1. Introduction

Created Thursday 29 March 2018

“Growth plummets”.
“Core sector growth rate dips to 5.7%”.
“Finance minister announces stimulus package to boost growth”.

The Modern World is obsessed with growth. We worship growth. Growth is our religion.

Daily, we hear thousands of statements about this phenomenon called “growth”. We are now conditioned to believe that growth is a natural reaction of a society and culture that is restlessly striving to improve, develop, progress and outdo itself.

Yet we fail to clarify that we don’t mean any old kind of growth. We don’t mean cyclical, limited biological growth that entities like plants, animals, humans and just about everything in nature follows. They all grow for a while and then stop growing.

We also do not mean the kind of qualitative growth that makes us love our family, friends, village, town and community increasingly with time.
Firstly, we reduced the notion of growth to a quantitative state. As if that were not enough, we expect it to increase exponentially on a perpetual basis. That is best called Perpetual Exponential Quantitative Growth. A mouthful, so best shortened to PEQG.

In fact our economic system demands Perpetual Exponential Quantitative Growth (PEQG), which makes an amazingly unreasonable assumption that we have limitless resources on a finite planet. The stunning benefits so far bestowed on industrial man crystallized the myth in classical economics that PEQG is a universal law, a God-given right, and that it can and must be sustained at all costs. This assumption appeared to hold true for the last 150 years as there were vast corners of our planet we had not plundered for resources yet. But that was the first half of the story of the Modern Industrial World.

Now we are in the second half of the story where we have roughly used up half of most of the world’s resources that are crucial to running an industrial world. And the key resource that is half gone is Oil. Oil is the blood of our industrial world in more ways than people realize. This half-way point of oil depletion is in truth a turning point in modern history – it is called Peak Oil and forms the body of this book.

This book illustrates our predicament by contrasting 2 curves. One is an exponential curve of our expectations – the economic paradigm of Perpetual Exponential Quantitative Growth (PEQG). And the other is a bell curve that in reality all resources follow and is an introduction to the basic principles of Peak Oil. Through these 2 curves, I will illustrate that in a PEQG paradigm you only have to reach the half-way point (not the end) of oil reserves to be in real trouble. That is to say, when oil has reached the point at which we are drawing the maximum oil (Peak) from the ground. We are at Peak Oil right now.

This is such a landmark moment in industrial history, yet surprisingly few people are aware of it. Now, within years, we start descending the oil curve. From here on, the slope goes only downwards and we can only get less and less oil from the ground. This inverts all the rules of economics! It actually spells the End of Growth. Growth: the very bedrock of modern economics. And that spells financial catastrophe.

If we look at this honestly, we realize that the future that was promised to us in the ‘50s, ‘60s and ‘70s no longer looks possible. Yet we follow the paradigm of Exponential Growth full throttle and reduce all chances of finding a viable solution. This mad quest for Exponential Growth takes a simultaneous toll on the natural fabric of the world as we rape the planet off every and anything that remotely looks like a resource to fuel the ever-rising, blazing inferno that we proudly call our Modern Economic System.

We notice that our environment is collapsing and now we see that even our economic world is collapsing.

One way to look at all the different crises emerging is to look at each one of them individually. That is what generally is being done even by experts.

The other way to understand it is to see the correlation between all these crises and identifies the root cause. My attempt here is to show the correlation between energy, growth, ecological crisis and economic meltdown.

While most discussions focus on the hazards of chasing exponential growth from moral perspectives, such as environmental damage, social injustice or climate change, in this chapter we will primarily explore the very possibility of perpetual growth exclusively from an energetics perspective. By contrasting the universal and immutable laws of energy (energetics) versus the man-made laws of money (economics) we will understand why the core tenet of modern economics, namely perpetual growth, was always false and in fact now, real economic growth is over.

No wonder our financial systems come apart when there is no growth. It therefore follows that maintaining perpetual growth at all costs has become the de facto global religion. However, perpetual economic growth is not a God-given right.

The financial collapse of 2008 and the persistent recession thereafter took economists and the business and financial worlds by surprise but was in fact predicted by another category of experts, aware of the actual role of energy (mainly fossil fuels) in our modern industrial world. These experts were looking at a different set of parameters of energy rules and its availability. This science is called energetics which is a more fundamental discipline than economics because:

‒ Energy is the true driver of all industrial and economic processes and not money.
‒ Energy is a hard-wired aspect of reality and follows the immutable laws of geology and thermodynamics.

Thus energetics dictates the possibility and limits of growth. It is crucial to clear the fog that surrounds the current economic predicament which is falsely premised on the impossible and therefore hazardous notion of perpetual growth on a finite planet.

So what is the “solution”, people ask?
Easy you might say. The solutions are obvious, right?
Find more oil!
Switch to alternative energies!
Increase energy efficiency!
Develop new technologies, new ways!

That is exactly what this book questions. It examines whether these solutions are indeed solutions or half-truths. Whether alternatives can indeed replace oil. Whether technologies can indeed save us in the face of resource depletion. Whether growth itself can be sustained on a perpetual basis.

It must be understood that this book is not about morality, justice, equity, and environmental consciousness.
It is simply about what is possible and what is not.
It is not about what we should not do.
It is about what we will NOT BE ABLE to do no matter how hard we try.
It is about limits set by the universe such as laws of thermodynamics, geology and ecology.
Namely The Third Curve.

Next: Why Economic Growth is Over