“Questioning growth is deemed to be the act of lunatics, idealists and revolutionaries” Tim Jackson warned in his report for the Sustainable Development Commission earlier this year. Fortunately he remains undaunted, and the report has been expanded and released as a book: Prosperity Without Growth – Economics for a finite planet.
As you may have noticed, the response to the financial crisis has been to try to restore the status quo as soon as possible, returning us the pattern of steady growth that we had become accustomed to and that our capitalist model demands. ‘Stability – Growth – Jobs’ said the banner at the G20 summit. The problem is that in the longer term, stability and growth are incompatible. “An economy predicated on the perpetual expansion of debt-driven materialistic consumption is unsustainable ecologically, problematic socially, and unstable economically” writes Jackson.
The book goes on to elucidate three fundamental reasons why the growth model of economics is impossible to sustain. Firstly, it assumes that material wealth is an adequate measure of prosperity, when it is actually pretty obvious that a life worth living is much more complicated than that. Slaves to rising GDP, we sacrifice community and wellbeing in the hope that just a little more, and just a little bit more after that, will make everything alright. This is futile. The growth model is now undermining our happiness and causing a ‘social recession’. “Our technologies, our economy and our social aspirations are all mis-aligned with any meaningful definition of prosperity”
Secondly, growth is unevenly distributed, and so is doomed to fail at providing a basic standard of living for everyone. Globally, the richest fifth of the world takes home 74% of the income, while the poorest fifth gets just 2%. Since poverty is relative, growth will never fix it. It’s a mathematical impossibility. You could grow the world economy for a million years and still not make poverty history.
And that brings us to point number three – we obviously can’t grow the economy for a million years. We’ve already gone into ecological overshoot. “We simply don’t have the ecological capacity” says Jackson. “By the end of the century, our children and grandchildren will face a hostile climate, depleted resources, the destruction of habitats, the decimation of species, food scarcities, mass migrations and almost inevitably war.”
That’s the case against. There are some easy answers, and Jackson dedicates a chapter apiece to these – ‘the myth of de-coupling’, the idea that you can grow without increasing material consumption, and the ‘green new deal’. Decoupling only works up to a point, he concludes. In theory, an advanced economy becomes more efficient in its resource use, meaning less CO2 is emitted and fewer resources are needed. In reality this doesn’t include imports, so all the materials use and emissions just happen elsewhere, perhaps in China. Even where true de-coupling does happen, the economy gains carbon efficiency at a rate of 0.7% a year, and it would need to be at least 11% a year to avoid climate change. The Green New Deal is a more promising idea and should be pursued, investing heavily in renewable energy and clean technology and stimulating the economy at the same time. Ultimately it still commits us to a growth strategy and is therefore not a long term solution.
Instead, we need to change the entire system, and change the culture that goes with it – developing “a new ecologically literate macro-economics” and “shiftting the social logic of consumerism”. Neither of these is an easy task, but it’s not impossible either. A new macro-economics could take shape around an alternative to GDP, something that honours the broader realities of human flourishing. The ‘iron cage of consumerism’ can be taken apart by reducing inequality and building community resilience. The government has a huge part to play in creating a level playing field, setting limits and resetting our national values.
This is where Prosperity Without Growth comes into its own. It’s easy to lament the unsustainable nature of growth economics. It’s slightly harder to re-imagine it on the other side. Hardest of all is to detail the transition, how you get from growth to a steady state without breaking the economy. That’s the missing piece, and Tim Jackson has boldly stepped into the breach with a book that is clear, balanced and free of political bias. This isn’t a blueprint for such a transition, but it does show that it is possible. For that, Prosperity Without Growth has got to be one of the most important books of the year.
The tragedy is that our economic system requires growth. Without it, we have recession and job losses. A revolution would be a messy business and a catastrophe, but social transformation is not just possible, but vital. “The clearest message from the financial crisis of 2008 is that our current model of economic success is fundamentally flawed” Jackson writes in his conclusion. “For the advanced economies of the western world, prosperity without growth is not a utopian dream. It is a financial and ecological necessity.”