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Cake day: June 20th, 2023

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  • o_o@programming.devtoMemes@lemmy.mlCapitalism explained through LEGO
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    1 year ago

    Yes, natural resources are limited, but that doesn’t mean that capital is limited. What I mean is that: yes, we’re using more energy as a civilization, but thanks to the investment of capital, we’re also expanding our ability to produce more energy at the same time. And “how much energy our civilization is capable of producing” can increase infinitely.

    Yeah, the problem of pollution is certainly an existential threat. But I don’t think it’s fair to say that the type of threat is “we’re running out of resources”. We’re not running out of anything, we’re just producing too much atmospheric carbon!


  • This is essentially the argument that Thomas Malthus (economist) made in the 1800’s. And he had a point!

    In his time, history had shown that the entire output of a country/state was people’s productivity times some function of land and labour. Meaning you could increase the output of a country by making people more productive (limited), or increasing the land available (limited), or by increasing the labour available (also limited). Therefore, there was a hard limit on how much output a country could have. And therefore we were fucked because population increases exponentially but output only increases linearly and has limits.

    I think this is similar to your lego analogy: the pieces (land, labour) are limited, therefore the output is also limited.

    Then the capitalist revolution happened and once the capitalist-style legal framework was in place which allowed the ownership of capital, countries’ outputs broke from the historical trend. We realized that a different function better described the output of a country. Rather than land, the correct thing to look at was capital. So the new function was people’s productivity times some function of land and capital (hence, capitalism).

    And unlike land, capital is, in fact, unlimited. Someone might build a factory on the land, and owning the factory, he/she has incentive to improve the factory. “How much you can improve the factory” is, for all intents and purposes, unlimited. Therefore the output is also unlimited. This equation better described the growth in output that people were seeing in reality (GDP is an attempt to measure this), which has been growing exponentially ever since.

    So… we’re not fucked? Well, it remains to be seen! We’ve certainly avoided being fucked so far! The standard of living of the average person on Earth has increased by a lot since Malthus.

    Of course, this has come with negative externalities (pollution). We’re still seeing infinite growth riiiiiight up until we go extinct. The trick is to keep the infinite growth without going extinct!

    EDIT: spelling correction