Comments Submitted to the Conference on the Economics of Peace --
Transforming Money, Rebuilding Community, and Redefining Wealth,
Sonoma, CA Oct. 18-23, 2009 by Bill Gough (based upon his previous writings)
(
economicsofpeace.ideascale.com/akira/panel.do?id=4265).
to email Bill Gough
GDP & Open Cycle Economics
World population is estimated by the United Nations to increase from
6.5 billion in 2005 to 9.2 billion in 2050 (United Nations, 2008). The
U.S. Census Bureau predicts that the United States population will rise
from the 304 million in 2008 to 439 million by 2050 (Swift, 2008). When
I was attending grade school at the time of the Great Depression the
U.S. population was 132 million. World population increase is a driver
behind the increasing problems we face and we can not continue
increasing population for long at the current rate.
However, the root structural cause underlying the global environment
and security problems is the fact that ecology has become a subsystem
of the economy. This occurred because the world is operating an open
cycle economic system in which resources are extracted from the earth
to enter the cycle and exit as wastes. The entire system has been
powered by polluting energy sources. Each person in the USA is
producing 4.5 pounds of garbage per day. Only 1% of the wastes we
produce in the United States are being recycled, the other 99% is
trashed in six months. For every can of garbage we produce, 70 cans are
produced upstream in the production process. (Leonard, 2008). Even when
material is recycled it eventually downgrades due to the buildup of
chemical impurities. Then it is down-cycled to a lower purpose, such as
filler material, and eventually becomes a waste (Hawken, Lovins A.,
& Lovins L. H., 1999, p.79). In this open cycle economy there
are only three sinks for the waste material to be deposited. They are
the air, water, and soil -- the life support systems for planet earth.
The citizens of our world need to become aware of the environmental,
security, economic, and social implications of continuing to use an
open cycle economic system. Nature operates as a closed materials
system powered by a clean energy source, our sun. The human species
cannot continue to operate and increasingly expand an open materials
economy within Nature’s closed materials system, and power this
expansion with polluting energy sources. In fact if the developing
world models our open materials economy and our lifestyle, we would
require three to five additional planet earths (Leonard, 2008).
Humans need to develop the technologies necessary to close our
materials cycle. In addition we will need to adjust our current
economic system. Economists now use the term “ecological economics,” in
the past this was called “closed cycle economics,” or “stationary-state
economics” (Daley & Farley, 2004; Daley, 1991; Boulding, 1973).
In our current open cycle economics great emphasis is placed upon
increasing the Gross Domestic Product (GDP). GDP is the total market
value of all final goods and services sold in an economy in a
particular time period. It is a measure of economic activity. Hence,
the GDP indicates how fast we can push “things” through our open-ended
system.
However, GDP is flawed as a measure of economic and societal wellbeing.
Much economic activity does not improve quality of life – for example,
low quality products, natural disasters, and war. In fact, GDP
increases when we pay the costs of pollution, the costs of crime, and
the economic losses from natural disasters like Hurricane Katrina. GDP
also excludes volunteer activities, elder care by family members, etc.
Even worse for our future, GDP does not measure the sustainability of
growth. This can’t continue since we are already observing the first
negative effects of operating and growing as an open system while
living inside of Nature’s closed system -- earthship Earth (Robins,
2008; Mack 2006).
To achieve growth in the GDP the open system fosters planned
obsolescence. How many of you have noticed that things tend to fall
apart after a few years? It also encourages perceived obsolescence –
the promotion of new clothing designs and new car styles, something we
have come to expect and anticipate. In a closed cycle economy the
pressure is to minimize the recycling costs. Growth would be fostered
in intellectual pursuits, the arts, music, and social activities.
Financial rewards through a more equable distribution of wealth would
need to evolve – society is beginning to recognize these needs, for
example the efforts to increase teacher’s salaries to strengthen our
education system (Gough & Eastlund, 1971; Daley, 1991). At the
present time the statistics of GDP are guiding this Nation rather than
values. Society is paying a price for the focus upon growing the GDP.
Alternative indices are being proposed that account for societal and
environmental factors related to real human development. We need this
“Enlightened Economics!” For example, Friends of the Earth support the
Index of Sustainable Economic Welfare (ISEW) (Friends of the Earth,
2008). Other indices being proposed are the Genuine Progress Indicator
(GPI), the UN’s Human Development Index, etc. (Robins, 2008). An urgent
need exists to settle upon a new measuring index that can help guide
our leaders and citizens. The GDP can still be calculated but it should
no longer serve as the guide to national policy. It was a tool
developed over 60 years ago to measure our increase productivity during
World Was II and has lost its appropriateness as the driving index for
society in the 21st century. Its principal creator Simon Kuznets
cautioned that “the welfare of a nation can scarcely be inferred from a
measurement of national income” (Wikipedia, 2008).
William C. Gough
Los Altos, CA 94024
650-941-7462
Need to Close the Materials Cycle
I believe that we will need a true holistic approach to the problems
that we will face in the future. The issues that societies will
encounter in this evolving future are so interconnected that new
technologies need to be developed to address the overall problem not
just a single topic. The approach would be to develop technologies that
returns us to the closed materials cycle inherent in Nature. Paper #1
is for the layman. It covers the overall issues involved -- resource
depletion, pollution buildup, national security, and economic changes
and how they are related. Paper #2 that I authored with Dr. George
Miley of the University of Illinois was published in an American
Nuclear Society (ANS) journal and focuses upon the more technical
aspects of an Inertial Electrostatic Confinement (IEC) fusion torch
system. Note that there are short term applications for using fusion
plasma technology that could yield near term financial benefits to
investors.
1)
www.fmbr.org/papers/ecological_sustainability.pdf
2)
www.fmbr.org/papers/reports/F-P_Torch.php
The following 300-word write-up describes our end goals:
The world is facing a myriad of man-made environmental problems that
threaten our future. At the heart of the environmental problem is our
injection into Nature of vast numbers of molecular structures and
alloys. At the same time the natural sources of many basic materials
are rapidly being depleted. With dwindling natural resources and
growing waste piles our fundamental challenge is to close the materials
cycle in an environmentally compatible way before escalating shortages
lead to global wars as nations vie for remaining resources. Our
approach focuses upon the fact that Nature has at its foundation only
92 fundamental elements. What we term environmental pollutants and
wastes consist of molecular structures that have been created out of
these 92 elements. To eliminate environmental problems our pollutants
and wastes need to return to their original state., then these elements
can be used or reconstructed into new products for society.
For example, we propose a revolutionary solution to do this that uses
the ultra-hot plasma generated in a fusion-temperature plasma device to
completely vaporize and dissociate materials into ions, which can be
separated and collected as pure elements. We employ an environmentally
friendly fusion fuel that is neutron-free -- a proton-boron fueled
(p-B11) fusion power plant using Inertial Electrostatic Confinement.
The extraction of the ultra-high temperature plasma for the fusion
torch represents a unique capability of fusion-technology. The physics
basis for starting on this process already exists. NPL Associates,
Inc., a small high-tech company in Illinois, specializes in advanced
energy source research, and is a leader in proton-boron fusion
development. Recent research has progressed to the point where a clear
development path can be identified for achieving the proton-boron
fusion plant. Funding for fast-track development is about $80 million
to achieve a small demonstration fusion-torch recycling plant in 6
years.
William C. Gough
Los Altos, CA
650-941-7462
