Prosperity in the Western world (aka the American Way of Life) has been in decline for decades, and no government since Nixon has done anything significant about it. Nor could they, in the long run. As any oil geologist knows, it is all about the end of cheap energy. All policies attempted simply to kick the can down the road. Or to lay false blame.

A useful scenario of the mechanics of degrowth based on the end of cheap energy is the latest piece from Tim Morgan, https://surplusenergyeconomics.wordpress.com/2020/11/23/185-the-objective-economy-part-two/. He shows how our consumption priorities shape a scenario of degrowth. A synopsis follows:

1. Consumption has been “living on the life-support of financial manipulation”.
2. As indebtedness reaches a saturation point, financial manipulation fails. Consumption declines.
3. Degrowth in consumption starts with discretionary consumption.
4. This depresses the whole sector of the economy that fuels discretionary consumption.
5. The destruction of demand for debt follows the destruction of demand for discretionary consumption. Consumption declines further.
6. All economic sectors dependent on consumption decline.
7. This reduces income, lowering consumption further.

This suggests a model structured as a positive feedback loop or two. All variables in a positive feedback loop experience exponential growth. Of course, in any complex situation, negative feedbacks exist that can counteract exponential growth. In my view however, something like the following positive feedback loops are currently dominant.