by MonteQuest » Tue 19 Apr 2005, 10:36:55
$this->bbcode_second_pass_quote('Mercani', '
')Monte and Aaron, why don't you bring your own data to prove your point ?
Oh, I think I did, but people ignore the facts that don't fit their world paradigm. Wildwell cites Sweden as an example of GDP growth without an increase in energy consumption. I reiterate:
As to Sweden, this pdf file gives a whole lot of explanations for their success, but there was still an
increase in energy consumption primarily by the industrial sector. And they too are concerned about being able to supply electricity in the future which is
required for economic growth.
$this->bbcode_second_pass_quote('', 'I')n 2000, Sweden consumed 11.0 Mtoe of electricity (128.4 TWh), accounting for 30.9% of the country’s TFC. Since 1990, absolute electricity demand has risen by
6.6% and its share of TFC has fallen from 32.2% to 30.9%. Demand from the
industrial sector is highest, accounting for 44.1% of the electricity TFC in 2000, followed by the residential sector,which consumed 32.8% of the power in the same year.
Gas use has
increased by 32% from 1990 to 2000. The majority of gas demand in the country comes from
industry (64%) and residences (22%).
In April 2002, the association of Scandinavian transmission operators, Nordel, published their Nordic Grid Master Plan. The plan noted that Sweden, Norway and Finland may face a combined shortage of electricity in the years ahead. Specifically, the plan analysed the period 2002–4 and found risks of power shortages in unfavourable conditions, particularly during years of low hydropower production.
In view of the
crucial role energy plays in the development of society, in 2001 the Royal Swedish Academy of Engineering Sciences (IVA) initiated a special Energy Foresight project, which will examine the Swedish energy system in both a European and a global perspective.
GDP economy must be accompanied by either an increase in energy consumption or an increase in efficiency, or an outsourcing of the energy consumption to another country. Increases in efficiency are limited due the the law of diminishing returns, not to mention newcomers who have no waste to conserve. Where will the energy for their consumption come from? From everyone else's piece of the pie?
If it is "value added" it is from money generated by an increase in energy consumption somewhere or by debt which is predicated upon
economic growth and the resultant energy consumption. It works no other way.
Now, what happens when you run an economy on price inflation or value added? Look a the following chart. See the red line? That represents "reported" GDP. The blue line represents actual GDP based upon the production of good and services and excludes the GDP growth or "wealth creation" as a result of housing inflation that is driving the current economy. We create illusionary wealth, and then borrow against that illusion to spend more money and increase GDP.
$this->bbcode_second_pass_quote('', 'W')here would the US GDP be today had the Household Debt, as % of the GDP, remained at the historically high level before the current run up? What if the GDP growth came from growth in the income of households and Household Debt growth that was at 45% of the growth in GDP? The primary reason that I picked the 45% number is that it is the average for 19 years, 1965-1983, and that after 1984 the Personal Bankruptcy Filings exploded. So, we are not talking about a case of no growth in Household Debt; we are simply talking about growth in household spending coming primarily from growth in incomes. Such a GDP would be a Secular GDP with organic growth. As some of you may know, growth in household incomes, in real terms, has been poor over the past 5 years (negative for the last twelve months). How long can debt be a substitute for growth in household spending when income growth is hard to come by?