Growth or Death

Economic growth has been criticized for decades, even centuries if we consider anti-industrialists like Henry David Thoreau. The specific arguments used vary wildly. They might include romantic, spiritual, environmental, feminist, and anti-Western takes.

All these arguments, however, belong to one of two categories. The first category is “degrowth”, those who actually want to shrink the economy. The other category is “zero growth” for those who believe the economy could and should stagnate at a certain level.

Proponents of both categories normally say that what they propose would be possible without causing mass poverty and large-scale destruction. If we can falsify that, only those comparatively few intellectuals who would openly express that they do not mind mass poverty and large-scale destruction could keep up their argument.

Degrowth means mass poverty and large-scale destruction

Let us first address “degrowth” arguments.

For this, we first need a definition of growth that is more general than the one used in economics.

That definition can be found by considering thermodynamics. We could at first try to define growth of any given system as a net intake of matter and energy. This falls within the purview of the First Law of Thermodynamics. The definition easily complies with both economic growth where resources like ore or energy like nuclear energy are turned into goods, factories, houses etc. and biological growth where nutrients and sunlight are turned into proteins, lipids, carbohydrates etc.

However, this definition is too general because it would include e.g. a pond that acquires more water and energy from a shower of rain. While the pond is indeed “growing”, it is too primitive a growth to equalize it with the growth of complex systems like living entities or an economy.

We can sharpen our definition of growth by adding a requirement that relates to the Second Law of Thermodynamics. The sort of growth we are looking for shall also not only require an increased net input of matter and energy, but also an increased net output of entropy. This means they need to be self-organizing in the sense of Postulate 6 of Halbe’s Razor.

Outputting entropy is necessary because an increase in entropy within a system would mean that a system’s particles come closer to mixing freely and that more of its energy becomes diffuse heat. Over time, this would destroy any order and thus any functions of the systems. For a living entity, approaching maximum entropy is what happens after its death. Until then, it manages to hold entropy within itself on a non-disruptive level. If biomass increases within a system, this means its entropy output has to increase, too.

To keep the entropy within biomass at livably low levels, the entropy in its surroundings has to increase by an amount that is higher than the internal reduction, because the net change of entropy always needs to be positive. As Erwin Schrödinger pointed out in “What is Life?” (1944), living beings achieve that by intaking somewhat ordered forms of matter and energy, like food or solar radiation energy, and outputting more randomly mixed matter like excrements and diffuse energy like heat.

A failure to do that means the death of a living entity. If we scale that up to an ecosystem, a reduction in the amount of entropy an ecosystem exports to its surroundings accompanies an increase in the death rate of its constituent life forms over the normal rate and a disruption of their normal interactions. This is for example observable when abiotic factors change drastically for an ecosystem.

All of this is the same for economic systems: They also output heat and waste, for example garbage and tailings. If this export of entropy is reduced, the constituent life forms, i.e. people, die at a higher rate than usual and normal interactions (like employment or social relations) are disrupted, for the simple reason that all of these are ordered, not random, processes, and thus require low entropy. If we reduce our entropy output, we will thereby arrive at mass poverty and large-scale destruction. And to keep up the entropy output, an input of more ordered matter and energy is required.

Zero growth means degrowth

A proponent of zero growth might even agree that shrinking the economy would have negative effects, but he might say that this can be avoided with keeping the economy at a constant level, i.e. “stabilizing” the yearly intake of ordered matter and energy and the output of entropy of the economy at a certain level.

However, this is not possible and trying to do it will also result in degrowth. There is only growth or degrowth, stabilization doesn’t work for anything but a very short time. Even in conservation biology, “born as a discipline of crisis, targeting the recovery of altered ecosystems under the paradigms of equilibrium and ecological stability”, “the prevailing paradigm has recently shifted to a more realistic view of non-equilibrium dynamics in ecosystems, even in the absence of anthropogenic impacts”. 

Where does the idea of an equilibrium in economics or biology come from? People might think of the dynamic equilibrium in chemistry and try to replicate that in an economical system. In a dynamic equilibrium, two (or more) chemicals react to one another at a certain rate each. For example, acetic acid (CH₃COOH). In an aqueous solution like vinegar, CH₃COOH sometimes reacts to CH₃COO^– and a proton (H⁺), giving the proton to the surrounding water. However, the reaction also regularly occurs the other way round, with CH₃COOH being rebuilt. Each reaction occurs with a certain probability per molecule, resulting in an equilibrium seen over all molecules. 

The big difference to a biological or economic system is that chemistry’s dynamic equilibrium means the highest amount of entropy possible in the system, meaning it is a thermodynamic equilibrium, too. Biological and economic systems always stay away from thermodynamic equilibrium, because they are self-organizing, as stated before. Only after death do they arrive at thermodynamic equilibrium.

To stay away from this, both biological and economic systems require an input of ordered matter and energy and an output of less ordered matter and heat, as stated above.  

But what if these inputs and outputs were held constant? Wouldn’t that result in an equilibrium and therefore achieve zero growth?

To achieve something like that for an economic system, one could imagine measuring the total resource usage, energy usage and waste production at the point in time where the desired level of economy is reached. And then trying to take political measures to keep each of these three things there.

However, this overlooks how these self-organizing systems manage to stay so far from thermodynamic equilibrium, i.e. death: They use tools and process information. For living beings, the tools are far example enzymes, and the information is always read out from the DNA. For an economic system, the tools are—well, tools, all the way from handheld tools to vehicles, machines and lab equipment. And the information is in the computers but most of all in all the working people.

Both tools and information are vulnerable to decay, noise, aging: All forms of internal entropy that will randomly accumulate over time. The only way to deal with that is to take in more resources and energy and produce more waste until the tools or information are repaired or rebuilt. For example, a worker may retire, taking much information with him, so a new one will need to be trained.

Now, the crucial issue with trying to achieve zero growth is that one would need precognition. It is not possible to tell when a tool will break, a worker will get sick or injured, or information will be misinterpreted due to noise, meaning that some resources and energy are wasted. But unless someone knows that in advance, it is not possible to compensate for it by putting exactly the required additional amount of resources, energy, and waste disposal into the system to repair the issue on time. And time is a crucial factor, because a lot of feedback loops tie everything together. One broken machine at one factory will mean that factories down the line face trouble, and so on. And all of a sudden, there is much more to repair, which again nobody will have seen coming. 

Of course, the central planners who want to achieve zero growth could try to compensate for that in advance by commanding everyone to be incredibly redundant: Stockpile resources, have replacement machines in storage, train substitute workers and so on. But that would ironically achieve the opposite of what they are trying to do. It would require tons of resources and energy and waste production to achieve all this redundancy. In other words, it would require massive economic growth.

This only leaves the other route open to them: Not take all those provisions and gambling that not too much will ever go wrong at the same time in order to keep resource usage etc. low. But we all know that it will be just a question of time and bad luck until too many things go wrong at the same time and it all comes crashing down, i.e. we would have degrowth again. Especially because if one starts to neglect maintenance and repair and only focuses on the most obvious failures to keep the economy as close as possible to zero growth, all the little issues will accumulate.

There also is the issue that the economy is far too complex for anyone to get detailed insight into what source of resource and energy usage and entropy disposal is happening even at the present time. In this sense, “the economy” on a national, not to mention global scale doesn’t even exist because it is far beyond human information processing capability to talk of such a thing with any degree of accuracy (see Postulate 5 of Halbe’s Razor). This is the old problem of central planners which will never be solvable. Trying to predict the future based on not even knowing the present can only go terribly wrong, even if it was possible to predict the future (which the probabilistic nature of the universe forbids anyway).

Why there always needs to be growth 

Biological systems and the market economy have found a brilliant solution for this issue of things always going at least a bit randomly: Just keep growing. Growth will easily offset decay, noise, aging and every other internal accumulation of randomness/entropy by simply increasing the dumping of entropy upon the environment.

More than just overcoming the average amount of decay etc., growth in these systems will also reserve some redundancy for when something goes exceptionally wrong. For example, growth in a biological system results in a larger gene pool which makes it likelier that evolution has something to work with in case of some catastrophic occurrence. It also spreads the system over a larger area, meaning that if something goes wrong very locally (think, for example, of a mudslide), many parts might not even be affected. In an economy, growth enables companies and workers to diversify in a way comparable to the gene pool, as well as train more skills and create savings and store goods, tools etc. for worse times.

The difference to the “planned” redundancy mentioned above is that this one is economically viable (since it is paid for by current business) and based on better information on what could really go wrong, because this is local information. It is therefore both a better and far less wasteful redundancy than what central planners could hope to achieve.

Thus, until someone learns massive-scale soothsaying, economic growth is the only way to prevent mass poverty and large-scale destruction.