Why, after ten years of unprecedented central bank interventions, has the global economy not enjoyed a robust recovery from the global financial crisis? Certainly there are demographic issues. Automation is a factor. However, the fundamental answer – ignored by mainstream economics – is that we are running an infinite growth paradigm on a planet of finite resources. In truth, though, it is not really us doing the ‘running’. The global economy as a totality is a self-organising complex system that is only consciously controllable in niches by individual humans and groups of humans. The whole is something we have automatically constructed over time – it as an expression of our nature, just as an ants’ nest is an expression of the nature of ants.

We are driven to transform raw materials into an ever greater number of goods and services, year on year, with competition and problem-solving needs constantly forcing technological advancement and rising complexity. We achieve all this via the dissipation of ever greater amounts of energy, mostly from fossil fuels, generating in the process ever more entropy (pollution, climate change, waste materials etc.).

But of course there are only finite amounts of energy sources and minerals on the planet, so our quest is ultimately doomed to failure. Furthermore, we will always naturally go for the most easily accessed resources first. This means that we have a physical resource-base that is constantly shrinking in quantity and quality and/or accessibility. Meanwhile maintaining existing infrastructure and battling the growing entropy soaks up more and more of the available energy, leaving less and less for growth.

Perched precariously on top of this shrinking and degrading pool of natural capital is a financial system that can only exist in a state of growth. The primary reason that growth is essential to the survival of the global economy is that debt is built into it. Governments use debt to pay for infrastructure, services and programmes before they collect taxes; companies use debt to start up and/or access resources before they become profitable; individuals use debt to pursue higher education and purchase ‘big-ticket’ items like cars and houses. The entire fractional reserve banking system is a form of debt.

Debt is the promise of a more profitable tomorrow that we use to ‘ramp up’ our purchasing power in the present. In fact we can understand burgeoning global debt, the erosion of interest rates in developed nations, the legalisation of share buybacks, the securitisation of debt and the growth in increasingly arcane and complex financial instruments generally as an attempt by the global economy to compensate for the encroachment of the growth-limits outlined above. We can trace this all the way back to Nixon’s cancellation of the direct international convertibility of the US $ to gold back in 1971, which occurred just after the US passed peak conventional crude production and as their imported oil rose significantly in cost.

Debt must be paid back with interest accrued, so a debt-based system is fine until tomorrow is less profitable than today – then it takes on the characteristics of a Ponzi scheme.

We have now reached the point at which each tomorrow really will, in biophysical terms, be less profitable than today and this declining prosperity is further exacerbated by global population growth, which results in a net gain of 200,000 humans per day. Energy and resource-constraints are biting, as evidenced by the dramatically rising extraction costs of conventional oil this century, for example, and we have a flat throughput of energy per capita. Wages of non-elite workers, which are themselves an expression of how much ‘energy profit’ is flowing through the system, have been stagnant for too long and workers are struggling to afford the output of the system. Many parts of the global economy are debt-saturated, ie existing debt is a worsening drag on growth and new debt is becoming less and less productive.

Trump’s protectionism and the increasingly fractious and polarised politics we are seeing in various parts of the world are a predictable response to this underlying sense of lack and the unease it generates. When people feel that their economic prospects are constrained or threatened they will vote or protest accordingly. Demagogues can rise to power. Wars can start.

Perhaps more likely than a global conflagration is that the financial system seizes up, as it so nearly did in 2008. Certainly the central banks are now in a much weaker position to cope with any downturn – interest rates cannot be cut significantly from where they are – and their putative cures are in any case themselves acting as slow poisons