The Economy can't keep on growing forever

I was reading another thread about the Nazi economy in Germany, and basically someone high up in the Party (it might have been Hitler himself?) said that their key to avoid inflation (a repeat of the disastrous Weimar Republic inflation) was to only expand the money supply by as much as the economy was growing.

 

It's indicative of the subsidy to the landowner. Land value is NOTHING BUT the market's estimate of how much more the landowner can expect to take from the community by owning the land than he can expect to pay in taxes on it.

 

Try "common sense".

See how it works for you ...

 

Yes, that is the case. And to that point (regarding Money Supply) I add this report on what happened in post-war (WW1) in Germany. To wit, the reparations payments to both France and the UK stifled the economy until Hitler came around and won the parliamentary majority - thus instituting himself as Chancellor. His first action was to stop the repatriation payments to France and the UK.

What did they say? Not a whimper. Had they left Germany to rebuild itself, whilst they were rebuilding their own economies, it is quite likely that the Germans would not have "fallen" for sHitler ....

 

Pot legal in your state?

 

HISTORY LESSON!

The above is crapola. It is no wonder that you quote Ayn Rand who knew diddly-shat about economics.

Economic history DOES REPEAT ITSELF.

And how? Because, it was Obama that called upon a Democrat HofR to spend the ARRA-money to stop-dead the post-Bush unemployment-rate explosion - which indeed it did in 2010 (at 10%!) Nonetheless, after the Replicants took control of the HofR in the 2012-midterms they blindly refused any further stimulus-spending (which was still needed at the time). So, what happened?

This happened as shown from the Bureau of Labor Statistics "Employment to population Ratio" chart here!
*Note that from January 2010 to October 2013, the Ratio did not budge. It was stuck around 58.6%! (Have we all forgot those years when no new jobs were being created?)
*A result that down from its high-point before the Great Recession of 63.4% in December 2006.
*Which, in turn, was prompted by the subprime mortgage crisis, which itself was caused by the unregulated use of derivatives in both Democrat and Replicant administrations prior to Great Recession*.

So, as a nation (and now Donald Dork), what have we learned? ABSOLUTELY NOTHING!

We are back on track for a repeat of the Great Recession!

*Which - due to the lack of regulatory oversight and having allowed banks to simply confiscate property and then remortgage - led to the Subprime Mess that caused the Great Recession. (History is a marvelous subject, once you get the hang of understanding it!)

 

Yes, but they are capitalist-system analysts studying a capitalist economy under capitalist rules and principles. Some day we will thrive with a near-zero to sub-zero fluctuating growth rate but it won't be in capitalism. Capitalism is considered to be under-performing if it's growth rate falls to 2% or lower. A good rate is considered to be about 3% but that is not sustainable forever. After about 100 years of 3% average growth the growth goes "through the roof". Testing it in a spreadsheet will prove it.

 

The measurements used for growth involve money. Given that, the economy can continue growing until debt levels are too high.

More important are the material resources and energy that backs that money. Those are limited.

 

The only thing limiting the economy is the chains of regulation, and the unimaginative mind.

If natural resources are fundamental, why is Hong Kong a very rich city/state? It’s nothing but a bunch of capitalists on barren rock.

 

When does "too high" happen? When America cannot meet its debt-payments.

So far, so good ...

Very true - but mastering technology has always pushed the "frontier" outwards. To the point where, for instance, in 20/25 years all cars (and a good many houses) in America/Europe will be running on much less expensive sun-power.

What I admire most about America is that the people are not "intellectual" about technology - as are the Europeans. A good idea comes to fruition as a marketable product/service in half the time it would take in Europe.

I am left to repeat that America has no reason to fear a meltdown because Demand remains strong and Supply is manipulable to meet it. Why? Because the US is a very flexible country, where people move to wherever they find jobs. The US has weathered the Great Recession from which not even the EU today is able to recover with the same speed as has the US.

That is not possible in Europe where language divisions do not permit such manpower flexibility.

Let's consider ourselves lucky ...

 

Yes, when it cannot do so. And likely it never will, which is why more countries are preferring SDRs and other currencies for trade.

The only technologies that can reverse limits to growth will involve those that can extract resources from outside the planet. And they have to be fully implemented immediately, but I don't think that's possible.

 

That's because wealth in this case refers to money. The amount of resources and energy to back that money remains limited, which is why the global economy has been weak since 2008, with that crash a likely result of oil production costs rising after 2005 due to diminishing returns. To make matters worse, diminishing returns lead to even more money made, leading to rising global debt which amplifies limits to growth.

 

Nope, they keep buying American debt because the country works and sustains its debt!

No doubt, however, we need to find a lower debt-level to obtain the same level of economic growth. But that-aint-gonna-happin for as long as most of that debt is due to the fact that a non-productive DoD that eats away half the present Discretionary Income that should be employed to educate our children. (And not just the ones of the military who manage to get back from duty alive to benefit from a government paid postsecondary scholarship!)

Technologies come and go, but since the advent of the steam-machine they changed the world from one Agricultural to one Industrial.

And this cycle will continue, and continue and continue well into the Information Age ...

Sez you. So far, however, so good. America's major challenge is Income Disparity and not how to feed its people.

No need to go to Mars to find the resources to run a diverse economy based upon services rather than manufacturing, which is what is happening to the world at this very moment.

Anyway, let's worry about the present situation rather than that of a hundred years from now ...

 

Yeah, it works based on debt. Hence, SDRs, plans to move away from the petrodollar, and the rise of BRICS and emerging markets.

No wonder Trump is trying to restrict free trade.

What do you think has been used to keep that petrodollar propped up? They attacked Iraq when the latter started selling oil for Euros, destabilized Libya when plans for the gold dinar was being set up, and continues to threaten Iran because the latter has its own oil bourse and accepts various currencies.

Nonsense. The world uses mechanized agriculture with manufacturing. Both require extensive amounts of oil.

Yeah, we'll be able to eat food and manufacture goods using only information. Good grief.

Not anymore.

Yeah, services can miraculously grow food and manufacture goods without the use of energy of minerals.

 

Useless piffle.

Moving right along ...

 

So much for a counter-argument. LOL.

 

A good comment

 

Services in the US are now the major employer in the US. Manufacturing employs barely 12% of the entire workforce!

I'll leave you to dig that morsel of truth out of the Bureau of Labor Statistics site. Because you have no idea whatsoever of what the American economy statistically looks like!

 

Yes, but the manufactured goods and food purchased by U.S. workers are not created by the service industry.

 

So, what?

Where have you been since the early 1990s when China started its takeover of the US manufactured goods market?

Asleep?

A strategy that remains as a "come back" (to save some jobs) is the ability of the US to implement in production lines sophisticated robots. Run/managed by who? People with a post-secondary education in robotics!

All of which means what for the workers in product-line manufacturing in America? There in not any longer that many jobs in "Goods Producing (Excluding Agriculture)", which is why that component hires only 15% of the total American workforce! (For your edification, see that data-point source from the BLS here.)

Wakey, wakey ... !

 

Did that puerile comment enable you to avoid knowing the facts I identified?

 

N

Nope. Just emphasizing the silliness of such ludicrous notions. Very comparable to the Progressives’s view of Venezuela: Evil capitalists are starving the people; Maduro is trying to save them. What’s next? Stalin slaughtered the Kulaks for their own good? Bonnie and Clyde were romantic heroes fighting for justice? Drinking water makes you thirsty?

 

And typical manufacturing jobs in the U.S. still pay more than typical service jobs.

That almost kind of sounds like comparative advantage in reverse!

 

But China can also use robots, and the growing markets for manufactured goods are BRICS and emerging markets.

With that, good luck with that "come back".

 

True enough, they can. (And some do, actually.*)

And when they do the Chinese will have an increasing population that is impoverished by lower average-incomes - which will lead (particularly in China) the country into a Major Societal Conflict. The Communist Party is still running things only because of historic precedence and (quite frankly) an excellent export-dominated industrial production that created jobs and enhanced incomes. (Can it last forever? Good question!)

That too will stabilize in the future as costs rise. Which is already the case - many Chinese companies producing cheap-goods easily manufactured by hand have moved to southern Asian countries to do so.

What happened to the US will happen to China. As time will tell ...

*Why do you think the US AND Europe are both very concerned about Huawei building the 5G-internet? Imagine the entire network within a given nation being "owned" by a Chinese company! (I don't wanna be around when that happens!)