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Anniee · Dec 5, 2004, 10:58 pm

[quote=bmaestro]I'm an Economics major. Because of this, I'm kinda stuck on the idea that trade liberalization and economic growth are good things. They bring people out of poverty, there's empirical evidence that shows increasing national income brings increasing environmental quality and so on. Now, a friend of mine sent me this article:

http://www.rachel.org/bulletin/index.cfm?issue_ID=2483

In brief, it explains that because of the second law of thermodynamics (that entropy will increase when energy changes form), all economic activity, and a constant growth in that activity will only create more entropy, more pollution, inequality, chaos, wars... who knows what exactly.

Is this too abstract an argument for it to hold true? Or does the author, Peter Montague, have a valid point here.[/qb]
[quote]

The laws of thermodynamics simply don't apply to economics. If one wants to argue that free trade carries the seeds of its own destruction, in that people become very prosperous and thus over time fat and lazy and thus unproductive, leading to eventual collapse, THAT case can be made. But to try to apply hard laws of physics to a discipline that is not hard science in the same way is not appropriate.

There really are no limits in the sense that there is one pie and it must be divided; expanding wealth in a free-market system is a reality. Thus the question is not, "How big a slice should I/he/we get?" but rather "How many more pies should we bake?" However, people being people, they do tend, after being prosperous through free trade for certain lengths of time, towards more socialistic economics, towards less productivity, etc. as I was saying above. Inevitably this leads to a breakdown in the economic system, just as it did in Rome (when it went from the Republic to the Empire.) I don't know if this is entirely inevitable or if people can be educated to the degree that they don't forget the lesson of the free market or what; I think it's probably inevitable. But I'm a pessimist. Its inevitability won't stop me trying to prevent that collapse through restoring freedom to the market, but at this point it's certainly an uphill battle with the ignorance of the masses.

Dec 5, 2004, 10:58 pm	#13 (permalink) (top)
Anniee Mr. Queen Posts: 231	[quote=bmaestro]I'm an Economics major. Because of this, I'm kinda stuck on the idea that trade liberalization and economic growth are good things. They bring people out of poverty, there's empirical evidence that shows increasing national income brings increasing environmental quality and so on. Now, a friend of mine sent me this article: http://www.rachel.org/bulletin/index.cfm?issue_ID=2483 In brief, it explains that because of the second law of thermodynamics (that entropy will increase when energy changes form), all economic activity, and a constant growth in that activity will only create more entropy, more pollution, inequality, chaos, wars... who knows what exactly. Is this too abstract an argument for it to hold true? Or does the author, Peter Montague, have a valid point here.[/qb] [quote] The laws of thermodynamics simply don't apply to economics. If one wants to argue that free trade carries the seeds of its own destruction, in that people become very prosperous and thus over time fat and lazy and thus unproductive, leading to eventual collapse, THAT case can be made. But to try to apply hard laws of physics to a discipline that is not hard science in the same way is not appropriate. There really are no limits in the sense that there is one pie and it must be divided; expanding wealth in a free-market system is a reality. Thus the question is not, "How big a slice should I/he/we get?" but rather "How many more pies should we bake?" However, people being people, they do tend, after being prosperous through free trade for certain lengths of time, towards more socialistic economics, towards less productivity, etc. as I was saying above. Inevitably this leads to a breakdown in the economic system, just as it did in Rome (when it went from the Republic to the Empire.) I don't know if this is entirely inevitable or if people can be educated to the degree that they don't forget the lesson of the free market or what; I think it's probably inevitable. But I'm a pessimist. Its inevitability won't stop me trying to prevent that collapse through restoring freedom to the market, but at this point it's certainly an uphill battle with the ignorance of the masses. Last edited by Anniee; Dec 5, 2004 at 11:02 pm.