Wolf argues that increased energy consumption per capita, primarily oil from fossil fuel, has been a key causal factor in creating the plus-sum economic world we live in, which he calls the positive-sum economy. Or in other words, rising energy consumption has helped produce rising productivity / real incomes / wealth, and the expanding global economy that we know today.
In addition, Wolf further argues that rising energy consumption transformed politics -- assisting both the birth of democratic politics at home and more-consensual foreign relations among states -- by increasing the size of the economic pie. Elites in a country, Wolf argues, became more willing to tolerate the enfranchisement of the masses because it was in the elites' economic interest to do so: i.e. that energy consumption created a more-productive (and more-valuable) citizenry with higher incomes.
Internationally, a nation's gains from the increased trade that characterizes the high-energy consumption era far exceed its gains from making war with another nation: the plus-sum global economy that trade produces supports today's norm of trade as opposed to the limited-sum world's norm of conflict and war.
Lower CO2, lower incomes?
However, climate change, Wolf argues, and the limits to energy consumption that CO2 limits imply, threaten to end the plus-sum global economy, i.e. cause it to regress to a limited-sum world, threatening both the norm of rising incomes and increasing trade / consensual relations among nations. In other words, with the economic pie limited, an emphasis is placed on redistribution of income and wealth -- a condition that can only lead to conflict in and among nations, Wolf argues.
Many socialists, Wolf said, welcome this conflict, as they believe "they are the birth-pangs of a just society." Conversely, classical liberals and libertarians, with whom Wolf sympathizes, view CO2 limits as the death knell for any hopes for domestic freedom and peaceful foreign relations.
Finally, Wolf recognizes that climate change and resource use must be addressed, but it is also vital that human ingenuity also preserve global economic growth and rising incomes -- the plus-sum world -- to prevent dark days from ensuing.
Economic Analysis: Selected zero-sum proponents will argue that prosperity can be attained for all by redistribution, and they'll frequently cite Sweden, and perhaps France, as an example. Still, it's hard to see how the zero-sum model could succeed in a nation as diverse as the United States or in a society as complex as the European Union. Moreover, some zero-sum proponents would argue that the zero-sum model is the only way to create universal prosperity, but these arguments are even less convincing.
Further, Wolf quite appropriately puts the spotlight on the need to deploy ingenuity to maintain high (and rising) productivity amid energy conservation efforts aimed at lowering emissions. The challenge is to devise ways to work and live smarter, from an energy use standpoint, without reducing productivity. Admittedly, this is a gargantuan challenge, but so far, it looks like the developed / developing world is off to a pretty good start regarding meeting, and one day surmounting, that challenge.
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Reader Comments (Page 1 of 1)
1-02-2008 @ 5:18PM
Steven Vest said...
I write as a non-scientist but, whether you are an Al Gore fan or not, it simply cannot be a good thing to be pumping 70,000 tons of carbon-based emissions into the atmosphere on a daily basis. At some point - and it is very arguable that there HAS to be a zero economic sum if alternate energy solutions are imposed on a global basis - we're going to have to come to the realization that economic growth should not be the sole driver of governmental policies.