What Ascension Island can tell us about economics – and Bitcoin
THAT somewhat misunderstood book, The Limits to Growth from the Club of Rome, swam back into my vision earlier this week when I was looking at some of the consequences of the pandemic.
You could be forgiven for thinking everything is going along just great, but underneath there are serious cracks and turning-of-blind-eyes to what is really going on.
The Limits to Growth details that the costs of growth rise faster than the benefits. What that means is that eventually it must come to a juddering halt. If you think about it, it’s why we have cycles of boom and bust, which were famously banished by Gordon Brown – but, as ever, the real world does its own thing and pays no attention to mere words.
‘Davos Man’, of course, does not believe this and indeed all the backslapping and bonhomie in Davos is intended to show that ‘They’ – whoever 'they' are – are in control and know what they are doing is for the best. If you believe that, you’ll believe anything.
In the simplest terms, controlling what happens requires more and more resources to be uselessly employed. Cut that out and everything will flourish. And guess what? That’s what economics tells us: stop interfering and everything will be fine. As I never stop saying, how does London get fed? The answer is no one knows. There is no authority doing it. It just does, all on its own. That’s economics for you.
I came across the following tale which has, to my mind, everything you need to know about free market economics. Quite apart from the Beagle taking Darwin to the Galapagos Islands, she also visited a rocky, inhospitable spot called Ascension Island. To all intents and purposes, there was nothing there and hardly any water.
Darwin – a great man for British reach – spotted that the Island would make a great naval base, if only it could be rendered a bit more hospitable. His idea was that planting trees would mean that there was more moisture and things would improve over time.
The Admiralty, to whom he relayed all this, and with the wonderful enthusiastic blundering amateurishness of the British people – decreed that every Royal Naval ship passing by should plant some seeds.
Of course, Royal Navy ships of the day were travelling all over the globe and, as a result, deposited every conceivable plant and tree from everywhere on earth in a veritable mishmash. It should have been ecological chaos, but instead, within a few decades, Ascension Island became a total tropical paradise.
Now, the point here is that, in theory, it should take eons for this to happen – that’s what current theory tells us. Unfortunately, no one told the plants that. So, they just got on with the job, and turned Ascension into an island with lots of water – and a naval base.
In case you haven’t heard of him, Yuval Noah Harari is the current darling of the Davos set. His views align very well with theirs. The only problem is that despite trying to organise and regulate everything, events dear boy, events, keep getting in the way.
The butterfly wing in the Amazon rainforest is all it needs to set the world on a completely unexpected course. He – and others like him – have been brought up to think that the world is a passive medium that can be shaped by his esoteric models. It must be a terrifying discovery that it just ain’t so and that, in fact, the world couldn’t care less about all that and will go its own – often much better way – if left alone.
All this, as ever, brings me back to crypto. Ignore all the chaff flying about and concentrate for a moment on Bitcoin. Conceived as an antidote to the banking crisis of 2008, it has chuntered on, completely unfazed by all ups and downs, immune from outside interference and solidly dependable.
Whilst governments and elites spend more and more time trying to control things, Bitcoin and its blockchain just doesn’t care. This blockchain’s job is to churn out some more Bitcoin every 10 minutes, which it does superlatively well. If only the Davos lot would leave everything alone in the same way, we would all be much better off.
Temple Melville, CEO of The Scotcoin Project Community Interest Company (CIC)
