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Luke Hutchison

TED Fellow, Google

TEDCRED 50+

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Is capitalism sustainable?

Bono stated in his TED2013 talk that the numbers show that we can eradicate all poverty worldwide by 2030. While I really hope that is true, it begs the question: Is capitalism sustainable? Is it possible to have a rich and middle class without a poor class? The sad reality of capitalism is that if there is an exponentially small number of people with exponentially large wealth, there has to be an exponentially long tail of much poorer people who are each contributing to that wealth. Not that we necessarily need an exponentially small number of people with exponentially large wealth, but would the world keep running without capitalistic incentives that increase the separation between rich and poor? Can we eradicate all poverty without the rich sharing their riches? What happens to civilization when nobody is willing to work in the factories and orchards, or build roads?

(Please don't take this question the wrong way! Personally I wish that nobody had to work menial jobs. I just don't understand how we can eradicate poverty when so many jobs will always translate into low-paid labor.)

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    Feb 27 2013: The question is not whether capitalism is sustainable but whether capitalism as we see it today is. Once again nature and its myriad systems become our teachers here. It is inevitable that resources/energy will always flow from where they are high to where they are low. If we consider the energy currency our own body uses (glucose/ATP), we find that the excess glucose is stored away as glycogen in the liver. But then this storage capacity is not indefinite and our system finds ways to bleed off this excess storage in a manner that is salubrious to the entire system. Because too much of glycogen storage becomes toxic to the body and manifests as disease. In a similar vein, too much money concentrated in the hands of few individuals would become toxic to the entire financial system unless there are viable valves to bleed off the excess in such a manner as to benefit human society at large. And needless to say that the present global financial system is diseased for the lack of such bleeder valves. And surely, if the system follows the same trajectory as of now, it is doomed to collapse in a heap in the near future. We need to learn from mother nature as to how it manages biological systems and apply the same laws to our financial systems for long term sustenance and viability. Dr Sivaram Hariharan , Bhaarath (India)
    • Mar 2 2013: I like your analogy Dr. Hariharan. The sugar aspect rings true with me. Here is why.

      When I was in school we studied 'populations'. We did an experiment where we put fruit flies in a jar with unlimited amount of food (honey). We counted the fruit flies (living) everyday and presented the data on a graph. The shape of the graph was an exponential curve (X=Y squared) starting with 2 fruit flies and curving upwards in a dramatic increase until one day there were suddenly no fruit flies. The reason why they all died suddenly was pollution. We were told that other experiments with various living things had the same results: exponential population growth ending in sudden and complete death.

      Is capitalism sustainable? Capitalism is the same expression as the fruit flies devouring the honey. It is gluttony. It is nature and it is frenzy. We are more natural than we are intelligent. Everything we do today is refined and perfected and purified like a powerful drug and like honey. Our food is full of sugar to a point that it is killing us. But what is really going to kill us is pollution. If we graph our population numbers we see the curve is rising along with an atmosphere of frenzy and the silent killer, pollution.
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        Mar 2 2013: Greg, U are so right when U say that we are more natural than intelligent. In fact, I would say that is a compliment to us humans because the intelligence governing natural systems is far far beyond what a human being could conjure at least at this point of time. Maybe, in the far future, provided we do not annihilate each other in wars and terrorism or even through suicidal eco-destruction, human intellect could catch up with this natural intelligence that is inherent in all things living and non-living in this universe. Regardless, Resource Management Systems in nature are ALWAYS regulated. There is no space for excess for even the goodies, leave alone those that are detrimental to the system. There is stringent regulation at all times and at all points so that the system does not get skewed and tips over irreversibly. That would explain the financial collapse of 2008 because the intellectual (albeit theoretical) financial derivatives that were supposed to click big time failed in the real world in absence of tough balances and checks. Each and every aspect of bio systems, starting from a simple virus cell to a complex ecosystem is finely balanced and regulated Greg. Thanks for your reply. Dr Sivaram Hariharan, Bhaarath (India).
        • Mar 8 2013: Natural systems are forced into this though. Too many wolves eat all the game, wolves then die of starvation which allow the game to recover in population thus maintaining the system. We as human are creative enough to circumvent this process by simply breeding more livestock or growing more crops. Agricultural revolution allowed for a tremendous population boom. The advancement of medicine pushed this gain higher still and continues to do so to this day. In advanced enough economies, people tend to have less children. We in the US are currently at 1.9 children per household, which is below the replacement rate. Our population would be shrinking and heading towards a more sustainable path if it were not for social security troubles forcing a looser immigration policy to meet these commitments.

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