In?managing?how?the?world?should?work,?an?influential?article?in?Nature led?with?the?statement?that?“Gross?Domestic?Product?is?a?misleading?measure?of?national?success”?and?urged?countries?to?“embrace?new?metrics”.1?As?reported?in?this?journal,?there?has?indeed?be?a?move?by?many?countries?and?provinces?to?seek?more?realistic?data?on?sustainability.2?A?solution?to?identify?key?factors?serving?wellbeing?is?in?the?combining?of?science?and?economics?to?measure?all?activities?by?the?changes?in?chemical?bonds?made.?From?the?simple?act?of?breathing,?up?through?the?refining?of?metals,?to?complex?manufacturing?and?what?a?whole?country?produces,?the?aggregate?of?oxygen-oxygen?bonds?exchanged?for?an?oxygen-carbon?bond?is?an?insightful?indicator?of?work?done.?As?shown?in?the?graphs?leading?this?article,?the?poor?performance?in?production?in?the?US?2001-2010?can?be?identified?objectively?in?science?but?was?hidden?in?dollar-based?National?Accounts?until?after?the?crises?of?2008.

The?wealth?of?nations?has?been?mused?since?the?reign?of?Solomon.?Chests?of?gold?and?silos?of?grain?were?the?early?measures,?and?the?advent?of?national?accounting?in?the?USA?80?years?ago?soon?led?to?a?movement?within?each?country?having?buildings?of?staff?working?on?their?GDP.?Leaders?across?the?spectrum?of?polities?hope?to?placate?constituents?with?news?of?GDP?growth?even?if?not?reflected?in?infrastructure?and?social?fabric.?GDP?data?shines?even?with?and?especially?if?reckless?growth?results?in?more?pollution?cleanups?and?increased?health?costs.?Money?management?becomes?unhinged?from?the?real?goods?and?services?that?money?is?supposed?to?represent,?and?“making?money”?sinks?into?to?“making-up?money”.

Backlash?in?the?form?of?a?search?for?a?new?economic?paradigm3?has?led?to?attempts?at?Green?GDP?and?the?Genuine?Progress?Indicator.?China?published?Green?GDP?data?in?2006,?embarrassing?provincial?leaders?to?the?extent?that?it?was?not?published?in?subsequent?years,?even?though?an?army?of?public?servants?collect?data?and?present?a?Green?GDP?Report?which?is?not?released.4?The?Genuine?Progress?Indicator?(GPI)?can?show?what?many?people?feel—that?they?are?no?better?off?in?general?wellbeing?than?twenty?years?ago,?even?though?GDP?would?suggest?otherwise.?The?GPI?is?now?an?official?instrument?for?policy?planning?and?management?in?some?regional?governments,?and?is?proving?a?useful?tool.5?However?the?basis?for?the?index?relies?on?surveys,?interviews,?and?people’s?perceptions,?and?not?on?the?hard?facts?of?financial?records.

To?tie?financial?accounting?down?to?what?is?really?happening,?attempts?are?made?to?link?to?science.?The?First?Law?of?Thermodynamics?can?be?comprehended?as?the?conservation?of?matter?and?energy.?In?practice?a?good?representative?of?finite?matter?is?gold.?Various?attempts?at?linking?a?nation’s?money?to?gold?have?been?tried,?most?responsibly?by?Great?Britain?and?then?the?USA,?but?no?country?has?been?willing?to?try?in?the?last?50?years.?Energy?is?a?more?malleable?concept,?yet?said?to?be?conserved?(indestructible)?and?therefore?applied as?a?measurement?of?economic?activity.?During?the?energy

crises?of?the?1970’s?it?was?popular?to?look?on?manifestations?of?energy?as?a?currency.

In?the?past?half?century?there?have?been?earnest?studies?to?link?economic?activity?to?energy?in?some?way.?Odum’s?“emergy”,6?Szargut’s?exergy7?and?Georgescu-Roegen’s?entropy?analysis8?all?have?intuitively?potential?insights?into?the?science?of?economic?production?and?consumption?processes.?This?paper?critically?reviews?the?concept?of?energy?and?its?relevance?to?the?physics,?chemistry?and?engineering?that?are?the?basis?of?primary?and?secondary?industries.

“We Have No Knowledge of What Energy Is”

Richard?Feynman?exclaimed?that?we?do?not?know?what?energy?is,?adding,?“we?do?not?have?a?picture?that?energy?comes?in?little?blobs”.9?And?if?the?purer?sciences?need?care?with?the?concept,?even?more?so?in?accounting?for?economic?activity.?Coal?mining?in?England?around?1750?provides?an?enlightening?case?study?in?energy?economics?before?the?term?“energy”?had?been?introduced.?Coal?mining?is?the?provision?of?a?resource?formed?by?nature?but?requiring?socio-economic?inputs?to?extract?and?deliver.?The?phenomenon?of?“energy”?resides?both?in?the?coal?and?in?the?work?done?on?it.?In?Ricardo’s?economics,?in?situ?coal?is?“virgin?land”?and?(especially?if?you?do?not?know?it?is?there)?has?no?cost.?A?major?cost?in?coal?mining?operations,?however,?is?the?vertical?lift?to?the?surface,?not?only?of?coal,?but?disposing?of?water?threatening?to?flood?the?mine.?Before?the?term,?“energy”,?was?coined?by?Thomas?Brown?in?1804,?James?Watt?had?already?popularized?the?notion?of?“horsepower”?which?he?defined?as?180?pounds?lifted?181?feet?in?1?minute?(rounded?to?33,000?foot?pounds).

The?idea?of?lifting?1?pound?weight?1?foot?high?is?elegant?and?practical,?set?in?the?equation?“work?equals?force?times?distance”,?W?=F?x?d,?only?enunciated?in?physics?in?1829?by?Coriolis.?It?should?go?without?saying?that?force?is?the?vertical?force?needed?to?overcome?gravitational?force.?The?“energy”?term?entered?wider?discussion?with?Joule’s?experiments?reported?1845?linking?mechanical?work?to?heat.?The?idea?of?convertibility,?and?of?the?conservation?of?energy?(in?some?form)?evolved?into?the?field?of?Thermodynamics?and?the?First?and?Second?Laws,?impacting?on?chemistry,?electricity?and?public?imagination.

Joule’s?presentation?of?his?results?as?“The?Mechanical?Equivalent?of?Heat”?was?an?exciting?advance,?discrediting?caloric?theory,?but?also?lent?itself?to?future?confusion.?In?hindsight?a?more?precise?naming?on?his?discovery?could?have?been,?“The?link?between?work?done?by?gravitational?force?and?the?maximum?heat?that?can?be?derived?from?that?work”.?That?title?is?not?as?catching,?but?does?not?pretend?any?energy?forms?are?“equivalent”.?The?force?of?gravity?can?be?harnessed?to?churn?water?and?raise?its?temperature,?but?warm?water?will?not?lift?weights?back?up?with?the?same?efficiency.

Gravitational?force?is?special.?It?is?directional?and?constant,?and?though?we?have?no?idea?of?what?it?really?is,?for?all?practical?purposes?in?everyday?life,?its?source?is?the?massiveness?of?planet?Earth.?Other?forces—a?push?or?pull,?the?force?of?wind,?come?from?diverse?sources?of?energy,?and?can?manifest?themselves?in?various?forms.?There?is?no?universally?agreed?list?of?forms?of?energy,?though?most?texts?list?about?six?groups?which?may?overlap?depending?on?user?perspective.?Discounting?the?force?of?gravity?because?it?is?free?and?the?strong?force?inside?nuclei,?the?only?one?force?left?to?drive?action?(including?economic?activity)?is?the?electromagnetic?force?(emf).10

If?we?return?to?Watt’s?comparing?of?steam?engines?against?horse?power,?a?joule?is?lifting?102?grams?one?meter?against?the?force?of?gravity.?But?the?link?to?gravity?was?dropped?in?the?1946?world?conference?on?measurements?because,?quite?reasonably?for?scientific?exactness,?gravitational?force?varies?by?0.7?percent?between?the?extremes?over?the?surface?of?the?Earth.?The?replacement?definition?requires?us?to?imagine?a?mass?of?1?kilogram?with?no?gravitational?forces?acting?on?it?experiencing?some?force?that?will?accelerate?it?at?1?meter?per?second.?That?is?hard?to?imagine,?in?high?school?physics,?and?in?professional?economic?research.?The?upshot?is?confusion?in?energy?analysis?of?economic?activities.

The?energy?concept?gets?only?general?treatment?in?economics,?as?if?the?details?are?taken?care?of?in?science.?Reference?to?the?relationships?water?has?with?food,?energy?and?environment11?has?firmed?into?discussion?of?a?“water-energy-food?nexus”.12?The?natural?water?cycle?is?now?almost?always?augmented?with?construction?of?storage?facilities?and?channeling?and?with?pumping.?That?is,?humans?must?intervene?with?energy?investments,?that?can?just?be?a?dollar?value,?with?the?details?left?to?engineers.?Simply?put,?energy?“inputs”?are?monetized?and?commodified.13

Yet?big-picture?accounting?of?physical?economic?activities?provides?a?useful?backdrop?to?dollar?cost?benefit?analysis.?It?can?identify?misunderstandings?in?double?counting,?counting?line?items?that?don’t?belong?and?failure?to?count?“externalities”?which?do?count?in?the?big?picture.?Energy?is?not?just?another?commodity,?another?input?to?an?ecosystem?and?is?not?some?single?digit?percentage?of?a?country’s?GDP.?In?science?there?is?only?matter?and?energy,?and?economics?never?counts?“matter”?as?a?generic?input.

Economics?needs?to?reverse?engineer?some?ecological?science?and?reassemble?it?in?a?new?approach?more?useful?to?economic?analysis.?Energy?in?economics?is?more?mysterious?than?rocket?science.?The?scientists?have?left?key?problems?unsolved.?As?a?case?in?point,?gasoline?prices?figure?prominently?in?economic?scenarios,?and?yet?how?science?relates?gasoline?combustion?to?the?environment?seems?unimportant?in?engineering?and?a?mystery?in?economics.

Fueling the Economy— Chemistry’s Hidden Debt

In?chemistry,?the?reactants?in?gasoline?combustion?are?accounted?as?having?bond?strengths?totaling?16?kj/mol?and?the?products?as?21?kj/mol.?The?change?in?enthalpy?is?-5?kj/mol?and?it?is?this?negative?number?that?consumers?demand?and?countries?go?to?war?over.?Chemical?engineers?ignore?the?minus?sign?and?convert?this?to?Mj/liter,?and?then?for?a?family?car,?16?miles/gallon?or?7?liters/100?km.?The?chemistry?gives?us?the?magnitude?of?the?number?accurately?but?hides?what?needs?to?be?recognized?for?modelling?in?ecological?economics.?It?does?not?make?economic?sense.?If?the?energy?units?were?dollars?it?would?seem?that?the?gasoline?costs?$16?and?emissions?$21?and?as?well?allows?$5?worth?of?energy?is?released,?available?for?human?use.?From?an?economic?sense?it?would?be?expected?to?start?with?a?certain?investment?and?portion?be?directed?for?beneficial?use?and,?due?to?imperfect?efficiency,?the?remainder?emitted?as?waste.?In?chemistry?the?numbers?seem?the?wrong?way?around.?It?just?does?not?add?up.

Over?the?past?hundred?years?chemistry?has?established?tests?for?the?energy?cost?of?separating?the?bonds?that?hold?atoms?in?molecules.?It?is?impossible?to?manually?separate?an?individual?bond?between?two?atoms?but?practicable?to?do?it?between?large batches?(6?x?1023?molecules).?The?published?results?serve?the?purpose?of?showing?that?when?a?fuel?combusts?with?oxygen,?the?difference?in?bond?energies?in?resultant?molecules?is?the?amount?of?energy?released?and?“available”?for?economic?use?(heating,?driving?a?car,?etc.).?Table?1?summarizes?this?lab?test.

&nbps;

Table 1. The combustion of gasoline shows the total bond energy of the product molecules is greater than that of the reactants, and the difference (taken as a positive quantity) is the amount of energy released and “available” for economic use.

An?attempt?is?made?here?to?venture?between?chemistry?and?economics?to?provide?an?explanation?of?the?system?at?work.?An?atom?is?a?structure?unlike?anything?in?macroscopic?engineering,?but?obeying?strict?quantum?mechanics?laws.?The?rearrangement?of?valence?electrons?seeking?tighter?bonds?in?neighboring?atoms?occurs?against?a?backdrop?of?the?total?energy?in?each?atom.?Chemistry?text?books?refer?to?the?“internal?energy”?by?the?symbol?“U”?and?deem?it?unknowable.?Given?the?complexity?of?the?Schrodinger?equation?and?acknowledging?we?cannot?pin?down?electrons’?positions,?it?seems?clear?that?there?is?no?exact?answer.?This?should?not?bother?economists,?and?guessing?internal?total?emf?as?the?sum?of?bond?strengths?of?valence?electrons?comes?up?with?an?estimate?that?can?be?improved?on?later.?See?Pull-out?Box?1?Where?does?bond?strength?come?from??for?this?approach?to?understanding?the?relevance?of?bonding?in?the?context?of?“total?energy”?in?a?single?diatomic?oxygen?molecule.

&nbps;

Figure 1. Calculating the energy released from 1 mole of gasoline in conventional chemistry and using an approach acknowledging where the energy is made available from.

Figure?1?displays?the?conventional?approach?and?a?new?approach?that?recognizes?what?happens?when?energy?is?tapped?from?the?overall?ecosystem.?The?conventional?approach?has?been?used?for?many?decades?because?it?gives?the?correct?magnitude?of?energy?released?from?a?mole?of?gasoline?(except?it?has?a?minus?sign).?The?alternative?approach?provides?a?new?and?humbling?understanding?of?the?bigger?picture.?The?energy?made?available?is?about?2?percent?of?the?internal?energy?of?the?reactants,?and?once?done?the?products?are?locked?in?tighter?bonds?where?there?is?no?more?energy?available.

This?pattern?is?demonstrated?using?the?chemistry?lab?situation?of?a?mole?of?gasoline?(octane,?C8H18).?But?the?pattern?is?the?same?when?graphing?just?one?molecule?of?octane,?or?a?liter,?ton?or?million?barrels.?Furthermore?other?hydrocarbons—methane,?propane,?exhibit?the?same?pattern?with?the?energy?released?being?2.1?percent?of?the?internal?energy?(as?calculated?in?the?Supplementary?Material).?The?energy?released?from?coal?is?less?because?of?impurities?with?the?representative?bituminous?coal?compound?in?the?Supplementary?Material?calculated?as?1?percent.?The?value?for?carbohydrates?is?1.6?percent.?In?general,?for?pure?hydrocarbons?the?energy?released?is?1.5?percent?of?the?internal?energy?(as?estimated)?of?the?oxygen?combusted.

Carbon Exchange with Oxygen as Objective Measure of Economic Activity

This?approach,?at?any?scale,?serves?as?a?model?for?the?realistic?appreciation?of?purposive?release?of?energy?in?any?economic?activity.?It?answers?Feynman’s?cry?for?what?that?energy?“is”.?It?is?indeed?the?“little?blobs”?he?sought,?in?the?form?of?electron-proton?pairs?within?atoms,?that?can?rearrange?combinations?of?atoms?to?save?about?2?percent?of?their?required?internal?structural?maintenance?forces.

The?right?hand?half?of?Figure?1?is?replicated?in?Figure?2?with?the?bond?exchanges?shown?occurring?as?the?reactants?become?products.?In?Figure?2?and?its?right?hand?half,?the?purposive?act?of?extracting?energy?from?the?reactants?can?be?shown?in?the?exchange?of?bonds?that?results?in?the?slightly?tighter?arrangement?of?products?with?the?difference?being?what?we?perceive?as?the?energy?released.?Only?2?percent?of?the?energy?internal?to?the?reactants?is?made?available?for?economic?use.?This?is?a?humbling?surprise?for?economic?actors?and?for?analysts?of?economic?behavior.?An?explanation?of?the?reaction?in?the?center?of?Figure?2?is?set?out?in?Pull-out?box?2.

&nbps;

Figure 2. In the simplest hydrocarbon, the mol of methane is said to “produce” or “release” about 8 megajoules of energy made available for economic use. In this figure it is shown that what we call energy is about 2 percent of the internal energy of the atoms in the reactants, and is the result of a small saving in structural maintenance of the new compounds because of their slightly tighter bonds.

Work as Lifting Against Gravity

Rather?than?Joule’s?comparison?of?weights?falling?with?water?temperature?rising?(and?referring?to?their?“equivalence”)?the?notion?of?lifting?is?a?useful?way?of?presenting?economic?activity.?It?is?like?lifting?the?stone?blocks?to?make?a?huge?pyramid,?and?the?test?can?applied?to?how?much?you?lifted?today,?in?a?year,?or?lifetime,?and?the?same?for?companies,?countries?and?the?globe.?The?sobering?realization?is?that?all?of?human?endeavor?is?an?aggregate?of?this.?Financial?calculations?need?to?match?the?physical?reality.

&nbps;

In?the?stark?example?of?a?forklift?rated?at?44?kw?lifting?a?4.488?ton?item?1?meter?high?in?1?second,?this?is?the?result?of?15?x?1021?molecules?of?C3H8?combusting?with?75?x?1021?molecules?of?O2.?In?that?1?second?each?of?45?x?1021?carbon?atoms?trades?up?from?its?bond?with?hydrogen?and?locks?in?between?two?oxygen?atoms.?The?swap?results?in?a?saving?of?about?6?electron?volts?(ev)?in?the?required?internal?structural?maintenance?in?each?of?the?product?molecules.?That?6?ev,?times?45?x?1021,?is?the?energy?released?in?all?directions?at?the?level?of?atoms?that?can?be?directed?and?harnessed?in?an?engine?cylinder?to?lift?4.488?tons?1?m?high?against?the?force?of?gravity?(theoretically?44,000?joules?or?2.7?x?1023?ev.).?This?calculation?is?for?full?throttle?(1?gram?propane?per?second)?and?empirical?tests?would?present?a?lesser?result.

Forklifts?also?transport?items?horizontally?but?if?the?combustion?rate?was?the?same?as?when?lifting?then?the?work?done?horizontally?including?against?friction?could?be?deemed?equivalent?to?a?weight?lift.?All?and?any?work?done,?based?on?calculation?of?oxygen?molecule?bonds?broken?and?exchanged?for?oxygen-carbon?bonds?can?be?represented?as?an?equivalent?“lift?against?gravity”.?A?weightlifter?may?lift?50?kg?2?meters,?and?unlike?the?forklift,?there?is?not?direct?instantaneous?register?of?bond?exchanges,?but?there?is?no?doubt?it?does?happen?and?there?is?an?objective?link?between?daily?intake?of?carbon?atoms?(in?carbohydrates?and?proteins)?and?work?done,?not?only?in?lifting?but?all?forms?of?work.?It?is?observed?that?heat?results?from?work?done?at?the?scale?of?atoms.

The?solution?this?approach?delivers?is?that?it?gives?a?closer?picture?of?contributions?to?economic?activity?than?GDP?or?income?dollars.?Speculation?is?a?zero?sum?game?and?has?zero?net?production.?Stimulus?packages?do?add?to?production,?stirring?economic?activity?where?there?was?none.?Millions?of?economic?actors?can?sense?that?their?oxygen?intake,?direct?and?indirect,?results?in?work?done.?The?more?that?that?fact?is?considered,?with?its?implications?and?the?chain?of?indirect?processes?that?combust,?the?clearer?it?becomes.?Even?in?tertiary?industries?with?seemingly?sedentary?work,?there?are?distant?but?vital?links?to?physical?activity?that?can?be?related?to?lifting?work.?This?serves?as?an?antidote,?if?not?a?solution?to?investment?whisperers?who?portray?that?they?can?“make?money”?by?paying?high?returns?drawn?from?the?investments?latter?hopefuls?have?made.?Mere?manipulation?of?money?in?such?practices?performed?by?Madoff?and?such?operators?detailed?in?the?documentary?film?“Inside?Job”?could?not?occur?if?required?to?show?what?work?was?done.

An?all-perceiving?alien?sweeping?by?our?planet?20,000?years?ago?would?see?the?natural?Earth?with?imperceptible?human?economic?activity.?Today?a?similar?sweep?would?see?pyramids?and?skyscraper?cities,?traffic?clovers?and?large?swathes?of?land?radically?transformed?for?better?or?worse?by?farming,?deforestation,?polluting,?and?in?the?past?decade,?proliferation?of?solar?panels.?A?glance?at?the?globe?could?be?encapsuled?in?the?sum?of?diatomic?oxygen?molecules?broken?since?the?start?of?the?Industrial?Revolution,?1750,?up?to?2017.?The?various?engines and?facilities?that?capture?the?flows?of?released?energy?were?manufactured?and?their?history?from?extraction,?processing,?assembly?and?transport?is?the?history?of?past?bond?trades.?Figure?3?graphs?the?estimated?number?of?oxygen-oxygen?bonds?broken?by?human?volition?1750?up?to?2017?and?projected?onward?to?2040.?The?period?starts?with?most?work?done?by?heavy?panting—labor?fueled?by?food?and?fodder,?supplemented?by?fires?fueled?by?wood?and?lamps?flickering?on?oil?from?animal?fat.?Coal?supplanted?firewood?as?main?fuel?mid?nineteenth?century.

Progress?made?through?capital?formation?can?be?modeled?by?application?of?an?inverse?version?of?Figure?2?to?the?timeline?of?Figure?3.?The?process?depicted?in?Figure?2?represents?an?engine?of?growth?inhaling?oxygenoxygen?on?the?right?and?the?bonds?broken?by?trading?for?an?oxygencarbon?bond?to?reduce?the?need?for?internal?structural?maintenance?of?the?atoms?involved.?The?emf?released?is?directed?out?the?left?side?to?“do”?something?such?as?heating?or?moving.?Humans?have?evolved?complex?organizations?and?systems?that?produce?goods?and?services?that?can?then?be?built?on?for?further?gains?in?perceived?wellbeing.?It?is?like?a?rolling?railway?operation?that?lays?line?and?peripheral?infrastructure?as?it?progresses.?In?Figure?3?the?chemical?reaction?depicted?in?Figure?2?represents?all?the?technical?processes?that?trade?an?oxygen?atom?for?a?carbon?bond?“profiting”?3.2?ev.?It?can?be?conceptualized?as?a?juggernaut?climbing?the?slope?of?human?progress,?being?able?to?rise?higher?through?the?benefits?of?highorder,?low-entropy?capital?that?has?been?laid?out?up?to?that?point.?The?red?arrow?is?not?quantified?in?this?paper?but?suggests?an?avenue?of?insights?for?further?research.?It?represents?high?entropy?inexorably?produced?from?the?reaction?and?can?lead?to?the?choking?of?further?progress.

Figure 3. From the start of the industrial revolution through to expected purposive release of energy in 2040 global annual aggregate has risen from 4 to 874 exajoules. The annual number of oxygen-oxygen molecules broken can be tracked and is projected to be 1,343 x1036 in 2040.

The?almost?flat?line?along?the?X?axis?is?a?record?before?the?“sharp?rise?in?energy”?shown?in?such?graphs?as?presented?in?by?the?International?Energy?Agency?(IEA)14?and?the?World?Bank.15?The?IEA?uses?as?units,?millions?of?tons?of?oil?equivalent?(Mtoe)?and?the?World?Bank,?terawatt?hours?(Twh)?to?unify?various?forms?of?energy.?In?so?doing?the?concept?of?energy?becomes?even?more?abstract?than?dollars.?Money?feels?real,?even?though?it?is?an?abstraction,?yet?what?it?is?supposed?to?represent?is?subject?to?misunderstanding?and?manipulation.?Oxygen?molecules?are?real?and?we?die?without?them?in?minutes.?The?oxygen-oxygen?bond?is?real?and?fixed.?Oxygen?is?an?invisible?gas,?but?the?bond?between?atoms?is?strong?and?real?like?the?bonds?between?atoms?in?a?bar?of?iron.?The?bonds?and?the?matrix?of?charges?in?electron-proton?pairs?that?makes?them?are?Feynman’s?“little?blobs”.?Unlike?money?they?cannot?be?magically?conjured?up.?Though?tricky?at?the?level?of?macroeconomics?or?enterprise?cost-benefit?analysis?they?are?an?aggregate?of?the?number?of?breaths?made?by?workers?and?the?oxygen?flow?drawn?in?by?engines?and?furnaces.?The?more?complex?the?process?the?greater?the?distance?and?time?in?the?cost?chains.?But?unlike?economics?in?money?terms,?micro-economic?activity?adds?up?to?macro-economics.?The?model?is?an?advance?on?the?currently?promoted?textbook?“circular?flow?of?the?economy”?that?draws?inspiration?from?farming?in?France?around?1750.?The?model?does?not?address?nuclear?energy?drawn?from?the?entirely?different?strong?force?inside?nuclei.

A?caveat?needs?to?be?assigned?to?the?key?word,?“growth”.?This?paper?makes?no?comment?on?what?the?aggregate?of?goods?and?services?in?a?nation?should?be.?Apart?from?producing?“goods” there?are?also?“bads”?produced,?but?they?are?driven?by?the?same?technologies?as?goods?and?therefore?show?up?on?Figure?3.?The?critique?of?this?paper?is?that?leaders?become?possessed?of?growth?mania?and?encourage?professionals?in?economics?and?finance?to?come?up?with?dollar?values?that?are?supposed?to?reflect?good?leadership,?even?if?there?are?no?material?benefits.?The?US?Treasury?$700?billion?stimulus?concocted?on?19?September?2008?required?no?material?reality.?It?cannot?show?up?on?a?Figure?3?graph.?In the two bar charts at the top of this article the problem is hidden in dollar accounts until 2010, but in physical economic activity (and lack of it) the signs begin in 2001.

Figure 4. Opening of a 2013 article in the journal of the China Ministry of Ecology and Environment comparing simple laborer with the (then) real estate developer, Donald Trump, with “scores” in gigajoules for contributions and damage to their surroundings

Summing up

This approach delivers a model of economic activity on a scale in time and magnitude from Adam Smith’s example of hunters trading deer and beaver up to the existing global economy. The knowledge that grand activities consist of real atoms and their real bonds means that cursory material flow analysis can highlight errors that supposed “due diligence” by financial accountants may miss. Anomalies draw focus and any entropy error, by ignorance or design, will unfold. Investors who care about their money will want this approach applied to any project targeted.

The current reliance on conventional economic models as a basis for financial analysis may lead to an assumption that any big amount of money is an aggregate of the small amounts most people are familiar with in daily activities. But devious manipulation of the money numbers in large activities is endemic. A stimulus package is a game with key players arguing wild, huge numbers. In high-profile sales, the prices can be outlandishly contrived through collusion to alter market dynamics. A quick assessment of the “weight of work” in any activity and transaction is a wholesome reality check. Ultimately, any goods or service item can be traced back to the work done and its equivalent weight lifted (this makes more sense than calories of heating, and much closer to reality than linking big dollars to the price of apples or a week’s wages). In any item the trail of oxygen bonds must add up. It relates to work done. Machines or people worked for it.

In short:

  • This approach jolts analysts of economic activity to acknowledge cost require work and work can be traced to aspirated engines, biological and mechanical.
  • Production, including GDP, requires economic action, and the cost of that activity has a scientific basis.
  • GDP measured as trading chemical bonds cannot be conjured up.
  • The raw and earthy truth is hard work requires heavy breathing and in modern major projects that work is embodied in resources, capital equipment and infrastructure as well as direct human labor.
  • In the two bar charts at the start of this paper, had analysts used the first chart, they would see sluggish activity beginning 2001 would lead to a financial crisis.

It is the aspiration of this paper that scientists and economists can work together to refine an objective numerical scoring system to assess the costs of human activity. One direction to be developed, to be understood and accepted by analysts of economy and society is to estimate (as referenced in an article in the journal of the China Ministry of Ecology and Environment, opening depicted Figure 4) for an individual the general observed benefits contributed (numerator) and also the draw-down on the environment imposed by such activities (denominator).

References

    1. Costanza, R. et al. Time to leave GDP behind. Nature. 505 (3). 2014.

    2. Costanza, R. et al. Toward a sustainable wellbeing economy. Solutions. Volume 9 Issue 2 April 2018

    3. Button, D. Stop obsessing about GDP: we should focus on wellbeing, The Guardian. 10 June 2019

    4. Kahn, J & Yardley, J. As China roars, pollution reaches deadly extremes. The New York Times, 26 August, 2007.

    5. Kubiszewski, I. et al. Beyond GDP: Measuring and achieving global genuine progress. Ecological Economics. Vol 93. September 2013.

    6. Odum, HT. Environment, Power and Society. Columbia University Press. New York. 2007

    7. Szargut, J. Exergy Method. WIT Press. Southhampton. 2005

    8. Georgescu-Roegen, N. The Entropy Law and the Economic Process. Harvard University Press. Cambridge, MA. 1971.

    9. Feynman, R. Feynmanlectures.caltech.edu/I_04. html

    10. Coulter, J. The chemistry of markets. Ecological Economics. Volume 41. January 2002

    11. Hellegers, P. et al. interactions between water, energy, food and environment: evolving perspectives and policy issues. Water Policy 10 Supplement 1. 2008.

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John E. Coulter

Dr Coulter has made extensive practical and policy contributions in resource management in China, Indonesia and Australia. He has successfully completed more than twenty projects for China State Council,...

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