With the U.S., Japan, and Europe facing lost decades and hundreds of millions of frustrated middle-class workers, it's worth asking: How much does capitalism need growth to survive?
Everywhere we look, economic stagnation is staring us in the face. The United States seems headed for a "lost decade" (some would say our second in a row), Europe and Japan are doing arguably even worse, and economists like Robert Gordon are proclaiming the "end of growth."
David Graeber, the anthropologist sometimes described as the "anti-leader" of Occupy Wall Street, wrote in August 2011, "There is very good reason to believe that, in a generation or so, capitalism itself will no longer exist -- most obviously, as ecologists keep reminding us, because it's impossible to maintain an engine of perpetual growth forever on a finite planet."
This is a common refrain. When we bump up against our planet's resource limits, the story goes, capitalism goes bye-bye. But is it true? Maybe, but I have my doubts.
First off, it's just false that growth requires infinite resources. Economic growth comes in two flavors: (1) "extensive," where we use more inputs; (2) "intensive," where we use inputs in a more clever way to do more interesting stuff. The former must eventually hit a wall. The limits of the latter are completely unknown. Deride the "information economy" all you want, but it makes people happy and it sucks up a lot less energy than what came before it.