Anyone who believes you can have infinite exponential growth on a finite planet is either a madman or an economist. -- Kenneth Boulding
Having spent the last 4 years or so reading up on the "peak oil" problem (which I am convinced will hit in the 2010-2012 time frame), and reading "Limits to Growth", I think the current new depression, exacerbated by the horrendous policies of the Bush administration, are merely the symptoms that our wholly unsustainable "living arrangement" is creaking towards its inevitable end.
Endless population growth, resource consumption, expansion of credit, deficits, energy consumption, economic expansion, military spending, etc., cannot continue indefinitely. The only question is when does the party end.
The person who has been sounding the alarm on this for years in his weekly blog is James Kunstler. People put him down as a pessimist but he has been right on the money for quite some time. His latest alarm was for the collapse in the financial markets, a result of us having spent the last 60 years applying our resources towards building an easy motoring society utterly dependent on cheap energy, and cheap energy being a temporary phenomenon of the 20th and part of 21st centuries -- he predicted this over a year ago, ignore him at your peril.
His latest blog points out the problems in Obama's approach to the credit crisis, which is to assume that once economic growth resumes everything will be "back to normal" again. When instead, Obama should be focused on trying to reinvent our economy and financial system so it doesn't depend on endless growth.
Among the questions that disturb the sleep of many casual observers is how come Mr. O doesn't get that the conventional process of economic growth -- based, as it was, on industrial expansion via revolving credit in a cheap-energy-resource era -- is over, and why does he keep invoking it at the podium? Dear Mr. President, you are presiding over an epochal contraction, not a pause in the growth epic. Your assignment is to manage that contraction in a way that does not lead to world war, civil disorder or both. Among other things, contraction means that all the activities of everyday life need to be downscaled including standards of living, ranges of commerce, and levels of governance. "Consumerism" is dead. Revolving credit is dead -- at least at the scale that became normal the last thirty years. The wealth of several future generations has already been spent and there is no equity left there to re-finance.