Brief notes and (and links to) a few studies providing evidence in favour of some of our suggestions, and one looking at the case for a Financial Transactions Tax.
Tag Archives: economic growth and sustainability
We’ve done a fair bit of criticising contemporary capitalism in this blog. One of the follow-up questions we have been asking ourselves all along is: “if not capitalism, then what?’
Well yes. If not life as we know it, with all its enormous ‘reality’, complexity, and slow-turning, apparently unstoppable power and momentum – then what? And how do we get from here to there? It’s quite a topic for a couple of part-time bloggers to tackle. The hubris! But then we’re not tackling it on our own – human society is always and inescapably a collaborative venture – we’re hitching a ride with the thinkers whose work we’ve commented on, hopefully in return bringing it to some who would not otherwise have met it.
So where have we got to so far, in our hitching, in our answer to this big question?
Jonathan Harris, “Ecological macroeconomics: consumption, investment, and climate change”, real-world economics review, issue no. 50, 1 September 2009, pp. 34-48,
Harris (Tufts University) begins his discussion by using the charmingly mild phrase “cognitive disconnect” to decribe the yawning great chasm between “scientists’ warnings of potential catastrophe if carbon emissions continue unchecked on the one hand and the political and economic realities of steadily increasing emissions on the other” (p.34)
It is, as he says, “the outstanding economic problem of the twenty-first century. Can economic growth continue while carbon emissions are drastically reduced?” (p.34) And asking that question makes us look more closely at what, in fact, economic growth is and how we might make a successful economic and social transition to sustainability.
NEF have released the latest version of the “Happy Planet Index” (HPI – which, I’m afraid, just begs to be tagged as the Hippy Index…). The HPI is a composite index constructed out of three sets of data: life expectancy, life satisfaction, and ecological footprint (explanation starts p.52 of the Report Appendix, which can be found here).
Among other things there is a neat animated graphic showing countries’ performance on the index vs GDP over time (select the countries you wish to observe in the tick box menu on the right, then push the ‘play’ triangle bottom left).
Looking at New Zealand’s performance since 1961 (when the data set starts) what is striking is just how poorly we have performed on both counts: there was a steep rise in our HPI number, while GDP grew at only a modest rate. I thought it might be interesting to look more closely at the three indicators, using the background data NEF has made available here.
A friend recently expressed to me one of the essential conundrums of contemporary capitalist society: “I can see growth can’t continue, [because of the environmental impacts] but I can’t see how we can stop it without the whole system falling over like a stack of cards.”
One good answer can be found in the recent report of the U.K Sustainability Commission, titled Prosperity Without Growth. But I thought I might also give a much shorter answer that comes at it from a slightly different angle, in the hope my friend and others might find it helpful.
Let’s look at why economies grow, and why capitalism (as we know it) depends on growth, because then we will quickly discover our answer as to how – in principle – we might create a no/low growth economy that doesn’t collapse and doesn’t produce social disaster.