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George Porter

Current neo-liberal economic policy is dependent on the fallacy that technology can meet future resource shortages. This misconception fails to recognise the fact that renewable resources are limited by the amount of solar energy that can be appropriated to create the volume of biomass necessary for the maintenance of all forms of life.

The evidence is overwhelming that human demands are approaching absolute limits of growth, and that in particular cases, limits have already been reached. Atmospheric pollution and marine resources are examples. Shortages are looming in food and water supply. Our primary forests are being ravaged and nutrients essential to biomass (food) production are being lost.

Human society is therefore living off natural capital that cannot be replenished. Resources such as soils, forests, aquifers, are being used at a rate faster than can be replenished. Whole life-supporting ecosystems are being destroyed or irrevocably damaged. Non-renewable resources cannot be replaced within human time horizons.

The free-market, the darling of the conventional economist and his followers, encourages increased consumption to keep profits growing. This is a recipe for disaster.

It has become absolutely essential to reverse these dominant attitudes. Consumption must be dramatically curtailed by reversing the trend for more and more goods; more and more growth. Many of the products today are unnecessary and quickly discarded. The affluent could still live comfortably with a fraction of the goods they buy, and could cut their energy consumption dramatically.

The stabilisation of population numbers is now accepted as necessary, but substantial reductions in consumption and increased conservation measures are ever more important. Some countries such as Sweden and the Netherlands, and the state of Kerala, India, have made significant progress in conserving resources. Few other countries are making serious efforts. Kerala is the only state living within its national capital limits.

The consumption culture is spreading, driven by unlimited advertising and promotion little short of mind control, and in the process creating a single global culture based on consumption and greed.

Growth must be replaced by economic stability and efficiency.

Adam Smith got it right in "Theory of Moral Sentiments":

The Market system is so dangerous that it presupposes the moral force of shared community values as its necessary restraining context.....It is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner but from their regard for their own interest.

Today current neo-liberal economics is under severe criticism. Increasingly, according to Hoogendijk "economic theory and practice are at odds with reality and the needs of future generations. Continual growth appears necessary for our economies to stay alive. At the same time, though, it is a noose tightening around our necks - there is not just an addiction for growth but even a compulsion to growth."

"Once, the public interest was the guiding principle. Today, collectivisation and common good are devalued." Hoogendijk continues.

"The true task - the development of sustainablity - involves stopping the dominant form of economic growth in the industrialised countries and achieving a severe cut in today's production volumes and a basic change in the nature of production.

"The choice for the rich and newly industrialised countries, now, is to shrink or not to be.

"High executive wages and investment and company profits produce surplus income providing money for investment - in new production, in new or existing business for example. These investments call for new or modernised machines and processes, or faster ones.

"Confronted with new competition, others are compelled to accelerate, modernise etc., or they will be pushed out of the market. In turn, this move must be answered by new and more competitive markets, and so on.

"Thus an accelerating and expanding spiral of competition which has less to do with needs and usefulness than with money seeking to grow. An enterprise has to grow under penalty of disappearing. The effect of competition changes from correction to destruction.

"Capital accumulation and growing capitalisation of production, with production becoming even more capital intensive, leads to oligarchies and monopolies. Stocks of capital compete with one another by searching for the highest/quickest revenue through production, thus forcing up production, and so distribution and consumption.

"In this spiral of capital competition, the driving up of production has turned competition into counter-competition. The advantages of competition no longer outweigh the destruction of capital goods i.e. the machines that become obsolete. Also wastage of common goods - wastage of duplicated research and development work being done in the same kinds of products, model or process.

"Lower selling prices oblige the producer to sell more to achieve the same turnover in money
terms - another cause of production growth.

"Competition has brought forth very efficient systems at the level of industrial enterprise, but this efficiency relies critically on sacrifices at macro level, affecting nature, resources, social structures and the future."

Hoogendijk advocates UN sanctions against countries that continue to cause serious environmental damage. Daly and Cobb propose balanced trade import quotas and capital immobility.

Remember Keyte's remark: "Let good be homespun".

The consequences of free financial movements - a complement to free trade as being promoted by the WTO secretariat, has been the running up of unpayable debt. Large surplus accumulations of money from trade imbalances seek ways to grow exponentially and to recycle back to the debtor country to finance further deficits.

"Like international trade", writes Hoogendijk, "borrowing and lending has to be greatly curtailed and be only for production or beneficial projects; should be between nations as communities, not between sub-national entities, seeking only their private interests".

Hoogendijk recognises that state bureaucracy can generate corruption and criminality, but that the criminality developed under up-scaled global capitalism is massive too - becoming a serious threat to normal functioning of economies and democracies.

Huge amounts are circulating in the criminal circuits: US$200 billion in the international drug trade alone in 1989. In the Netherlands, for example, it is estimated that crime pulls in $20 billion per annum.

Problem: how do we get into politics the sort of caring people lacking in personal ambition who want to create a new society concerned for people and community and who recognise the need for "the Ecological Revolution"?

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