Growth and Demographics
I’ve wondered why our gurus all tout growth. We are told that:
• we can borrow to defer paying for things now because growth will allow us to pay the interest plus the principal and maybe have something left in the future.
• we must grow or we are failing, and that
• without growth there is no prosperity.
Because of our “gurus” we assume:
• that savings will always grow.
• that there will be enough increases to pay for today’s debts.
• what was before (during a long population growth era) will always be even though things aren’t necessarily growing.
• we can keep growing
Is that necessarily so?
My son (www.keepcalm.ca) recognized that our fascination with growth was often based on the run up of population cause by the post war baby boom. He was one of those small classes in school that followed a run of large classes. He noticed the difference, took a look at those following him and recognized that growth wasn’t necessarily going to continue. He reasoned that demographics should be more of the discussion than it appeared to be. He advocates a minimalist approach and it looks like he was correct.
Without growth in population, why should our economic models be based solely on growth? Maybe we should develop an economic model that doesn’t rely on growth (and maybe the “boomers” should be required to pay much more of their own way).
Is constant growth really possible? A couple of events seemed to that it is not.
1. Fiction, but thought provoking: There was a Star Trek episode (I think the Next Generation) where the place being visited had recognized that slavishly advocating growth was pushing them towards disaster. Their solution was to keep up on things for well being (medicine etc.) but return to a more pastoral and static economy. They didn’t emphasize growth. Might have been a utopian slant but it was definitely something to think about.
2. Experimentation reported on a CBC radio show (Quirks and Quarks I believe). An experiment where a single cell organism was placed in a closed test tube of food. The organism(s) ate and divided once a minute. The amount of food was designed to be fully consumed in one hour. There were some questions – If 11:00 is the start of the experiment,
a. how much food would be left in 11:55 minutes? Something like 97%
b. how much food would be left at 11:59. 50%
But this is 50% growth. Wouldn’t slow growth be OK? What if things grow at 1% per year? That should be OK?
The unfortunate problem with growth is it isn’t straight line. It’s growth on growth. If the world’s population grows at only 1% per year:
• there will be 50% more of us (10.5 billion) in 2050 and
• more twice as much of us (15 billion) in 2085.
Finally, we seem to look at Canada as a vast empty land. True, but how much of what is empty is capable of supporting people? To support people, they have to be fed. Unfortunately we are filling up our farmland with housing and the non arable areas are left sparsely populated. Some of us rue the loss of species but we continue to invade and thus adversely alter their habitat. Natural calamities are much more disastrous because more of us are in their path.
Maybe our low birth rate and lack of population growth is really the right way to go.
Maybe it is time to make a concerted effort to develop an economy that doesn’t rely on “growth”
The Plaidneck