Not directly linked to climate but this article from the LRB on degrowth vs green-growth is not bad.
It has one major flaw in that it totally underestimates the active role of labour but the criticism of green-growthers, and of some/most(?) of the de-growthers is on the money.
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Vol. 44 No. 16 · 18 August 2022
Reversing the Freight Train
Geoff Mann
Tomorrow’s Economy: A Guide to Creating Healthy Green Growth by Per Espen Stoknes. MIT, 360 pp., £15.99, April, 978 0 262 54385 9
Less Is More: How Degrowth Will Save the World by Jason Hickel. Windmill, 318 pp., £10.99, February 2021, 978 1 78609 121 5
Post Growth: Life after Capitalism by Tim Jackson. Polity, 228 pp., £14.99, March 2021, 978 1 5095 4252 9
The Case for Degrowth by Giorgos Kallis, Susan Paulson, Giacomo D’Alisa and Federico Demaria. Polity, 140 pp., £9.99, September 2020, 978 1 5095 3563 7
It is hard to know how to talk about modern economies without talking about growth: productivity, entrepreneurial ‘risk-taking’ and the profit-driven cycle of expansion and accumulation. Economic growth is understood to be a natural or automatic process, its absence taken as evidence that we must somehow have got in its way. The purpose of economic policymaking is, accordingly, presented as a matter of loosening the ‘fetters’ on growth, as if the economy were a wealth-generating beast, always raring to go, if only we’d let it.
Given all this, it may come as a surprise to learn that the analysis of ‘economic growth’ in its contemporary sense is a relatively recent development. Some will say that Adam Smith was the first theorist of economic growth (a term he didn’t use), but even as late as 1946, Evsey Domar, one of the founders of modern growth theory, could remark that the rate of growth was ‘a concept which has been little used in economic theory’. That didn’t remain true for much longer, as economists and policymakers wrestled with the legacy of the Depression, fears of postwar stagnation, and the geopolitics of decolonisation and the Cold War. The challenges of growth and industrialisation – the obstacles to achieving them, but also the dislocation and inequality they often entailed – weren’t just a matter of investment, technology and productivity. They were also, in the words of Simon Kuznets, about ‘the future prospect of underdeveloped countries within the orbit of the free world’.
Walt Rostow, who was, along with Kuznets, one of the field’s most influential early thinkers, understood growth as the foundation of the postwar world order. His Stages of Economic Growth, published in 1960, was unsubtly subtitled ‘A Non-Communist Manifesto’. According to what is now called the ‘Rostovian’ account, growth wasn’t just the solution to domestic instability in advanced industrial economies and the remedy for the backwardness of ‘traditional’ (non-industrial) societies; it was also the antidote to socialism. There was no need for revolution: the managed markets of postwar capitalism would eventually, peacefully, deliver the fruits of modernisation – a non-violent, self-reinforcing alternative to expropriation and collectivisation. It wasn’t clear, however, how traditional societies would respond to the inevitable disruption associated with integration into the global economy. ‘How,’ Rostow asked, ‘should the traditional society react to the intrusion of a more advanced power: with cohesion, promptness and vigour, like the Japanese; by making a virtue of fecklessness, like the oppressed Irish of the 18thcentury; by slowly and reluctantly altering the traditional society, like the Chinese?’
Kuznets’s hunch was that market-driven economic growth in traditional societies would initially worsen inequality, but in the long term reduce it. (A hypothesis which, despite his admission that it was ‘95 per cent speculation’, was subsequently elevated to the status of a truth in the now notorious ‘Kuznets curve’.) How could the West keep hold of the rest of the world during these initial shocks? How could the process be designed to ‘avoid the fatally simple remedy of an authoritarian regime that would use the population as cannon-fodder in the fight for economic achievement’? ‘Where is compound interest taking us?’ Rostow asked on another occasion. ‘Is it taking us to communism; or to the affluent suburbs?’ Are we headed ‘to destruction; to the moon; or where?’ The task was to transform traditional societies in such a way that they could ‘enjoy the blessings and choices opened up by the march of compound interest’.
In the years since Kuznets and Rostow, economic growth has arguably become the principal object of contemporary economics and economic policy, and the rate of increase in Gross Domestic Product (GDP) its standard measure. GDP represents the monetary value of a country’s annual output, usually given on a per capita basis. It is commonly assumed that growth – compound growth, in fact – drives the economic miracle-making of modern capitalism, with the result that a rising GDPhas become a policy goal in itself. As Rostow put it, the point was to make growth the economy’s ‘normal condition’, as ‘compound interest becomes built, as it were, into its habits and institutional structure.’ In today’s global economy, income or output growth, at every scale from the firm to the sovereign nation-state, is a primary determinant of the capacity to attract investment or borrow on financial markets, which is in turn a primary determinant of future growth, and so on in a compounding cycle.
Yet while GDP dominates economic policy, it has been subject to withering critique for decades, not least because it is so obviously a poor measure of human wellbeing. All ‘output’ contributes to GDP, no matter if it is in education or healthcare, fracked gas or weapons. It doesn’t matter, either, if an increase in GDP is distributed between two rich people or among a million poor people: if you get hit by a bus, and it costs thousands to save you (or fail to), both you and the bus driver have made a positive contribution to GDP.
Attacks on the fetishisation of growth and the moral bankruptcy of believing that ‘more’ is the same as ‘better’ have an even longer history. John Stuart Mill (among others) argued that humans are best served by a society in which ‘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.’ More recently, the accusation has been that the economics of growth and the policies they underwrite confuse the quantitative process of growth for the qualitative process of development. Today, we know that countries whose per capita GDP is the highest or which grow the fastest aren’t necessarily more peaceful or more democratic; neither do their citizens necessarily live healthier, longer or happier lives. Despite all this, GDP remains the standard measure of aggregate national economic activity, much to the chagrin of proponents of such alternatives as the Human Development Index or the Genuine Progress Indication, which do make some attempt to gauge human wellbeing.
The precipitous decline in the planet’s ecological stability, associated in particular with climate change, has turbocharged the critique of growth. It is becoming accepted wisdom that modern capitalism’s relationship with the planet is increasingly extractive and destructive. A lunatic fringe refusing to ‘believe’ in climate change may not yet have bumbled off the edge of the earth, but the facts are now part of mainstream consciousness. Even the likes of the International Monetary Fund, the Financial Times, the European Central Bank, Deutsche Bank and the US military now acknowledge that modern economic growth has been ecologically destructive, and is a principal driver of the looming climate cataclysm.
The critical question is whether our current concatenation of crises is a product of the current mode of economic growth, or of economic growth per se. Is it possible to pursue economic growth in a way that doesn’t make things worse for the planet and its inhabitants: can we, as they say, ‘decouple’ growth from greenhouse gas emissions, the decline in biodiversity and the destruction of habitats?
The prophets of decoupling belong to a motley but expanding crew of green-growthers, including financiers such as the former governor of the Bank of England Mark Carney, economists including Per Espen Stoknes of the Norwegian Business School and Mariana Mazzucato of University College London, and business gurus like Paul Hawken (co-author, with Hunter and Amory Lovins, of Natural Capitalism: Creating the Next Industrial Revolution, published in 1999). The green-growthers’ pitch is an appeal to the magic of innovation and technology. Self-described ‘techno-optimists’, such as the Financial Times columnist Martin Sandbu, are vocal proponents of market-based climate policy (like carbon taxes and tradeable permit schemes), ‘innovation economies’ and ‘net-zero’ pledges: corporate and government commitments to large-scale projects that would supposedly allow us to continue business basically as usual while offsetting emissions with carbon capture and storage, tree-planting, and other carbon-sequestration programmes.
This is also the message we hear from advocates of the European Green Deal and renewable energy entrepreneurs. Once we get the right kind of growth – ‘healthy growth’ decoupled from capitalism’s sordid environmental record – we won’t have to worry about there being too much growth, and indeed should welcome it as the path to a more ‘inclusive’ capitalism and the means of paying for the coming transition to a high-tech, low-carbon world. ‘Yes,’ Stoknes says, ‘the current version of capitalism may be wreaking havoc, but it’s not that capitalism is broken.’ In fact, he claims, ‘denying the human psyche its subconscious yearning for growth’ would be disastrous.
There is a no-nonsense realism behind some of the green-growthers’ hopes for decoupling: growth-driven capitalism is what we’ve got; it isn’t going away anytime soon; let’s cross our fingers and work with it. One gets the sense that this is where Carney, now UN special envoy on climate action and finance, has ended up. He has rallied virtually every significant financial institution in the world (commanding between them some $130 trillion in total assets) to form the Glasgow Financial Alliance for Net Zero, with the aim of mobilising private sector financing for a ‘global transition’ to net zero by 2050. But the initiative seems driven more by desperation than hope. The same might be said of Mazzucato’s exhortation to ‘do capitalism differently’. It’s as if time is so short, and human nature so rigid, that we have no other choice.