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Capitalism explained through LEGO
(media.mas.to)
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this post was submitted on 17 Jul 2023
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This is essentially the argument that Thomas Malthus (economist) made in the 1800's. And he had a point!
In his time, history had shown that the entire output of a country/state was people's productivity times some function of land and labour. Meaning you could increase the output of a country by making people more productive (limited), or increasing the land available (limited), or by increasing the labour available (also limited). Therefore, there was a hard limit on how much output a country could have. And therefore we were fucked because population increases exponentially but output only increases linearly and has limits.
I think this is similar to your lego analogy: the pieces (land, labour) are limited, therefore the output is also limited.
Then the capitalist revolution happened and once the capitalist-style legal framework was in place which allowed the ownership of capital, countries' outputs broke from the historical trend. We realized that a different function better described the output of a country. Rather than land, the correct thing to look at was capital. So the new function was people's productivity times some function of land and capital (hence, capitalism).
And unlike land, capital is, in fact, unlimited. Someone might build a factory on the land, and owning the factory, he/she has incentive to improve the factory. "How much you can improve the factory" is, for all intents and purposes, unlimited. Therefore the output is also unlimited. This equation better described the growth in output that people were seeing in reality (GDP is an attempt to measure this), which has been growing exponentially ever since.
So... we're not fucked? Well, it remains to be seen! We've certainly avoided being fucked so far! The standard of living of the average person on Earth has increased by a lot since Malthus.
Of course, this has come with negative externalities (pollution). We're still seeing infinite growth riiiiiight up until we go extinct. The trick is to keep the infinite growth without going extinct!
EDIT: spelling correction
I think the issue is that natural resources are limited, and even virtual things still require real energy. Online spaces are hosted on physical servers, machine learning uses real CPU computing power, and so on. And we're increasingly using more and more energy and natural resources to facilitate our civilization.
Arguably, we've already fucked the climate and the biosphere. We're literally in a middle of a mass extinction right now, and the climate is breaking down in front of our eyes. It's entirely possible that we've already kicked off feedback loops, such as methane burp, that are beyond our ability to control. As you say, the growth will likely continue until we start seeing very rapid collapse as we hit the limits of our biosphere.
Yes, natural resources are limited, but that doesn't mean that capital is limited. What I mean is that: yes, we're using more energy as a civilization, but thanks to the investment of capital, we're also expanding our ability to produce more energy at the same time. And "how much energy our civilization is capable of producing" can increase infinitely.
Yeah, the problem of pollution is certainly an existential threat. But I don't think it's fair to say that the type of threat is "we're running out of resources". We're not running out of anything, we're just producing too much atmospheric carbon!
My point is that any meaningful capital is directly tied to resource usage. Our ability to produce energy directly depends on our ability to mine resources to build power plants and maintain them. Saying that we can increase energy production infinitely is reductive beyond any meaning, it's like a physics problem about a perfectly spherical cow.
And yes we absolutely are running out of easily accessible resources that have sustained the current growth. Getting further resources is becoming increasingly more difficult and energy intensive. We're also running out of things like fertilizer, dealing with topsoil erosion, and increasingly unstable climate that's threatening our food production. I don't think people appreciate just how fragile our whole civilization is.
Not at all! To use real examples to avoid spherical cows:
Used to be that you needed wood to generate energy. Then coal (which is an order of magnitude better). Then oil (another order of magnitude). Then solar. Then fission. Then (hopefully) fusion. Then who knows what. At each step, we've taken something which previously wasn't considered a resource at all and used it to generate exponentially more and more energy. There's no limit to how often we can do this-- things which were previously not resources become resources once we know how to use them.
Another example is food production. I saw a graph recently-- if I find it I'll edit this message to include it, but it showed how it used to be that we needed 100% of our population dedicated to food production. Now it's less than 1%. Meaning that 1 person is producing enough food for 100 people. Incredible.
These examples (and many more) show that our ability to produce things are not subject to limitations of natural resources, because natural resources aren't limited. There's enough energy coming out of the sun to be infinite, for all intents and purposes.
let me introduce you to the Jevons paradox https://en.wikipedia.org/wiki/Jevons_paradox
And this is a pretty good read on the state of food production with lots of mainstream sources to what's currently happening, it's a pretty sobering read https://collapsesurvivalsite.com/reasons-theres-going-to-be-a-global-famine/