October 2, 2008

Bring on the Loonies!

Filed under: Economic Growth — ken finn @ 12:53 pm

Out to Lunch Thinking

For many years having been of the school of loonies…of the Lunatic Left, the Loony Enviro Faction or just the plain Misguided and Unrealistic the last few weeks have been quietly satisfying.

Not because I take any pleasure in observing the turmoil striking the financial community but because perhaps right now ‘the system’ that is based on continued growth looks … well, unrealistic.

I even have some sympathy for the traders who are at this time the focus for so much anger. The market just does what it does and the germ of this particular crash was in the crash of the twin towers. It was then that with the global economy on the brink following 9-11 that the US government pumped in heaps of cash and said to a shocked America ‘go shopping!’

With the wholesale cost of money cheap and bundles of it sloshing around the markets just looked for innovative ways to sell it. While the gravy train rolled along Bush, Blair, Brown and the rest were happy to look like masters of the Universe.  Now that the inevitable bubble has burst their solution is offer the same remedy; to pump more borrowed money into the system. To perpetuate the notion that business as usual is sustainable or even possible.

Now for some time many of us have maintained that continued growth in the global economy is just not possible. The environmental constraints that having only one planet places upon the system makes a bigger crunch inevitable. Economies like the US, Britain and the developed world consume the potential of 3 planets to sustain their lifestyles so we’re already in deep debt to the world’s poor and the ecosystem as whole. As the competition for the earth’s resources like oil, timber, fish and even water and soil becomes focused on diminishing returns then the holes in the free market system will become un-pluggable with more monetary debt. There is no buy back on extinction.

In the coming weeks much will be talked about the economy and much less about the environment. In fact there is something of a trend to say that in these times of troubled finances we can less afford to make the environment a priority. We ignore the signs of an imminent collapse in the ability of the earth to support our way of life with peril. And the signs are writ large.

It’s time to ask, just who is running the asylum!