economic growth

Ecological economist Tim Jackson is one of the few serious scholars trying to imagine what a post-growth world might look like. Over the past thirty years, this specialty – largely ignored by mainstream economics – has become ever-more relevant to contemporary life. It is becoming clear that growth is not the panacea for what afflicts modern societies.

In the 1990s, Jackson pioneered the idea of “preventative environmental management,” showing how preventing pollution in the first place could improve profits and quality of life. But his journey into post-growth thinking surged forward when he was appointed Economics Commissioner for the UK Sustainable Development Commission in 2004. Improbably, UK politicians wanted a professional, an indepth assessment of the idea of a no-growth economy.

The result – a controversial 2009 report to the UK government – was published as the book Prosperity without Growth: Economics for a Finite Planet. (A substantially revised and rewritten edition was published in 2017). This book, now translated into 17 languages, examines the problems of growth and consumerism and the prospects for a new “ecological macro-economics” and a redefinition of prosperity. More is not always better; we need to focus on what helps us flourish as human beings and helps us lead a satisfying “good life.”

More than a decade later, Jackson’s thinking about this topic has evolved in some new and unexpected ways. He has just published a new book, Post Growth: Life After Capitalism (Polity Press), which doesn’t offer economic charts and policy proposals. It is, instead, a philosophical, cultural, and personal exploration of how we might pursue a vision of post-growth.

The pandemic now sweeping the planet is one of those historic events that will change many basic premises of modern life. Let us act swiftly to deal with the emergencies, but let us also seize the opportunity to think about long-term system change. If there is one thing that the pandemic confirms (in tandem with climate change), it is that our modern economic and political systems must change in some profound ways. And we are the ones who must push that change forward. We've already seen what state officialdom has in mind -- more bailouts for a dysfunctional system. Serious change is not a priority at all.

However, pandemics are hard to ignore. Many ideas once ignored or dismissed by Serious People – commoning, green transition policies, climate action, relocalization, food sovereignty, degrowth, post-capitalist finance, universal basic income, and much else – now don’t seem so crazy. In fact, they are positively common-sensical and compelling.

The pandemic has been horrific, but let's be candid: It has been one of the most effective political agents to disrupt politics-as-usual and validate new, imaginative possibilities.

Many things are now less contestable: Of course our drug-development system should be revamped so that parasitic corporate monopolies cannot prey upon us with high prices, marketable drugs rather than innovation, and disdain for public health needs. Of course our healthcare system should be accessible to everyone because, as the pandemic is showing, individual well-being is deeply entwined with collective health. Of course we must limit our destruction of ecosystems lest we unleash even greater planetary destabilization through viruses, biodiversity loss, ecosystem decline, and more.

In this sense, covid-19 is reacquainting us moderns with some basic human realities that we have denied for too long: 

• We human beings actually depend on living, biological systems despite our pretentions to have triumphed over nature and its material limits.

• We human beings are profoundly interdependent on each other despite our presumptions – at the core of modern economics and liberal democracy -- that we are self-sovereign individuals without collective needs. (Margaret Thatcher: "There IS no society, only individuals.")

Most people don’t really understand how money is created and what political choices are embedded in that process. As a result, the privatization of money-creation is largely invisible to public view, and the anti-social, anti-ecological effects of privately created, debt-based money go unchallenged. 

Mary Mellor, professor emerita at Northumbira University in the UK, wants to change this reality, as she explains in a recent essay, “Money for the People,” at the Great Transition Initiative website. Mellor, the author of Debt or Democracy and an expert on the development of alternative economies, writes that we must create new public circuits for money-creation so that we can direct money toward socially and ecologically needed activities, and not just the types of debt-driven loans that banks deem profitable. In other words, money-creation need not be controlled by private creditors in the course of creating debt.  

The average citizen knows that banks are too powerful and often predatory, but they may not realize that the state has largely ceded its power to create new money ("seignorage") to banks. Banks create new money out of thin air when they make loans. That money is not something they otherwise hold in a vault. It is literally created when a loan is approved. That is how banks make profits. 

The power to create new money is something that the government could feasibly control and administer itself, for the benefit of all.  But governments have surrendered their power of seignorage to the private banking system and its investors.

This has far-reaching, negative impact because, as Mellor explains, “It is the private, bank-issued money system that leaves us with a pernicious cycle of debt and growth. Money could encourage socially and ecologically sustainable production and consumption, but only if it ceases to be a creature of the market and is reclaimed as a social and public representation of value.”

It is self-evident that mass consumption is a main driver of relentless economic growth, the utopian goal of capitalism, and this has obvious ecological implications as we over-consume the Earth.  But why do we feel compelled to consume far beyond what we truly need? 

In a provocative new essay on the Great Transition Initiative website, neuroscientist Peter Sterling explores “Why We Consume:  Neural Design and Sustainability.”  It is an evolutionary scientist’s argument for how human beings are neurologically wired and what we might do about it. What is the biological substrate for our behaviors as homo economicus and as social cooperators?  Why do we (over)consume? 

Sterling points to such obvious social factors such as our desire for social status and a good self-image, all of it fueled by advertising.  But while these feelings of satisfaction invariably wane, they invariably surge forward again and again: “Something at our neural core continually stimulates acquisitive behavior,” he writes, adding that “we urgently need to identify and manage it.”

Sterling notes that we all have neurological circuits that are periodically bathed in dopamine as a reward for satisfying behaviors. More than a “pleasure center,” these neural responses serve as a reward for human learning and adaptation in a highly varied environment. It is the decline of our highly varied environment that may be responsible for our consumerist obsessions.