On this Earth Day, we’re called to reflect not only on our relationship with the planet but also on the systems of thought that shape how we live with it. The challenges facing Earth today—climate chaos, ecological degradation, social inequity—are symptoms of a deeper issue: outdated ideas still guiding our economies and our policies. This reflection is a call to question, to learn, and to evolve.   

When The Limits to Growth was published by the Club of Rome in 1973, it was immediately controversial. While the controversy helped it sell 12 million copies in 37 languages in the years that followed, many of the world’s most prominent economists including Milton Friedman, Robert Solow and Julian Simon, scoffed at the suggestion that there could be such limits. Under the influence of such expert opinion, the mainstream media trashed it as “irresponsible nonsense.” A half century later, we are now living through a remarkably similar scenario as the book’s baseline case—not a forecast, just the “business as usual” scenario.   

Fifty years wasted, now the chickens have come home to roost. We have now named it the polycrisis. Ignorance among economists who have more power over our lives than we know has a cost. Ideology promoted as theory is downright dangerous.  

A Modern Monetary Debate: Kelton vs. Moore 

It was deja-vous all over again listening to a debate last week between Stephanie Kelton, author of The Deficit Myth and a leading expert in what’s called Modern Monetary Theory (“MMT”) and Steve Moore, senior economist of the Heritage Institute around the question, “Should the US federal government make reducing the national debt a fiscal priority?”   

Moore is certainly no Milton Friedman, but he would proudly consider himself a disciple. He is also the co-author of the chapter on The Department of the Treasury in Heritage’s Project 2025. So he has influence in Washington at this moment in time. And that’s what’s both terrifying and so reminiscent of the response to The Limits to Growth.  

This debate is critical right now for two reasons. First, Minister Musk’s DOGE project is premised on Musk’s ignorant declaration that the US “will go bankrupt” if it doesn’t get the deficit under control. This view is reinforced by several high-profile Wall Street “experts” such as retired hedge fund magnate Ray Dalio proclaiming the debt problem is the county’s greatest threat because there’s a “supply-demand problem” with the debt. You might find it easy to dismiss an extreme right wing economist’s perspective, but should you dismiss the founder of one of the world’s most successful hedge fund’s perspective? I admit, it gives me pause.  

But let’s consider the debate. Stephanie laid out the thesis of MMT that in reality should be called modern monetary mechanics. It’s not a theory at all, but a description of reality. It is literally about the actual mechanics of government spending and taxing, and the “proof” is already worked out in the balance of accounts between the private sector and the public sector published by the government for all to see (if they care to look). But this is not my point here.    

My point here is that Moore never once addressed the mechanics and the explanations Stephanie gave during the debate. He ducked. Instead, he pontificated about his pro-growth ideology. At one point he referenced a recent study that “proved” that countries that run high fiscal deficits grow slower. I’m pretty confident that the study included countries that become over indebted economies with hard currency debt (think Latin American and Asian debt crisis with US dollar and Euro debts, not local currency debts). These examples have virtually nothing to do with the US federal deficit which is denominated in US dollars, over which the US central bank has monopoly control, and just so happens to be the world’s reserve currency. Statistics and averages are not meaningful when the sample size is one.  

Kelton attributes her fascination with MMT to a man named Waren Mosler, one of the architects of this school of thought. Mosler was a Ray Dalio of a different time, just not on such a grandiose scale. He was also a client of mine when I ran the derivatives desk for JPMorgan in Tokyo in the late 1980s. Mosler was and remains unusually smart and articulate on financial markets. I’m sure he is rolling his eyes at Dalio’s warnings in all the spotlight his wealth garners. The US government is not like you and me, nor is it like Argentina with massive foreign debts. It cannot go bankrupt from dollar liabilities when it can print dollars. This does not mean there are no limits to deficits as Kelton explained nicely in the debate.    

It turns out you can become a billionaire speculator based on your truly impressive capital allocation and risk management skills (a large, institutionalised poker game of tightly controlled positive expected outcome bets) without understanding as much as you think you do. You can also become the senior economist at the Heritage Foundation. You can even become the richest man in the world. But you can still lack the wisdom the times demand.   

Why the Deficit Narrative Persists 

The second reason it matters, is that Trump’s tariff war, regardless of what you think about “unfair trade practices,” appears increasingly likely to trigger a recession by the end of the year (JP Morgan now puts the probability at 60%, up from 20% before the trade war). The Federal Government’s fiscal response will be critical to contain the bleeding and to mitigate the inevitable pain. This was the primary lesson of the Great Depression. And with the thinking of people like Moore, Dalio, and Musk influencing policy, the risks are high that a bad situation could spiral out of control. Moore’s panacea of more growth at all costs to attack the deficit while at the same time scoffing at “investments in windmills” is beyond ignorant. It’s suicidal.  

Which takes me back to my title of this piece.  I recently learned that a few years after the publication of The Limits to Growth, the Club of Rome published a second book titled No Limits to Learning by James Botkin, Mahdi Elmandjra, and Mircea Malitza.  It never received the audience of The Limits to Growth. But its message is even more prescient today.  

We face a knowledge gap to deal with the unprecedented complexity we now call the polycrisis. Nowhere is this more true and dangerous than in economics. Yet the oxygen in the room continues to be consumed by outdated and often wrong ideas from “successful” (usually) men who confuse success with the wisdom our times demand.    

The Education We All Need 

The root of the word “education” is educare: to lead out. We must begin with an education adapted to the new context of complexity if we are to lead ourselves out of the polycrisis. This means not only childhood education. It includes confronting the dominant ideas of western modernity that have also brought great progress on many fronts. What our “leaders” fail to see at our collective peril is that this same reductionist thinking, breaking things into parts while missing the more vital relationships of the whole, is incapable of addressing the challenges of complexity we now face. Complexity begins with interconnections, not parts.   

The good news hasn’t changed. There are no limits to learning. Let us begin with some humility. This Earth Day, Week, and Month let’s honour the planet by not only taking meaningful and local environmental action—but by uprooting the harmful ideas that keep us trapped in outdated systems that got us here in the first place. If we are to regenerate our relationship with Earth, we must first regenerate our ways of thinking. That begins with learning—together. 

First published by The Capital Institute.