Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

Biophysical Economics

with 5 comments

The Tyee’s series of new ideas for the New Year reaches number 10, and lashes out rather indiscriminately at economists.

Now if there is one thing we all know about economists it is that they never agree – not even with themselves. They always hedge their advice with the words “but on the other hand …”

The present crisis is not the fault of economists but can be squarely blamed on a political philosophy that decided to oversimplify the amount of economics that it used. Frankly no-one who has ever studied the subject seriously would say that “perfect competition” was in any way prescriptive – it is just an abstraction for heuristic purposes. It is based on a some quite unlikely premises – but is designed to explain what would happen if they prevailed. It is only used in the classroom because economics is hard to do as a laboratory experiment. Yet a whole bunch of right wing nuts decided that they could introduce policies as though not only were perfect competition possible (it isn’t) but actually existed (it didn’t). No one with a degree in economics would think that.

The idea of limits to growth is not new either. The Bruntland Commission coined the phrase. But the world chose to ignore that body’s sage advice. Again that was wilful political self interest. No-one wanted to confront the hard necessity – and there are still plenty of people who seem to believe that we still can get away with not really changing buisness as usual.

We cannot now do anything else sensible but start to address the ludicrous imbalance of distribution that sees a small minority consume enough to use up three planets while the rest starve. We have to deal with climate change – it is too late now to slow it down let alone stop it. We have either passed peak oil or soon will – either way we cannot behave as though there will always be a cheap source of energy.

Just about everything that the conservative political philosphy has been promoting for most of my adult life has been shown to be false. So that is enough evidence for us to abandon it. And we now need to seriously work on how to do things differently. Any other direction is simply antithetical to our continued existence on this planet.

Written by Stephen Rees

January 5, 2009 at 7:34 pm

Posted in Economics

5 Responses

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  1. Great blog, Stephen.

    Just one correction — the “limits to growth” was coined by Meadows et al. in 1972 in their book of the same name.


    January 5, 2009 at 9:34 pm

  2. Club or Rome was the originator of the Limits to Growth that Meadows wrote about.

    Bravo for talking about this subject. 99.9% of the world is busy trying to breath life back into a failed economic system predicated on endless growth (and therefore endless resouces). This system may sputter awhile, but it cannot live on. We’d best put our energy into inventing a system based on living within our (global resource) means.

    Dave Gardner
    Hooked on Growth: Our Misguided Quest for Prosperity
    Join the cause at

    Dave Gardner

    January 6, 2009 at 9:22 am

  3. This makes a lot of sense, especially to one who was a small child in NE England during Thatcherism…

    BTW your twitter link to this post is broken

    Andy in Germany

    January 6, 2009 at 10:21 am

  4. Whoops. Meant Club of Rome. Sorry for the typo

    Dave Gardner

    January 6, 2009 at 12:15 pm

  5. Dave your link brings up a malware flag on Google; explain.

    Greg A

    January 7, 2009 at 4:42 pm

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