Traditionally, economists have argued that the answer is “yes.” In the 1960s when Victor was earning his various degrees, a steady rise in gross domestic product (GDP)—the combined value of our paid work and the things we produce—was seen as crucial for raising living standards and keeping the masses out of poverty. We grow or we languish: This assumption has become so central to our economic identity that it underpins almost every financial move our leaders make. It is to economics what the Second Law of Thermodynamics is to physics. (via Nothing Grows Forever | Mother Jones)
- But Victor—now a professor at York University in Toronto—felt something tugging him in the opposite direction. Ecologists were beginning to learn that Earth does have limits. Pump enough pollution into a lake and you can ruin it forever; chop down enough forest and it might never grow back. By the early ’00s, the frailties of the planet were becoming even more evident—and unsettling—as greenhouse gases accumulated and chunks of Greenland’s glaciersbegan breaking off into the sea. “We’ve had 125,000 generations of humans, but it’s only beenthe last eight that have had growth,” Victor told me. “So what’s considered normal? I think we live in very abnormal times. And the signs are showing up everywhere that the burden we’re placing on the natural environment can’t be borne.”
- Unless, of course, there’s a third way. Could we have a healthy economy that doesn’t grow? Could we stave off ecological collapse by reining in the world economy? Could we do it without starving? Victor wanted to find out. First, he created a computer model replicating the modern Canadian economy. Then he tweaked it so that crucial elements—including consumption, productivity, and population—gradually stopped growing after 2010. To stave off unemployment, he shortened the workweek to roughly four days, creating more jobs. He also set up higher taxes on the rich and more public services for the poor, and imposed a carbon tax to fill government coffers and discourage the use of fossil fuels. The upshot? It took a couple of decades, but unemployment eventually fell to 4 percent, most people’s standards of living actually rose, and greenhouse gas emissions decreased to well below Kyoto levels. The economy reached a “steady state.” And if the model is accurate, then something like it, say some ecologically minded economists, may be the only way for humanity to survive in the long term.
- Victor’s economic theory is radical, but he is not alone. Over the past few decades, a handful of scholars have been laying the intellectual groundwork for “no growth” economics, and several recent books have proposed design principles for a healthy, nongrowing global economy. Even some of the world’s major governments, spooked by the twin specters of global warming and the recent financial crisis, have begun exploring this seemingly subversive idea: In 2008, French president Nicolas Sarkozy asked Nobel economics laureate Joseph E. Stiglitz to draft new ways to measure prosperity without relying on GDP as the main indicator. But what would a no-growth society look like? Would we like it? And could we build one?
- Even Adam Smith, the great-great-grandfather of capitalism, acknowledged that it might be possible for an economy to max out its natural resources and stop growing. In the 19th century, economist-philosopher John Stuart Mill argued that growth was necessary only up to the point where everyone enjoyed a reasonable standard of living. Beyond that, he said, you could achieve a “stationary state” that would move past the “trampling, crushing, elbowing, and treading on each other’s heels” that he saw in unfettered capitalist growth. In 1930, John Maynard Keynes likewise predicted a period in the future—possibly as soon as his grandchildren’s time—when the economy wouldn’t need to grow (pdf) further to meet our basic needs. Man’s “economic problem” would be solved, and people would “prefer to devote our further energies to non-economic purposes.” Things like art, child rearing, and leisure.
- By the 20th century, growth had become not only an item of faith in economics, but a deeply held political belief. When Franklin Roosevelt supported grappling with Great Depression unemployment by decreasing the workweek to 30 hours, the largest corporations fought back fiercely. America, they argued, would be saved only by the new “gospel of consumption.” The administration would need to pursue flat-out growth, loosening labor laws and so forth, so that the industrialists could revive the nation. Roosevelt backed down.
- Daly’s major contribution to the field is the concept of“uneconomic” growth—growth that actually drives living standards downward. He believes that America has already reached the point Mill and Keynes foresaw, where average living standards have grown as high as necessary to vouchsafe a generally prosperous population. He points out that the happiness of Americans, as reported by social scientists, rose steadily after World War II as GDP grew. But by the late ’50s, that connection broke down: Although our median family incomes have nearly doubled since 1957, the proportion of people who say they are “very happy” has barely budged (pdf). Daly thinks we simply hit the point of diminishing returns. Our growth turned uneconomic: GDP now keeps growing mainly because we are producing gewgaws and services that don’t significantly add to our happiness. Or worse: It grows because we are spending money to solve problems that growth itself created.
- As concern over climate change has migrated from the science community to the mainstream, the number of economists willing to question growth has slowly but surely increased. Recent books on the subject include Peter Victor’s 2008 Managing Without Growth, and last December’s Prosperity Without Growth (pdf) by Tim Jackson, economics commissioner for the UK’s Sustainable Development Commission. (In 2004, the MIT team published a new edition of The Limits to Growth, complete with updated versions of their model.) Though each camp differs in the details, they broadly agree on a set of economic principles—a road map, as it were, to a world that doesn’t grow, but doesn’t collapse either.
- Handled correctly, this could bring about an explosion of free time that could utterly transform the way we live, no-growth economists say. It could lead to a renaissance in the arts and sciences, as well as a reconnection with the natural world. Parents with lighter workloads could home-school their children if they liked, or look after sick relatives—dramatically reshaping the landscape of education and elder care. (Some steady-state thinkers argue that these typically unpaid forms of domestic labor ought to be included in GDP calculations and even subsidized by the government, since they contribute so heavily to national well-being.)
- Viewed this way, a nongrowing economy could have broad political appeal, ushering in the sort of togetherness and family values that social conservatives celebrate. Liberals might appreciate the concept of work sharing, which could help narrow the income gap between rich and poor. Indeed, some countries have already edged towards this vision. In 1982, labor unions in the Netherlands agreed to limit demands for higher pay in exchange for policies encouraging people to work less. Within a decade, the proportion of Dutch citizens working part-time soared from 19 percent to 27 percent, the average workweek fell from 30 to 27 hours, and unemployment had plummeted from 10 percent to 5 percent. (They called it “theDutch miracle.”) Work sharing also has a pedigree in times of crisis: In Austria and Germany, the Kurzarbeit laws let employers avoid layoffs by scaling back people’s hours and pay—10 percent less money, say, for 10 percent less work. The government then steps in and covers the salary difference.
rehashing cornucopians vs neo-malthusians (Thomas Homer-Dixon).. see also:
Posted May 27, 2012 at 12:53pm in cornucopians neo-malthusians optimism pessimism science demographics economy environment forecast futurology happiness civilization industrialization gdp
