A 14-Year-Old Girl Explains How We Can Stop The Addiction To Economic Growth

Tyler Durden's picture

Via ClubOrlov blog,

[This week's guest post is by Scott Erickson, who is an award-winning humor writer and the author of a satirical novel titled The Diary of Amy, the 14-Year-Old Girl Who Saved the Earth. I liked it. It is entirely disarming and strikes a good balance between humor and seriousness. There are enough jeremiads and diatribes and rants on this topic out there. Luckily, this isn't one of them because Scott's scathing social critique and mordant wit are delivered via a charming narrative device: a smart, earnest, precocious 14-year-old girl.]


Hi! I’m Amy Johnson-Martinez, the 14-year-old girl who’s saving the earth from environmental destruction. A lot of people don’t understand how the destruction of the earth is connected to our addiction to economic growth. Actually, a lot of people don’t even realize that we’re addicted!

Personally speaking, I think it’s kind of weird that economists don’t tell us about this. So I guess it takes a 14-year-old girl to tell you about it!

Economists always say, “The economy has to keep growing or else it will collapse.” But it can’t grow forever, because the earth is running out of resources. Actually, it’s already starting to happen. That’s a big reason why the economy is getting worse.

Our economy is giving us a totally stupid choice: Save the economy or save the earth. It won’t let us save both! I personally think that’s pretty crazy!

On my journey to save the earth from environmental destruction, I figured out pretty quickly that the main problem is the economy. Pretty much every time there’s an idea that would make things less destructive and more sustainable, the argument against it is always: “It will be bad for economic growth.”

That’s when I found out the economy has to grow or else it collapses. But when I asked why, nobody knew the answer. So I had to figure it out myself.

I looked at a bunch of economic books, but none of them said anything about why we’re addicted to economic growth. I couldn’t even find out how the economy could grow. That’s another basic question: How can money grow?

Isn’t that an interesting question?

This led to another question, “How is money introduced into the economy?”

The answer wasn't easy to find. At first I thought the answer was that the government prints it, but that was back when I was young and naive. It turns out that the government prints only a tiny percentage of the money in circulation, and the rest is just promises, based on future growth (which is kind of weird if you think about it.)

Then I found out about “quantitative easing,” which sounds intellectually sophisticated. But it’s not the “real” answer, because quantitative easing only creates more promises. And the only way to live up to these promises is by overall growth of the economy. So we’re back to where we started: How does the economy grow?

Since I couldn’t find any answers in books about contemporary economics, I tried looking at books about the history of economics. I focused a lot on John Maynard Keynes, who was from England and invented the basic economic ideas we still use.

I found something interesting that he wrote in 1933. It’s the first thing I found that talks about economic growth. Basically, he thinks it’s important to have the economy grow, but when everybody is doing OK then growth should stop:

Suppose that a hundred years hence we are eight times better off than today. The economic problem may be solved.

The economic problem, the struggle for subsistence, always has been the primary, most pressing problem of the human race. Thus for the first time since his creation man will be faced with his real, his permanent problem – how to use his freedom from pressing economic cares, how to live wisely and agreeably and well.

When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals. The love of money will be recognized for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease.

I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue – that avarice is a vice, that the exaction of usury is a misdemeanor, and the love of money is detestable.

But the prediction that economic growth would end poverty hasn’t happened. In fact, even with all the economic growth that’s happened since then, poverty is getting worse. Obviously, the idea that economic growth will end poverty isn’t right.

I had to look up what the word “avarice” means, and basically it means “greed.” I also had to look up what “usury” means. It means to charge interest on loaning money. It’s a religious word and at one time all religions were against it as unethical.

Even though the quote was interesting, it didn’t answer the question about how money can grow. So I had to go back even farther. The ideas of John Maynard Keynes were influenced by another guy – John Law.

What a weird person! According to one book, in addition to being a banker and an economist he was “a gambler, swindler, rake and adventurer forced to flee the British Isles after killing an opponent in a duel.” This kind of person helped invent our economic system?

I found something in a book about John Law that seemed important: “Law made clear the distinction between a passive treasury, where money just accumulated, and an active bank, where money was created.”

Banks create money? That was news to me! I thought they just kept money and loaned some of it out.

The answer has to do with the “fractional reserve system” which started in the 1700s. It used to be that money was sort of a “receipt” for gold. The receipt was called a “banknote,” which was printed by the bank. But then some bankers figured out they could print more “receipts” than the gold they had, therefore they only had a “fraction” of the gold compared to the “receipts” (actual money).

That explains how it came to be that banks could create money, but it didn’t explain how money could “grow” – since banks were only allowed to print a certain percentage extra.

Then, some bankers figured out a way to become even more wealthy with this “extra money” they could print themselves. What they did is to give out the money in the form of a loan. Since they charged interest on the loan, they would get back more than they gave out. This next part is where the addiction starts.

Let’s say you get a loan for $100, but because of the interest you pay back $110. Here’s an interesting question: Where did that extra $10 come from?

It didn’t come from you, since you can’t create money. Only banks can – by making loans. So the extra money could only come from one place: More loans! If you trace money to where money comes from, it almost always comes from a loan.

People can get personal loans, but what’s more important for the economy is business loans – loans to start or expand a business. Of course all the loans have interest, which means paying back more money. But we’ve already figured out that money is “created” by banks issuing loans. So to pay off past loans, somewhere else in the economy there has to be new loans which create more money. But then THOSE loans have to be paid off with money, which means MORE loans.

It always comes back to the banks making more loans to pay off the existing loans. This has been going on for hundreds of years, which is how the economy “grows.”

Economic growth needs more money, but more money needs more economic growth, which needs more money. And it doesn’t stop. It can’t stop.

That’s not only how the economy grows, but why it HAS to grow. We can never get to a point where growth is “enough.”

This is why we’re addicted to economic growth. We’re not creating money; we’re creating debt!

Like with any addiction, we keep doing it even when it’s not working any more. This is why even when it’s obvious that economic growth isn’t solving unemployment or ending poverty or doing any of the other stuff it says it can do, we keep trying it anyway. It’s why even though we have more money than ever before in history, we still need more.

The funny thing is that the solution is super-easy. All we have to do is stop the banks from creating money as debt.

You know what’s really interesting? I discovered that our greatest president Abraham Lincoln figured this out and tried to stop it. Lincoln tried to fix the problem by having the government print a kind of money called “greenbacks”—$450 million of interest-free money. But the banks did NOT like this because they wanted to create all the money themselves! So they bought up all the “greenbacks” and forced the government to buy them back in exchange for gold.

Lincoln had the right idea, but he didn’t go far enough. We have to eliminate interest on ALL money. The answer is actually super-easy.

To end the addiction to economic growth and save the earth, this is what we need to do: End the creation of money as interest-bearing loans. Put an end to fractional reserve banking and make it so banks can’t create money. Then give the U.S. Treasury the exclusive right to issue U.S. currency free of debt.

Of course, the big banks won’t like this, because they make money from keeping us addicted. But as I learned in school, we live in a democracy which means companies aren’t the boss of us; we’re the boss of them. Yay for democracy!

Let’s stop the addiction before the economy collapses and destroys the earth, which is very beautiful. In fact, it’s my favorite planet!

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gdogus erectus's picture

Lincoln was a good guy?
We are responsible for the resource depletion?
Work on your education a bit more. Zero Hedge is free. (as long as you don't mind being educated in a men's locker room.)

HelluvaEngineer's picture

Yeah, I didn't actually read it.  Now that you mention that part and I revisited it, I have no friggin idea how you could pick Lincoln over Andrew Jackson.  Choice #2 would be Kennedy, since he died for that shit.

icanhasbailout's picture

"But as I learned in school, we live in a democracy"



Buckaroo Banzai's picture

Lincoln was an awful President, but you have to give him credit for the Greenback.

"But the banks did NOT like this because they wanted to create all the money themselves! So they bought up all the “greenbacks” and forced the government to buy them back in exchange for gold." And they also had Lincoln shot.

And another thing. It isn't just compounding debt that is creating cancerous economic growth; the takeover of our global economy by publicly traded corporations contributes to the problem as well. Publicly traded corporations MUST grow in order to increase their stock price in a financial environment that scorns dividends. Consider a company like Starbucks. In Italy, there are thousands and thousands of family-owned corner bars that sell espresso and cappucino. Each one of these little family-owned bars make a nice living for their owners. Contrast that to Starbucks, which must grow exponentially in order to benefit a literal handful of corporate executives. It doesn't even benefit shareholders in the long run, because one day the growth will stop, and the stock price will collapse, leaving shareholders holding the bag.

James_Cole's picture

It's not about saving the Earth, the Earth will be ok.

Thomas's picture

I suspect a little ghost writing went on in this article.

AlaricBalth's picture

It's a novel.
Amy doesn't exist.

zhandax's picture

Let's hope so, else that kid is on tv in some mall tomorrow morning with an assault shotgun rifle glock.

Help Is Not Coming's picture

I agree with you with regards to corporations. The real problem is that corporations are effectively immortal. Shareholder's come and go but the corporation lives on. Jonathan Swift had insight into immortal beings when in Gulliver's Travels he described the Struldbrug  which was a person that looked like everyone else except for the red dot above the left eye. But more importantly...

Struldbrugs were forbidden to own property:

As soon as they have completed the term of eighty years, they are looked on as dead in law; their heirs immediately succeed to their estates; only a small pittance is reserved for their support; and the poor ones are maintained at the public charge. After that period, they are held incapable of any employment of trust or profit; they cannot purchase lands, or take leases; neither are they allowed to be witnesses in any cause, either civil or criminal, not even for the decision of meers (metes) and bounds.


Otherwise, as avarice is the necessary consequence of old age, those immortals would in time become proprietors of the whole nation, and engross the civil power, which, for want of abilities to manage, must end in the ruin of the public.


acetinker's picture

I claim the official title of asshole in this realm, but this is attributed to a 14yo girl.  You expect her to "know" what you know?  I'm normally good with anything you say, Mc.  If I'm missing something, clue me in.

zhandax's picture

Skip, you want to rethink 'claiming the official title of asshole in this realm' in fight club?

acetinker's picture

So I've been told, but I'm sure someone, somewhere thinks you're an asshole, too;)

acetinker's picture

OK zhandax, it's been a few days.  I'M STILL THE ASSHOLE.  You got a counter-claim?  If not, fuck off, Skip!

peter4805's picture

But only if the duck floats...


VulpisVulpis's picture

There isn't a 14 year old in the US who could write anything like this. Satire ineffective.

The Mist's picture

Not only satire, the entire conclusion fails.

Yes let's have the govt print free money, no way they will print too much and spread inflation among the citizens... Surely a new fiat currency is the answer right?

How about you make money redeemable for gold again and any private bank can issue notes, which are redeemable for gold that's in their safe.

Freddie's picture

Any American woman, man or child with a hypenated name is an AH unless they are part of the British upper class.   Most of these people are idiot Americans trying to sound like upper class WASPs. 

akak's picture

What is an "AH"?

And not that I disagree with you that the hyphenated name thing is pretentious and idiotic, but why is it OK for upper-class Brits to hyphenate names but not Americans?

zhandax's picture

The same reason for us to shoot at them until they went away.  We (precarious term these days) don't want royalty here.

A Nanny Moose's picture

The Hedge, "in the beginning."

The Hedge is the AH and the ZH...the beginning and the end. It is all things.

BigJim's picture

Freddie, can't you read?

[This week's guest post is by Scott Erickson...


RSloane's picture

Hey. Don't dis the little girl. She made more sense than Krugman ever did.

RSloane's picture

I feel so strongly about it I said it twice!

Zero Point's picture

I liked your comment so much, I greened it both times!

David449420's picture

Imagine a world where EVERY Banker in the World, from the least to the Truly Corrupt were "Corzined (Vaporized)" tonight.  We would wake up to a different world tomorrow.  Just a Pipe Dream, though.

David449420's picture

Why stop there. Lets throw in EVERY Politician at the same time.  It would take them Decades before they could even start to Fuck us up again.

Zero Point's picture

Every "news" reporter can go on that list.

Gamma735's picture

Is this 14 year old home schooled?

Running On Bingo Fuel's picture

I wonder if Trav777 is babydaddy? Does she have peak oil or nuke opinions?


SilverIsKing's picture

Bottom of page: "Zero Hedge is intended for Mature Audiences"



falak pema's picture

back to barter and bitcoin

akak's picture


Lincoln had the right idea, but he didn’t go far enough. We have to eliminate interest on ALL money. The answer is actually super-easy.

To end the addiction to economic growth and save the earth, this is what we need to do: End the creation of money as interest-bearing loans. Put an end to fractional reserve banking and make it so banks can’t create money. Then give the U.S. Treasury the exclusive right to issue U.S. currency free of debt.

I smell here the powerful stench of Ellen Brown the Money Clown and Bill Still the Fiat Shill.

SpykerSpeed's picture


Love these nicknames, I shall employ them myself in the future.

akak's picture

Those two duplicitous, disingenuous, lying bastards really piss me off, as they pretend to be 'reformers' of the current corrupt and unsustainable monetary regime while being nothing but pro-statist wolves in sheeps' clothing who fundamentally uphold the governmental monopoly on the issuance of money while constantly propagating misinformation and outright lies on sound money and the beneficial role of gold (and silver) in monetary history, as well as being opponents of monetary freedom and free market money itself.

Beware these two agents of monetary lies and subversion.

RSloane's picture

+1 Akak. You said it just right.

1100-TACTICAL-12's picture

Competeing currencies, I'll give you thee Texans for one New Mexican & a hit off your bong>

Againstthelie's picture

Many ZH readers seem to be glad about interest slavery as long as it is based on Gold not on fiat money.

You also don't seem to know that the money we have is created 90% by private banks. So it's not government money it's privately created money that creates compound interest.

If interests on a credit must be paid back in gold or credit based fiat money changes NOTHING.

You must understand the principle of the problem: paying back more than what is available at creation.


The money masters increased their power during a gold standard and they will welcome it again, if the current Kondratieff cycle will end. Nothing will change until the criminal principle of compound interest is forbidden like it was forbidden by death penalty in the golden middle aged centuries.

Raymond K Hessel's picture

90%? You do that math in your head?

Interest is not evil.  Everyone needs a boogey man for all their pain.


Booga wooga wooga wooga!!!  Pitch forks!  We're not going to take it anymore, 8 hour work day, blahhhrrrr!!!!

zhandax's picture

I guess 'I'm persecuted' is the boogey man for all your pain'?  Prove interest is not evil.

Againstthelie's picture

Interest is not evil. 

A system that forces paying back more than is available and this gap growing exponentially is not evil?


Oh, isn't there one single people with a dediceted word for an incredible outragous lie? And randomly this people has a "religion" which prays that compound interest will give this people the world and only then then JWH will come?

Martian Moon's picture

I donate to Still.  Not because I share his statist views but because he is genuinely trying to reform the system from within.  And doing a great job in educating the uninitiated.  For being real, I give the man an A+.

Now if you have some info showing him as the recipient of some wolf in sheep's clothing foundation money ... please share.

spdrdr's picture

Yes, Still's crazy concept seems to be cropping up everywhere.

"Let's just print money directly from the Treasury, and everything will be sweet as!"

Lunatics.  The lot of them.


Induced Coma's picture

I live for the day when everything will be sweet ass...




Radical Marijuana's picture

Well, akak, I LIKE the THEORIES of "Ellen Brown the Money Clown and Bill Still the Fiat Shill."

However, those theories are pretty well irrelevant to the real world, since money is measurement backed my murder. There is no real money system without some murder system to back it up. Ellen Brown and Bill Still propose preposterous boot strap pick-up political miracles, based on being able to awaken enough people to the ways that they are abject victims of the runaway systems of privatized fiat money. While there is no doubt that is so, there are no real solutions which could operate outside of the historical situation that the international banksters are who they are because they were quite willing and able to bribe, intimidate, and assassinate their way through. The current monetary system is really based upon dishonesty backed by violence. Any theories which propose monetary reforms which ignore that money is backed by murder are actually non-starters.

Our real problems are almost infinitely worse than any "monetary reforms" that I am aware of being proposed by anyone. My view is that people who recommend going back to gold and silver based money are even more full of bullshit than those who propose that the government will regulate the fiat money supply better, in the public interest, rather than allow that fiat money supply system to be almost totally privatized. The FACT that we have created a global system of electronic fiat money frauds, backed by atomic bombs, is trillions of times worse than anything that ever existed before in human history.

In my view, we are going to get "monetary revolution" in the worst possible ways, after the current systems push themselves through more genocidal wars, along with democidal martial law. Whatever the good THEORIES might be about possible monetary reform, what is actually going to happen is more runaway social insanity, as the established systems of legalized lies, backed by legalized violence, endeavour to keep themselves going and going, ... and try to transform themselves to become even more globalized systems of force backed frauds.

Human realities are always organized systems of lies, operating organized robberies, with the monetary systems being the symbolic expression of those basic facts. The sublime paradoxes that are manifesting more and more every day are that progress in science and technology ends up being mostly employed to become better at being dishonest, and backing that up with violence. Thus, the existence of global electronic frauds, backed by atomic bombs.  Governments are organized crime, controlled by the best organized gang of criminals. Thus, the government of the USA is the single greatest gang of organized criminals and terrorists in the world, which is actually directed to do what it does by the international bankers.

Whatever nice sounding lists of theoretical solutions to those problems, they are all actually irrelevant to what is really going to happen, which is the exponential growth of the systems of backing up frauds with force, which will destroy themselves to a degree that are trillions of times worse than we can currently comprehend. Since human civilizations ended up being controlled by the people who were the best at being dishonest, and backing their lies up with violence, every decision we have made about what to do has become dominated by systems of legalized lies, backed by legalized violence. Therefore, we have an economic system which is based on maximizing the short-term benefits, regardless of the longer term costs. It was always privatizing the profits, while socializing the losses. Those trends have been accumulating and accumulating, until we finally will reach some real point where the longer term costs, and socialized losses, will overwhelm all of the short-term benefits and privatized profits.

Any genuine changes will have to go through those inevitable processes. There may eventually emerge some kind of monetary revolution. There are no possible monetary reforms which are practically possible to happen until after things get so bad that there are driven to be some sort of monetary revolutions. Such monetary revolutions will be based upon some new regime of death controls, to back up some new regime of debt controls. It is extremely dubious that that will be better than what exists now, since we are on a runaway path towards overshooting, and collapsing into chaos first. The deeper problems are that, since money is measurement backed by murder, how could we ever operate any better murder system, after the development of weapons of mass destruction which are trillions of times more powerful than ever before in human history, since that has no apparently sane and possible answer at the present time?

Any saner money system would require a saner murder system to back it up. That is a pretty tall order, asking for a prodigious series of political miracles. Instead, what one can more reasonably expect is that the runaway debt slavery systems, reaching the point of numbers which become debt insanities, will cause the outbreaks of death insanities as their consequences. AFTER that, one can not predict what the world would look like then! However, the deeper theories continue to be that the central concept of any possible political economy, within any possible human ecology, MUST still be the death control system.

Neolithic Civilization has evolved through the history of warfare, to create murder systems operated through the maximum possible deceits, in which the well established social stories were all bullshit religions which were working within those overall systems, by agreeing to deny that they should exist. Upon that basis was built the monetary system, based on the maximum possible frauds, which were similarly opposed by bullshit ideologies which were working within those overall systems, by agreeing to deny that they should exist. It is almost impossible to estimate the degree to which our current human civilization is insane, since it is all based on doing everything it does through the maximum possible deceits and frauds about what it is doing.

Meanwhile, real progress in science and technology has enabled the scientific methods to discover different truths about the laws of nature, which have enabled some human beings to become trillions of times more powerful and capable than ever before in human history. However, those abilities have primarily been applied to become many orders of magnitude better at being even more dishonest and violent. In that context, sane "monetary reforms" are not possible, while real "monetary revolution" will be possible only after the established systems become so insane that they madly destroy themselves ... after which there are no longer any possible predictions regarding what that world then will look like.

Anyway, akak, if you happen to read this, I wonder what kind of bullshit pie-in-the-sky monetary reforms you personally recommend?  Or ... do you recognize that money is measurement backed by murder, and that any monetary revolution must necessarily be based upon surviving through to some new kind of murder system, operating death controls, which can adapt and assimilate themselves within a world where advances in science and technology have made some human beings become quadrillions of times more powerful and capable than ever before ???

walküre's picture

What's happening at Google?