What does it take for us to have a prosperous planet and at the same time live a good life? Instead of a growing economy that depletes the environment, a stable economy with equitably distributed resources would be needed.
From a political point of view, a mix of regulations and market solutions is used to limit greenhouse gas emissions, and to reduce the consumption of non-renewable resources. The effects are not clear. The picture is complicated by the fact that much of our pollution has been outsourced to China and other emerging economies at the same time, where not enough is being done to reduce the already high emission levels.
It is often different countries’ emission levels that are compared. But the question is how relevant it is to look at countries. For it is not countries that account for emissions, but the industries and individuals in a country. Looking at the distribution of different groups of individuals and their greenhouse gas emissions at a global level, significant inequalities appear. In addition, those who account for the smallest environmental impact are also debated most.
A 2015 report states that ten percent of the world’s population accounted for forty-five percent of all emissions between 1998 and 2013. These ten percent were distributed across all continents, with one-third resident in so-called emerging economies. At the same time, half the world’s population accounted for only thirteen percent of all emissions during this period.
Can the market solve environmental problems?
One way of approaching this issue is to streamline the allocation and consumption of non-renewable resources through financial instruments. Another way of looking at this is that technological developments will produce innovations and new technologies that solve the problems in the most cost-effective and ecologically sustainable way.
Another way is to look at what the growth entails. If things are really bad, these efficiency enhancements and technical solutions can lead to increased consumption of non-renewable resources in completely different areas than before, as the cost of consuming these resources decreases as efficiency increases.
A new form of growth criticism has emerged during the last ten years under the umbrella designation degrowth. The criticism is directed at the traditional way of measuring economic growth through the gross domestic product (GDP), that is, the value of all goods and services produced in the country for one year. Among other things, the criticism is based on the fact that GDP does not include unpaid work at home or free time that is perceived as valuable. In addition, the environmental damage caused by the products or services is not valued financially.
A well-established complement to GDP is the UN measure of human prosperity, the Human Development Index (HDI). This measure includes child mortality, life expectancy, equality, equality, education and more. If HDI is compared with GDP over a longer period of time, there is a strong connection between them: economic growth in almost all cases leads to increased human wealth.
But when compared with HDI with all countries’ so-called ecological footprints (EF), only a few countries have succeeded in combining human prosperity with an ecological footprint that remains within the country’s consumption and impact on the total biocapacity of the earth. By biocapacity is meant the capacity of the earth in terms of water, oxygen, nutrients and other necessary resources for the survival of living beings.
The major challenge lies in limiting the negative impact on the environment while increasing human prosperity for large parts of the world’s population. Instead of believing that general economic growth will solve this, a different thought figure is required. Growth is one.
Growth is based on the fact that the earth’s resources are limited and evenly distributed. The economy should, therefore, be adapted so that the resources needed after all and now and in the future – for both secure food production and a secure energy supply – will benefit the people who today lack this.
As non-renewable resources are depleted, these become more and more expensive. The deeper the oil or coal lies, the more expensive it is to extract. Rare metals needed for mobile manufacturing are rising in price, as are food raw materials that can increase in price due to drought and flooding in the wake of climate change.Growth, therefore, comes at an ever-higher price.
For many wage earners in the US and Europe, growth does not appear to be a particularly attractive solution. One reason for this is surely the poor development of real wages. In the last thirty years, actual wage levels have not risen at the same rate as the development of value in society. In practice, this has meant that a normal salary is sufficient for less consumption than thirty years ago. But consumption is still kept up, thanks in large part to an extensive debt/equity ratio.
Sure, growth is required, but within certain areas and for certain groups. However, as a political goal, general economic growth is the wrong way forward, I mean.
Growth criticism is not new
For some, growth does appear to be a fashion word, but criticism of growth has been around for a long time, albeit in different forms. Already in the 18th century, there was a concern that food production would not be enough to feed everyone.
Contemporary criticism of growth took shape in the late 1960s, while the modern environmental movement emerged. It was a time when alternative lifestyles and loud protests characterized the climate.
In 1972, the book Growth of Borders was published by a group of researchers from MIT in the United States, who, on behalf of the Rome Club, an association of senior politicians, business leaders, researchers, and officials, were to investigate the future of humanity. The reception was huge. The book was translated into 37 languages and became a bestseller.
One reason was probably its relatively simple message: that the resources of the earth are limited, but that humanity consumes them as if they were unlimited, moreover, at an ever-increasing rate. Another reason for the sales success was probably the oil crisis that broke out the year after its publication, and which seemed to corroborate some of the predictions made in the book.
In the wake of Growth’s Borders, researcher Fred Hirsh published the lesser-known book Growth’s Social Borders. He said that economic growth is driven by the fact that we are constantly comparing ourselves to each other. According to Hirsh, our fear of appearing insufficient or less capable to others in our immediate vicinity is the foremost driver of economic growth. There is also a contradiction here. Because while status consumption is intended to make us happier, its effects are the exact opposite. It triggers new consumption patterns and in the long run it leads to status stress and status anxiety.
A steady economy
In the book Welfare Without Growth from 2009, Professor Tim Jackson launched his criticism of the growth paradigm, arguing that it is perfectly possible to live a fulfilling life without a constantly growing economy. His criticism is directed at those technology optimists who believe that technological advances are enough to change society and the economy on a more sustainable path. The criticism is based on a model that includes social and psychological factors that drive growth.
Tim Jackson presents two different future scenarios. One is called collapse and is based on a “business-as-usual” scenario. Even though growth stabilizes at a level just below today’s, it also means that unemployment and poverty are growing rapidly, and that government debt as a share of GDP is growing.
In order to achieve a stable economy over the thirty years, while reducing unemployment, poverty and emission levels, Jackson believes that net investment in the economy must decrease and the structure of the labor market change. This future scenario calls Jackson resilience.
Tim Jackson believes, among other things, that shortening working hours and reducing unemployment can easily be achieved if the jobs are shared among those who are part of the working population. He also thinks that the public sector should hire more people, since it is human care and care that matters after all. He also argues that the public sector should use tax funds for ecological investments, and that their return requirements should not be measured in monetary terms, but in environmental improvements.
Criticism of growth has been around for a long time, but the nature of it has changed as the outlook on society, and the perception of the role of politicians has changed. Economy is no longer regarded as a means of achieving other social goals, but as a goal in itself.
While the growth critique of the 1970s left much to be desired regarding the solutions to environmental problems, when the facts were assumed to speak for themselves and thus call for action, today’s solutions are about a mixture of researchers and experts’ market solutions. In today’s view, politicians are subordinated to the overall societal goal of economic growth.
Global climate negotiations have had a difficult time reaching concrete results quickly enough. The unfulfilled promises to change society on a more sustainable path have given the cynics air under their wings – politicians seem to lack the ability to make any substantial change.
Among the growth researchers, there is also a distrust of the established political channels. Instead, the hope is for the social movements that have emerged under the designation of growth.
Growth is not only an emerging field of research and a multifaceted social movement, but it is also a solution to two of the biggest problems we face today: climate change and economic inequality.
Instead of the growth paradigm and a growing economy that both depletes the environment and leads to a concentration in the ownership of the earth’s resources, a stable economy, with equitably distributed resources and energy resources, would be needed. I mean that growth offers an alternative, an alternative that benefits both man and the environment and leads to another type of growth, human flourishing.
Article written by the guest writer Joshua Jacobs.
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