I’ve been meaning to write a column on steady-state economics for some time. Last year, I even did some preliminary research, before getting caught up in topical current events instead. Then, last week, I returned to my internet perusal, again typing in my search phrase, “zero growth economy.” To my consternation, the results had changed dramatically. While the radically different economic philosophy I was after still topped the list, many of the recent hits came from news articles reporting on the dire economic straits of Europe, the United States, and even China.
Then, as I glanced through the articles, absorbing the negative tone and fearful outlook, I realized how perfectly they highlighted the contrast between our present-day economic model and a zero growth one.
In this country – indeed, globally – the economic motto is “Grow, grow, grow!” Unemployment on the rise? Grow businesses to add more jobs. Bank accounts dry? Grow sales to fill the coffers. Investments stagnating? Grow your portfolio until the zeros disappear.
To some extent, economic growth is necessary, particularly because the human population is still expanding. Basic human needs for food and shelter – plus some extra for the luxury of financial security – must be met, so economies must expand accordingly. But beyond a certain point, happiness no longer scales with income.
Where is that point? In the United States, a 2010 study by Princeton scientists Daniel Kahneman and Angus Deaton placed it at the (admittedly high) household income level of $75,000. While people who earned more than that did claim to be more satisfied with their lives, their happiness and emotional well-being didn’t improve with the extra income.
Despite this intrinsic limit to how good tangible things can make us feel, we’ve pinned ourselves commercially and socially to an economic model that relies on growth. We tell ourselves – through advertisements, “keeping up with the Joneses,” and our definition of “success” – that the goal is to have more money and more things. And the only way to support this growing demand is to grow the economy.
Unfortunately, economies simply cannot grow forever. Influential economists from Adam Smith to John Maynard Keynes acknowledged fundamental limits to growth imposed by natural resources. There’s only so much coal to fire the power plant, only so much lithium for hybrid car batteries. And we have plenty of evidence – Easter Island, the Mayan Empire, and so on – of societies who exceeded the natural limits to their growth and then collapsed.
Of course, many have argued that knowledge-based economies, which exchange thoughts and ideas for money, can decouple economic growth from resource limitations. Likewise, increased technological efficiency can allow the same raw materials to stretch farther. Still, it seems impossible to imagine any real economy that could grow infinitely in any meaningful way – though it’s easy to envision runaway inflation driving up dollar values.
Meanwhile, even in our current global economic state – which includes 1.2 billion people experiencing extreme poverty as they survive on less than $1.25 per day, and billions of citizens in growing economies dreaming of living a resource-demanding American lifestyle – we’ve already exceeded the natural limits of our planet.
We’re moving rapidly past the atmospheric checkpoints that scientists have earmarked as climate change turning points. We support most of our economic machinery on non-renewable fossil fuels. The ecological footprint analysis of Wackernagel and Rees – which tallies up the physical footprint of all our impacts, from water use to food production to carbon sequestration – calculated that we already use the equivalent of 1.5 Planet Earths.
At what point will we realize that we have an obligation to ourselves, to live not as mindless consumers but rather by striving for balance by seeking fulfillment in a myriad of other ways. In this country, we continue to rank our families, our friendships, and our mental and spiritual wellbeing highly – at least in principle. Let’s allow our economic system to reflect those values by putting moneymaking in its rightful place.
We need to re-define our economic system as seeking a sustainable steady state. In this time of increasing awareness of resource limitations, and of the consequences of human activity (e.g., climate change and species extinction), we have a unique opportunity to embrace zero growth and the idea of having “enough.” It’s time to see that goose egg at the bottom of the balance sheet not as a mark of economic failure, but rather as a sign of social growth.
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