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In our last post TITM defined the economic mindset and pointed out what we think are some defects. This post is a first attempt to outline possible changes that might correct those defects. It is obvious a short blog post cannot solve our most pressing concerns. The ideas below are just that, ideas. The hope is to encourage further discussion. This summary of policy considerations comes from a number of serious thinkers. We encourage further exploration.
Many years ago when I studied economics it was fashionable to ridicule the pessimistic forecasts of Thomas Malthus (i.e. that population growth would exceed growth in the food supply). The conventional wisdom was that an efficient price system, technology, and declining population growth with rising living standards would save us. In 1972 the Club of Rome published the Limits to Growth. The authors were dubbed neo-Malthusians and quickly dismissed. It is still not clear how things will turn out in the long run. Today many of those Mathusian worries have resurfaced. Can we go on, where should we be going, and how can we get there? To reach a consensus in today’s fractured and polarized world may be impossible.
The world generates at least 3.5 million tons of solid waste a day, 10 times the amount a century ago, according to World Bank researchers. If nothing is done, that figure will grow to 11 million tons by the end of the century, the researchers estimate. On average, Americans throw away their own body weight in trash every month. (Drowning in garbage)
By 2050, there will be so much plastic floating in the ocean it will outweigh the fish according to a study issued by the World Economic Forum. Scientists estimate that there are at least 5.25 trillion plastic particles — weighing nearly 270,000 tons — floating in the oceans right now. (Drowning in garbage)
Planned obsolescence and the constant rebranding of “new and better” models leads to the abandonment of increasing amounts of electronic gadgets (phones, tablets, computers, printers) and other consumer durables (refrigerators, freezers, microwave ovens, etc). Our throwaway society poses dangers both now and in the future.
According to a United Nations Environment Program report titled “Waste Crimes,” up to 50 million tons of electronic waste—mainly computers and smartphones—are expected to be dumped in 2017. That’s up 20 percent from 2015, when about 41 million tons of electronic waste was discarded, mostly into third world countries serving as global landfills. (The Global Cost of Electronic Waste)
Apart from the immediate health risks, the long-term impact of the increasing waste generated by economic growth includes resource depletion and global warming. Some pessimistic experts say it’s already too late to stop global warming.
Aside from pollution, global warming, and resource depletion, there are a number of personal and individual problems cropping up in our hyper-connected high-tech society. Growing inequality resulting in large part from the technological revolution is dividing society and encouraging populism around the world. The associated mental issues of increasing time spent online is leading to loneliness and depression especially among the young.
Those who think that wise and efficient governing might help are confronted today by a powerful movement to make government irrelevant as Michael Lewis points out in his timely book The Fifth Risk.
The list goes on, yet, not everyone who studies these depressing issues is ready to throw in the towel. Jeffrey Sachs admits that it will be difficult. We are not currently on the right path, but he is hopeful that we can get there if we are determined to do so.
In the coming decades we will have to convert to solar power and safe nuclear power, both of which offer essentially unbounded energy supplies (compared with current energy use) if harnessed properly and with improved technologies and social controls. Know-how will have to be applied to long-mileage automobiles, water-efficient farming, and green buildings that cut down sharply on energy use. We will need to re-think modern diets and urban design to achieve healthier lifestyles that also cut down on energy-intensive consumption patterns. And we will have to help Africa and other regions to speed the demographic transition to replacement fertility levels, in order to stabilize the global population at around 8 billion.
What are some specific policies and ideas that might help move us in the right direction? Think in the Morning proposes the list below (in no particular order) based on ideas from people much smarter than we are. At the links you can find more details.
Biologist and naturalist E. O. Wilson in his book Half Earth proposes “to avert catastrophe by setting aside half the planet as wild land for non-human nature.” Impossible you say? Read his book or at least the review. Wilson has worked his entire life on these concerns. You may find the impossible is possible if we can muster the will. Wilson points out that we are already making progress albeit slow and fragile.
Economist Robert H. Frank has spent his career studying and writing about how a “consumption tax” could be used to replace the “income tax” in a way that could reduce inequality and improve consumption habits. There are arguments PRO and CON but the idea is serious and has proponents on both sides of the political spectrum.
A Nudge in the Right Direction
Behavioral economists such as Richard Thaler, psychologists like Daniel Kahneman and legal scholars like Cass Sunstein argue that finding better ways to present choices to consumers (libertarian paternalism) can alter their choices in ways that could counter some of the defects that underlie the economic mindset. Read the book Nudge by Thaler and Sunstein for some specific examples. The big question, of course, is who makes the decisions regarding how to nudge consumers? These are political choices and must ultimately be determined by elected politicians. But, those politicians should be informed that such policies are viable. As we pointed out in the last post, there is no such thing as consumer sovereignty. Consumers are buffeted this way and that by advertisers and sometimes manipulated by unscrupulous corporations. Consider how today’s opioid crisis has in some part been driven by bribes from pharmaceutical companies to doctors and pharmacies. Why not nudge consumers in a more wholesome direction?
The Big Three
There are three other ideas we will briefly mention: universal basic income, Medicare for all, and free college tuition. A universal basic income has at times had support on both the left and the right as a way to reduce inequality and increase security as artificial intelligence, rising productivity, and globalization disrupt jobs and lives. Some type of guaranteed healthcare has wide support. Obamacare has in many ways been successful. Something like Medicare for all continues to be a popular topic of discussion. In today’s world a college or vocational education beyond high school is essential to prepare our youth for an increasingly complicated job market. The cost is driving many into debt and this needs to be addressed head on. These three ideas have been sharply debated. They are unlikely to go away. As a society we need to continue the debate and ultimately take action.
The short list we present is incomplete and tentative. It is a one place to start in the search for solutions. The American economy, when it has worked best, has been at neither the extreme of socialism or capitalism—it has been a mixed economy. Democracy and freedom, free markets with controls on the imperfections markets inevitably bring, have a history of providing widespread success. This is not the time to throw the baby out with the bathwater. Nor is it a time to throw our hands up in despair. We have serious problems brewing that cannot be ignored. Let’s put our heads together and work toward realistic and reasonable solutions. Two steps forward and one step back, its an awkward approach but that’s democracy.