by wilburke » Fri 15 Jul 2005, 10:50:02
$this->bbcode_second_pass_quote('', 'b')robak wrote:
4) Demand is ever increasing (with population and industrialization)
There is no such thing as demand per se. Economists see demand as a function of price. In a free market, the price changes to the level at which demand and supply are equal. So what you are really saying is that recent demand/supply patterns have produced prices at which demand and supply have grown steadily.
brobak wrote:
5) Demand will outstrip supply at some point (the exact date isnt important)
This is impossible and represents a fundamental misunderstanding of economics. As stated above, the fundamental principle is that the price adjusts to the level at which demand and supply are equal. What you mean is that as supply becomes harder to get, the price is expected to grow.
Ah, yes, the Libertarian counter-arguments! I know them well (I could have re-listed them all, but why not save space).
brobak, the only thing I would change in your list of arguments is to substitute "our current economic system" for "Capitalism." Then you won't get derailed by counter-arguments such as those listed above. The highly theoretical "free market" does not exist, not even remotely, and therefore any reference to this particular pipe dream is the ultimate "straw man" argument. The world economic system is a rigidly-controlled, highly rigged game for the wealthy and powerful. And, in fact,
our current economic system is absolutely based on growth! The banking system, or, more properly, "Big Debt", is constantly creating money out of thin air
by law, and therefore, absolutely,
needs to expand or else it dies. And without an ever-increasing supply of energy (for the argument about the benefits of our modern "energy efficiency", reference this thread on
Jevons Paradox)
it cannot expand.
As for the notion of supply and demand with regards to non-renewables, simply put, Peak Oil theory is the crack in the armor of classical (and modern) economics. The debate on this point is very long, but the best introduction to these ideas is found at the
DIE OFF website.