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Culture War Roundup for the week of September 26, 2022

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There are, broadly speaking, two types of growth:

  1. Extensive growth is where you increase outputs by increasing inputs.

  2. Intensive growth is where you increase outputs through process improvements that allow you to produce more or higher-quality outputs with the same inputs.

In recent decades, economic growth in wealthy countries has been heavily skewed towards intensive growth. For example, carbon emissions per capita peaked in the 70s in the US, and total emissions peaked just before the GFC. Growth is coming mainly from producing better stuff, not from producing more stuff. Computing technology is the ultimate example of this: Computers are orders of magnitude more powerful than they were in the 80s, but use the same materials in the same quantities, more or less.

The socialist claim that capitalism requires infinite growth (it doesn't, although increases in per-capita GDP are certainly desirable) and therefore requires infinite growth in resource consumption is simply false. We have had quite a lot of intensive growth, and can continue to do so indefinitely. In theory, there may be some optimal state of the economy beyond which no improvements are possible, but that's so far removed from the status quo that it's a purely theoretical concern.

The point of growth is that it increases material standards of living. That aside, there's a cognitive bias where people perceive slow growth as regression. This is how you get people like Bernie Sanders and his followers on Reddit insisting that real incomes have collapsed when all the evidence says otherwise. Living in a high-growth economy just feels better than living in a low-growth economy.