Degrowth: Do’s and donuts
19 Jan 2023
Cost of living crisis, climate crisis, refugee and immigration crisis: The current political answer to these crises is economic growth. Economic growth will fix this. The political debate is really, really narrow. It's simply: What is the best way to deliver this economic growth? And once we have this economic growth, what do we do with the dividends of it? Growth, growth, growth will make everything better. But there is a counter-argument, made by the anti-growth coalition, that suggest economic growth isn't the answer. Maybe it's actually the source of the problems we are facing. Instead of economic growth and how to deliver it, the question we should be asking is:
"Growth of what, and why, and for whom, and who pays the cost, and how long can it last, and what's the cost to the planet, and how much is enough?"3
When we talk about economic growth, what are we actually talking about? The metric politicians are judged by predominantly is the Gross Domestic Product (GDP):
"The sum of the monetary value of goods and services produced by paid labour, sold in a given time (e.g. a year) in a given economic area (e.g. a country)."4
There is a couple of things you need to pay attention to in this definition.
Firstly, the "monetary value of goods and services". There is no economic value in GDP in a forest. It is not a good, it is not a service. A forest is worth nothing to the GDP. Chop it down, that's great, you can sell it. So the things that we value in this GDP, in this economic growth are skewing our public policy choices and potentially disincentivizing some of the choices we should be making.
Secondly, these goods and services are produced by "paid labour". Some labour has no value in GDP terms. Feminism did a lot, but it's still predominantly women who are homemakers. Unpaid labour that is not measured in the GDP. The professions that we value - those that produce goods and services that you can buy and sell - are usually better paid than caring professions, like nursing.
Third critique of GDP as a metric: It doesn't measure how this economic growth is then distributed in society. You could have a country with amazing economic growth and all of the benefit of that growth is going to one person. This is not a fair distribution. But the GDP does not distinguish between an equal and an unequal society.
And then finally, it doesn't distinguish between whether the policy choices that contribute to that "sum of monetary value produced by paid labour" comes from good things or bad things. Technically, taking the metric to its absurd, you could have a series of policy choices that encouraged car crashes. Every time a car crashes, you need to buy a new car, which contributes to the GDP.
So: GDP as a metric is really, really flawed. But it's the metric that we use, when we're measuring the success of politicians.
But if it's so flawed and economic growth isn't necessarily the solution to our problems - why has the political debate landed there? Because that is where we are just now in our political, democratic journey. The big political challenge today: How to distribute the finite resources fairly? Since the early industrial revolution politicians haven't really embraced this challenge head-on because they went with economic growth so far.
And here we are: Doing jobs that we hate to buy stuff we don't need. This unhealthy society in the name of economic growth comes with a cost:
We are burning through the resources of the planet faster than we can sustain if we are going to continue living the lives that we think we should be able to live.
Degrowth is asking the question: If this isn't the way we can do it, if we can not continue on this path, then what is our economic and social model going forward?
What is degrowth?
"The democratic transition to a society that – in order to enable global ecological justice – is based on a much smaller throughput of energy and resources, that deepens democracy and guarantees a good life and social justice for all, and that does not depend on continuous expansion."5
The key element in this definition is "the democratic transition". We could get to a place we need to be by just saying: You can't buy a car, you can't eat a steak, because collectively we don't have sufficient resources to do it. Or we could do it through a market-based, a capitalist approach, how we are doing it at the moment: If you can afford to offset your carbon for a flight, you can buy your way out.
Neither of those approaches seems to be particularly democratic. But we can not all consume like the average U.S. citizen: That would require 36 planets. So we need to find a different way of how to share globally.
One woman, who tries to find a more human way of approaching this challenge and describing it, is the British economist Kate Raworth6. She uses a donut as a metaphor:
At the heart of the donut is the idea of a "social foundation": A source of basic quality of life, that all humans across the globe should have access to and this is our foundation for social and ecological justice.
The outer ring of the donut is the "environmental ceiling": Our planet with its complex interdependent set of ecosystems and its safe limits.
And to complete the donut: Between the social foundation and the environmental ceiling is our "safe and just space". This should be our guiding rule for our policy choices and how we decide to spend our money.
How would a degrowth life in this safe and just space look like?
- LESS: Consuming less. Especially in the global North. We overconsume and in a meaningless way.
- DIFFERENT: Living differently. More democratic participation. Less outsourcing of policy choices to centralized politicians.
- NEW: New ways of living. New tasks. New technologies.
Economic growth will not fix our unequal society. We need to build social and ecological justice in our policy choices from the very start. How much do we pay on nurses or teachers? Should people buy a house that is bigger than they need?
How do we change the way we use resources in the first place? How do we build regeneration in the design of things we are building?
"If it can’t be reduced, reused, repaired, rebuilt, refurbished, refinished, resold, recycled or composted, then it should be restricted, redesigned or removed from production."7
This could lead to a lovely society, where we share and not buy. And where we probably will eat less meat and more tofu.
Behind decoupling theory is the idea that at the moment economic growth and carbon emissions are in lockstep. Recently there was some excitement because of the idea that we potentially have decoupled economic growth and carbon emissions: Economies are growing while efficiencies in production, recycling, different ways of engineering, different materials used, suggest instead of a degrowth agenda we could have a green growth agenda: like the Green New Deal8. However, that doesn't work. There will be no sufficient decoupling that would enable us to live within a 1.5 degree limit. Decoupling is not drastic enough to be the answer.
Other metrics and measures
Methods and metrics for trying to fix the problem of GDP and measuring our economic assets better can help us. The Stern Review9 was an attempt by British economist Nicholas Stern to attribute value to our natural resources to try and help inform policymaking so that when we chop down forests we calculate that as a loss rather than a creation of value. But: It still is predicated on a society that is powered by buying stuff that we don't need. And as long as that is a driver behind how we live we're screwed, because we are consuming in the West far beyond our means already. We can't have an economic machine that is powered by consumption anymore.
Another example of measuring a societal progress is the "Happiness Index"10 in New Zealand. It measures political success different: It measures if the welfare of citizens increased instead of the nation’s Gross Domestic Product.
Right now we don't have 36 other planets in reach where we can live. So we need to fix our own gardens now.
The Nerd Nite London took place on 18.01.2023 at Backyard Comedy Club. Speaker for this topic was Louise Inman.