ripping us off!" was certainly an element of it.
There are signs that the energy-lite economy growing isn't as useful to people as the old energy-connected one.
Well, it's not the foreigners ripping the US off. It's the US willingly providing the reserve currency without having a high enough percentage of the world GDP to deal with the negative effects.
Having a country offer their own currency as the global reserve currency was stupid to begin with. It's no surprise that it will have to end one day.
The argument boils down to that all economic activity, whether material or just information, requires energy as an input, and at least on one planet, the ability to heat-sink that energy (let alone generate it) must set some finite growth limit.
Yes. This is very similar. Lots of commenters here seem to be missing that point. Rather than making a low confidence claim about the immediate future (the economy will crash next year) it's making a more confident claim about the distant future (growth rates are unsustainable over the next hundreds or thousands of years without mind-bending physics).
Yes, definitely. This isn't meant to argue that those limits are anywhere nearby.
The significance of the argument is that once everyone accepts that a seemingly-unstoppable exponential growth trend can be halted by far-off limit A, you can start to have productive discussions about whether it can also be halted by more relevant limits B and C. Sometimes the hard part is just getting past the point that an exponential trend ever need stop for any reason.
As a physicist I find this to be a trite argument. You can easily get to 'finite' simply by arguing that the number of digits required to represent a number cannot exceed the number of atoms in the Universe. That's a ridiculously loose bound, but it's still finite.
The practical question is will our lives be recognizable to someone alive today when we do hit a ceiling? The average person 100 years ago could hardly imagine the way we live. If the limits come in some unimaginable future, what good does it do to worry about it now?
There are plenty of problems that we can foresee in the near to medium term. The finitude of the Earth is not yet an issue.
> The average person 100 years ago could hardly imagine the way we live.
Serendipitously, Karel Capek's "R.U.R.", the book which popularised the concepts both of robots and of androids, was first published in 1921, 100 years ago this year.
I dunno. I think people from 100 years ago could likely imagine our current lifestyle just fine.
I mean, some of them are still alive, even, and many were involved in making our current lifestyle.
It might be because you're a physicist that you find the argument tiring! You already understand and accept the underlying assumptions. I think it's meant to be applied when someone really stands their philosophical ground on exponential growth continuing forever.
We're very far from exceeding the limits of available energy on Earth. Between enormous reserves of carbon (the U.S. has an insane amount of natural gas in proven reserves), nuclear, and solar, we're good for a long time. Of course, I am considering that negative population growth is baked into the world population pyramid, which means that we'll see some slowing of energy demand growth in a couple of decades. I think most people would be very happy with 15-20KWh/day, which is roughly what Americans are used to.
> I think most people would be very happy with 15-20KWh/day
'640K of memory should be enough for anybody.' - Bill Gates (apocryphal, apparently he never said this)
When the Jones' are using their energy-sucking teleporter to travel instantly to work and taking summer vacations to the Moon, when their kitchen is fitted with exotic self-cleaning metamaterials and they tolerate no natural discomfort in their lives, I would think that their neighbors would not be caught dead one step behind them. You can achieve happiness with less - but you can achieve happiness today with much less than your number as well, and most people measure themselves against their neighbors, not some theoretical absolute level of energy usage.
Energy consumption in the developed world tends to increase.
U.S. consumption has been around 22KWh/day/capita for a long time. The rest of the world is much lower. The 22KWh/day/capita includes gasoline and diesel. I don't see Americans wanting to consume 30KWh/day for current uses. Do you?
According to OurWorldInData[0] the number is closer to 220 kWH/capita/day, although it does show the usage as stable or even declining over the last decade.
According to the US Energy Information Administration[1] total energy usage seems to have increased. That particular chart stops at 2009, but this tool[2] using their data shows 1. stable usage since ~2007 and 2. roughly 10% increase since 1995, and a 3-fold increase since the start of the data in 1950. By a long time, did you mean since 2007?
Current growth rates need an exponential increase in resources.
Even if we -after some technological singularity- could expand a sphere of influence that brings everything in the expanding bubble to complete subatomic level of control, this would mean at most sustainable cubic growth (available resources are growing cubically).
So our current situation is exceptional and not steady state and can't continue indefinitely (wasn't going to anyway).
I think his main most valuable point is that the status quo can't - and that stands.
Personally chasing constant growth doesn't sound like what we need to be aiming at anyway.
It would be saner to be engineering some long term stable state that we adjust as soon as new potentials become available.
Like aiming at a fixed upper limit maximum human population on earth with an acceptable minimal standard of life as opposed to letting blind growth search out the natural feedback loops instead.
I think they are talking about "economic" growth rates, which are independent of population growth rates.
This actually makes me lean towards saying that the economist is right, money is arbitrary anyway so if the argument is actually that the economy can increase forever I see no reason that can't happen physically. It's not real, it can't be real in the future and it's barely real now.
Well, if we are going to talk about nominal growth, I'll throw this in.
Our money system does need endless growth just to function properly but it only needs endless nominal growth. If inflation is high enough then real interest rates are negative. No need for real growth.
Numbers going up does not mean increased productivity and there are human (and technological) limits to that, even if you make everyone into work slaves. Which would be completely immoral.
Maybe we are far from exceeding the limits of available energy regarding the inputs of the processes, but our most immediate problem is the output energy, which is released as heath in the environment.
Ok, but CO2 is another output of human activities, can we increase energy expenditure while lowering CO2 emissions? (it’s not a rethoric question, I don’t know the answer)
LED bulbs are a relatively recent invention, thus their manufacture, at industrial scales, was built on developments in manufacturing engineering that didn't exist when the incandescent bulb was developed. So here's a question for you: if we went back and re-tooled incandescent assembly lines for modern processes, would LEDs still beat them?
The answer is yes, by simple costs of communication. Communication is neither free in energy, nor instantaneous or faster than light. Fanout limits the speed too.
So essentially at some point the economy becomes unmanageable and unstable by pure lag. Earlier than that, by human reaction time and decision failures.
HFT is already riding on speed of light distance differences. If you grow the economy even more (in number of actors), the costs become exponentially higher.
And if you're talking real economy, then we're talking actual real resources which are even more finite and scarce than electricity and time lag.
I'm sorry to put it so crudely, but this doesn't make any sense.
It does not cost more in 'communication' to convey a better idea.
Moreover, communications cost is marginal, so even in an very theoretical scenario in which 'more economic activity requires more communication' - it's not applicable.
"And if you're talking real economy, then we're talking actual real resources which are even more finite and scarce "
Again this is completely false.
Education, Entertainment, Legal Services, Financial Services, R&D - i.e. 'Services' are the 'Real Economy'.
The 'Value Add' provided by applied intelligence is considerably greater than the raw, natural resources economy.
> Maybe we figure out how to control simply and cheaply store CO2 in pellets at the bottom of the ocean. Climate changed solved.
Well… yes, maybe we’ll figure out. But I hope you understand that’s a risky bet ? Climate change CAN be stopped rapidly. But it can’t be reversed (on centuries scale). So each catastrophe frequency increase, each heat record, each impact of the acidification of oceans that happen year after years is here to stay for centuries, at least.
I sincerely hope your CO2 pellets are for today, because if they are not, we will need another plan. And the only working one we have as of today is to stop burning fossil fuels.
> The issue is does increasing economic output, require increasing energy use? The answer is no.
The article addresses that by arguing that it would imply energy became arbitrarily cheap, while being scarce and finite. That means someone could buy the whole supply and wipe out their competitors. That contradicts it being arbitrarily cheap, so energy would be a limiting factor.
Which is a silly argument. There a lots of essential raw materials that have a market size of a few billion or less per year. Bezos could theoretically buy the entire years supply and cripple the economy.
For example, let's choose something expensive sounding -- platinum. 170 tons per year of production, at $30 million per ton. $5B will let you corner the market for the year. Yet it doesn't happen, for a wide variety of reasons.
For the analogy to work with energy and still be true to the physicist's argument, we would also have to imagine that all exchange of goods and services requires new platinum -- and that there's a hard physical limit on the platinum mining rate.
Perhaps a world where platinum jewelry is all that is bought and sold. Jewelers improve in skill and the jewelrt becomes ever more intricate and elaborate, such that its value grows ever higher than the raw platinum it's made from.
In such a world, there might be no limit on the jeweler's craft, but could the price of platinum really become arbitrarily small? As time goes on, first the world's greatest jeweler could afford the whole supply, but then even a second rate jeweler, and then eventually anybody could perhaps afford to buy all the raw platinum.
A: Platinum is an example, there are hundreds of other such resources.
B: Platinum is much easier to corner than energy would be, since platinum mining is limited to a very few number of active minutes. Energy production is quite distributed.
The limit is very high. Every kW generated by hydrogen fusion is a kW that, by the laws of physics, will eventually be dissipated. Enough exponential growth fusing hydrogen on this planet and the earth would quite literally become a mini sun. That is the theoretical limit referred too.
Space is cold and big. We can theoretically sink near infinite heat there (generally in the form of radiation of wavelengths not readily absorbed by anything in the atmosphere).
Yes, but only in proportion to the fourth power of the Earth's surface temperature, which we would want to limit. (The argument is predicated on not becoming multiplanetary).
Fourth power of temperature of heat spreader. It can be isolated from earth's atmosphere and still export heat. Of course, it's not enough if we want to limit ourselves to "IR wavelengths to which atmosphere is transparent".
That's a good point, although in the context of exponential growth, it's a small difference that just buys a few more centuries. The heat spreader would either have to grow exponentially in area radiating into space, or grow exponentially in temperature; at some point it will hit geographic or material limits, or else eventually end up bathing the Earth in gamma rays.
“When the materials point at the sky, the infrared rays can pass straight through the atmosphere and into space. That effectively links the materials to an inexhaustible heat sink, into which they can keep dumping heat without it coming back.”
I agree with jbay808 on the impracticality, but note that in context, I am responding to the question of whether it would be harder to remove the heat than to generate it. Both obviously quickly become impracticable if we expect exponential increases.
Economic growth due to technological advance is completely swamped by economic growth due to increased throughput.
It is the throughput, the increase in entropy, that is at issue. Almost all economic growth comes from increasing the flows from sources to sinks. E.g. Turning coal into CO2
I would suggest that the increased throughput comes from the technological advance. We're getting ever more efficient at converting energy and raw materials into stuff we want. That means it's cheaper. That means we do it more.
And yeah, "the economy" includes services as well as goods. But services are performed by humans, and humans need to eat and live in houses and wear clothes etc.
For now. The sink analogy does not quite work, they're closer to empty containers that you fill with gas, which get harder to fill above certain pressure and can even explode.
Right, I don't get what atoms have to do with it at all. Today, I can buy an iPhone for $1000 that's a phone, camera, encyclopedia, game console and more and more. Just 30 years ago this would have required a lot more atoms (including energy input, I suspect) and a lot more money.
I’m guessing here but it seems to me the idea is that each atom can hold a finite amount of information and information storage requires energy. An economy requires information and storage of information (not necessarily permanently for each transaction). So it seems to me that the ‘economy’ is limited in size by being proportional to the number of atoms we’ll be able to have access to.
Consider Jevon's Paradox. Yes, we're more efficient at turning materials into products, but that just means we do it more, and the net consumption goes up. Did you replace your camera, encyclopedia, game console etc every few years, 30 years ago? Do you think we're mining less?
Replace atoms with bits of quantum information and you'll get a more or less equivalent upper limit. Even if your economy is 100% information based, you still need to store/transmit that information.
If a bit of data could be stored in a single hydrogen atom, after 1000 years of 1.03 growth 1e9 kg of hydrogen would be required (starting from 100 zetabytes today). After 2000 years you're at 1e21 kg, more or less the mass of the moon. For completeness, after 2700 we'd need the mass of the solar system in hydrogen atoms.
I agree with the article that there is a fundamental limit to growth. If I had to guess, the first limit will be the number of humans on the planet, followed by the black body radiation rate of the earth needed to stop our gizmos from overheating.
>Heck a few thousand years in the future we could all wire up our brains directly into hyperspace and still grow at 1% per year.
The economy ultimately comes from material goods. The digital economy is only a facade built on that substrate. And it's already pushing its limits, which is why everyone, from FAANG companies to the guy selling some digital asset online, is pushing to sell something or another as hard as they can, with all the conviction and integrity of a snake oil salesman.
I agree, and I'm not even clear on what "grow" means. Like, literally increase global GDP? Increase some measure of productivity? Because already there's all sorts of contradictions in our society's "advancement."
Productivity is increasing, but wages are decreasing.
Country net worth is increasing, but happiness is decreasing.
Etc.
When I read these kinds of posts, I think about "stagnate." It feels like an inherently negative word. I know that most people value a constantly improving technology, but as my OP says, technology can "improve" while, say, net worth or GDP "stagnates." Even leaving that to the side, I don't feel like "stagnated" technological advancement is inherently bad. It's just a value many of us hold.
Not to get primitivist, but, humans really were just eating berries and vibing for a really long time. I don't think we should "return to monkey," but if we get to the point where we figure out that we can't really defeat death, it might then become time for society to instead start thinking about living the way a cancer patient with a deadline does: how can we find meaning, knowing the end is inevitable? Sure yeah meaning could be still trying to advance, but given that current modes of technological advancement often involve capitalist exploitation and general misery (which isn't REQUIRED but we seem to be really big fans of it cause we keep doing it), perhaps we could decide to let go and just live happily with "technological stagnation."
While not directly tied to economic growth, one factor this article leaves out is that global human population growth could possibly peak within our lifetime (although more likely around 2100) [1].
In the last 60 years, total fertility rate has dropped from 5 to 2.5 [2], and most industrialized nations are hovering right around replacement rate of 2.1 or actively shrinking (Japan, 1.4, Germany, 1.6). Albeit during COVID, the 2020 TFR in the United States was only 1.64, and has declined for the last four years in a row [3].
With technology, I'd still expect the overall "size of the economy" to grow, but it will be interesting to see how growth is affected by substantial changes in demography that play out over the next 100-200 years (if only I could stick around to watch!).
Demographic leveling or collapse is in a category I've heard called "demand limits to growth."
Everyone always thinks about supply limits, with some making dire Malthusian prophecies of what happens if we exhaust our resources with runaway growth. I've seen surprisingly little discussion of demand limits.
Other possible sources of demand limits include: satiation (people just feeling satisfied and not wanting much more), diminishing marginal utility of wealth, diminishing impact of new technologies (compare the next CPU density node to jet aircraft or antibiotics), consolidation of functionality into fewer more versatile products (e.g. computers and smart phones eating TVs, tape decks, radios, book shelves, CD collections, etc.), cultural shifts toward simplicity, replacement of complex labor-intensive technology with simple low-maintenance technology (e.g. EVs have 1/10th the moving parts of typical ICE cars), etc.
The eternal growth assumption assumes both infinite supply and infinite demand.
As a civilization, we are good at inducing demand, though. For example:
> satiation (people just feeling satisfied and not wanting much more)
Advertising industry literally exists to mitigate this problem. I don't envision it hitting a limit any time soon.
> cultural shifts toward simplicity
This has not happened yet. Our existing "trends" for simplicity and minimalism are just thinly-veiled attempts to get people to buy more shit they don't need (like "simpler" items, to replace the perfectly fine items they already have, or books and videos and conference tickets of minimalism thought leaders).
> replacement of complex labor-intensive technology with simple low-maintenance technology (e.g. EVs have 1/10th the moving parts of typical ICE cars)
I don't believe this is stable state. EVs are more reliable because they're new. They haven't gone through enough value engineering cycles. The market has a structural incentive to optimize away all quality, until the result is barely fit for advertised function - so I expect that once EVs start dominating, they'll also start breaking at the rate people are used to with ICE cars, because manufacturers will optimize away spare capacity and surplus material of every component.
I think the risk is still dominated by the supply side.
No matter how clever/appealing the Smirnoff advertisement becomes, there is a point where drinking more vodka just kills the customer. There are analogous limits for any product that one can eat, drink, inject, or inhale. For products that aren't directly consumed by the body, the limit is time if nothing else. An hour spent watching Marvel® characters save the world is an hour you can't spend driving your Acura MDX with A-Spec®. Even the best ad agencies can't create enough hours in a day to indulge every urge they cultivate.
On top of that, you cannot watch infinite number of advertisements at the same time.
Attention and time is a limited resource. Even shortening work day we get to the point where work is dominated by travel time, further reductions there require restructuring cities or removing whole swathes of work while still paying people to consume.
ICE cars are inherently more complex than EV cars, much like a Swiss army knife is inherently more complex than a kitchen knife.
If EVs quality will degrade to the quality of current ICE cars, that would mean that production if EV cars will use less resources, not more. It will not have to repeat the ICEs' complexity.
But frankly popular EV cars like Tesla are often considered sub-par compared to modern ICE cars with regard of build quality. They are used despite these shortcomings, and will actually need to rise tp the quality level of e.g. ICE Toyota cars.
Nobody is going to open up and fix EV's in the near future. When they break down people will be expected to just go buy a new one. Especially if they are much cheaper to produce and buy. If you can buy a car for 3-5k nobody is going to fix them.
By all means, show me a new car with a list price of 3-5k. Current ICE cars already cost 10x that amount, and EV cars are generally even more expensive. On what basis do you expect new cars to ever cost 3-5k? That's the range of an electric bicycle, not a car.
But sure, I was exaggerating. I should have said 10-15k where you will find more examples that are less deadly to drive :)
But actually, I agree with the other comment. I would be surprised if the automotive industry doesn't manage to force us all into car subscriptions.
For the first little while you'll have to buy the car and the subscription, but over time the upfront cost will be less and the subscription will get bigger.
When a my 1980s Ford, my one friend who pays his electrical bill + has a craigslist-sourced machine shop can fix it from steel+aluminum stock, and also teach me how to fix it myself.
When something with power electronics breaks, my option is to buy new power electronics from a big company or trash it. My many friends with PhD/industry EE experience are unable to fix it nor tell me how to fix it with simple tools.
The complexity of the latter therefore seems greater in he colloquial sense than the complexity of the former.
With your 1980's ford, you outsource all off the complexity to a local shop. You're enjoying 100+ years of investment in internal combustion engines. In the future, with wide-scale adoption of EV's, local shops will respond to market demand. We're in early phases. The Model T was launched in 1908. In 2121, I think it's a strong possibility you'll be able to get your 2080's Ford serviced at a local shop.
A 1901 electric car has batteries in glass jars and plates of iron and nickel, speed control of just carbon and copper, easy to make with a vice, hacksaw, and file.
Let's not be comparing obsolete technology to modern.
> I don't believe this is stable state. EVs are more reliable because they're new. They haven't gone through enough value engineering cycles. The market has a structural incentive to optimize away all quality, until the result is barely fit for advertised function - so I expect that once EVs start dominating, they'll also start breaking at the rate people are used to with ICE cars, because manufacturers will optimize away spare capacity and surplus material of every component.
This is a completely nonsensical argument that doesn't fit the real world data. ICE cars have steadily improved in reliability over time. A car that made it to 100k miles was notable in the 80s. A car model from 2010 that didn't routinely make it to 100k miles would probably be considered defective.
The metric is, how long before you have to get it to a mechanic to fix a component failure, and how difficult/expensive it is. Engine durability is good in ICE cars these days - it's everything else that falls apart much quicker.
This is completely anecdotal and could be explainable by survivorship bias, but in my experience, past 1990 or so, the newer the car is, the more likely it is to cause regular and expensive maintenance burden on the owner.
Also, think of it this way: people are already used to having to do some serious maintenance work on their cars around 100k miles - why would EV manufacturers not want to eventually target similar repair schedule? In complex projects like these, reliability is a controlled variable.
You're not thinking big enough. A star trek style holodeck (or matrix-style brain port) has the possibility to simulate literally any experience with roughly constant resource inputs.
Short of literal deception, advertising cannot offer someone with access to those technologies anything.
You don't think holodecks will come with freemiun subscription plans or micro-transactions, a la video game skins and upgrades today?
Why would someone sell you a holodeck once, when they could sell you plugins and content modules for your holodeck continuously forever? You don't think you'd get bored looking at the same trial plan holo-beach for years?
Of course, piracy and/or open source will hopefully be around to offer free alternatives.
At first sure. But in this hypothetical future I think holodecks would eventually become widespread enough that an upstart vendor would differentiate itself by selling an unencumbered holodeck.
At that point, the designs themselves become the currency, and spread of them is limited by brainpower of the authors.
People cannot be easily prevented from using (or trading) a thing they make themselves. Enforcement of it requires serious violence. Previously, that resulted in communist revolutions.
I should've expressed it more clearly in the original comment. My point wasn't that demand limits don't exist - they do, and GGP is right by calling attention to them, they're definitely not talked about enough. I only wanted to say why I think we'll hit the supply limits first.
Pretty much every aging country is seeing the demand side of their economy die. I'd say education increases the minimum standard of living that people expect. If having more children threatens that standard of living they will refuse to have them.
This is silly. For one, large portions of the economy are not built on actual material. For example, take software, an evergrowing segment of the economy.
The number of computer programs is incredibly large. Even assuming a dense packed instruction set, even 512 bits is already enough to contain more programs than can be assigned to individual atoms in a universe! That's right. We could label every single atom with a number that would fit in the AVX instruction registers. That scale is mind-blowing, but it's true.
Take for example another growing part of the economy: AI. AI models like GPT-3 contain billions of floating point parameters. The number of potential configurations of the weights (which is what ultimately holds the value when models like GPT are productized) is orders of magnitude larger than the universe.
The fallacy here is the equivalence of economic goods to material goods. Many economic goods are not material.
Moreover, many material goods hold no value due to the material, but rather to the placement or arrangement of the material. In this sense, the same 'stuff' can be part of multiple goods and each of those goods can be more expensive than the previous good. For example, if I paid a laborer $10 to mine aluminum, the refinery $2 to refine it, the sheet metal factory $3 to make a sheet, the sheet metal worker $10 to make a good of it, and then the installer $20 to install it. I've made ever more money off the same 'stuff'. As industries like recycling take off, there is yet more opportunity to be had in the same amount of stuff.
And this doesn't even begin to touch on services and such, which do not even require material goods proportional with the economic value added.
In other words, there is no reason to believe we will hit up against an atomic wall after which we will be unable to expand the economy due to a shortage of atoms.
> The number of computer programs is incredibly large. Even assuming a dense packed instruction set, even 512 bits is already enough to contain more programs than can be assigned to individual atoms in a universe! That's right. We could label every single atom with a number that would fit in the AVX instruction registers. That scale is mind-blowing, but it's true.
You're going the wrong direction. The issue isn't fitting atoms into data. It's fitting data into atoms. You can give every atom a GUID, but you can't give every GUID an atom!
You don't have to put it in terms of economy. Our rate of growth for energy and data are unsustainable. Current growth would hit a wall informed by our understanding of physics somewhere very roughly in the thousands-of-years-range. So either we go beyond our needs for space and energy or growth slows down. Both of those are a big change from the status quo.
> Current growth would hit a wall informed by our understanding of physics somewhere very roughly in the thousands-of-years-range.
A thousand years is a very optimistic estimate I would say.
World3 (which is still on track of its predictions) predicts before 2050, which seems realistic considering the current
context.
You can only run so much code with so many electrons. At a certain point, you run out of electrons.
Imagine a world in which there is just one person and the economy is just how big of a number this person can make on a computer.
If there is more than one person or more than one computer - you have less electrons at your disposal - because they're making up other people & computers respectively.
This is obviously very far into the future - but so is 8000 years!
Between 1960 and 1970 - global GDP increased by about ~$1T. That was about the same increase between 2018 and 2019 - even after adjusting for inflation.
That was a low-growth year for the last decade.
In the 1960s we had the entire space race and a lot of the modern computer (including the Internet).
If the trend continues, in another 60 years, we could accomplish about as much in a month. In another 120 years, about as much in a day. In another 120 years, about as much in an hour. Another 180 years, about as much in a minute, and in another 180 years, about as much in a second.
It's hard to argue you haven't hit the singularity at that point - and that's only 660 years away.
8000 years at this current growth rate would be truly unimaginably alien - and I'm not sure why everyone is convinced it could keep growing or would even need to.
If the population keeps growing at current rates - we'd have enough productivity for everyone to have a higher quality of life than Jeff Bezos does today in <700 years - at least, inflation adjusted, the average person on the planet would have >$15Bn in annual income.
This doesn’t really apply to housing or congestion of any sort. Space can be recycled but only when you’re not using it. Everyone and everything takes up space. Things like AirBnb only go so far to make cities more efficient. people don’t like getting packed in, so they will pay for more space.
Camera is made of materials which need to be mined, transported, refined, milled, soldered, molded, etc.
So quite a lot of energy has been used to make the camera. It is not really about of the chemical bonds in the camera, but about the the energy the whole manufacturing chain uses.
The bond-energy of goods is less significant, particularly if that bond-energy existed in the raw form of the material (e.g., wood or plastic (petroleum)). It's the energy used in transforming, processing, and transporting materials that matters.
>The fallacy here is the equivalence of economic goods to material goods. Many economic goods are not material.
It's not a fallacy as long as economic activity is a proxy for human activity, because humans consume to survive. In your sheet metal example, while it's the same physical aluminum throughout the process, you've hired a team of people (and expended a huge amount of energy, incidentally). Each of those people will take that money and spend it on food, electricity, clothes, and luxuries. All economic activity ultimately boils down to that.
Software is actually very special: it can be an economic good (sold by companies), or service, or given away for free as open-source by volunteers.
A few weeks ago I heard a message about there being 3 major forms of investment: private companies (stocks), governments (bonds) and property (banks).
All these want to show exponential, compounding growth, but that isn't what happens. Stocks follow a business cycle of expand-contract. Governments grow in proportion to tax base, which is related to population. Property has been increasing in price due to the ever-increasing population, but this is likely to plateau soon.
I fear the day when companies realise that they can make more money for their shareholders by destroying governments and property through starting a war. (c.f. United Fruit Company, but with private space rockets = missiles).
What's a good investment during a war? I believe that philanthropy is the solution.
Schindler invested in his List of employees, rather than some economic instrument. They looked after him during his later years. People will try to protect their own lives, and if I die, I don't need the return on investment anyway.
Social connections can continue to grow factorially, as the world gets more connected. I think that this is always good, because it promotes peace and understanding among the diverse cultures that exist. I don't know how that can be harnessed economically, and I dislike the advertising model used by private companies to monetise the network. Still, I think that encouraging social connection will create viral growth, and be beneficial to the world.
> The fallacy here is the equivalence of economic goods to material goods. Many economic goods are not material.
But what part of the economy does this represents?
Most of the Internet run through ads, whose objective is to sell stuff.
The real fallacy is the knowledge economy here.
The value of Internet is that it sells physical stuff, not that it makes people smarter or happier.
> Money isn’t magical. You can’t create infinite value out of nothing.
It's not 'nothing'. It's something, just sold over and over and over again.
Remember that MV = PQ . Fundamental equation of macroeconomics. The average price of all goods (P) times the total # of goods (Q) is equal to the total amount of money (M) times V, the total number of times a dollar is spent in the time period in question.
You can make the total cost of goods be anything depending on how often that dollar is spent in a year / decade / whatever.
As a reductio ad absurdum, suppose that you and I and a few friends sit down in a circle and sell the same hot dog to each other over and over again. What value have we created? Assuming that the price of the hot dog remains the same each time, and we’re spending the same money over and over, according to your formula we have created an infinite supply of hot dogs. Q can go as high as we want it.
That’s quite a hot dog! Maybe that’s how Jesus fed all those people with just a couple loaves and fishes? The hot dog of infinite bounty. :)
I rather suspect however that Q in that formula is only quantity of goods sold, not quantity of goods produced or consumed. I’m more interested in the actual amount of value produced- the amount of work done.
But this is a contrived example where each person agrees to buy the hot dog for purposes of this experiment.
Fair market value is typically defined as the value you'd get on the market, selling to someone you don't know and without coercion.
So, like if I arrange with a rich guy to sell my house (worth about $700k) to him for $2million, so that he can 'donate' it back to me and take the charitable giving write-off for $2million, this would not fly, because by the definition of fair market value used by the IRS (and other agencies), my arrangement with the guy is not the fair market value. In order to determine that, I'd need to put the house up for sale to general availability and see what others offer 'me'.
So to 'fix' your example, you'd need to sit in a circle with your friends. Say the hot dog you are about to eat is for sale, and see if any of your friends want it from you.
By the way: GDP measures of a country’s economy are measuring the total value of the finished goods produced in a given year, sold to the final user. The intermediate steps you listed don’t count. So the mv=qp formula doesn’t directly translate to gdp growth. It’s just an accounting identity over the intermediate sales of unfinished products.
Then you increase the GDP, the nominal measure of the economy. This is not rocket science.
If person A mines aluminum and sells it to person B for $10.
And person B sells person A wheat for $5.
And then person A sells person B bread for $8, and person B sells a metal box to A for $12.
And this is the entirety of the economic activity in country X, then country X's economy is $35 in size. You can sell the same 'stuff' back and forth.
A more contrived example. Suppose person A makes water bottles. He sells to person b for $10. Then person A goes on vacation. At a concession stand run by person B, person A needs water, which he buys from person B for $4 each. Person B has added value to the same 'stuff' person A sold him simply by moving it. The 'good' being sold by person B is simply the transport of the good sold by person A, which is not subject to the same limitations as number of particles. There are many ways in which things can be moved or repositioned to add value.
If you look up how gdp is measured, you will find that they measure the total of transactions for the final consumer, for exactly the reasons I’ve listed.
From the IMF:
“ Theoretically, GDP can be viewed in three different ways:
The production approach sums the “value-added” at each stage of production, where value-added is defined as total sales less the value of intermediate inputs into the production process. For example, flour would be an intermediate input and bread the final product; or an architect’s services would be an intermediate input and the building the final product.
● The expenditure approach adds up the value of purchases made by final users—for example, the consumption of food, televisions, and medical services by households; the investments in machinery by companies; and the purchases of goods and services by the government and foreigners.
● The income approach sums the incomes generated by production—for example, the compensation employees receive and the operating surplus of companies (roughly sales less costs).”
So, sorry but you are mistaken about this, I’ve been trying to get you to understand this but you’re not paying attention. So in my hot dog example, you’re not supposed to count anything as gdp other than the final sale to the person who ate the hot dog. Or you can measure it one of the other two ways listed but you’ll get the same answer.
What if I need a water bottle for a minute. I buy it for $5, then I resell it for $5 and so does every following person? Surely each transaction shouldn't add $5 for GDP?
What if it is an extremely valuable water bottle. Let's say it costs $10,000 as it's made out of gold. Let's say it gets transferred similarly as everyone needs it for just 1 minute just to use it to fill it and take a sip.
At the end of the day "this" (economic growth) is powered by using energy to multiply the impact of human labor. The Industrial Revolution kicked off because we learned how to harness steam powered by wood and coal, and how long "this can go on" is going to depend on how well we can manage the transition off fossil fuels into renewables, not just on a 1:1 replacement basis, but catering to increased future demand.
Yes, but renewables would only give us a chance to see growth plateau without our civilization disintegrating. The point the article makes is the year over year multiple-percent economic growth is impossible, and the limiting factor becomes the number of atoms in the galaxy on a timescale shorter than human civilization's total history.
The other part is increasing knowledge, which allows us to use energy more efficiently. This could theoretically allow continued growth with the same amount of energy.
> At the end of the day "this" (economic growth) is powered by using energy to multiply the impact of human labor.
That's just a restatement of the Victorian/Marxist model of industrial labor.
The actual reality is that energy intensity of the OECD economies has been dropping for decades. As well attested in several sources such as, say, EIA data.
I'm a big fan of energy consumption BTW, and think it should increase significantly on a per capita basis, especially in poorer regions (though not from fossil sources). I just have been following this particular statistic for years and see that growth is not proportional to energy consumption.
Honestly, I can just change what I consider economic growth and the problem immediately goes away. I can make that graph do anything I want, just a matter of convincing enough people to go along with it.
Also:
>Why can't this go on?
>If this holds up, then 8200 years from now
Alright. Well how about we worry about that in 8100 years?
Ultimately an economy has to meet the fundamental physical needs of human beings (at least until we're all Singularitied into Hive Mind Cryostatsis Upload Tanks or equivalent). That's food, clothing, shelter, and the rest of it --- the base of Maslow's Pyramid.
More money can solve some distributional probems, but ultimately not the problem of insufficient production or supply.
The classic "toy economy" example of this is "The Economic Organisation of a P.O.W. Camp", which looks at the use of cigarette-based currency within a World War II prisoner of war camp.
It's not a perfect analogue of a true economy (goods were largely supplied to the camp through the German authorities and Red Cross shipments, there was little actual production or labour). But what was illustrated were both price fluctuations as the currency (cigarettes) increased and decreased in prevalence, subject to an innate destructive demand (habitual smokers). And when the actual supply of goods (food and other items) dried up late in the war, no amount of currency could in fact make the camp economy function.
The point isn't that physical limits will only be a problem in 8200 years, it is to counter the defective idea that such growth can be sustained indefinitely. We don't have access to all the atoms in the galaxy, and can't even make use of most of the ones we have here on earth. We will hit a wall much, much sooner.
I'm surprised the author tackled this topic without mentioning World3 from The Limits to Growth or the heavy reliance of modern, developed societies on fossil fuels?
Thus it's a very interesting economical opinion, but without adding the physical aspects (energy consumption) into the reflection, I don't see any interesting result.
This! In a world where oil discovery, extraction and distribution was ever increasing, betting on a bigger energy pie in the future made sense. All of our macro-economic theories were developed under the naive assumption of an increasing fossil-fueled bonanza.
But in a world of no new oil fields and increasing costs for extraction, we no longer have the ever-growing pie to fund our future financial obligations. Credit looks risky and economic decline seems inevitable based on the energy availability alone.
That's not even mentioning the externalities of fossil fuel consumption: climate impacts, ocean acidification, mass extinction, etc. make these economic issues even harder. Or is it the other way around? Either way, "this can't go on" and fossil fuels are a central part of the equation.
Wind and solar are cheaper sources of energy than fossil fuels and are going to be a lot cheaper soon. They're going to fuel a boom we haven't seen since the energy crisis of the seventies.
Unfortunately physics and mechanics of these sources are not unlimited either.
Current renewables would require huge expanding battery capacity as well as mega production and construction we likely won't have in a few decades yet. (And we're already about 30 years too late handling the global warming.)
The problem is caused by energy density per manufactured unit panel/turbine, and additionally basic physics of the energy source.
We have huge expanding battery capacity and construction. That is literally a thing right now. And confidently saying we’re too late on global warming is an absolutely absurd claim.
I don't like it when people say we're "too late" on global warming either. But the narrative behind that is not physically absurd - as atmospheric CO2 density increases, the temperature rises, which makes in turn causes increased CO2 (increased fires), and this causes a runaway effect resulting in something like Venus.
It's not too late. And even if things become really dire, even apocalyptic, we may as well face it open-eyed and do our best to survive (in earthbound arks) and recover (applying all those science fictional terraforming ideas...to Terra). It seems highly unlikely that we'll survive (Fermi paradox and all) but that shouldn't stop us from giving it the old college try!
No, you're reading too much into "too late" part. We're unable to prevent reaching 3.5 C rise in 25 years and are clearly on track to exceeding it even more. This is the "too late" part.
We're not too late to mitigate the damage from it. And it will be a lot of damage requiring serious ingenuity to thrive under. Perhaps even survive.
Making the problem worse obviously makes it harder.
There is every likelihood that we could in principle just keep drilling new oil. Our ability to extract oil at a cost effective rate scales almost exactly with the depletion of easy reserves. The reason we need to switch out is the devastating environmental impact, and only the devastating environmental impact.
It's not the drilling, but leaks of oil, gas, fires and obviously actually burning this fuel without full recapture. (Not offset, that is insufficient and sleigh of hand.)
The externality of fossil fuel consumption by far is the most problematic part of our economy. We have more energy than we ever meet from the sun, nearly all of which is uselessly radiated out into space, never mind what we don't use when sunlights hit our Earth.
Is it not interesting because there's nothing to argue? If the author focused on something from Limits to Growth, it would be possible to argue about whether the world was actually that way. As a logical argument based only on historical trends and physical impossibility, it's a much stronger argument than it would be were it possible to pick holes in the detail.
The world3 model is not really something you can use to make predictions- it’s got variables like “resources” with no units. And the conclusion you get from it was programmed into it.
I’d put my money on “steady state” or maybe “steady state but after a contraction due to climate change”, but not due to the world3 model.
"But I don't think [stagnation is] the most likely future."
Why not? Thomas Malthus predicted[1] that population would explode and collapse, but it didn't... and it looks like it's stabilizing.
The author should be wary of making the same mistake.
Come to think about it, a high tech and stable economy could be a very nice place to live. It could also be a totalitarian dystopia, depending on exactly how things play out. But one can at least imagine it working out well.
I think stagnation, or at least a change through successively smaller exponential regimes, should be the base case. I'm bullish on our future tech prospects and I know we have the entire universe from which to draw resources. But for all the real world cases of exponential growth, I think they are all limited.
And I only exclude collapse as a base case because I'm an optimist.
- edge of punctuated equilibrium: we reach a Kardashev level and getting through it requires major breakthrough again - would produce a flattening increasing sigmoid zigzag
- slow catastrophe pending resource depletion outstripping rate of innovation or travel, very slowly reversing progress
- singularity immediately halting the progress - flat horizontal line - the Accelerando situation
- potential speciation or technological fragmentation where it stops to be useful to talk about a single progress
Some economic thoughts I always bring up in such discussions.
- There is much economic activity that comes from increasing inefficiency, think cost disease, this is a feature not a bug in a system straining to maintain full employment at all costs that is increasingly managed in a top-down manner
- queueing theory probably explains most monetary policy, as inflation gas pedal is feathered to make historically large debts look like speed bumps in the rear view they do the same to buying power but the inverse to assets, keeping this process slow enough but not too slow probably has something to do with avg human lifespan
- no empire lasts forever and usually exhaust their hinterland expansion efforts for various reasons ultimately debasing the currency to mfg more growth while the fundamental drivers are long gone, what is the hinterland for our empire and how much more of it can we exploit?
- During the Black Plague something like 1/3 of Europe died off, this gave rise to a new wealthy class of inheritors laying some foundations for the Renaissance, we are on the edge of a historic population decline as birth rates plunge across the world, will we see a similar effect, or does this only work when lives are cut short?
I would argue that the stagnation option is the most likely. After all, the exponential growth in technology and economics is made up of a series of smaller 'S' curves in individual technologies and industries. Each goes through an initial period of slow growth, followed by a rapid expansion, and then a slowing and leveling off of growth. We're already seeing this same pattern on a larger scale with population growth. Certainly a significant drop is possible. I suppose a 'singularity' is conceivable as well. But an S curve, with growth leveling off over time, seems like a good prior. (Of course, it won't be perfectly smooth. Zoomed in, it might end up feeling more like the sawtooth graph.)
The obvious counter argument is that economic growth is not measured in any physically stable form. If it was, then yes, there would be a limit.
But if we measure economic growth in the amount of money that moves across the globe in a defined time interval, there is not necessarily any limit.
The interesting question is whether we are willing to accept that physical goods will stop getting cheaper at some point. We seem to accept this when it comes to real estate so I assume we will also accept it when it comes to cars and computers some day.
"Economic growth" as measured by numbers moving around is just a proxy for what we really care about, which is increased availability of goods and services. Goods and services necessarily entail resource expenditure. If you're just moving numbers without any actual physical effect, you don't really have an "economy" to speak of.
That is obviously true but not an argument for a limit. Availability of goods and services could grow logarithmically while prices could grow exponentially, you'd still see linear nominal economic growth.
I don't understand what you're saying. Logarithmic, exponential, it doesn't matter what shape the curve is or how fast you get there - all "growth" we care about is ultimately backed by expenditure of physical resources, which are clearly limited. If you redefine "the economy" in such a way that it's not limited, you also break its connection to the real world.
Honestly, all this talk about money is distracting from the core issue, which is that we are unsustainably increasing our consumption of limited resources.
Why? What's "silly" about it? I think the article does the best you can at predicting that far out, which is saying which futures are incompatible with each other. I find meaning in thinking about the future and I like seeing it be done well.
It doesn’t make any sense to graph something like gdp or economic output on a scale of thousands of years. The world looks nothing like it did 2000 years ago, and 2000 years from now, by the authors own admission, it will look entirely different.
IMO the graphs the author uses are like graphing something like baking a cake. Y axis is “how much is this thing a cake” and x axis is time. It’s zero pretty much the whole time, then you stick it in the oven and it rapidly becomes a cake. Funny thought experiment I guess, but it provides no value.
Science fiction would never exist with this attitude and we can read early science fiction and see that much of it was in fact quite correct. The speculation gets us to thinking about what is coming and what we can do to make it better.
As interesting as these topics are for an extended dinner table conversation, they actually move the focus away from the hard work necessarily to create "progress".
Yes, we could worry about running out of atoms in the universe sometime in the future, but why not put that effort in developing broad spectrum antivirals instead?
> There are likely fewer than 10^70 atoms in our galaxy, which we would not be able to travel beyond within the 8200-year time frame.
This offers an interesting upper bound on growth, being that our energy consumption couldn’t possibly outpace our ability to travel (at the speed of light) to obtain new sources of energy. (Of course assuming no FTL tech or and no way of generating energy without interacting with matter).
For example, consider we’ve learned to harness 100% of the sun’s output, and we’re looking to double what we can harness. The next nearest star is at least 4ly away, so the doubling time is at least 4 years. To double again, we now need to find two additional stars, each with their own travel limitations. This doesn’t include overhead, like the time it takes to build a dyson sphere or collect the raw materials to do so.
It seems the masses disagree with you, but personally I also find it objectionable. I shouldn't have to click through and increase someone's ad view count just to find out the article is completely irrelevant to me.
I believe the rule is against changing the title to make it more click-baity. (Or for any reason besides necessary shortening.) In this case the title of the original article was used unchanged.
The incentives are opposing; the original author wants clickbaity headlines, since it increases hit counts and therefore ad impressions, and ad income. HN readers would like descriptive (non-clickbaity) headlines so that they can choose not to click on a link.
My point is that "the author used a crappy title" doesn't mean submitters should get a pass on "no linkbait" rule (which as was pointed out, is actually a rule.)
I don't think they were being patronizing, just trying to answer your question as written. Without the context of this reply I wasn't sure of your point either.
I should have looked up the rule though - from that other comment it does indeed appear that changing the title is allowed if the original title is clickbait. In this case though (without a subtitle or obvious other alternative), I assume the OP decided it was best to stick with the original.
What I learnt from the comments here is that this is a highly emotional subject and many people are making strong assertions without the strong evidence to back up their claims - on both sides.
If people from both sides could recommend books to read on this subject, I'd appreciate that more than the offhand comments.
Specifically: it would be great to reach a consensus on a few books that argue the case that the economy relies on finite and nearly exhausted resources, and a few books that argue that technological advances will greatly increase the capacity of economic growth.
What does "the economy" count, precisely, and furthermore why do we believe that it is likely that whatever "the economy" counts is going to continue to be an important thing to count?
I think tech era has redefined the way people value a company? It is not based on the P/e ratio anymore, people keep buying stocks from companies that are not even making money yet. Basically most people are betting their money based on trust that these tech companies are going viral one day.
Either way, i'm not an economist so maybe that's just a high level or me being dumb
If I write you an iou for a million dollars, and you write me an iou for a million dollars, we can both be millionaires, and if everyone does that for everyone else, then we can all be millionaires, but only until too many people try to trade those IOU’s for something real at the same time.
That describes inflation, not a bubble, unless you mean a bubble in $USD.
If I then go to trade my million-dollar IOU for a house that now costs a million dollars because everybody has a million, that's a price increase. More dollars in circulation means higher prices for everything, which is inflation.
A bubble would be if I went to go buy a house and then found that your IOU was good for nothing and you didn't actually have a million dollars to give me. This was the situation in 2009 but doesn't appear to be the situation today.
Well on the surface it might seem like it but there's a huge amount of nuance here. What happens if the act of writing these IOUs creates a situation where economic activity can happen that creates real wealth (or destroys real wealth)? This hints at one of the crucial dynamics when debt interacts with money which is that the value of money is not constant over time in a debt-based monetary system.
Yes, exponential growth cannot continue forever. Fortunately exponential shrinkage of the population is baked into the world' populate pyramid. As for economics, we can still get wealthier on a per-capita basis by generating more and higher quality activity per-person, though at some point one does expect decreasing returns.
I’d put my money on stagnate. But, only compared with the exponential growth baseline. You can still have linear growth, and then gradual growth, for quite a while.
The human population is already leveling off. I’d bet any amount of money that, within 50 to 100 years, economic output will also reach some more or less steady state.
The number of atoms on earth has remained the same, more or less, over the last 5000 years. The size of the economy, as the author charts, has increased many fold.
So why does he then expect the number of atoms on earth and outside to be pertinent to the size of the economy into the future?
The number of atoms on earth in the past isn't relevant because we were not close to exhausting the earth's resources in the past. The author is demonstrating that if this rate of growth were continue in the future, eventually we would run up into physical limitations; the idea that we could sustain a whole present day earth's worth of activity for each individual atom in the galaxy seems more than a little unlikely. Of course, there would certainly be other bottlenecks hit first; looking at atoms in the galaxy is just a clear-cut way to show that there is almost certainly a limit to growth somewhere, and that even in that extreme case we would hit it in a short time frame, relatively speaking.
I expected more intelligent discussion of this from HN. I’m quite disappointed. Every comment dismisses what he is saying and I guess that is what we should expect from a culture that doesn’t realize how bizarrely different and unsustainable their era is.
Seems like the population graph would similarly take a big uptick from historical norms and it's fairly well studied that it is reaching a steady state now.
So, do we need the same GDP growth with the same or less amount of people to be/feel richer?
fundamentally all human growth and expansion is in order to satiate desires for dopamine and other feel good chemicals.
It's a relative cycle including what one has recently experienced, combined with observations of relative status (eg, what is your neighbor going through). This is a process whereby the only way to maintain good feelings is to incrementally consume more units of good per unit of dilution (eg time, or density). For example getting more reward experiences in succession -- this is the example of social media + video games. Another example is high fructose corn syrup sweeter per gram...
Until we can get off that treadmill we're going to be more and more consumptive (than both our previous selves, and our peers)
We're most probably heading towards collapse real soon now (for some undetermined value of "soon" between a few months and a few decades). Of course, this is to be received with strong rejection in the HN techno-optimist bubble :)
What's your model of this? What data do you base this on? What the quantitative value of "most probably"? What's a collapse?
I mean, I'm not optimist, but I'm aware that my doom and gloom about how stupid and irrational we are is just a gut feeling.
Yes, we're squarely out of the easily comprehensible by naive human wetware regime. But then we should recognize that instead of doubling down and giving in to the fear coming of an even primal faculty.
The "this can't go on" chart has a very simple solution. This can go on because very easily, because we're still burning fossil fuels, and every time we switch to a healthier alternative that chart goes up. And we are furiously trying to switch, not necessarily everybody, but ask anyone who lives in cities who doesn't want less smog, who doesn't want less noise pollution, etc. And that graph is also going up because people are moving to cities en masse. (See the real estate prices all around the most desirable living places, but urbanization is happening everywhere else too.) People who live in cities simply by participating in a more productive economy make that chart go up again.
Sure going on like this forever is impossible. But a collapse is not the only alternative.
Did you check my links? "Collapse" may have several definitions; generally for a complex society or ecosystem it's a rapid simplification, reduction of exchanges and population.
Here is our situation: as you may have heard, every year around August we reach the "Overshoot day". That means that we use more resources (even renewable ones) than the Earth can produce (its carrying capacity), i.e. we're actually "mining" renewables resources such as oceans, soil, forests, etc. That means that the quantity of renewable resources globally available tends to go down while our resource usage still goes up.
At some point, our resource usage WILL fall down UNDER the line of globally available renewable resources. The longer we wait, the LOWER we will need to back down.
Also I don't really get where you're going with your fossil fuels example. We switched from renewables to fossil fuels back in the 18 and 19th centuries because they're so much denser, easier to use and powerful than renewables. They enabled the "great acceleration" by providing almost limitless energy, and doing without them is a tremendous, unprecedented effort.
Human history is about getting better energy sources: our ancestors got bigger brains by eating meat (more energy). Then they invented fire (more energy) to make their food more digestible (more energy). Later on they invented agriculture (more energy), then burned forests for more energy, and switched to peat and coal by lack of wood (more energy), then oil and gas and nuclear (still more energy). Notice that we never "switched" from an energy source to another: we piled them up. Coal usage nowadays is higher than it ever was during the 19th and 20th centuries. See
https://jancovici.com/wp-content/uploads/2016/04/energie_gra...
For the very first time in 300 000 years, we'll have to go from a dense, easy to transport and store energy sources to more diffuse, harder to transport and store ones. We'll have to go from an incredible abundance to relative (or maybe not so relative) scarcity. It's literally an unprecedented challenge, particularly at the global scale we're talking about.
I'm also aware of overshoot day. It's not completely terrible as a metric, but it's based on shoddy data, and in the end simply shows that we are not raw material efficient enough: https://en.wikipedia.org/wiki/Earth_Overshoot_Day#Criticism
Carrying capacity only makes sense for a given technology.
> At some point, our resource usage WILL fall down UNDER the line of globally available renewable resources. The longer we wait, the LOWER we will need to back down.
That will likely take thousands of years. Just solar and batteries can go a very very very long way. Especially if we consider that it seems the human population is going to peak after every region goes through the usual development phases (education, health, more choices for women, more economic freedom).
> They enabled the "great acceleration" by providing almost limitless energy, and doing without them is a tremendous, unprecedented effort.
Yep, and now we're likely switching back. It'll not be easy, but a collapse (big reduction in population) is very unlikely.
> Notice that we never "switched" from an energy source to another: we piled them up
Yes and no. For example we stopped burning wood for energy. We stopped burning wood for potash. Coal plants reached the point that it's uneconomical to run them in developed economies.
> It's literally an unprecedented challenge, particularly at the global scale we're talking about.
Yes, agreed. But there's nothing fundamentally preventing it. Humans are pretty much known for these sudden huge Earth-wide changes. Roads, cars, planes. Churning out war stuff.
Of course the possibility that we stubbornly refuse to allocate the required resources, dig in, and make the situation a lot worse is there. But since there's at least some minimal "rationality forcing" in climate change (meaning, that the stubborn denialist ones tend to face worse problems) it's likely that eventually people will be incentivized to allocate those resources.
I think the thing that this article misses is that per capita growth (the thing that's important for people's experienced life satisfaction) can essentially grow a lot further with fewer atoms under cultivation if you increase density. Humanity probably doesnt have much more area under cultivation than 300 years ago, but it has several orders of magnitude more people. The way i see the future going is less people, but each one is a billionaire. Kind of like how when stars run out of fuel they don't just wither away, but turn into very hot, dense and fast spinning white dwarfs.
This was accomplished with profligate use of fossil fuel based fertilizer, it’s a trick you can only do once. And nobody produces enough value on their own to become a billionaire, you have to be in a position in an organization where you can skim off the labor of a lot of people.
I'm thinking if population growth continues to shrink and go negative and automation continues to increase, production will stay constant or even increase, even while population decreases. Which would mean that each individual would get more riches with less work.
How do you mean? I'm sure even with flat yields people in that camp will be far better off than the average person since one of the prerequisites is getting assets equal to 20-30x your annual expense
I'm not the grandparent poster, but I share the same thought.
The ~4% SWR for FIRE assumes that we'll see sustained growth in equities markets, because that's what we've seen before. But the data really only goes back to the early 20th century (the data from the "Trinity Study" looked at the period from 1925 to 1995).
I agree with you that people in the FIRE camp will still be far better off than the average person. But to me the terrifying scenario is retiring at 30 and then running out of money at 60 because the 4% rule didn't work out.
I suppose if someone performed exactly as in the study(fixed withdrawal rate, adjusted for inflation, no variations), but surely if yields flattened you'd be able to recognize it sooner than when your nest egg is nearly depleted. That might mean returning to work in your 40s or 50s part time or full time to fill the gap, but again you're no worse off than the average worker who was working all those years anyways.
It definitely is justification for those people to make sure they build in a buffer though since its unlikely they'll be able to immediately return to their peak salary before retirement.
If you're in tech, things are changing so rapidly I don't think it's realistic to walk away for 15 years and then be able to come back and get hired as a practicing, competent engineer, unless you've been keeping up on personal projects in the meantime.
If someone walked away 15 years ago, what would they have missed if they decided to come back today?
I honestly can't think of anything fundamental. Mobile and single page web applications, for example, became popular in that time, but those only brought back the same patterns we were already accustomed to on the desktop, not some brand new paradigm that someone from 15 years ago could have never imagined and cannot contemplate now.
Perhaps you might have to spend a week or two catching up on the specific keywords used by the popular framework du jour, but that's not a hurdle in any meaningful sense.
Granted, someone from 15 years ago coming back to an "Agile" shop will run right back where they came from, as fast as they can, wondering what on earth we are thinking the whole way.
Worst case it's a year of a crash course to learn almost anything in enough depth to be proficient, even if not quite an expert. With the base in programming or electronics, it would take even shorter time with a well designed course.
What would justify a year long crash course, assuming you have a functioning memory? I still cannot think of anything that has actually changed, in a fundamental way, over the last 15 years.
To me hyperinflation is the real nightmare scenario for FIRE. In a hyperinflationary environment your retirement stash can go from infinite to > 1 year in less than a year.
Presumably a FIRE person would be sitting on assets that act as significant hedges against inflation. It wouldn’t be fun but they’d be in a better position than most.
I would argue that the real nightmare scenario is that the rules of the game or government policy are radically changed by fiat. For example, effectively nationalizing private retirement accounts in some fashion to backstop public pension systems like Social Security (which has been floated in the US at various times). A lot of FIRE plans are predicated on retirement accounts existing in something like their current legal form over the next several decades. I am skeptical.
You can't hedge against inflation if it is caused by a collapse in production of the thing you want to buy. E.g. farm workers start a civil war against land owners (think Zimbabwe) and now there isn't enough food for everyone.
You will do better than people who own nothing but your wealth won't last forever.
Yeah, that's the issue. Hyperinflation usually involves large increases in the prices of basic necessities (food, utilities, gas, physical security, and shelter if you don't own your home) and collapses in the price of financial assets. Except for the most hardcore leanFIRE types who are into subsistence living off the land, that's usually levered the opposite way from most retirees.
Being able to count on your own labor and having skills in industries related to fundamental survival are key in hyperinflationary economies. You can't count on the financial system remaining intact in any usable form. Most FIRE plans are about leaving the labor force to live off of returns of capital, though.
Hyperinflation is a nightmare scenario for everyone.
FIRE presupposes having non-liquid asset base, such as actually owning the place you live in, means of transport and potentially the tools you use, first.
does anyone really think that humanity will be here in 200 years? 500 years? I think that's a real stretch. There are 100 ways we will go extinct, and we don't care about any of them.
We might lose billions on the way but I don't really see why humanity wouldn't survive with 10 million people alive in 500 years assuming extinction level natural disasters.
For me the question isn't if there will be warm bodies around, but if they will have agency, dignity, a longing for justice and a capability for empathy, plus a lot of other things at least I associate with humans being human, rather than appendages of machinery that accumulates power without any use for it other than accumulating more power.
A little sidetrack question: why are news headlines 90% in the wrong case?
Because of the language "Go" and this platform I have to rephrase some headlines with "go" in it a couple of times until it's kinda clear what the content might be.
I have a feeling that people are just going to think my comments here are hyperbole or give me a lecture on how I don't understand economics, but I will say it anyway.
And please read to the end because I believe my opinion is different from the normal sides taken.
Money supply and debt are increasing in ways that are unsustainable in the current system. At the same time, there are reasons that this is being done, and it boils down to the fact that a fixed supply just doesn't work either.
However, I believe that our money is too simple and our global political systems too disorganized continue this way. Essentially, at some point some countries have too many problems and cannot morally tolerate letting other countries produce money and throw debt into a hole while forcing them to live up to their obligations.
If another system that is fair and based on sound cryptocurrency is not put into place, the result within the next few years may be a global war. The first part of this is using blockchains to prevent people from constantly cheating as is the current case. Also, I believe that a fixed supply is absolutely not appropriate, but so is an infinitely expanding supply. But beyond that, I think money needs to become a high technology. So rather than having a few valves that can be turned on or off by lucky people near them, there should be a lot more data involved and more levers. Such as connecting money in some way to real resources. Or regulating use for different purposes in different ways.
You can reduce emissions and grow the economy, stabilize your population and grow the economy, move from physical goods to digital and grow the economy, reduce number of hours worked and grow the economy. Heck a few thousand years in the future we could all wire up our brains directly into hyperspace and still grow at 1% per year.