For some time now I’ve been minded to post something about “the end of growth” at LinkedIn.
Obviously this had to state the issues in ways that make sense to anyone not hitherto familiar with the Surplus Energy Economics thesis.
Because of character limits, this had to be brief, and split into two posts. Perhaps because of my lack of prior experience posting there, I wasn’t able to import my formatting to those articles.
So here, as a formatted single article, is the original text. I hope it provides a usefully compact synopsis of our predicament.
Part Two of our ongoing series – The Surplus Energy Economy – will appear here in due course.
1
There are times when the most important facts, though straightforward in principle, are simply too big, or too unpalatable, for general recognition
This is one of those times. The Big Fact informing all of the sub-narratives of our age is that the global economy has stopped growing, and is starting to shrink.
We should swiftly dismiss all official or orthodox statistical claims to the contrary. GDP isn’t a measure of material value created in the economy, but of the transactional exchange of money in the system. Money routinely changes hands without value being added, and never more so than when most of the money in question has been conjured out of thin air as credit.
In reality, no form of money has any intrinsic worth. Obviously enough, we can’t eat fiat currencies, power our cars with cryptos, or sow our fields with precious metals. Rather, money is token, not substance – it commands value only as an exercisable claim on those physical products and services for which it can be exchanged.
This principle of money as claim leads directly to a conceptual necessity, which is that we need to think in terms of two economies, not one. The first is the “real” or physical economy of material products and services. The second is the parallel and proxy “financial” economy of money, transactions and credit.
Once this is understood, we are spared the futility of comparing money only with itself.
2
There are two things that we need to know about the underlying “real” economy.
The first is that it operates by using energy to convert other raw materials into products, and into those artefacts and infrastructures without which no worthwhile service can be provided. Since some of these products are consumed, whilst others wear out and need to be replaced, this is a continuous process of creation, consumption, abandonment and replacement.
Second, energy is never “free”, but can only be put to use with an energy supply infrastructure. This infrastructure, which might be wells and refineries or wind turbines and grid systems, is material, meaning that it cannot be created, operated, maintained or replaced without the use of energy.
Colloquially, then, we have to “use” energy to “get” energy. Stated more formally, “whenever energy is accessed for our use, some of that energy is always consumed in the access process, and is unavailable for any other economic purpose”.
This proportionate Energy Cost of Energy is a matter, not of money, but of physics. ECoEs from all sources of primary energy have risen from 2.0% in 1980 to more than 11% today. Accompanied by a gradual degradation of the non-energy resource base, this has impaired annual rates of material expansion to a point at which the underlying physical economy inflects from growth into contraction.
3
The authors of The Limits to Growth, published back in 1972, used the then-new technique of system dynamics to see this coming, and even gave us a pretty good steer on its probable timing.
None of this is palatable, of course, to a world so obsessed with “growth” that it disregards the obvious truth of Kenneth Boulding’s observation that only “a madman or an economist” could believe in the promise of infinite, exponential economic growth on a finite planet.
Over the past twenty years, material economic prosperity has increased by 25%, but huge rises in the stock of monetary claims have enabled statisticians to assert that the flow of economic activity measured as “real GDP” has more or less doubled (+96%, 2004-2024).
Our resistance to the very concept of an ending and reversal of growth has been vested in two false presumptions. One is that the material economy can be reinvigorated using monetary tools, which would be true only if the banking system could lend energy and raw materials into existence, or if central bankers could conjure them, ex nihilo, out of the ether.
The other is the supposedly “limitless” potential of human ingenuity, enacted as technology. In reality, the potential of technology, far from being limitless, is bounded by an envelope of possibility whose parameters are set by the characteristics of materials and the laws of thermodynamics.
4
Since the real costs of energy-intensive necessities are rising, just as top-line prosperity inflects into contraction, the supposed “cost of living crisis” isn’t a temporary “crisis” but the emergence of a wholly predictable trend. This goes a long way towards an explanation of worsening internal political and social instability.
Washington, meanwhile, has awakened, belatedly, to the reality and consequences of material resource finality, an understanding that, we can reasonably infer, has long been grasped in Beijing and Moscow.
The breakdown of international trade – and its balkanisation into trading blocs and exclusion zones – becomes readily explicable if we once recognise the ultimate finality of the material, the impotence of the monetary and the technological, and the resultant intensification of competition for scarce and dwindling resources.The last working-class hero in England. Clio the cat, ? July 1997 - 1 May 2016 Kira the cat, ? ? 2010 - 3 August 2018 Jasper the Ruffian cat ??? - 4 November 2021 Georgina the cat ???-4 December 2025
I've been thinking about this for a while, and all I can suggest is changing the economic system in a sense of having it more 'mixed' and more connected to the public good. Not particularly want to get drawn into the evolution/revolution angle ..
I also hate 'techno-fixes' but! .. there is the thorium nuclear reactor as developed by China .. my ai tells me about minituarising these:
Yes, thorium salt reactors, specifically Molten Salt Reactors (MSRs) utilizing a thorium fuel cycle, can be scaled down significantly. In fact, many modern designs for thorium-based molten salt reactors are intentionally designed as Small Modular Reactors (SMRs) to facilitate off-site factory fabrication and transportable deployment. Key aspects regarding the scaling down of thorium salt reactors include:
Modular and Transportable: Companies like Copenhagen Atomics are developing thorium reactors designed to fit into 40-foot containers, designed to produce roughly 100MW of energy.
Small-Scale Demonstration Reactors: Rather than requiring massive, site-built structures, 1 MW thorium molten salt test reactors are being planned and developed, allowing for lower-cost testing and validation. Lower Operating Pressure: Because MSRs operate at close to atmospheric pressure and do not require heavy, high-pressure steel containment vessels, they are physically easier to scale down compared to traditional, high-pressure water-cooled reactors.
Operational Benefits: Small-scale thorium MSRs can be designed to continuously reprocess fuel, reducing the accumulation of fission products and allowing for high efficiency even at a smaller scale.
While they can be scaled down, challenges remain in the corrosion resistance of materials at high temperatures and the legal/regulatory hurdles involved in licensing new nuclear technology. Blah .. blah
I remember having a half serious exchange with Morrissey a couple of years ago .. anything changed M?
This is not Moonbat's conversion to nuke energy. He is an ijit.
on February 13, 2026, 7:32 pm