Fixing Economics – Accepting Reality

We humans are a clever lot. We figured out long ago how to bring automatic control to machines and systems of all kinds, and we used this control to change the world.

The rapid growth of industrial civilisation was driven in a very large part by steam engine technology, and central to this new technology was a simple device that brought automatic control. The pressure regulator for steam boilers prevented the pressure from rising to the point where the engine would inevitably explode, without a human engineer working the valves. It was simple, and it was genius, and it helped to drive the transformation of the world’s economy.

We need another transformation of the world’s economy. We need to make a transition from a system that depends on infinite energy, infinite growth and infinite resources, to one that can operate effectively in a world without abundant cheap energy and with a set of unavoidable limits on economic expansion.

To make this transition we will need to take control of certain economic outcomes, but we humans have never truly figured out how to control outcomes delivered by the global economy, the most powerful machine ever constructed. That is, until now.

We have a solution, and just like the pressure regulator, it is a fairly simple but ingenious control mechanism. The pressure regulator was a control system that allowed us to better harness the energy in the very abundant coal resources at the time, and we exploited it to power the Industrial Revolution.

A control system for the global economy will allow us to better preserve what remains of our natural resource base for as long as we choose. It will harness the inherently innovative and competitive engine of profit-seeking markets, and exploit them to grant us the power to make the transition we need.

A control system for the economy would also grant us the freedom to decide what economic outcomes we want, above and beyond the simple goal of the sustainability of human civilisation, and give us the power to make markets rush to deliver those goals.

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