Saturday, December 31, 2005

Thinking Growth in 2006

As we look to a New Year, it is common to think about ways to improve our lives. It is good to take time to do that, and it should happen more often than annually. We tend to lose some steam as the year goes on. The diet and exercise program goes by the wayside, and we leave books unread on the nightstand. Changing behavior is hard, especially if it does not accompany a change in the way of thinking.

Rich Karlgaard’s column in the January 9, 2006 issue of Forbes presents some good insights into what he calls the “world’s worst disease.” It is not a physical malady, but a way of thinking that focuses on life as a zero-sum game. He identifies three beliefs as foundational to this thinking: (1) the world is running out of resources; (2) people are burdensome consumers, not contributors; and (3) wealth is fixed and limited.

Though we are familiar with zero-sum thinking, Karlgaard offers this additional insight: perhaps politicians are more amenable to it because they occupy a zero-sum world. In every election, there is one winner and loser, and there are only so many political posts to chase after in their quest for power. (Sadly for me and my blogging pals, he also throws professors in this category, as there are only so many tenured spots out there. However, unlike politicians, we don't spend nearly all our waking hours thinking about, and raising money for, reelection.)

History teaches us that each of these foundational beliefs of the zero-sum world view are deeply flawed. We have more resources today than we ever have, though their form is changing. With technology we have new resources that we never thought about even ten years ago. While it is true that some people are burdensome consumers, human capital has been the source of the growth in resources and in innovative uses for them. Finally, wealth has grown dramatically, and it seems to continue growing as the economy improves worldwide. (Remarks today by China’s president offer new hope for improving openness and growth in this country bounded for many years by the iron curtain of communism.)

Here’s to finding cures for this “disease” in 2006.
Best regards.


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