Beyond Economic Growth: green political economy, the transition from unsustainability and enhancing human flourishing

John BarrySchool of Politics, International Studies and Philosophy

Background

Context

Types of economic growthPro-poor economic growth Pro-egalitarian economic growthLow carbon economic growth – ‘ecological modernisation’, ‘green growth’; ‘green capitalism’;

Economic and ‘uneconomic’ growth – growth that does not reduce inequalities, reduce resource/energy intensity or increase opportunities for human flourishing

Why be critical of growth?

Sustainability reasons – climate change, energy, resources and pollution;

Equality reasons – economic growth under capitalism manages and reproduces inequality it does not eradicate it;

Human flourishing reasons – beyond a threshold, economic growth does not add to and can reduce human flourishing.

Orthodox economic growth and ‘actually existing unsustainability’ Capitalist economic growth has locked

us into a carbon based energy economy that is socially, economically and ecologically irrational, unsustainable and ecocidal;

Economic growth has passed the threshold beyond which it adds to human flourishing / development;

Has locked us into debt-based consumerism;

Manages and requires rather than reduces socio-economic inequalities

Economic growth as permanent feature of the economy that serves the interests of a minority;

Its cooking the planet, creating geopolitical instability, increasing inequality and undermining human flourishing now and for future generations

3 criteria for assessing economic growth/policy

Low carbon/sustainability – does an economic policy lower carbon and move us away from ‘actually existing unsustainability’?

Equality – does an economic policy increase or decrease extreme inequalities?

Human flourishing – does an economic policy increase or decrease human flourishing?

So…if economic growth can be low carbon, lower inequality and increase human flourishing it is to be welcomed

The cancer stage of capitalism - unsustainable and uneconomic

growth

Cancer - healthy cells that grow beyond a threshold to become unhealthy

Orthodox economic growth - undifferentiated GDP growth as a permanent feature of the economy - as ‘cancerous’ (John McMurtry) or ‘uneconomic growth’ (Herman Daly)

Central importance of thresholds

Orthodox, undifferentiated economic growth

Orthodox GDP/GNP measurements

Need to differentiate– some growth is, ceteris paribus, positive , contributes to meeting human needs and enhances quality of life and human flourishing

However, ‘Defensive consumption’/production – hiring security guards because of declines in social trust, increase in crime; buying water/air filters due to environmental pollution; purchasing children's’ toys/home entertainment due to parents having no time (work pressure) or there being no appropriate/local open spaces/parks; bottled water due to poor quality of tap water.

Because ‘what gets measured gets done’ we need better measurements than GDP (even most neoclassical economists accept this)

GDP does not differentiate between defensive and non-defensive consumption and production , positive and negative economic activity in terms of human flourishing, sustainability, or equality

Within an overall sustainable economy, which sectors and activities do we want to grow and which to shrink?

A post-growth economy – consistent with growth in some sectors, so long as it does not transgress the thresholds set by the three criteria above

Grow life-sustaining/enhancing sectors and contract those that undermine/threaten life and human flourishing

Less weapons, warships and bombs and more schools, playgrounds, hospitals, kidney dialysis machines?

Economic GrowthThe fact that an economy is growing tells you nothing about the ‘quality’ of economic activity

“in times of recession, life expectancy can rise, even as livelihoods are apparently harmed. This happens in rich countries probably due to force of circumstances, as people become healthier by consuming less and exercising more, using cheaper, more active forms of transport such as walking and cycling”, new economics foundation. 2010, p. 6

It is possible, in other words, to have both ‘economic’ and ‘uneconomic’ growth and we should not assume that growth per se is a ‘good thing’, to be held onto at all costs.Or as a permanent as opposed to a historically

contingent feature of the human economy

“…our economy is killing the Earth”

“This is the logic of free-market capitalism: the economy must grow continuously or face an unpalatable collapse. With the environmental situation reaching crisis point, however, it is time to stop pretending that mindlessly chasing economic growth is compatible with sustainability. Figuring out an alternative to this doomed model is now a priority.” ‘Why politicians dare not limit economic growth’, Tim Jackson, pp. 42-3.

New Scientist, 16 October 2008

Imagining an economics...and life... beyond orthodox growth

“questioning growth is deemed to be the act of lunatics, idealists and revolutionaries” (Jackson, 2009: 14).

Criticising economic growth is tantamount to a fundamental act of betrayal in modern societies, a public act of disloyalty to the modern political economic order.

Growth and Inequality“Growth is a substitute for equality of income. So long as there is growth there is hope, and that makes large income differentials tolerable” (Wallach, 1972).

“We are addicted to growth because we are addicted to large inequalities in income and wealth. What about the poor? Let them eat growth! Better yet, let them feed on the hope of eating growth in the future!” (Daly, 1991)

Economic growth, inequality and ‘trickle down’

economics....

Inequality, insecurity and consumerism, status

competitionSocio-economic

inequality as driver of consumerism via status competition;

Psychological and political economic significance of shame and status;

Because inequality increases status competition, it also increases consumerism. People in more unequal societies work longer hours because money seems even more important.

More inequal

ity• More superiority and

inferiority• More status competition and

consumerism• More status insecurity

• More worry about how we are seen and

judged

• More “social evaluation anxiety”

(threats to self-esteem & social

status, fear of negative

judgements

Inequality, status competition and consumerism

Growth, consumerism and human flourishing

UK Cabinet Office’s Strategy Unit report, “above a certain threshold of consumption, there is no clear relationship between economic growth and quality of life.” (Foley, 2005)

The Swedish EPA has called for strategies to target both the supply (production) and demand (consumption) sides through the propagation of eco-efficiency in production and by embedding a notion of ‘sufficiency’ in consumption.

“The ultimate question facing today’s society in developed countries is whether consumerism actually contributes to human welfare and happiness” (EPA, Sweden, 2005)

From Economic Growth and Consumption to Economic Security

“People in countries that provide citizens with a high level of economic security have a higher level of happiness on average, as measured by surveys of national levels of life-satisfaction and happiness…The most important determinant of national happiness is not income level – there is a positive association, but rising income seems to have little effect as wealthy countries grow more wealthier. Rather the key factor is the extent of income security, measured in terms of income protection and a low degree of income inequality.” (Emphasis added)

International Labor Organisation, (2004), Security for a Better World

Replacing economic growth with ‘economic security’

Factors influencing well-being (Jackson, 2009)

So why not design economic policy to directly address these rather than indirectly trough economic growth measures? What does public policy look like when orientated towards enhancing and strengthening community or relationships rather than economic growth?

From the ‘Goods Life’ to the ‘Good Life’?

“The necessity to reduce our material impact on the ecosystem is normally seen as a threat to our ‘standard of living’. However…it is existing patterns of consumption that compromise our prospects for ‘the good life’. Re-visioning the way we satisfy our needs is not the bitter pill of eco-fascism; it is the most obvious avenue for renewing genuine human development”. (Jackson and Marks, 1998: 38; emphasis added)

Beyond GDP and undifferentiated ‘economic growth’ as a permanent

feature of an economy…

“The Gross National Product counts air pollution and cigarette advertising, and ... the destruction of the redwood and the loss of our natural wonder in chaotic sprawl ... Yet [it] does not allow for the health of our children, the quality of their education, or the joy of their play ... the beauty of our poetry or the strength of our marriages ... it measures everything, in short, except that which makes life worthwhile”.

Robert Kennedy, 1968

J.S. Mill, (1848) ‘Of the Stationary State’, from his Principles of Political Economy, Book IV, Ch VI“I cannot, therefore, regard the stationary state of capital and wealth with the unaffected aversion so generally manifested towards it by political economists of the old school. I am inclined to believe that it would be, on the whole, a very considerable improvement on our present condition. I confess I am not charmed with the ideal of life held out by those who think that the normal state of human beings is that of struggling to get on; that the trampling, crushing, elbowing, and treading on each other's heels, …

But the best state for human nature is that in which, while no one is poor, no one desires to be richer, nor has any reason to fear being thrust back, by the efforts of others to push themselves forward.”

Principles for a Macro-Economics of SustainabilityResilience –Centrality of

‘in-built redundancy’ and ‘slack’ to withstand shocks ensure long-term functioning

Sufficiency: as a principle of production and consumption‘An economics of enough’Challenge the principle of maximisation “Sufficiency thus aims at

excess. It is not sacrifice in the negative sense of the term, not second best. It is first best when users want to do well now and into the indefinite future. It lies at the heart of an ecological order‘ (Princen, 2010: 74; emphasis added).

Reclaiming the principles and virtues of Thrift and frugality

“Thrift is not the opposite of generosity, the closed fist that holds one to what you have, but the enabler of generosity. A frugal life that does not waste and cares for what you have is what enables you to give away, to share, to open your hands and pour forth what you have preserved” (Astyk, 2008: 208).

From ‘Buildings, Banks and Boutiques’ to… ?

Old, failed economic model based on:

Property speculation

Financialisation of the economy and life

Debt-based consumerism

All for economic growth

To…Libraries, Laundromats and Light

rail? Beyond ‘business as usual’ Collectivisation of consumption

(and democratising production)If we’re socialising risk (bank

bailouts etc) why not socialise other aspects of the economy?

Transition to a sustainable, green economy based on more shared forms of consumption

Post-growth political economy: From ‘employment’ to ‘work’?

“a redefinition of work to include the full diversity of what is necessary for life. It requires we find new ways of valuing parenting, caring and community building as much as paid work”, (Boyle and Simms, 2009: 89).

What would public policy and economic policy look like if they were orientated towards supporting ‘work’ and not just ‘employment’?

Where does the largely gendered labour within the ‘reproductive sphere’ get recognised as part of the ‘economy’?

Productivity gains translated into reduced formal working hours, not increased output or income

And opportunity for developing the internal goods of work and employment – autonomy, democratic control, creativity, self-expression etc.

Unconditional Basic Income

One way of creating economic security

Reducing inequality and economic growth – help reduce irrational status competition and consumerism

A direct investment in social capital. BI would encourage activities in the social economy.

Finance through a carbon tax, or tax on luxury goods?

Reduce the working week

Shift from 40 hour (+) as the normal working week

20 hours – new economics foundation

Popular with workers where pay and conditions are good

“To meet the challenge, we must change the way we value paid and unpaid work. For example, if the average time devoted to unpaid housework and childcare in Britain in 2005 were valued in terms of the minimum wage, it would be worth the equivalent of 21 per cent of the UK’s gross domestic product.” new economics foundation, 2010, p. 2

Shorter working week – productivity gains realised not as output increases (or income increases) but more free time and focus on internal goods of work

Need greater work-time flexibility, gradual reduction of working hours over time, reward businesses for taking on more workers etc. Wage stability necessary, childcare and less unequal gender distribution of childcare

Reducing working hours as a climate change

mitigation strategy“Reducing work hours over the rest of the century

by an annual average of 0.5 percent. ... such a change in work hours would eliminate about one-quarter to one-half of the global warming that is not already locked in (i.e. warming that would be caused by 1990 levels of greenhouse gas concentrations already in the atmosphere).

However...back to inequality

“reduced work hours as a policy alternative would be much more difficult in an economy where inequality is high and/or growing. In the United States, for example, just under two-thirds of all income gains from 1973–2007 went to the top 1 percent of households. In this type of economy, the majority of workers would have to take an absolute reduction in their living standards in order to work less.” (Rosnick, 2013: 3)

So, for work hours reduction from productivity growth to be more broadly shared by majority of people requires reducing inequality.

Post-growth political economy A new development model, new way of thinking about the economy and economics;

Sharing and public services, infrastructural investment as important as personal disposal income and consumption;

Meaningful free time (not unchosen unemployment) within context of economic security and sufficiency;

Shift from exclusive focus on the formal/cash economy (conventional public and private) to social/informal/convivial economy Separation of ‘work’ from ‘employment’ and focus on internal goods of work and employment i.e. beyond productive efficiency

Replace economic growth with ‘economic security (or equivalent)

Challenge and opportunity for the 21st century – how to improve the ecological efficiency of human flourishing NOT the ecological efficiency of orthodox economic growth

The end of the world as we know it....is not the end of the world

Difficulties with post-growth

Hard sell! Can be viewed as anti-aspirational, backward, regressive, defeatist, unattractive etc.How to promote a new paradigm in thinking about the economy and societyVery difficult (but not impossible) in context of austerity, and general desire to return to growthWhat is the narrative/storyline of post-growth?Need for civic conversations as well as academic, policy-related scholarship

What if the most important things in life really do turn

out to be free?

“Economic growth, for so long the great engine of progress, has, in the rich countries, largely finished its work. Not only have measures of well-being and happiness ceased to rise with economic growth but, as affluent societies have grown richer, there have been long-term rises in rates of anxiety, depression, and numerous other social problems. The populations of rich countries have got to the end of a long historical journey”. (Wilkinson and Pickett, 2009 pp.5–6).

And while there are material ‘limits to growth’, there are many other dimensions of human flourishing that not subject to limits

“True growth is the ability of a society to transfer increasing amounts of energy and attention from the material side of life to the non-material side and thereby to advance its culture, capacity for compassion, sense of community, and strength of democracy.”

Arnold Toynbee

Choices ahead.... What is to be done?

…..

‘Toxic Textbooks’ campaign

Growth isn’t Working “Between 1990 and 2001, for every $100 worth of

growth in the world’s income per person, just $0.60 found its target and contributed to reducing poverty below the $1-a-day line. To achieve every single $1 of poverty reduction therefore requires $166 of additional global production and consumption, with all its associated environmental impacts.”

new economics foundation (2006), Growth Isn’t Working

Highly improbable to reconcile the objectives of poverty reduction and environmental sustainability if global growth remains the principal economic strategy. The scale of growth this model demands would generate unsupportable environmental costs; and the costs would fall disproportionately, and counter-productively, on the poorest – the very people the growth is meant to benefit.

Need to de-link poverty reduction from orthodox economic growth and focus on increasing the share of income that goes to those in poverty i.e. redistribution (which decreases inequalities) and economic security, not economic growth (which reproduces inequalities).

Imagine an economy not only designed by a scientist (or with cognisance of the basic biophysical laws of nature) but also one aimed to enhance human relationships and health not income, wealth and the accumulation of more and more possessions?

Or where societal ‘success’ is measured by how we look after the most vulnerable not the size of our economy or army?

The necessity of scarcity and insecurity under neoliberal capitalism The mythic or cultural-psychological ‘fact’ of scarcity, and associated notions of insecurity (job, body image, status) and ‘status anxiety’ (amongst others), are necessary features for the modern growth economy.There is never ‘enough’, only constant gratification without satiation; ‘Perpetual scarcity’ in the midst of affluence and plenty; Scarcity as a master concept for neo-liberal capitalism– how to organise human life between infinite wants and scarce means.Rather than democratically/politically regulating/limiting (some) wants below a threshold in the interests of other wants and needs and to satisfy the needs of more people

Economic growth as our modern myth to live by and through which social order is sustainedNot so much as 'let them eat cake' but the promise of cake in the future

Alternative hedonism: its pleasure Jim....just not as we

know it Pleasure can be attained not just by

working for or getting into debt and then purchasing commodities.

But also by finding time for those ‘simple things’ in life that are free or at least inexpensive –time with family and friends, time to swim in the ocean or read, time to be creative, to make love, to sit and think...or just to sit.

In other words, alternative hedonism does not see material simplicity of life as impoverishing, but rather the opposite as enriching life.

But key to this is economic security for all