The absurdly impossible implications of economic growth.
The foregoing argument has been that the present levels of production and
consumption are quite unsustainable. They are too high to be kept going
for long or to be extended to all people. But we are determined to increase
present living standards and levels of output and consumption, as much as
possible and without any end in sight. Few people seem to recognise the
absurdly impossible consequences of pursing economic growth.
If we have a 3% p.a. increase in output, by 2060 we will be producing 8
times as much every year. (For 4% growth the multiple is 16.) If by then
all 10 billion people expected had risen to the living standards we would
have then, the total world economic output would be more than 100 times what
it is today! Yet the present level is unsustainable. (For a 4% p.a. growth
rate the multiple is 220. In the 1980s Australia had a 3.2% p.a. growth
rate, which was not sufficient to prevent virtually all our problems
becoming worse.)
Globalisation
We have entered a period in which all these problems will rapidly
accelerate, because of the globalisation of the economy. Since 1970 the
world economic system has run into crisis. It has become much more
difficult for corporations and banks to invest their constantly accumulating
volumes of capital profitably. One consequence has been the rise of "casino
capitalism"; frantic speculative investment gambling on stock markets,
takeovers, futures and derivatives.
Thus the big corporations and banks are now pushing through a massive
restructuring of the global economy, the development of a unified system in
which they have swept away all the arrangements which previously hindered
their access to increased business opportunities, markets, resources and
cheap labour. The pressure is on governments to remove the protection,
tariffs and controls which they once used to manage, regulate, stimulate and
protect their economies, and to sell government enterprises to the
corporations, to cut government services, to reduce taxes on corporations,
and above all to increase the freedom for market forces; i.e., the freedom
for corporations to operate. These changes are enabling the transnational
corporations to come in and take advantage of more business opportunities.
The dominant neo-liberal ideology asserts that it is supremely important to
"free market forces. The emphasis is therefore on deregulation, freeing
trade and investment, privatising and reducing government activity.
A huge critical literature now explains how these changes are devastating
the lives of millions of people, especially in the Third World, and their
economies and ecosystems, but they are a delight to the corporations and
banks. The changes eliminate the arrangements which used to ensure that many
little people could sell and work and trade, and that local resources such
as land would produce things they needkl. Now the corporations are able to
take over all those opportunities to increase their sales. Globalisation is
basically a gigantic takeover of economic activity by the big corporation s
and banks. It can reduce csts of goods bought by consumers in rich
countries, but it is impoverishing millions of peple and preventing
governments from controlling development. Develpment is now little more
what the corporations want developed.
Why do governments willingly go along with these "economic rationalist"
policies? They have no choice if they are to survive in a globalised
economy. Governments must seek to cut production costs, free corporations
to do more business, make national exports cheaper and more competitive, and
attract more foreign investment in order to "get the economy going again."
If the government doesn't do these things the country will not survive in
the increasingly open and competitive global economic. It will not attract
foreign investment; its credit rating will be dropped so the cost of
borrowing capital will rise, and its exports will not be able to compete in
the global market.
The corporations' most powerful weopen is their mobility. If a country
tries to tax or control them they will leave and invest somewhere else.
Thus countries compete against each other in a "race to the bottom" to
attract corporate foreign investment.
Globalisation will oblige Australian workers to compete against the lowest
paid workers in the world. Because the freedom of trade is now of supreme
importance, governments will not be able to ban imports of goods produced in
environmentally unacceptable ways or unsafe conditions, or goods containing
pesticides, or to make woodchip companies pay for replanting, because these
steps would be regarded as infringements on the sacred freedom of trade.
Governments are increasingly unable to govern, because the real control over
economic affairs and conditions is in the hands of transnational
corporations and banks and World Trade Organisation officials.
Corporations are able to minimise their tax payments. They avoid much tax
through "transfer payments". Governments must lower taxes on corporations
or the corporations will locate their plants in some other country. (Half
the transnational corporations with branches in Australia pay no tax at
all!) Therefore governments have drastically cut state spending; they can't
collect much tax from corporations and if they try to the corporations will
take their investment somewhere else. Tax burdens are being shifted from
corporations to workers, and state spending on welflare, education, health
etc., is being dramatically reduced.
Globalisation constitutes a crushing triumph for the corporations, the banks
and the rich. Inequality is rapidly worsening; a few are becoming much
richer, the poor are becoming poorer and even the middle classes of the rich
countries are being hollowed out. The new rules the World Trade
Organisation is trying to bring in to guarantee freedom of investment are
almost the final blatant grab that will deliver just about everything that's
left to the corporations and banks. The prospect is alarming; we are
rapidly heading towards a world run by a few corporations, doing only
whatever suits their shareholders.
Hence we have the absurd situation where Australia could be running its own
economy at a relaxed pace to give all people a high quality of life,
importing only a few necessities and securely in control of our own fate,
but instead we must work harder, accept reduced wages and the takeover of
our economy by foreign firms, and complete more furiously to export ...
while all other countries are locked into the same frantic struggle.
Bodies like the World Trade organisation are now trying to build these
powers into the rules of world trade and investment, binding all nations.
At present a corporation has great power to force a country to accept the
conditions it wants in its specific negotiations with that country, but what
they are pushing for now are rules which all countries must follow, giving
corporations almost complete freedom to do what they like without having to
negotiate with each country in turn. The proposals include few if any rules
restricting the ability of corporations to disadvantage workers, damage the
environment, distort regional development or contravene human rights.
Globalisation is literally the corporate take over of the planet, to be run
in the interests oft he corporations. Note that some aspects of
globalisation, such as the internet, are desirable, but the limits to growth
analysis shows that a sustainable world order cannot be highly globalised
economically; there will not be sufficient energy and resources or all that
transport and trade.
The Social Effects.
Because of this corporate presure to reduce the power and activity of
government, and the power to avoid paying tax governments are drasically
cutting their spending on welfare, which is increasing the deprivation and
suffering of large numbers of poorer people. Governments no longer have
full employment as an important goal. The main role of government now is
to provide the conditions for business prosperity. Consequently we are
seeing increasing social breakdown, stress, drug abuse, suicide, decay of
communities, rural decline and loss of social cohesion. Attitudes to the
poor, homelss and umeployed are hardening. All must focus on competing to
succeed as a self-interested aggressive entrepreneur, and not to expect much
assistance from the state. Public institutions like museums and even
universities are are expected to operate like corporations that must sell to
customers and make a profit. This is seriously damaging public spirit and
social solidarity.
It has become a winner-take-all society. The rich, including the
upper-middle class which does the top managerial and legal work for the
corporations , and the professionals, are rapidly increasing their wealth
and have no interest in calling for change. Inequality and polarisation are
accelerating. The state has ceased to be concerned with redistribution of
wealth. The outrageous looting evident in bank fees, corporate executive
salaries, legal and professional fees, cheap sell-offs of public assets,
take place with little complaint.
All this is sociologically appalling. You cannot have a satisfactory
society made up of competitive, self-intereted individuals! In a
satisfactory society here must be considerable concern for the public good
and the welfare of all, and there must be considerable collective social
control and regulation and provision, to make sure all are looked after, and
to reinforce the sense of social solidarity whereby all feel willing to
contribute to the good of all.
Yet there is no dissent! Captalism has never been more secure from threat.
There is no opposition to what is happening from the working class or the
middle class. These have been seduced into docility and willing compliance
in consumer society by the promise of ever-rising "living standards". There
is discontent, there is grumbling, but there is no focused resistance let
alone pressure for system change. The media's obsession with trivia,
spectacles and sport distract and eliminate any capacity to focus on what
really matters and thereby maintains the massive stupification that leaves
the nelo-liberal agenda unhindered.
The self-indulgent acdemic and "intellectual" ranks have more or less
refused to concern themselves with the massive global injustice that
underwrites their priveleges, nor the limits to growth that will soon
terminate them. Overall consumer society shows a complete inability to
respond to the terrible challenges now facing it. The ants go diligently to
work each day, dressed in their impeccable new clothes, oblivious to the
30,000 Third World children who will die from deprivation that day, or to
their own grim prospects within 20 years when the oil begins to dry up.
Governments refuse to give any attention to the possibility of limits to
growth. The lack of awareness and the irrationality are impossible to
comprehend.
Conclusions on our situation.
What we have seen in the last 20 years is a stunningly successful grab by
the rich. Their share of national income is rapidly increasing. They have
routed the working class. The Left has been eliminated as a political
force. Above all they have crushingly won the ideological battle. The
collapse of communism has been taken to have established that there can be
no sensible alternative to free market capitalism, and that the fundamental,
indeed sole considerations are now "efficiency", individualism and
competition, getting richer, and freedm for market forces.
It should be obvious that the present socio-economic system is extremely
unsatisfactory and cannot solve our problems. There is no possibility of
having a just and morally satisfactory or ecologically sustainable society
if we allow the economy to be driven by market forces, the profit motive and
economic growth. In a satisfactory economy the needs of people, society and
the environment would determine what is done, not profit. (We could have
markets and private enterprise in a good society; see below.) These
economic faults cannot be remedied without radical change in values and
world views, away from individualistic competition, greed and selfishness.
The present economy gears most productive capacity primarily to the
interests of the rich. Look at our abundant productive capacity and ask who
is benefiting most from all the work being done and from all the production
and development. Ask what is being developed? Why for example do none of
the resources used to produce houses go into making very cheap but adequate
houses for the thousands of Australians who would like a house of their own.
Ask yourself what developments would make your neighbourhood into a very
pleasant place to live, or make the lives of aged or mentally ill people
more enjoyable, or enable unemployed people to have a worthwhile role?
These are not the things that are being developed. What is being
developed? Mostly things that are likely to maximise the income of
corporations and banks, because they are the ones who control and invest
most of the capital and they only invest in the most profitable ventures,
and those are always ventures which produce what richer people want.
We let what happens in our society be determined by the few who own most of
the capital. From here on such an economic system will inevitably lead to
more polarisation and more deprivation for the majority, and to more
destruction of the environment. We cannot achieve a sane, peaceful, just or
sustainable world unless present economic theory and practice are almost
completely scrapped.
We have allowed ourselves to be misled into thinking that we need more
production, more efficiency, more GNP, more science and technology and
harder work. But we already produce far more than would be necessary to
give a high quality of life to all, and we work much harder than is
necessary. We could easily develop a society in which we do much less work
and producing and have much more time to enjoy life, without stress and
insecurity, and knowing that we are not damaging the environment or
depriving the Third World. We do not need better technology or more GDP to
solve our problems.
Above all it must be stressed how far beyond sustainable levels of
production and consumption we are. The foregoing figures show that we must
develop ways of living in which we can have a good quality of life on per
capita resource rates that are a small fraction of today's rates.
THE ALTERNATIVE: THE SIMPLER WAY
There are now many books and articles dealing with the general form that a
sustainable society must take. If the foregoing limits to growth analysis
is basically valid some of the key principles for a sustainable society are
clear' and indisputable. (For a detailed discussion see The Conserver
Society, Ted Trainer, 1995.)
? Material living standards must be much less affluent. In a
sustainable society per capita rates of use of resources must be a
small fraction of those in Australia today.
? There must be small scale highly self-sufficient local economies.
? There must be mostly cooperative and participatory local
systems whereby small communities control their own affairs,
independent of the international and global economies.
? There must be much use of alternative technologies, which minimise the
use of resources.
? A very different economic system must be developed, one not driven by
market forces or the profit motive, and in which there is no growth.
The alternative way is The Simpler Way; we can and must all live well with a
much smaller amount of production, consumption, work, resource use, trade,
investment and GNP a than there is now. This will allow us to escape the
economic treadmill and devote our lives to more important things than
producing and consuming.
Simpler lifestyles
Living more simply does not mean deprivation or hardship. It means focusing
on what is sufficient for comfort, hygiene, efficiency etc. Most of our
basic needs can be met by quite simple and resource-cheap devices and ways,
compared with those taken for granted and idolised in consumer society. A
wardrobe sufficient for comfort and acceptable appearance is far less dollar
and resource expensive than one typical of a rich world person. Compare a
modern car with one that might have been designed to minimise resource use
and to be repairable, safe and durable. Modern houses are often palatial.
The more we simplify our ways the more we avoid unnecessary work,
production, resource use and environmental impact.
Living in ways that minimise resource use should not be seen as an irksome
effort that must be made in order to save the planet. These ways can and
must become important sources of life satisfaction. We have to come to see
as enjoyable many activities such as living frugally, recycling, growing
food, making rather than buying, composting, repairing, bottling fruit,
giving old things to others, making things last, and running a relatively
self-sufficient household economy. The Buddhist goal is a life "simple in
means but rich in ends."
Local self-sufficiency
We must develop as much self-sufficiency as we reasonably can at the
national level, meaning less trade, at the household level, and especially
at the neighbourhood, suburban, town and local regional level. We need to
convert our presently barren suburbs into thriving regional economies which
produce most of what they need from local resources. They would contain
many small enterprises such as the local bakery. Some of these could be
decentralised branches of existing firms, enabling most of us to get to work
by bicycle or on foot. Much of our honey, eggs, crockery, vegetables,
furniture, fruit, fish and poultry could come from households and backyard
businesses engaged in craft and hobby production. It is much more
satisfying to produce most things in craft ways rather than in industrial
factories. However it would make sense to retain some larger mass
production factories.
Many market gardens could be located throughout the suburbs and cities, e.g.
on derelict factory sites and beside railway lines. This would reduce the
cost of food by 70%, especially by cutting its transport costs. More
importantly, having food produced close to where people live would enable
nutrients to be recycled back to the soil through compost heaps and garbage
gas units.
We should convert one house on each block to become a neighbourhood
workshop, recycling store, meeting place, surplus exchange and library.
Because there will be far less need for transport, we could dig up many
roads, greatly increasing city land area available for community gardens,
workshops, ponds, forests etc. Most of your neighbourhood could become a
Permaculture jungle, an "edible landscape" crammed with long-lived, largely
self-maintaining productive plants such as fruit and nut trees. Especially
important will be achieving a high level of local energy self-sufficiency,
through use of alternative technologies and renewable energy sources such as
the sun and the wind.
There would also be many varieties of animals living in our neighbourhoods,
including an entire fishing industry based on tanks and ponds. In addition
many materials can come from the communal woodlots, fruit trees, bamboo
clumps, ponds, meadows, etc. These would provide many free goods. Thus we
will develop the "commons", the community land and resources from which all
can take food and materials. Many areas could easily supply themselves
with the clay to produce all the crockery needed. Similarly, just about all
the cabinet making wood needed could come from those forests, via one small
sawbench located in what used to be a car port.
One of the most important ways in which we will be very self-sufficient will
be in finance. Virtually all neighbourhoods have all the capital they need
to develop those things that would most enrich them, yet this never happens
when our savings are put into conventional banks. We will form many small
town banks from which our savings will only be lent to firms and projects
that will improve our town. Many neighbourhoods and towns are now starting
their own banks and moneyless trading systems.
It would be a leisure-rich environment. Suburbs at present are leisure
deserts; there is not much to do. The alternative neighbourhood would be
full of interesting things to do, familiar people, small businesses, common
projects, animals, gardens, forests and alternative technologies.
Consequently, people would be less inclined to go away at weekends and
holidays, which would reduce national energy consumption.
Local economic self-sufficiency is crucial if we are to reduce overall
resource use because it cuts travel, transport and packaging costs, and the
need to build freeways, ships and airports etc. It also enables communities
to become independent of the global economy.
More Communal and Cooperative ways.
The third essential characteristic of the alternative way is that it must be
much more communal and cooperative. We must share more things. We could
have a few stepladders, electric drills, etc., in the neighbourhood
workshop, as distinct from one in every house. We would be on various
voluntary rosters, committees and working bees to carry out most of the
child minding, nursing, basic educating and care of aged and handicapped
people in our area, as well as to perform most of the functions councils now
carry out for us, such as maintaining our own parks and streets. We would
therefore need far fewer bureaucrats and professionals, reducing the amount
of income we would need to earn to pay taxes and for services.
Especially important would be the regular voluntary community working bees.
Just imaging how rich your neighbourhood would now be if every Saturday
afternoon for the past five years there had been a voluntary working bee
doing something that would make it a more pleasant place for all to live.
There would be far more community than there is now. People would know each
other and be interacting on communal projects. One would certainly predict
a huge decrease in the incidence of social problems and their dollar and
social costs. The new neighbourhood would surely be a much healthier and
happier place to live, especially for old people.
There would be genuine participatory democracy. Most of our local policies
and programs could be worked out by elected non-paid committees and we could
all vote on the important decisions concerning our small area at regular
town meetings. There would still be some functions for state and national
governments, but relatively few.
The new economy
There is no chance of making these changes while we retain the present
economic system. The fundamental concern in a satisfactory economy would
simply be to apply the available productive capacity to producing what all
people need for a good life, with as little bother and waste and work as
possible. Our present economy operates on totally different principles. It
lets profit maximisation for the few who own most capital determine what is
done, it does not meet the needs of most people and it now condemns us all
to becoming more and more productive while actually becoming poorer.
Market forces and the profit motive could have a place in an acceptable
alternative economy, but they cannot be allowed to continue as major
determinants of economic affairs. The basic economic priorities must be
decided according to what is socially desirable (democratically decided,
mostly at the local level, not dictated by huge and distant state
bureaucracies -- what we do not want is centralised, bureaucratic big-state
socialism). However, much of the economy could remain as a (carefully
monitored) form of private enterprise carried on by small firms, households
and cooperatives, so long as their goals were not profit maximisation and
growth. Market forces could operate in carefully regulated sectors. For
example local market days could be important, enabling individuals and
families to sell small amounts of garden and craft produce.
The new economy would have a number of overlapping sectors. One would still
use cash. In another market forces would be allowed to operate. One sector
would be fully planned. One would be run by cooperatives. One large sector
would be cashless, involving barter, working bees and gifts (i.e., just
giving away surpluses), and totally free goods (e.g., from the commons,
such as the roadside fruit and nut trees.)
Unemployment and poverty could easily be eliminated. (There are none in the
Israeli Kibbutz settlements). We would have neighbourhood work coordination
committees who would make sure that all who wanted work had a share of the
work that needed doing. Far less work would need to be done than at
present.
Above all in the new economy there would be no economic growth. In fact we
would always be looking for ways of reducing the amount of work, production
and resource use.
When we eliminate all that unnecessary production, and shift much of the
remainder to backyards and local small business and cooperatives and into
the non-cash sector of the economy, most of us will need to go to work for
money in an office or a mass production factory only 1 or 2 days a week. In
other words it will become possible to live well on a very low cash income.
We could spend the other 5 or 6 days working/playing around the
neighbourhood doing many varied and interesting and useful things everyday.
The biggest changes will have to be in values. The present desire for
affluent-consumer living standards must be replaced by a concern to live
more simply and self-sufficiently
People working for the alternative way have no doubt that the quality of
life for most of us would be much higher than it is now. We would have
fewer material things and would have much lower monetary incomes but there
would be many less obvious sources of life satisfaction, including a much
more relaxed pace, having to spend relatively little time working for money,
having varied, enjoyable and worthwhile work to do, experiencing a
supportive community, growing some of one's own food, keeping old clothes
and devices in use, running a resource-cheap and efficient household,
practising arts and crafts, participating in community activities, being
involved in governing one's area, living in a nice environment, and
especially knowing that you are not contributing to global problems through
overconsumption.
A step backwards?
We would have all the high tech and modern ways that made sense, e.g., in
medicine, windmill design, public transport and household appliances. We
would still have national systems for some things, such as railways,
telecommunications and taxes, but on nothing like the present scale. We
would have far more resources for science and research, and for education
and the arts than we do now because we would have ceased wasting vast
quantities of resources on the production of unnecessary items, including
arms. We could go on living in private houses with our different amounts of
private wealth. We could move to a different place to live whenever we
wanted to. We would not be confined to unstimulating, closed villages
because there would be many cultural activities in our localities, and we
would have easy access by public transport to (small) cities and cultural
centres.
It must be emphasised here that if the limits to growth analysis is
basically correct, then we have no choice but to work for the sort of
alternative society outlined here. In rich and poor countries a sustainable
society can only be conceived in terms of simpler lifestyles mostly in
highly self-sufficient and participatory settlements, and zero growth or
steady state economic systems.
The transition to a sustainable society.
In the last 20 years a Global Ecovillage Movement has developed, in which
many people all around the world are building, living in and experimenting
with new settlements of the kind sketched above. The Directory of
Eco-villages in Europe lists 57 settlements. (Grindheim and Kennedy, 1998.)
Some of the most promising developments are in Australia, including the
Crystal Waters and Jarlanbah Permaculture villages and the town of Maleny.
(Reviews are given by Douthwaite, 1996, and Swhwarz and Schwarz, 1998.)
The transition will not be assisted most by people attempting now to change
their personal lifestyles in conserver society directions. "Voluntary
simplicity" etc. is important, but the transition can't get far until we can
eventually make vast changes in our society's structures and systems, e.g.,
unless we dig up lots of roads, take control of the market system, locate
market gardens in cities, phase out whole industries etc. so that it becomes
easy for many people to live more simply and self-sufficiently. Such
changes can only come when the majority of people understand why the simpler
way is necessary and understand how satisfying it could be. The most
important thing to be done therefore is not to change one's own lifestyle,
but to help us with the huge task of public education about the need for
transition.
By far the most valuable contribution one can make is to help us to
establish inspiring examples of alternative settlements, so that more people
in the mainstream will be able to see that The Simpler Way is viable and
attractive. However not all of us are in a position to do that. What we
can all do though is talk; i.e., we must explain to as many people as we can
that the consumer society is grossly unsustainable and that there is a
Simpler Way.
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Campbell, C. J., (1994), The World's Endowment of Conventional Oil and its
Depletion, Geneva, Petroconsultants.
Dalton, G., (1968), Primitive, Archaic and Modern Economies; Essays of Karl
Polanyi, Boston, Beacon Press.
Daly, H. E. and J. Cobb, (1989), For the Common Good, London, Greenprint.
Douthwaite, R., (1996), Short Circuit, Dublin, Lilliput.
Fotopoulos, T., (1997), Towards an Inclusive Democracy, London, Cassel.
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Trainer; F. E. (T.), (1995c), "Can renewable energy save industrial
society?", Energy Policy, 23, 12, 1009-1026.
Trainer, F. E. (T.), (1998), Saving the Environment: What it will take,
Sydney, University of N.S.W. Press.
Trainer, F. E. (T.), (1999), "The limits to growth case in the 1990s",
The Environmentalist, 19, 329 -339.
United Nations, (1996), Human Development Report, New York.
Wachernagel, N., and W. Rees, (1995), Our Ecological Footprint,
Philadelphia, New Society.
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