The news is trickling out the economic growth will have slowed to 1% by election day. “Blamers” will like to pin it on the president, though anyone with economic sense knows that there is a much larger context. Capitalism itself needs to be called into question as an economic model.
If you want to study the economic situation, read the work of economists like John Makin at the American Enterprise Institute. He provides a glimmer of optimism that compromises will be worked out between Europe and the U.S. to improve the situation, however, he also wonders analytically if monetary policy has run its course.
“With nearly two-thirds of the global economy either shrinking or slowing, the 2008 economic and financial crisis is back with a vengeance and threatens to bring on a recession that engulfs the world’s major economies.”
-John H. Makin
In searching for alternatives to capitalism and doing some inventing too, I discovered Professor John E. Ikerd who provides brilliant critique. Professor Emeritus of Agricultural & Applied Economics, University of Missouri Columbia College of Agriculture, Food and Natural Resources, Ikerd is a farmer-professor from Missouri and that is someone who you can trust.
John Ikerd critique of capitalism
Can capitalism produce a sustainable economy?
Another way to ask the question: is capitalism sustainable? If one asks the question this way, it presumes that “capitalism” is an end state. People don’t care about capitalism unless it produces a sustainable economy. Therefore, the question is “Can capitalism produce a sustainable economy?”
“A sustainable economy must be based on a fundamentally different paradigm, specifically, on the paradigm of living systems. Living things by nature are self-making, self-renewing, reproductive, and regenerative. Living plants have the natural capacity to capture, organize, and store solar energy, both to support other living organisms and to offset the energy that is inevitably lost to entropy. Living things also have a natural propensity to reproduce their species. Humans, for example, devote large amounts of time and energy to raising families, with very little economic incentive to do so. Obviously, an individual life is not sustainable because every living thing eventually dies. But, communities and societies of living individuals clearly have the capacity and natural propensity to be productive, while devoting a significant part of their life’s energy to conceiving and nurturing the next generation.”
“In order to foster a new economics of sustainability, social and ethical values must be reintegrated into capitalist economics, thus restoring a sense of balance into the economic system that ensures that communities the world over will thrive. Rather than calling for the overthrow of capitalism, Ikerd suggests how capitalism can become a vehicle for these ends.”
To begin Ikerd says that “sustainability ultimately depends upon energy because anything that is useful in sustaining life on earth ultimately relies on energy.” That confirms the idea ultimately proffered here linking sustainable economic model with energy strategy.”
Everything that humanity needs to live on the planet requires work to produce it and work requires energy.
Ikerd explains the cycle from the first law of thermodynamics to the second law and into the state of entropy. The point is that in the long run, the planet will run empty. In the meantime, we can be frugal about how we use our scarce resources. If we are reckless, humankind will accelerate its demise.
Capitalism that is based on ever expanding markets and populations is unsustainable. News today is that the economy is moving very slowly.
“Economy In U.S. Probably Expanded At “Slowest Pace In Year
By Shobhana Chandra – Jul 27, 2012 12:00 AM ET
The U.S. economy probably expanded in the second quarter at the slowest pace in a year as a softening labor market caused Americans to cut back on spending, economists said before a report today.
Gross domestic product, the value of all goods and services produced, rose at a 1.4 percent annual rate after a 1.9 percent gain in the prior quarter, according to the median forecast of 81 economists surveyed by Bloomberg News. Consumer purchases, which account for about 70 percent of the world’s largest economy, may have grown at the weakest pace in a year.”