Preface. Joseph Romm writes that the exponential growth Ponzi Scheme is consuming the resources of the next 100 billion people. Our children and grandchildren. And I’d guess for anyone under 60 years old today with peak oil likely to have happened in 2018. We’re out of time. Speed limits are still 80 mph in Nevada…
Romm’s post was originally at http://climateprogress.org/2009/03/08/ponzi-scheme-madoff-friedman-natural-capital-renewable-resources/ but has vanished from the internet and lives today only here. Romm has written a great deal about the crisis we’re in (though from a climate change, not energy decline point of view). I first discovered him after reading “The Hype about Hydrogen”, which should have ended all the false hopes about this zero-energy resource, yet the hype continues today.
The second article estimates we’re using up $7.3 trillion of free natural resources a year. Hell, it’s probably a lot higher than that. I hate to use dollars, especially now that we are printing trilllions and seems like we could forever… But as the money / energy transition proceeds, digital and paper money will be worthless, energy worth everything. The point is that all political parties want the endless growth Ponzi scheme, no matter what the price of pollution and destruction. Even the so-called Greens do, but with Green growth.
Alice Friedemann www.energyskeptic.com Author of Life After Fossil Fuels: A Reality Check on Alternative Energy; When Trucks Stop Running: Energy and the Future of Transportation”, Barriers to Making Algal Biofuels, & “Crunch! Whole Grain Artisan Chips and Crackers”. Women in ecology Podcasts: WGBH, Jore, Planet: Critical, Crazy Town, Collapse Chronicles, Derrick Jensen, Practical Prepping, Kunstler 253 &278, Peak Prosperity, Index of best energyskeptic posts
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Romm J (2009) Is the global economy a Ponzi scheme, are we all Bernie Madoffs, and what comes next? climateprogress.org and now only here:
By “paying ourselves” with the wealth from future generations — indeed, from the next 50 generations and next 100 billion people to walk the earth — we cleverly took advantage of victims not yet born, those not able to even know they were being robbed.
Madoff is reviled as a monster for targeting charities. We are targeting our own children and grandchildren and on and on. What does that make us?
Yes, homo “sapiens” have constructed the grandest of Ponzi schemes, whereby current generations have figured out how to live off the wealth of future generations. Yes, we are all in essence Madoffs (many wittingly, most not) or at least his most credulous clients.
“We created a way of raising standards of living that we can’t possibly pass on to our children. We have been getting rich by depleting all our natural stocks — water, hydrocarbons, forests, rivers, fish and arable land — and not by generating renewable flows.
In our Ponzi Scheme, investors (i.e. current generations) are paying themselves (i.e. you and me) by taking the nonrenewable resources and livable climate from future generations. To perpetuate the high returns the rich countries in particular have been achieving in recent decades, we have been taking an ever greater fraction of nonrenewable energy resources (especially hydrocarbons) and natural capital (fresh water, arable land, forests, fisheries), and, the most important nonrenewable natural capital of all — a livable climate.
The system is destined to collapse because the earnings, if any, are less than the payments.
Usually, the scheme is interrupted by legal authorities before it collapses because a Ponzi scheme is suspected or because the promoter is selling unregistered securities. But in this Ponzi scheme, the authorities (i.e. world leaders, opinion makers, the cognoscenti) haven’t been doing much interrupting over the past two to three decades since, unlike a typical Ponzi scheme, they are heavily invested in the scheme and addicted to the returns!
By enriching those who did the most plundering the most, we enabled them to fund lobbying and disinformation campaigns to convince substantial fractions of the public and media that there is no Ponzi scheme — that global warming is “too complicated for the public to understand” and nothing to worry about.
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Roberts D (2013) None of the world’s top industries would be profitable if they paid for the natural capital they use. A sobering new study finds that the world’s biggest industries burn through $7.3 trillion worth of free natural capital a year. And it’s the only reason they turn a profit. Grist. https://grist.org/business-technology/none-of-the-worlds-top-industries-would-be-profitable-if-they-paid-for-the-natural-capital-they-use/
Globalglassonion summarizes” as follows: David Roberts at Grist summarized a report by the environmental consultant group Trucost, at the behest of The Economics of Ecosystems and Biodiversity over at the United Nations. The idea behind the report was simple. Tally up all the world’s natural capital — land, water, atmosphere, etc. — that doesn’t currently have a dollar value attached to it, and figure out the price. Figure how much of that natural capital is being consumed, depleted or degraded without the responsible party paying the cost for that use. The number the study hit on was a staggering $7.3 trillion in 2009 — about 13% of global economic output for that year. In a theoretically perfect market, the price of consuming, degrading or depleting a resource would be paid by the party responsible.But getting the theory of markets to map onto the real world is difficult. Dumping trash on a neighbor’s lawn is technically free, so a lot of us should be doing it more. But because we’ve built societies in which our neighbor can sue us, or the cops can fine us, we’re forced to internalize that cost. Lots of costs can only be internalized through smart institutional design and govern
