Economic growth is a means of producing wealth. No doubt about that. However, there are two central problems linked to this logic. First, the term “wealth” loses its meaning, when you exclusively apply it to financial abundance. Wealth, considered from a holistic viewpoint, does not only include the presence of money, but also other vital elements that help guarantee a certain quality of life, e.g., safety, health, freedom, environmental quality and successful social relations – to name the most important ones. Second, a growing GDP says nothing about wealth distribution. The lower the disparity of incomes, the better for a society. No one is disputing this any more.
Having said that, I have to admit I sympathize with the supporters of an economy that stops growing. De-growth, zero growth, post growth or steady state economy – whatever you call it, the idea has achieved considerable media coverage in recent years. To name the most famous supporters: Tim Jackson (“People can flourish without more stuff”)*, Herman Daly (“the claim that growth will cure poverty has proven false”)*, Serge Latouche (“We are in a performance car that has no driver, no reverse gear and no brakes and it is going to slam into the limitations of the planet”)* and, partly, the Occupy Wall Street movement, of course.
On the other hand, many argue that it is indeed possible to have a growing economy and sustain the planet at the same time. This requires a fundamental change in the way we do business, too, but it does not question the paradigm of unlimited economic growth. Environmental and resource economics, sustainable growth, low carbon economy, circular flow economy – these are some headlines under which an ongoing growth is said to be possible, even if a different one. Thus, a great part of the economy should shift its base from consumption to service production. The remaining consumption of goods, in addition, should comply with sustainability criteria. These criteria include consistency with ecological systems, sufficiency concerning our lifestyle, and efficiency to reduce the consumption of physical resources and energy. Prominent supporters of this viewpoint can be found all around the globe.
Even supporters of a weak sustainability approach have to admit that the manner in which we’ve been hailing economic growth over all other realities in the 20th century has to change. At the beginning of the 21st century’s second decade, it is not doubted that economic growth should no longer over-top all other political goals. Much rather, it is one goal out of many. And it is an arguable goal.
What do you think? Should government around the world stick to the paradigm of economic growth? Is sustainable growth possible? What framework is needed? Who has the power to push it? Is de-growth just an academic discussion, or the only way to save the planet? What transitions are needed first? Which important book or article is missing in the following list?
- Tim Jackson: Prosperity without growth; partly avaible on Google books
- Serge Latouche: Farewell to Growth; partly avaible on Google books
- Herman Daly, Joshua Farley: Ecological Economics: Principles and Applications; partly avaible on Google books
- Ernst Ulrich Weizsäcker et al: Factor five: transforming the global economy through 80% improvements in resource productivity; partly avaible on Google books
- contraposition.org: A Conversation With Herman Daly
- grist.org (04/2003): The economic heresy of Herman Daly
- postgrowth.org (05/2010): Plenitude: The New Economics of True Wealth
- monde-diplomatique.fr (11/2003): Pour une société de décroissance
Article image edited by Moritz Bühner. Earth background image by NASA, found at woodleywonderwork’s photostream.