Economic insanity

Theoretically, we should be able to provide for everyone's needs and reasonable wants with in a static economy. The only reason why endless growth is necessary in the capitalist system is simply that it is the mechanism by which the system works. Without growth, capitalism deteriorates. But growth imperative causes serious side effects, one of which is the tendency to confuse both money and debt with wealth.

• If we don't consume or use up real wealth, it perishes on its own. We can't store enough of it to satisfy our lifelong needs. The only way we can make today's wealth fulfill tomorrow's needs is to lend it to others, put them in our debt, and persuade them to pay us back over time, with interest. While debt tends to expand regularly and indefinitely, the wealth it symbolizes cannot.  
• The ruling passion of individuals in a modern economy is to convert wealth into debt in order to derive permanent future income from it. That is the heart of the capitalism. But the idea that all people can live off the interest of their mutual indebtedness is a vulgar delusion on a grand scale.
• In reality, only the minority earns significant interest and the majority pays it. But the difference between what the majority owes and what it is able to pay steadily widens. Debt grows exponentially, but new real wealth which common laborers must repeatedly create new real wealth to pay the interest on their borrowings does not. We can never produce enough actual growth in wealth to keep up the exponential growth of our debts. We just roll them over and end up borrowing to pay up interest on them which is nothing more than a giant, legalized Ponzi scheme.
• The solution to debt crisis is a further dose of growth. The way to grow is to invest, and the way to invest is to borrow. The solution to debt is to increase the debt! How it is believed that new debt will be used productively than the older debt is never explained.
• The resultant explosion of debt will lead to defensive actions by borrowers include inflation, bankruptcy, confiscatory taxation, fraud, or outright theft. These are socially and economically destructive actions and yet they are also the inevitable fruit of compound interest which we deem normal and acceptable.
• Growth in the money supply is the “leading edge” fueling productivity and economic expansion through debt. The logical solution to this dilemma is simple. Since exponential growth of real wealth is impossible, we must tie the money supply more closely to wealth to keep it from expanding needlessly. 
• Exponential growth of money and debt creates unrealistic expectations for similar growth in real wealth which in turn puts immense pressure on short term profits and return on investment. Thus to attract capital, businesses must offer competitive return which often means they search the world over lowest-cost production opportunity. Thus manufacturing gets relocated to countries with lowest labour wages and returns greater.
• Free trade between nations brings only unrestricted capital. But labour stays put which results not in mutual benefit to both the nations but significantly lower wages to the nation that loses capital.
• Balance of trade and capital mobility is the way country borrows in real terms is to import more than it exports. In the last few decades, US has run up staggering trade debt means that immense amount of capital has moved out to other countries. No economist would maintain that this large trade imbalance can continue to expand forever. At some point capital will have to start flowing in opposite direction to bring the account back into balance. For this to happen wages and benefits of US workers have to fall to globally competitive levels. The living standards of US workers will drop significantly. Americans must somehow change course to a limited growth economy—and even accept a no-growth paradigm—or the whole system will explode.
• An economical economy is inherently conservative (not wasteful) in both its production and consumption. In the restorative economy products will require more labour, use less energy and produce less waste. Productivity will go down but employment and profits will go up. This runs contrary to conventional economic logic. Taxation and fees must discourage frivolous, dangerous and dirty products and encourage useful, safe and clean products.
• Such a system will remove incentives for unlimited growth, discourage or deterr formation of enormous, impersonal and capital driven corporations and encourage small, employee-owned, service oriented and environment-sensitive businesses.

There is a sufficiency in the world for man's need 

but not for man's greed ... Mahatma Gandhi

We have far more oil, coal and gas than we can safely burn without global warming. Coal is the dirtiest of fossil fuels produces least amount of energy and the greatest amount of pollution and threatens clean water to drink, clean air to breathe, and a safe climate. In the name of globalization human consumption & wastage has crossed ecologically sustainable limits and piles of waste has proven disastrous to environment. Pollution haunts every city in the world. Enormous burning of oil & gas adds to the woes. While over population is the fundamental cause, other aspects of over consumption and wastage and elimination of unnecessary and dangerous items is in our hands.

The insanity of endless growth

Almost all governments, business, media and both the political ‘left’ and ‘right’ are busy extolling endless growth on a planet which is finite. Clearly endless economic growth is impossible, and its pursuit unsustainable and unethical and such destructive pursuit of the impossible is insane. Humanity is totally dependent on the biosphere and it is degrading. Hence society needs to realize that we are way past sustainable ecological limits. 

• The most drastic effects of the rise of economic growth are the impoverishing of democracy, the loss of liberty, and the abandonment of equality. We must subject the economy to the ideals of democracy, liberty, equality, and unity. The drivers of free-market system are causing interrelated problems and if we are to turn our nation from this path of folly, we must first abandon the faulty assumptions that drive our thinking. The four pillars of capitalism - endless economic growth, ever-increasing productivity, accelerating technological advances, and self-interest must be abandoned. Economic insanity challenges people to stop looking for answers within the system and look instead to changing the system.
• The reality is that endless economic growth on a finite planet is unsustainable, especially if society has exceeded ecological limits. There are ‘limits of growth’; and the ‘endless growth mantra’ within society is unsustainable. The three main drivers of ‘unsustainability’ are overpopulation, over consumption and the growth economy. 
• The ‘decoupling’ strategy by switching over to renewable sources of energy etc has its merits and limits, and at best a partial solution to the problem. The key social problem is denial of our predicament along with the contribution of anthropocentric modernism as a worldview that aids and abets that denial. At best attempts at decoupling slow down the rate at which things get worse. Talk of 100% decoupling is likely to be merely a wishful thinking.
• Human population growth and the concomitant increase in the consumption of resources would exceed planetary limits around the middle of the 21st century, causing societal collapse. The Global Ecological Footprint now stands at 1.6 Earths. The Living Planet Index has declined by 58% between 1970 and 2012.  The species extinction rate is at least 1000 times normal. At least 60% of ecosystem services are degrading or being used unsustainably. We are bankrupting nature and consuming the past, present and future of our biosphere.
• Economic growth is seen as the panacea for almost all societal ills. Commitment to growth is being promoted in the guise of free trade, competitiveness, productivity – or even as sustainable development which is an oxymoron. Sustainable development requires a GDP growth rate of 5%, doubling output every 14 years. Economic growth can't be the cure for poverty, unemployment, debt repayment, inflation, population explosion, and so on.
• The idea of benefits of growth would trickle down and alleviate global poverty has failed. The verb ‘to grow’ has become twisted; its original meaning is to spring up and develop to maturity, a steady state. To grow beyond a certain point is disastrous. It is possible to develop scenario where full employment prevails, poverty eliminated, people have more leisure, and greenhouse gases drastically reduced, with low or no economic growth. It is a mistake to assume that economic growth is a necessity for full employment.
• Once we have exceeded ecological limits, growth will make us worse off with uneconomic growth. Products scarcity leads to advocacy of even more growth. This becomes a death spiral. Healing our world requires accepting the reality that the economy cannot grow forever. 
• A dismissal of ecological limits and the rapidly worsening environmental crisis indicates many are still in denial of the insanity and unsustainability of endless economic growth. Many things change and solutions become easier if we change our worldview and ethics. Society needs to return to ecocentrism and adopt an Earth ethic and undertake the work of repairing the Earth and changing to a worldview of ecocentrism to step on the path to a sustainable future.

We have been locked into an insane growth fantasy for two centuries, but the past does not mandate the future. It is time now to grow up. We need to acknowledge the scale of the problem, abandon denial, and move towards a major shift in worldview. This is a big task, but also an exciting, positive challenge – one nobody should deny.

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Four Earths would be needed if everyone lived like Americans.

All progress is precarious, and the solution of one problem 
brings us face to face with another problem ... Martin Luther King, Jr.

Growth mantra has simply made rich much richer while poor remained poor. The disparity between rich and poor has widened like never before. This trend can't go on forever. In order to retain our humanity in the face of ecological limits, we would have to confront inequality head on. If wealth were divided equally among the all the people in the world, the per capita material affluence would drop significantly. Global society has already entered the phase where the capacity to grow, to generate real new wealth, is declining. When growth stops, tensions mount. Only the tyrannical state, with its monopoly on violence, its enormous bureaucracies, its tentacles reaching into every facet of life, will have the power to save us from the stupidity called the freedom to grow forever.