THERMODYNAMIC DISSIPATION & ECONOMICS
In industrial capitalism, certain consequences of industrial capitalist activity must be indemnified by law as "externalities" or the motive for capitalism disappears - profit. If environmental impacts were measured and the provision of equitable wages based on production were mandatory, for-profit industry could not exist. It is exactly this problem that is only possible with an economy based on general purpose money.
So if industrial capitalism requires the atmosphere of the earth to pollute with fluorocarbon and carbon emissions in order to make a profit, the atmosphere must be provided by law as a dump, free of charge. If these two considerations conflict - profit or internalization, then capitalists - aided by a government by, for, and of capitalists - will externalize. That means we will not regulate these discharges, but that we will instead pretend they have nothing to do with the processes of production and exchange.
In the material world, nothing is external. Economic externalization is a symbolic exile of those things that might disrupt a return-on-monetary-investment.
Money, which brings all these problems into existence, is an abstract sign that has tremendous material force. We all know that intuitively, but there is a particular and observable and verifiable way to understand how that sign works materially. It works to dissolve, or more precisely, dissipate the organization of matter and energy. If you listened to the link above, you will have heard Alf Hornborg describing a dissipative process. He is not talking about figurative dissipation, but physical dissipation based on physical law - the law of entropy.
Science geeks will like this one.
We begin with an economist/mathematician who became interested in the ecologic and social connections created by different kinds of energy. He was born in Romania in 1906 and died in the United States in 1994; and his name was Nicholas Georgescu-Roegen.
Georgescu-Roegen begins by considering a new form of evolution that is unique to human beings. We evolve exsomatically. Exo meaning outside, and soma meaning body.
This is no longer bio-evolution in the sense that some gene mutation successfully adapts a species to a change in environment. That would be endo-somatic evolution; endo meaning inside, or inside the body.
As Homo habilus, we might call ourselves, we have changed our relationship to the environment by changing things outside the body - for now, we can just call it technology. The technology might be a flint-knapped hand-axe or an iPod. We make things outside our bodies that not only change the environment, and not only change our relationship to the environment, but that make profound changes in how we behave - that is, what we are.
Georgescu-Roegen compares these dramatic changes in behavior to those endosomatic changes (bio-evolution) that differentiate species. One thing that differentiates big cats is unique behavior, how they obtain food, how they raise their young, etc. Georgescu-Roegen said that the changes between peoples and subsets of peoples that has been wrought by variant kinds of appropriation from the outside environment has divided us into ever-evolving exosomatic "species" (NOT in the biological sense).
These are not species that have only evolved linearly through time (though that kind of evolution is happening), but simultaneously, sometimes in relations that very resemble predator-prey and/or parasite. Differences between, say, first world and third world regions are not merely inequitable, but the affluence of one depends upon the exploitation of the weaker. There is interspeciation, then, across space. With the introduction of an ecologic analysis, we see the dissipation of resources by one generation in a way that deprives and thereby exosomatically differentiates future generations - interspeciation over time.
Much modern economic theory ignores the fact that these exosomatic resources - especially, for us, exsomatic energy - are finite. The implications of that finity are not friendly to mainline economic theory as a whole, which valorizes an abstraction called "growth," meaning endlessly creating returns on investment using money. The problem is that the materials, including energy fuels, that have been essential to the industrial takeoff that led us to today, will at some point require more energy and other material than what gets put into production - whereupon production will come to a halt.
This won't happen in an abrupt and apocalyptic break, but by degrees that will be remarkable for the changes in social relations. We see some of them now with international wars on and around the global oil patch.
Enter, now, William Stanley Jevons, circa 1865, who wrote a paper called The Coal Question. He states a problem that would come to be known as "Jevons' Paradox." He says that a more efficient energy source - which in a steady-state would yield more benefits per calorie - actually leads to an accelerated exploitation of that resource, destroying its potential benefits more quickly than would be the case if there were less.
Figurative "growth" uses real energy in increasing quantities, or it wouldn't be "growth." This is not a normative statement, like "capitalism can be heartless." This is a demonstrable physical reality.
Not only is exosomatic energy, i.e., fossil fuels (for us), required in a steady and steadily increasing flow into and out of productive processes, it is required in particular forms. You can't burn coal in automobiles. All calories of energy are not the same. Energy sources are not like general purpose money, not the ding-ding-ding of pure quantity - even though you can measure energy in joules or calories - because energy sources are not interchangeable.
So if we look at industrial production in general - a capitalist phenomenon that was unsuccessfully imitated in the short-lived states practicing barracks socialism - we can think of the productive process as requiring inputs, which we can assign the shorthand, fuel. That includes fossil hydrocarbons (very substantially), but also things like iron, copper, nickel, water, lead, magnesium, graphite, tungsten, limestone, and on and on, as well as newly critical materials like silicon, cadmium, and lithium. All the stuff that is required for the general production process.
Stop reading for a moment and look around the room, and try to identify materials and energy sources. Look at your computer, for that matter.
These are inputs in the process.
Then we look at the outputs of the process, which fall into two categories: product and waste. For every car, there is - somewhere - scrap metal that was shaved or ground off, polluted water, burnt fuel, a host of mines where topsoil was stripped and slags dropped somewhere else, a loss of habitat, the air pollution from chemical production, carbon released into the atmosphere, etc.
Georgescu-Roegan described two basic kinds of activity based on physical state-changes - order and dissipation, which we can see work hand in hand. The order of the produced automobile is the outcome of disorder (dissipation) in several other sites. Here is where the Second Law of Thermodynamics (entropy) applies. It applies directly in the use of combustibles, and indirectly in the breakdown of naturally occurring order in the biosphere, as well as in social relations. The basic fact is this: the total order of a thing made by people is less than the total disorder that is created somewhere. This is a physical law, which fetishism conceals.
Overall, as far as we know, the universe as a whole is moving from a state of low-entropy to high-entropy, that is, the universe is cooling off. This cooling is aimed at a final state - barring interruptions from outside space-time as we can know it - of total dissipation and a temperature of absolute zero. Some people refer to this as an "unwinding," and that unwinding is what we perceive as the passage of time. Time never goes backward because of the Second Law. Humpty-Dumpty never gets put together again. Time's "arrow" only goes in one direction. This is the mechanism that ensures we will all die.
What this means in more practical terms is that cold never moves into warm in nature. That's why we have to use "heat pumps" to force the cooled air from an air-conditioner into a warmer space in a building. When you put ice into a glass of water, the water doesn't freeze; the ice melts.
In nature, heat - a bi-product of energy exchange - always dissipates in any closed system. Even in a system like the earth, where we are closed with regard to matter but receive constant energy input from the sun, the heat generated by the sun eventually dissipates back out into space.
The principle means by which solar energy is captured and concentrated for use is photosynthesis, which -while it is still part of a universal entropic process - serves as a counter-entropic process on earth. The vast majority of the energy that is keeping you and I alive at this very moment is solar in its origin. Plants concentrate solar energy in the form of carbohydrates, etc., whereupon other creatures can eat those materials, converting energy to use (and losing some in the process to dissipation). Some creatures eat the creatures who are constituted by their conversion of photosynthetic energy-concentrations, using more of that energy (and losing some in the process to dissipation), and so on.
Humans jumped over the process by using heat from combustion, to render meat more digestible, for example, or to stay warm in cold places, but also to power kilns, and nowadays to generate electricity, power vehicles, and so forth. Still all solar. The fossil energy we rely on now began as photosynthetic-product, which was stored and concentrated by geologic processes over 50-300 millions of years. We have burnt up nearly half of that in around 130 years. This "cheat" will not last a great deal longer, because our use - a la Jevons' paradox - has actually accelerated.
That savings account is in trouble.
This fact is an externality, excluded from consideration because it would disrupt profit.
Economics measures GDP, or the total amount of monetary exchange. Economics does not synthesize GDP with any account of remaining material capacity, that is, how the actual material world is being dissipated.
But what economics really fails to measure or account for is that there is a greater paradox affixed to that of Jevons. The greater the profit, the greater the acceleration of entropy. Profit and the material value of the unused resources (they lose value after use) are inverse. The more profit gained, the more potential that is lost.
One more of those out-of-sight-out-of-mind fetishism problems is that we - by that I mean the "advanced" nations - appear to have less environmental disorder than poor nations, where environmental devastation is pronounced and visible.
We noted earlier that Kenneth Boulding said belief in indefinite "growth" is the mark of madness or economics. He also said that "dissipative structures allow complex systems to achieve and maintain a high level of order by dissipating their entropic tendencies, i.e. their tendencies to disorder, disorganization, and energy loss, to neighboring systems."
This is essential for understanding how entropy in capitalism translates into the division of the social world.