Friday, December 20, 2019

Against Degrowth

Today many on the left argue for the necessity for a radically-restructured economy linked to ecological sustainability. The idea here is that the pursuit of economic growth is leading to an “uninhabitable earth”, as David Wallace-Wells has put it, thereby threatening the continued existence of humanity. Growth should be subordinated to solving the climate crisis and if that leads to no or negative economic growth, that is the price we must pay. A capitalist economy based on growth must be replaced with a “degrowth” economy focused on simple, healthy communities, efficient resource use and the elimination of wasteful consumerism.
Naomi Klein, author of the hugely influential 2015 book, This Change Everything: Capitalism Vs. the Climate, in a New Statesman essay advocates “radical and immediate de-growth strategies in the US, EU and other wealthy nations…[W]e happen to have an economic system that fetishises GDP growth above all else … The bottom line is that an ecological crisis that has its roots in the overconsumption of natural resources must be addressed not just by improving the efficiency of our economies but by reducing the amount of material stuff we produce and consume.”
Degrowth is probably the worst idea on the left since communism. People want more, not less; they don’t object to growth, they object to where the benefits of growth have mostly gone. In short, they want abundance, not societally-mandated scarcity. And not only will people not accept artificial scarcity, but the transition to a green economy is really only possible in a high-growth context, where the requisite (and expensive) technological innovation and infrastructural development—as, for example, in a Green New Deal--can be supported.
And what is true for publics in advanced countries is doubly true for those living in the developing world. The radical drop in extreme poverty from 44 percent in 1990 to under 10 percent today has been widely noted. Less well-know, a Brookings study has shown that the global middle class has doubled in size from about a quarter of the world’s population in 2000 to just over half today. These changes are attributable to economic growth, even if the benefits of economic growth in developing countries, as in developed countries, have been distributed unequally. It is highly implausible that these populations want less growth when they’ve already benefitted so much from the growth they have seen. What they really want is more and more equally-distributed growth and, ultimately, the lives of abundance they see many people around the world already living.
This is why the left should wake up and realize that degrowth and related doctrines are a trap. Capitalism once again—as it did when democracy and then the welfare state got on the social agenda--needs the left’s help to move forward to a better model. That model is a market-based society of mass abundance, not austerity.
Consider: Capitalism since the 1970’s has performed poorly. This has partially been because of slow growth across the Western world. But it is also because of the absurdly unequal distribution of gains from that growth. This has caused the famous skyrocketing incomes and wealth of the top one percent. But it has also resulted in the emergence of a mass upper middle class for the first time in history.
If you look at what has happened to the middle class in terms of living standards, this is clearly the case. The so-called shrinking of the middle class is mostly due to elements of the middle moving up to a significantly higher living standard, not downward mobility. For these upper middle class families and individuals, their lives are now a reasonable approximation of abundance. They want for very little in material terms and are able to take advantage of the cornucopia of entertainment, information, travel and health options that modern life affords.
But that’s leaving a lot of people behind. This is not because capitalism has to work this way. It is because capitalism is working this way. The enormous potential of today’s market economies to grow faster and lift much larger sections of the population to an abundance level is being squandered by today’s dysfunctional neoliberal model of capitalism. Evidence for this dysfunction has been accumulating for decades, underscored by the financial crash and great recession of 2007-2009 and ratified by subsequent poor economic performance and populist upsurge.
There is no good excuse for this continuing poor performance. Current policies reflect the priorities of those at the top of the system and the conservative economic views that dominate the political right. These policies are getting in the way of unleashing the abundance-producing potential of the third industrial revolution, which has been only limping along since its beginnings in the late 20th century. To take maximum advantage of the new information and networking technologies—not to mention stopping climate change--large scale action is required to develop new infrastructure, turbocharge scientific innovation, massively raise educational levels and spread economic dynamism beyond large metropolitan areas. That requires a decisive break from austerity policies and a renewed commitment to government as an agent of social and economic transformation.
That is the left’s assignment. Once again they are called upon to make capitalism live up to its potential and move it to a new stage. The assignment is not just to defend and, where possible, extend the welfare state (though this is important). The assignment is not just to promote equal access to the benefits of neoliberal capitalism (though this is important). The assignment is to create something new, an abundant life for the mass of people in society.
This is what today’s voters really want. Not a bigger, more democratic welfare state grafted onto neoliberal capitalism but rather a fundamental change where people’s opportunities and quality of life are not walled in by scarcity. They want not just a better life, but a really good life, which they now realize is possible. When early industrial capitalism reached the point where it could support democratic systems, it look the left to make it possible. When the capitalism of the second industrial revolution reached the point it could support generous welfare states, it took the left to make it happen. And now that postindustrial capitalism has reached the point where it potentially could support mass abundance, it will also take the left to make that happen.
It’s a daunting assignment but the left will be far better off embracing that as goal, rather than the chimera of a degrowth economy. As will the world as a whole.

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