Tag Archives: growth-economic

Countering the EcoPessimist

According to New York Magazine and economist Robert Gordon, the good times are over. Forever. In “The Blip,” we learn that the dramatic and unprecedented improvements to our standard of living over the last 250 years or so are a historical aberration. Over the span of the Industrial Revolution, following all of previous human existence in which, relatively speaking, nothing much changed, “human well-being accelerated at a rate that hardly could have been contemplated before.” Plumbing, electricity, medicine, cars, planes, telephones, computers changed almost everything and the result was an era of economic growth that altered civilization to a degree, the article says, we won’t ever see again.

Gordon believes “we can no longer expect to double our standard of living in one generation” as occurred in recent times, and “the rate of improvement [going forward] will be no faster than it was in the dark ages.” The significance of inventions and the resulting growth in productivity cannot possibly continue.

Here at EcoOptimism, I think it’s fair to anoint Gordon the EcoPessimist.

The thing is: Gordon is right. In fact the data already tell us this is happening. Many have lamented that this is the first time in recent history that current younger generations cannot expect their standard of living to be better than their parents’. Stories of grown unemployed or under-employed children returning to the parents’ empty nests abound, and the inexorable rise of the cost of college education seems set to pave the way for the trend to continue.

Environmental economics predicts this, too: you can’t have infinite growth on a finite planet.

But here’s the other thing: Gordon is also wrong and, depending on how we define growth, so is the previous sentence. Actually, it more specifically depends on how we define standard of living and quality of life. As EcoOptimism and many others have noted, the conventional definition has been based on GDP, which is a deeply flawed measure of economic growth and even more deeply flawed as a measure of quality of life. In fact, it was never intended to be used for this purpose (it was developed as a gauge of wartime production in WWII) and it’s been criticized for almost half a century, going back to a speech by Robert F. Kennedy. Once a basic living standard has been reached – in the case of the US, this occurred in the mid-twentieth century — increases in GDP no longer signal increased well-being. In fact, it begins to work in reverse. Indicators show that quality of life in the western world has gone down since then, even while GDP continued to grow.

This would seem, at first, to bolster Gordon’s pessimism. Not only is GDP destined to remain low – perhaps zero – but our well-being is diminishing even faster. We’re on the downside of “the blip” and “it would be crazy to expect something on the scale of the … industrial revolution to ever take place again.”

OK, but what if something else could follow? Could we have a different kind of revolution – a Human Revolution – in which inventions, developments and policies focused not on improving production and consumption, but on the human qualities of our lives: our self-development, our relationships, our contributions. In the western world, generally, people are housed and fed and live in relative comfort amid a plethora of material goods. We don’t need bigger houses and cars or more meat or more choices of deodorant and televisions. Instead, we need those “things” or, more accurately, lifestyles that will let us – encourage us – to interact with and enjoy each other and ourselves. Quality time as opposed to productive time.

A core part of achieving this is getting off the “hedonic treadmill,” the cycle of working more to buy more within an economic system that falters if we don’t consume enough. The answer is buying less, at least materially, and instead consuming in ways that truly better our lives. Consuming things that aren’t in fact material things, like entertainment or vacations or continuing education.

So that’s how Gordon can be both right and wrong. We can’t have continued growth, economically or materially, as we’re used to defining it. But that’s not at all the same thing as saying we can’t continue to improve the quality of our lives. (And I’m talking here about people in both the rich and poor parts of the world.)

For material and environmental reasons, we can’t have another industrial revolution. But we also don’t need or want one. Yes, there are still people lacking some very fundamental needs like food, shelter and water, not to mention health and education. But we have smarter ways to provide access to those, without expanding and repeating the mistakes of the sometimes crude ways we here achieved them. We need the next revolution, let’s call it the Human Revolution, in which the quality of our lives, beyond survival and beyond comfort, is addressed. Eudaimonic pleasure versus hedonic pleasure. Flourishing versus sustaining.

Gordon says “we need innovations that are eight times as important as those we had before” in order to maintain a growth rate similar to that of the last couple of centuries. Again, right and wrong. We need innovations that are of a different nature from the material-based inventions we’ve grown to expect, courtesy of Moore’s law, every few years. Those innovations have the potential to alter, to improve, our lives at least as much as indoor plumbing and refrigerators did, but in ways that are less material (that’s a good thing both socially and environmentally) and will supersede and surpass the goals of the American Dream (as if others can’t partake in that dream).

Gordon doesn’t deal much with environmental questions. His bleakness, his EcoPessimism, is based on the not incorrect observation that the Industrial Revolution has probably run its course, and therefore we can never have the same expectations of growth as did the past few generations. Environmentalists would add that the Industrial Revolution, based as it is on an economy of consumption, can’t continue also because we are running out of materials and fuel and creating a climate that will be unconducive to survival, let alone growth.

These viewpoints are consistent with each other and with the prevailing pessimism that says life in the near future will involve sacrifice, for economic or environmental reasons or both, and a diminishment of our quality of life.

EcoOptimism rejects this and says we can simultaneously and symbiotically solve our economic and ecological problems — AND improve the quality of our lives. One revolution, one era, replaces another.

Sometimes the succinct version says it best…

Redefining Growth

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I thought maybe I coined a new word recently: physophilia, meaning love of growth. It describes the — at times irrational – preoccupation with and addiction to economic growth that possesses politicians and many economists.

This misplaced attachment has already been the focus of several EcoOptimism posts, especially here and here. (While we’re not physophiles, I guess you’d have to say we have a love of the topic itself.) The essence of the problem is that economic growth, at least as it is usually defined, is not the great objective most of us think it is. It is neither advisable nor desirable. Yet it remains an assumed good.

In a post at one of my favorite blogs (you know you’re an eco geek when you regularly read posts from a site called the Center for the Advancement of a Steady State Economy), Brian Czech dives into this, noting that President Obama, as well as almost-President Gore, try to sell the idea that we can simultaneously address environmental issues and grow the economy. In his recent State of the Union address, the president said: “Now, the good news is, we can make meaningful progress on this issue [climate change] while driving strong economic growth.”

At first blush, this sounds like a strong and positive pronouncement, a “Yes, We Can” for environmentalism. But there’s that intractable little problem (as we’ve previously discussed – see the links at the top) of living on a finite planet, a place where infinite economic growth – especially one based on materialism – is a physical, mathematical impossibility. That’s the reason Czech calls the president’s declaration a “slippery slope” in which he “capitulate[s] to paltry cynicism” in not acknowledging the linkage between economic growth and pollution.

image source

So growth is bad, right? That depends on what we mean by the word “growth.” And this isn’t a Bill Clinton “it depends on what the meaning of is is” hairsplitting moment. Economic growth is usually taken to mean an increase in the popular indicator, Gross Domestic Product. The problem, as so many have noted, is that GDP is a crappy measure of well-being. It’s entirely possible to have strong GDP “growth” while people are becoming worse off, which in fact is what’s happened in much of the developed world (and parts of the developing world as well) over the past few decades.

In short, economic growth – at least in its GDP definition – is neither sustainable nor desirable, even if we didn’t have environmental issues to deal with. Fortunately, economic growth is not really what we want. Economic growth is not the same as improved quality of life, and sometimes it’s the opposite, for instance if it means longer work hours or harsher conditions, or if it feeds off the “hedonic treadmill” in which we constantly have to work more to buy more.

Czech asks if we have to get the president off this slippery slope of promoting economic growth alongside environmentalism, and concludes that, no, “he’s too far into it.” That conclusion, though, makes the assumption that Obama can’t use his bully pulpit to educate and inform. Yeah, I know he hasn’t been great at that to date, but here’s my proposal: instead of sending the misleading and incorrect message that “there is no conflict between growing the economy and protecting the environment,” change the emphasis to address what we really want by saying “there is no conflict between improving the quality of our lives and protecting the environment.”

‘Growing the economy’ is an abstract goal that’s mostly irrelevant to living better lives. Many economists and environmentalists know this; the U.S. data have indicated as much since the middle of the last century. But the public, by and large, doesn’t realize this because of the fixation that politicians and the news media have on reporting GDP and other markers like the stock market. (A secondary proposal: can we please get the news media to stop putting GDP front and center?)

That word I thought I had coined – physophilia – well, it turns out that Juliet Schor and others were there first. There goes my shot at a wordsmith credit. Merely getting rid of physophilia, though a necessary prerequisite, will not solve everything. Much of our current economy is based on a presumption of growth; how else can investment be encouraged and debt be retired? There are, in fact, other economic models – truly sustainable ones, unlike what we have – such as the world described in Enough Is Enough. (See my review here.) But as I’ve mentioned (ad nauseum, or so it seems at times to me), it’s a communication issue. How do we eschew something as seemingly positive sounding as growth? It will take a convincing group of voices, with resounding sound bites, to change the goal from wins for the economy to wins for people. Czech sounds as if he’s given up on Obama taking the lead in this. “He’s uttered the win-win rhetoric one too many times; now he’d have to admit his mistake in addition to explaining the trade-off between economic growth and environmental protection.”

The EcoOptimist in me isn’t ready to do write Obama off just yet. In one sense, Czech is right: no politician wants to admit a mistake. But Obama doesn’t have to. He can instead redefine – in populist terms – what the goal really should be. It’s not the economy that we want to win; it’s us. It’s human growth, not economic growth.

Answering the Wrong Question

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On the Colbert Report Monday night – if you’re keeping count as I am, that’s two weeks in a row that Colbert’s “forced” me write a post – environmental policy expert Michael Shellenberger advocated for nuclear power as a necessary energy source. His rationale is that energy demand is going to double by 2050, efficiency and conservation notwithstanding, so we really have no choice.

The new e-book he and co-author Ted Nordhaus have edited is called Love Your Monsters and in the Colbert interview, he explains we need to love our problematic children, our monsters, rather than abandoning them.

As I’ve mentioned before, I hate metaphors because it seems you can always find one to make any position sound right. One of our monsters, he says, is nuclear power and we simply haven’t been good parents. Were they my children, I’d give nuclear reactors a really really long time out.

I could go on about the major issues of nuclear energy, from the fact that it isn’t economically feasible without massive government subsidies and insurance, to the not-so-small question of what to do with the leftover radioactive waste for the next few thousand years or so. But there’s a bigger point at work here. Shellenberger and other pro-nuclear environmentalists like Stewart Brand are committing the ecological sin of not thinking in systems. They’re looking at the energy issue as if it’s independent from our other environmental and social dilemmas. In fact, there are at least two larger pictures that they are ignoring.

That doubling of energy demand prediction is predicated on an assumption of the status quo: that the population will continue to grow until we reach 10 billion of us sometime mid-century and, perhaps more significantly, that our patterns of consumption will continue along the paths we’ve been following for the last century.

It’s somewhat understandable that they follow the population growth predictions. Slowing population growth, to put it mildly, is a difficult issue. (Though, as I mentioned in “Less is More, More or Less,” it’s been pointed out that annual population growth is roughly the same as the number of unwanted pregnancies.) Altering our rates of consumption, however, is a much more achievable – and desirable – goal.

There’s a fundamental mathematical formula that calculates our environmental impact. It goes like this: I=PxCxT. Environmental Impact is determined by the Population, how much we Consume and the resource or Technological intensity of those things we consume. So the ways to reduce impact are by reducing population, reducing consumption and decreasing material and energy intensity. That predicting doubling of energy demand assumes we can’t do much or anything about the first two and we can perhaps eke out some mildly increased efficiencies in the last one.

It also assumes, as most conventional economic theory does, that those increases in C and T are a good thing because growth is assumed to be good. Sort of a tautology. But as has been mentioned here in EcoOptimism and elsewhere, more consumption and more technology do not automatically lead to improved quality of life. In fact, once basic needs have been fulfilled, the opposite is true. Many studies have found that people in developed countries are no happier now – and may be less happy – than they were a generation or two ago. Of course, indoor plumbing and antibiotics made life infinitely better and many of us would find it hard to live without ~~Starbucks~~ drip coffee makers. However, the digital revolution, for all its amazing abilities and benefits, doesn’t seem to have improved quality of life or happiness. Some would say it’s done the opposite.

So that’s the first missing element in the pro-nuclear argument. The path it assumes is not actually the path we want. And the paths that would really make our lives better happen to also require less energy.

The other part of the big picture that they are missing is due to a narrow concept of environmentalism that focuses almost exclusively on energy. One of the first slides I often show my classes shouts out “It’s not just about climate change.” Yes, climate change chaos has the potential to do to us what that asteroid did to the dinosaurs. At the very least, adapting to it is going to be very expensive and will in all probability involve a lot of human suffering. Superstorm Sandy brought that point home. A seemingly relentless series of other atypical storms, heat waves and droughts are making the point elsewhere.

But simply solving the energy issue with low-carbon sources, whether it be through “too cheap to meter” nuclear power or a more likely blend of renewable sources, won’t make everything hunky-dory. It won’t solve resource depletion, water shortages, loss of biodiversity or numerous other ecological impacts. Moving away from fossil fuels doesn’t diminish the amounts of materials needed for all the stuff demanded by 10 billion people desiring to live as Americans do. It doesn’t reduce the staggering amounts of material we throw out daily. It doesn’t eliminate the toxic runoff from the industrial farming that barely feeds 7 billion people today. It doesn’t change either P or C or T.

Here’s the thing: we can’t approach this (nor should we) with only the goal of weaning ourselves off fossil fuel. We need to dramatically reduce the demand for energy and – happily — that can go hand in hand with some very positive changes in our patterns of consumption and in our lifestyles. And then we wouldn’t have to deal with creating more misbehaving monsters in our nuclear family.

The Growth Panacea

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In The New York Times “Room for Debate” column last week, the topic was whether growth is a good goal. Until recently, it’s been an assumption in both political and economic circles that growth was unquestionably good and essential. It’s a rare politician who will dare to say otherwise. So it was somewhat refreshing that, in the Times debate, only one of the four participants, Diana Furchtgott-Roth, supported the idea. And her point of view, as a former chief economist of the U.S. Department of Labor, was both surprisingly and typically old-school in its conventional but outdated approach. Here are some quotes from her statement (in italics), with my responses:

Economic growth raises standards of living for rich and poor countries alike.

This is the old “rising tide lifts all boats” line. I can think of plenty of unlifted (and some sinking) boats in the developed world where the tide has supposedly risen. While the argument for economic growth in the developing world is stronger, it’s still true that economic growth does not equal human growth and, as we’re finding out in the US, the opposite becomes true after a point.

And what happens when the rising tide (to continue the awful metaphor) is actually caused by rising sea levels?

The more growth, the better.

This is just fundamentally wrong because, aside from being incorrect in economic terms, it is physically impossible (unless growth is decoupled from consumption). Assuming we don’t start importing resources from other planets, we live in a finite system, technological advances notwithstanding. No matter how often the growth mantra is repeated, it cannot violate the laws of physics.

The finitely-supplied Earth seen from the Cassini probe as it passed Saturn

In developing countries, higher G.D.P. growth results in lower infant mortality, running water, sewer systems, electricity, better schools and education for children, as can be seen from comparative World Bank data.

So how does this explain the sad standing of the US in most of those categories?

As electric power plants replace wood stoves, the air is cleared of smog.

Sure, the localized air inside the home may be better, but replacing it with coal and other fossil-fueled plants just relocates and, by some measures, worsens air pollution and greenhouse gas emissions.

Stringent Environmental Protection Agency regulations do not come cheap.

This is a particularly old-school defense, or rather offense, against regulation. In far more cases, regulations prompting efficiency and limiting pollution result in greater profits, new technologies, new industries and more jobs.

Her post is titled “Only Growth Can Sustain Us.” She has a curious idea of sustainability.

The good news is that she represented a minority view and, judging from the comments below it, a growing number of people are realizing that economic growth is not the panacea that Wall Street and most politicians continue to believe it is.

Less is More, More or Less

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Thanksgiving, the celebration of bounty, seemed a completely appropriate time to contemplate the corollary concept of enough. Hence one of my tasks for the weekend (why do I always think a day or two off, or even a long plane flight, will give me the time to catch up on everything?) was to read the advance copy of Enough Is Enough sent me by co-author Rob Dietz. A bit overoptimistic I was. I’ll blame the lingering L-tryptophan effect. But I’ve only missed the goal by a bit.

Dietz is the executive director of an organization called CASSE or the Center for the Advancement of the Steady State Economy, a mouthful as large as the (first) slice of leftover pumpkin pie I had for breakfast on several of the days following the feast. “Enough Is Enough” rolls off the tongue much more easily (than CASSE, not pumpkin pie), and the strong, memorable title makes me almost wish CASSE would change its name to accompany the book.

The basic tenet of the steady state economy (or SSE) is an observation that makes complete sense: you can’t have infinite growth in a finite system. Unfortunately, conventional economics – perhaps in an attempt to defy its characterization as the dismal science – says otherwise. Its faith in unending growth portrays it as both possible and desirable.

EcoOptimism, though based (obviously) in optimism, doesn’t subscribe to this delusional belief in the virtues of growth. In another post, I’ll discuss how that self-serving faith is actually more akin – as faith-based ideas tend to be – to a religion than it is to a science. So much so that, in attempting to escape the “dismal science” moniker by being less dismal, conventional economics may have instead lost its reasoned science aspect.

What’s in a name?

Part of the politically untouchable faith in growth derives from the positive nature of the word growth. How could growth possibly be bad or undesirable? And, even after proving that it is, finding an appealing word or phrase to convey that idea is a difficult task, yielding less than positive terms. Ungrowth? Uh uh. Degrowth? No better. Is the opposite of growth diminishment? Nothing appealing in that. Another suggested term, post-growth, gets warmer, but still doesn’t quite make the cut for me.

And so we get to steady state economics. Though it ain’t exactly catchy ( as noted above) SSE at least doesn’t succumb to easy connotations of negativism and survives the first round of sound bite tests. Steadiness, especially when compared to the booms and busts of recent history, has much to be said for itself.

Going Steady

But the goal of SSE is not so much to steady the rough ride of economic cycles as it is the creation of a path for continuing human growth within the constraints of an amazing yet finite planet. And it’s also more than (merely) achieving sustainability. It is the decoupling of economic growth from human flourishing. It is the enabling not just of a future, but of a positive future.

We already know that happiness (yes, I know that’s a mushy subjective quality, but there actually are ways to define and measure it) does not correlate with economic growth, at least not in the long run. In the richer nations (the “developed” world), where essential needs have largely been met, the acquisition of more material things does not lead to happier or more fulfilled lives. And acquiring things is, after all, an integral part of material growth and its measure, the appropriately named Gross Domestic Product. But even with this knowledge (which is not nearly widely enough known), how is the iconoclastic case against growth made? And accepted?

I have nearly the same image in my book, Sustainable Design: A Critical Guide, but this is from Enough Is Enough

There’s been a plethora of books on this topic of late. I’ve written about some of them before: Prosperity Without Growth, The End of Growth, Plenitude, eearth, et. al. But in virtually every case, what’s been missing from the iron-clad arguments has been an accompanying roadmap. We have a general idea of where we want to go, but no idea – especially not a convincing one – how to get there.

Indeed, this shortcoming is a major part of the purpose behind EcoOptimism. Along with the lack of concrete steps, I’ve been positing that we need verbal descriptions and perhaps graphic illustrations (I must still be in a Thanksgiving state of mind because that made me think of the “twenty seven eight-by-ten color glossy pictures with the circles and arrows and the paragraph on the back of each one” from Arlo Guthrie’s Alice’s Restaurant — but I digress) depicting what our un/re/de/post-growth future will look like.

Happily, Dietz and co-author Dan O’Neill have brought us much closer to answering the how-the-hell-do-we-get-there question. Each chapter in the section “Strategies of Enough” as well as most of the chapters in the third section “Advancing the Economy of Enough” begin by asking “What Are We Doing?” and proceed to “What Could We Do Instead?” Then they move to the part I devoured each time: “Where Do We Go From Here?”

Dietz and O’Neill are, of course, thoroughly familiar with the concepts of a Steady State Economy. But, they write, “we had been asking ourselves for some time how a steady-state economy would work in practice.” What are “the policies and transition strategies that would turn [a SSE] vision into a reality?” Those questions, as it happens, are the same ones I’ve been asking since I started focusing on the “New Economy.”

They’ve done a terrific job on the second question. First they demolish the conventional argument that growth is the solution to poverty, poor education and unrepresentative rule as well as pollution (the argument proffered by groups like the WTO and mainstreamed by Bjorn Lomberg’s The Skeptical Environmentalist). Toss out the convenient and misleading metaphor “a rising tide lifts all boats.” Our economic history strongly declares otherwise.

Responding to the Econ 101 tenet “Market prices give no reason to believe that natural resources are a limit to economic growth,” they almost literally scream “This statement may be true, but it reveals more about the failure of markets than the absence of limits!” This is the core of an argument many of us have been making in various forms for years: a “free” market can work only if everything is priced accurately. And our current markets, which consider almost every resource and service provided by nature to be free, are far from that point. “Prices often fail to capture the effect of resource depletion, waste generation, and loss of ecosystem services. As a result, the market sends improper signals—if it sends any signal at all—regarding the sustainability of throughput levels. We need to eliminate this market failure….”

What’s Enough?

Making economic growth the measure and the goal does humanity a huge disservice. Growth, in the gross unqualified version that we currently reflexively strive for, is a false god asking us to sacrifice everything (our lives, our planet) in search of a future nirvana that cannot possibly be the result. The problem, putting aside such relevant constraints as physics and, yes, economics, is that we’ve set our goal on the wrong sight. “More” is not only unachievable; it is undesirable. And the opposite of more is not less; it’s enough – provided that what we achieve enough of is what we in fact need to grow qualitatively. This becomes a two-part question: first, what is “enough,” meaning what sates us and leaves us better off than we started and, second, how do we get to that state?

We can continue the overly obvious Thanksgiving analogy here. For most of us, the quantity of the food leaves us with that content but overstuffed lagginess and perhaps the feeling that we overdid it. We certainly could live without it, though most of us would choose not to. Why? Because we enjoy the ritual, the company … and the food. What, more precisely, is it that makes the holiday so valued to so many? It’s not the amounts of food that we often wish we had exercised a bit more willpower to resist. It’s the circumstance, the associations and the experience (both social and sensorial), not the amount of food. In a crude way, this sums up the difference between the economy of growth and the economy of enough. Economic growth, after a point, does not translate to improved well-being. And after that point – the point at which basic life needs have been met — our economic and social goals should change course.

This does not by any means signify stagnation, which is perhaps the main problem with the term steady state – it’s vulnerable to being misinterpreted as a call to sacrifice. In reality, it’s the opposite of sacrifice; it’s finding the true value and measure of progress. As Dietz and O’Neil more succinctly put it: “the economy can develop qualitatively without growing quantitatively.”

It’s People!

Environmentalists all know that our problems stem from the combination of too much consumption (or rather, unnecessary and inefficient consumption primarily by people in the rich nations) and too many people (who, increasingly, are in the poorer nations). And therefore any real solution has to address both problems. While the first part is certainly key, the second part – population growth – is the elephant in the room. It’s an incredibly delicate and laden topic. To its credit, Enough Is Enough doesn’t skip over it, as most such discussions do. “We need smaller footprints but,” they emphasize, “we also need fewer feet.”

The authors underscore the point that the number of unintentional pregnancies in the world each year (80 million) is equivalent to the annual growth of the human population. This means we don’t need to dive into heavy-handed intrusive programs like the Chinese one-child-per-family rule. We can achieve steady population through education and voluntary birth control.

The Role of Wall Street

When I discuss ecodesign in my classes, I emphasize that there are two ways to approach changing the environmental impact of a product. One is the “tweak,” which involves one or more relatively small and incremental changes to the design. The other is the “innovation,” which demands rethinking the problem (often by rephrasing the question) to find alternative ways of achieving the result the product provides. Often this leads to what has come to be called disruptive technology, a fancy phrase for a new way to do something that reduces the old to history. Think Internet versus encyclopedias. Or 3D printing replacing mass production.

I found myself categorizing the suggestions within Enough Is Enough the same way. Many of their proposals required minor alterations to our current ways of doing things. Others, though, are more like the “square one” approach. For instance, in the chapter “Enough Debt,” they propose some fundamental changes to how the financial world operates, ranging from the technical (requiring reserves on loans to be 100%) to the structural (decreasing the size and power of financial institution below the “too big to fail” level and – here comes the part that will elicit protests of socialism – democratizing the means of production).

Instead of hailing and idolizing the financial arena as the source of investment and growth as we currently do, the authors say we should be viewing it as a cost. “The fewer resources needed to accomplish this service [helping money to flow where it’s needed in the economy], the better off society is. So we should aim to minimize the cost represented by the financial sector—it should account for as small a percentage of total economic activity as possible.” We’ve come to see the financial world as an end in itself (how’s the market doing today?), forgetting in the process that its purpose is to be a means to the improvement of our lives. “Instead of focusing on using money to make more money, financiers should be focusing on serving a stable economy, an equitable society, and a healthy biosphere.”

Enough is (Almost) Enough

Enough Is Enough does an admirable job of making the off-putting topic of SSE much more approachable and enticing, but (ironically) leaves me still wanting more. The authors fully understand that “for people to embrace the concept of a steady-state economy, they need to understand how it would work and why it would be preferable to what they’ve become accustomed to.” They’ve brought us much closer to this point, but I came away still wanting to know what it will feel like and look like and how we will experience it.

This shortcoming – and I’m nitpicking through an exceptional book – strengthens the underlying need for what I see as a primary mission of the EcoOptimism blog: providing that visceral taste of a positive future. Enough Is Enough lays the policy groundwork. Now we need to make it concrete and present it in a form people can relate to in order to convince an understandably skeptical populace. This requires the merging of policy wonk-dom with the visioning and communicating designers can provide (with perhaps some added oomph from the PR and advertising worlds).

Dietz and O’Neill write “An enlightened transformation to a steady-state economy is a profoundly hopeful prospect.” Not one of doom and gloom or involving sacrificing the “American way of life.” The overriding need is to develop and successfully present this thoroughly desirable future so that we will pursue it, not because we have to but because we want to. Enough Is Enough is a major step on that path.

Enough Is Enough will be released by Berrett-Koehler Publishers on January 7, 2013

The Growth Schism: Could a Sound Bite Save the World?

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This being election season (good thing it’s also the season for apples – I’m partial to Macouns — and pumpkin pie or I’d have to call it my least favorite season), let’s pose this topic with a relevant question. Suppose you’re a political candidate with both an economic and an environmental agenda – and want to not just make a statement but have a real chance at election. Your environmental background tells you that growth, as in economic growth, is a huge issue. You understand that continuous growth on a finite planet is a physical impossibility that will inevitably lead to a human disaster. (So much for EcoOptimism, or so it would seem.)

But you also know that growth, because it ostensibly leads to much needed jobs, is a political given. That’s why you’ll never hear a candidate come out against growth.

Is this dilemma resolvable?

If that candidate has studied growth as taught in conventional economic circles, she’s been told that growth is the solution to virtually all economic problems and that, because of the way the “free market” works, resources are in practice not finite, that pricing factors will always lead to substitutes and alternatives.

On the other hand, if she has studied environmental economics, she’ll be aware that not only does the market not have the ability to break the laws of physics, but perhaps more relevantly, growth does not solve all economic problems and, in fact, does not even improve lives.

We’ve known this for a while. Yes, growth is indeed necessary and a positive force – up to a point. When the members of a society don’t have adequate shelter and sustenance, growth is critical to achieving those essential needs. But there’s a diminishing returns curve here and, after a point, growth no longer makes us happier. I thought this observation was so important that I found a way to include it in my book on sustainable design despite it not being – directly at least – about design.

You wouldn’t know it from political discussions (see dilemma above), but there has been a slew of research and books on this topic of late. I mentioned a few of them in an earlier post. Most of them are discussing growth in the context of developed countries, where fundamental human needs, for the most part, have been met. Assuming one accepts the premise that growth is necessary until that point has been reached, a question that follows is: what is that point?

We may have a partial answer in the form of research by a team of economists from UCLA and USC. Summarized in a recent New York Times op-ed by Richard Easterlin, a member of that team, they found that a quadrupling of per capita consumption in China over the past 20 years was accompanied by a decrease in life satisfaction.

Image source: icis.com

Of course, there are several possible reasons for this and it’s not correct to automatically assume that the unhappiness is due to growth and increased consumption. Easterlin sees it in terms of socio-economic causes. “In China,” he writes, “life satisfaction declined as output and consumption rapidly expanded. The difference shows that economic growth is not enough; job security and a social safety net are also critical to people’s happiness.”

However, a mountain of evidence shows that, at least in developed regions and countries like the U.S. and Europe, growth is not the panacea that most politicians believe it is. Or perhaps they do realize this, but know that it is just too complicated an idea to explain in sound bites. Coming out against economic growth would leave any candidate vulnerable to easy pickins.

Image source: Adbusters

Which brings us back to the superficial tactic of finding a way to pose the idea in a positive light. If “no growth” or “antigrowth” are non-starters for a political platform, well we need to find a way to recast the idea in a way that illustrates the reasons we should, in fact, desire the end of growth. As with several previous EcoOptimism posts, we’re drawn back to the issue of communication. In this case, the problem is how to communicate that growth – such a positive sounding goal – is not actually good. Or smart. Or even possible, at least not in any version of our finite planet.

I hate that it comes down to spin, to PR essentially. But we know we can’t promote “no growth” as a goal. The snappy retorts are just too easy. This one took me less time to come up with than it takes for a conservative to spot voter fraud: “No growth, no way.”

“Post-growth” has been suggested by a number of people and it has potential. I fear, though, that it begins to evoke post-apocalyptic associations. I’ve pondered “regrowth,” but I think it still requires too much explaining. It may be that we need a term that sidesteps the problem by not evoking growth at all. Juliet Schor’s Plenitude is one attempt; however it doesn’t make the cut in terms of being popularly self-explanatory either.

So we do indeed have a dilemma. It’s a critical one for EcoOptimism: how to make a counterintuitive idea appealing? Facts and figures we have aplenty. It’s the sound bite we’re missing.

News we like

“A new form of radical centrist politics is needed to tackle inequality without hurting economic growth”

Some quotes (taken out of order):

In America the share of national income going to the top 0.01% (some 16,000 families) has risen from just over 1% in 1980 to almost 5% now—an even bigger slice than the top 0.01% got in the Gilded Age.

[I]nequality has reached a stage where it can be inefficient and bad for growth.

Even the sort of inequality produced by meritocracy can hurt growth. If income gaps get wide enough, they can lead to less equality of opportunity, especially in education.

Here’s the positive take-away:

The priority should be a Rooseveltian attack on monopolies and vested interests, be they state-owned enterprises in China or big banks on Wall Street.

From Grist.com:

“The greener the industry, the higher the job-growth rate”

According to a new study from the Economic Policy Institute, “Industries that support a higher number of “green” workers who are making goods and services more environmentally friendly have experienced a higher rate of growth over the last decade than industries with fewer green jobs.”

The 2010 result: “3.1 million green jobs nationwide in renewable energy, water management, recycling, and various positions that help improve the efficiency and environmental footprint of a company or institution.”

From Greenbiz.com:

“Natural capital accounting gets a push at Global Green Growth Forum”

image source: ForumForTheFuture.org

One of the positive outcomes achieved on the sidelines of the Rio+20 conference, as highlighted by Jo Mackness at GreenBiz on June 26, was progress made on natural capital accounting. Fifty-seven countries and 86 companies, for instance, signed a World Bank-organized communiqué committing signatories to account for the value of clean air, clean water and forests in their decision-making.

From ThinkProgress.org:

“Federal Reserve Official Calls For Placing Limits On The Size Of Big Banks”

image source: Huffington Post

[Federal Reserve Board Governor Daniel ]Tarullo said that, in order to keep big banks from growing so large that they threaten the entire financial system, they should be limited in size to a certain percentage of the overall economy.

“[T]he Fed should block any merger or acquisition this group of big banks attempts to make,” which it is allowed to do under Dodd-Frank.

The string of positivism actually began a bit earlier in the week with a post from The Atlantic’s new site Quartz:

“Does Ben Bernanke want to replace GDP with a happiness index?”

image source: Redefining Progress

In a prerecorded talk for a conference this past summer, Bernanke said, ”…we should seek better and more-direct measurements of economic well-being, the ultimate objective of our policy decisions.”

Rather, Bernanke suggests that survey measures of happiness and life satisfaction should take their place alongside GDP as measures of how a nation is doing. In doing so, he joined current British Prime Minister David Cameron, who said ”it’s time we focused not just on GDP but on GWB—general wellbeing” and former French Prime Minister Nicolas Sarkozy, who said he would ”fight to make all international organisations change their statistical systems by following the recommendations” of the Stiglitz report. He refers to Nobel Prize winning economist Joseph Stiglitz’s committee’s work proclaiming “the time is ripe for our measurement system to shift emphasis from measuring economic production to measuring people’s well-being.” The emphasis is in the original.

It’s good to end the week on an up note. Would be great if I could make a habit of this….

David Bergman: EcoOptimism

EcoOptimism: Finding the Future We Want

Tag Archives: growth-economic

Countering the EcoPessimist

Sometimes the succinct version says it best…

Redefining Growth

Answering the Wrong Question

The Growth Panacea

Less is More, More or Less

The Growth Schism: Could a Sound Bite Save the World?

News we like

“A new form of radical centrist politics is needed to tackle inequality without hurting economic growth”

“The greener the industry, the higher the job-growth rate”

“Natural capital accounting gets a push at Global Green Growth Forum”

“Federal Reserve Official Calls For Placing Limits On The Size Of Big Banks”

“Does Ben Bernanke want to replace GDP with a happiness index?”

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