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Daly, Herman (editor). Toward a Steady-State Economy. Freeman. San Francisco 1973. pp 149-174

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THE STEADY-STATE ECONOMY: TOWARDS A POLITICAL ECONOMY OF B iophysical EQUILIBRIUM AND MORAL GROWTH - Daly. Daly, Herman (editor). Toward a Steady-State Economy. Freeman. San Francisco 1973. pp 149-174 Ben Kreisman ; Ecological Economics. GROWTHMANIA.

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Daly, Herman (editor).Toward a Steady-State Economy. Freeman. San Francisco 1973. pp 149-174

Ben Kreisman; Ecological Economics

  • Fragmentation of knowledge and people by excessive specialization
  • Disequilibrium between the human economy and the natural ecosystem
  • Congestion and pollution of our spatial dimension of existence
  • Congestion and pollution of our temporal dimension of existence with the resulting state of harried drivenness
growth is the answer to everything
  • grow more to provide more employment for the poor
  • invest and grow to bolster aggregate demand
  • grow by raising productivity so more goods will be chased by the same number of dollars and prices will fall
  • grow to become rich enough to afford the costs of cleaning up and of discovering new resources and technologies
  • grow to be strong and have both guns and butter
  • poverty
  • unemployment
  • inflation
  • pollution and depletion
  • war
the steady state
  • “…defined as an economy which the total population and the total stock of physical wealth are maintained constant at some desired levels by a ‘minimal’ rate of maintenance throughput”
  • At what levels should the stocks of wealth and people be maintained constant?
  • What is the optimal level of maintenance throughput for a given level of stocks?
  • What is the optimal time horizon or accounting period over which population and wealth are required to be constant?
  • What is the optimal rate of transition from the growing economy to the steady-state economy?
social institutions of control 3
Social institutions of control (3)
  • maintaining constant populations
  • maintaining constant stock of physical wealth
  • governing distribution
  • guiding design principle for social institutions
      • provide the necessary control with a minimum sacrifice to personal freedom
      • provide macrostability, allowing for microvariability
      • combine macrostatic with microdynamic
social institutions of control 31
Social institutions of control (3)

2. maintaining constant stock of physical wealth

  • control aggregate depletion rather than control pollution
  • legal rights to deplete auctioned off
  • population /economic growth increase demand = higher prices and less consumption

3. governing distribution

  • Set limits for the maximum and minimum amount of wealth and income
  • supports concept of property rights, but only under the assumption that everyone owns some property
  • would legitimize free-market system

1. maintaining constant populations

  • Kenneth Boulding plan for birth certificates
      • initial allocation is equal across the market
      • compensation for people suffering from infertility
      • rich can purchase more credits, but ultimately decrease per capita income
on moral growth
On moral growth
  • Based on the assumption of static morality, logic and necessity are not sufficient to bring social change
  • “…progress chiefly depends on the extent to which the strongest and not merely the highest forces of human nature can be utilized” – Alfred Marshall
morality of the steady state
Morality of the steady-state
  • ‘wholeness’
      • If ‘truth’ is whole, then current knowledge is so far from the truth that knowledge is not worth obtaining

“…unless physical, social and moral dimensions of our knowledge are integrated in a unified paradigm offering a vision of wholeness, no solutions to our problems are likely.”

  • Sermon on the Mount: “Do not be anxious about tomorrow for tomorrow will be anxious for itself. Let the day’s own evil be sufficient for the day”
  • Karl Marx’s materialism and objection to the alienation of man from nature;
      • recognized that nature is the ‘inorganic body if man’ and not just a pile of neutral stuff to be dominated

“…to advance the steady-state economy, with stabilized population and consumption, as a policy goal with widespread public support.”

  • CASSE top 15 policies for achieving a steady-state economy
      • Adopt macro-economic policy goal – a steady-state economy
      • Maintain exemplary network of conservation areas sufficient in size to support ecosystem services
      • Stabilize population
      • Gradually reset existing fiscal, monetary and trade policy levers from growth towards steady-state
      • Limit the range of inequality in income and wealth
      • Develop a commons sector to accompany the public/private sectors; assign property rights for commonly held resources
      • Employ cap-and-trade auctions in commons sector for allocating resources
      • Establish for flexible working day/week/year
      • Overhaul banking regulations; elimination of fractional reserve banking so monetary systems move away from debt structure that requires economic growth
      • Adjust zoning policies to limit sprawl and promote energy conservation
      • Continue to monitor GDP as a a measure of the size of the economy; use other measures for welfare
      • Prevent unconstrained capital mobility
      • Work towards full utilization of costs in prices
      • Institute policies that move away from globalization and towards localization (conservation)
      • Limit advertising to prevent unnecessary demand