I ran into this article today and its says some things that are so weird I don’t even know how to refute it properly. So I was wondering if you all have some thoughts on it. But I would suggest not wasting your time if you don’t know who this guy is.
First, he seems to be really mad at degrowthers. I don’t know what degrowthism entails exactly. Maybe there is a Degrowth LLC somewhere with a Chief Degrowth Officer who has laid out the official degrowth position. I have personally always FELT (I have no evidence) that supply chains are designed to push down costs rather than resource usage. A liberal will conflate the two but a large part of the costs is labour costs and labour costs are “artificially” suppressed due to imperialism. A large part of why developing countries are not allowed to develop is that it would drive up their wages and thus the costs of goods and services that global north nations buy from them. But he seems to think that degrowth means that we should go back to the copper age to keep emissions low which seems disingenuous to put it kindly.
Then there is stuff like this:
Dematerialization, not offshoring, is what has allowed U.S. GDP to continue to increase at a more-or-less steady clip even as we’ve reduced our usage of energy, fresh water, copper, aluminum, and other metals, as well as our carbon emissions.
This is presented without evidence.
What is dematerialization? I am not sure but this part hints at what it is:
Think of the classic movie American Graffiti. George Lucas depicts his memories of a 1950s world where young people have fun, hook up, and get social status by driving around in cars all day and all night. This is hugely resource intensive. Nowadays, kids can have fun with their friends by chatting, sharing stories, and playing video games online. They can use Tinder to hook up instead of cruising around. And they can get social status by accumulating Facebook likes, TikTok views, and Twitter follows. Thus, young people have been ditching cars for smartphones. That means less gasoline burned, less steel and aluminum used, and so on. But more fun ultimately to be had.
He seems to be saying that what was once done by cars is now done by software. Software is, simplistically put, an arrangement of ones and zeros that creates value out of thin air. Hence, dematerialization. He seems to acknowledge somewhere that the computer industry has material resource usage at all points but I think he sees it as less than what cars consume or a lump sum cost that is paid for at once in advance.
What I don’t understand is that how are cars and phones mutually exclusive? He draws on this Atlantic article that I am not gonna read. Also I think most kids just can’t afford to have cars anymore. Also I don’t think Ferris Bueller and Mean Girls depict the average school experience.
It’s certainly possible for economic growth to happen in a virtual environment with no increase in real resource use. To see this, just do a little thought experiment: Imagine simply simulating the economic growth that has already happened on Earth.
Imagine that sometime far in the future, with highly advanced technology, we create a complete, physically exact simulation of the planet Earth in 1600 A.D., complete with the minds of 554 million digitized human beings. And then suppose we simply run that simulation forward, as the digital people develop steam engines, railroads, tractors, cars, airplanes, and so on.
This is a very real increase in GDP!
If you were sitting in 1970, you could look at this curve and claim, very confidently, that economic growth requires concomitant increases in energy use. And you’d be wrong. Because the trend is your friend til the bend at the end.
There’s simply no deep reason that economic growth requires increasing use of any physical resource. Economic value is all about the configuration of stuff, not the amount of stuff. If you took a hammer and smashed your phone to pieces, the resulting pile of trash would still contain the same amount of silicon and cobalt and gallium arsenide and so on. But now those resources would not be a valuable thing. Rearranging resources from a less useful configuration into a more useful configuration is what creates value
Wow! It’s crazy how *checks notes* “rearranging resources from a less useful configuration into a more useful configuration” was only invented in 1978. I wonder what a meaningful definition for this could be, why US energy use could go down but it’s GDP continued to soar?
I wonder if this could instead indicate that the US process of de-industrialization forced the metrics for how GDP is created to change fundamentally, masking the failure for the US economy to grow meaningfully outside of key sectors.
Damn maybe the fact that this predates the internet by an incredibly wide margin indicates that this trend isn’t due to the internet reducing the energy cost of the economy but instead that the economy has been allowed to dwindle and deteriorate while those on top who decide how it’s measured have decided to inflate it’s supposed value. Hell knows that I’ve never known economic growth while I’m alive outside of the tech sector.
I’m sure that chart has nothing to do with the late 70’s and 80’s being the beginning of offshoring and the moving of heavy industry to overseas plants to reduce labor costs. Pure coincidence!
But note that although the use of virtual resources in the digital, simulated world is increasing in this scenario, the use of real-world, physical resources probably isn’t increasing. It probably does not take any more energy, or silicon, or gallium arsenide to faithfully simulate the world of 1900 than the world of 1600 (as long as you’re making sure to simulate the entire planet, particle for particle).
Of course, this example is impossible; we’ll never be able to make a simulation anywhere close to that big. But the thought experiment illustrates the key principle here: People in virtual environments can create economic value without putting any strain on the real resources of planet Earth. You can think up lots of more realistic examples of growth in virtual environments if you like.
In terms of physics and computation:
In principle, a computer is only ever doing one calculation at a time. Carrying out one step after the other, in sequence (albeit rather quickly). In practice, you can spread the work out a bit - have multiple CPU cores carefully timed to work alongside each other, or farm out calculations to dedicated hardware like a graphics card. But… fundamentally, each component is still only doing One Thing At A Time. So, to run a given programme – like say, a simulation – you first have to reduce the job down into individual tasks. Then you feed those tasks through the computer one by one. Simulation is, by definition, reduction and simplification. You sketch out the likely path of a physical system by ignoring most of it and hoping you didn’t miss anything too crucial. (ideally, you then compare it to real world results and adjust as needed; in practice, you can just say the world is wrong instead)
Our friend Noah Smith, on the other hand, is imagining a machine that can hold the state of every particle and evolve on their interactions over time. That’s not a simulation. That’s not even a computer. That’s a whole-ass physical system (a universe machine, one could argue). He’s doing this bait and switch where he wants you to think of binary zeros and ones as if they’re particles. They’re not. Particles exist and interact concurrently. Binary is static and linear. It just sits there in memory, waiting for the CPU to eventually get round to doing something with it.
One. T.a.s.k. A…t… A… T…i…m…e…
In terms of economics:
yes, you can measure imaginary gdp
what a shame all the value is just that, imaginary
Good point. So essentially what he’s saying is that if we could become god we could attain infinite growth.
before the Dot Com Crash, this was a much easier argument to make
“computer new, therefore infinite profit maybe?” silicon valley is still running on this assumption, only they have to twist their justifications that much more with each decade
I mistyped an important word in my previous reply. Have fixed it. (Good -> god)
Also why does this simulation have to be an exactly copy of reality? Why can’t I just boost GDP by posting Victoria 3?
sneaking a laptop running Equestria at War into Venezuela to raise their GDP
It’s certainly possible for economic growth to happen in a virtual environment with no increase in real resource use. To see this, just do a little thought experiment: Imagine simply simulating the economic growth that has already happened on Earth. Imagine that sometime far in the future, with highly advanced technology, we create a complete, physically exact simulation of the planet Earth in 1600 A.D., complete with the minds of 554 million digitized human beings. And then suppose we simply run that simulation forward, as the digital people develop steam engines, railroads, tractors, cars, airplanes, and so on. This is a very real increase in GDP!
Okay, now, in Noah’s defense, this is about at totally bonkers nonsensical as the concept of GDP itself.
I am going to prove that near infinite growth is possible.
Imagine, if you will, a world with infinite resources.
QED
In minecraft!
the simulated gold sitting in the simulated ground unexploited is transformed into something of real value by the simulated labor of the simulated miner when it’s dug up and used to build a simulated giant golden monument to our own very real arrogance and hubris
Imagine that sometime far in the future, with highly advanced technology, we create a complete, physically exact simulation of the planet Earth in 1600 A.D., complete with the minds of 554 million digitized human beings. And then suppose we simply run that simulation forward, as the digital people develop steam engines, railroads, tractors, cars, airplanes, and so on.
There is no reason for such a world to have any real scarcity or resource constraint. Any such constraint is made up.
With no resource constraint, there is no market value and no GDP (since GDP is market value of final goods and services).
Tbf he sounds like he would want to artifically constraint resources and have my children starve so that these digitally simulated humans can boost the GDP numbers.
Like a bitcoin but with actual human being burning. I would said that’s pretty common Holden Bloodfeast fetish in sci-fi works ever since matrix.
the torment nexus makes the line go up, heretic! do not question the torment nexus
It’s certainly possible for economic growth to happen in a virtual environment with no increase in real resource use. To see this, just do a little thought experiment: Imagine simply simulating the economic growth that has already happened on Earth.
Imagine that sometime far in the future, with highly advanced technology, we create a complete, physically exact simulation of the planet Earth in 1600 A.D., complete with the minds of 554 million digitized human beings. And then suppose we simply run that simulation forward, as the digital people develop steam engines, railroads, tractors, cars, airplanes, and so on.
Reading this gave me a fuckin aneurism.
This is a very real increase in GDP!
Bro, fuckin how
Its all fun in games (increasing the “value” of something) until you need to cash out.
Unless you’re just hoping that you can use the artificial overvaluation of a non-physical asset to sucker somebody into giving you a cash loan for a fraction of the asset’s assumed value.
But then you’re just creating a situation of creating an ever increasing bubble that will eventually pop and cause another catastrophic recession.
deleted by creator
You should be thankful I haven’t shown you what his face looks like
deleted by creator
Sounds like a techbro version of the old liberal economics handwave where the possibility of economic growth without an increase in use of material goods (or even a decrease) in certain circumstances negates the problem of “infinite growth on a planet with finite resources.” It ignores the practical reality of what economic growth has done and instead uses a hypothetical outlier. A world with “smart” technology isn’t a theoretical, were there, we can look at what that world has meant for material resource usage.
It’s like if someone looked at the Boba skip and came to the conclusion, this means hours and hours of practice isn’t necessary in order to speedrun a video game.
I found a YouTube link in your comment. Here are links to the same video on alternative frontends that protect your privacy:
HOW does he have 226,000 subscribers on Substack?
Hes nuanced
I assume that Smith is a darling of whoever runs Substack so the algos always push his articles hard. Another possibility is that Substack lets rich people buy enormous amounts of subscriptions in one go and Substack pretends that’s not the case. 1,000s of subscriptions? 10,000s? Even more? Smith is always a poor writer, stupendously stupid, and fantastically wrong.
archive.today • Economic possibilities for Gaza - by Noah Smith
It doesn’t hurt to dream of better days.
NOAH SMITH
OCT 19, 2023
A sampling - he has a section called “Easy wins: tourism, tax haven, and natural gas”.
