Monday, 19 July 2010

Breaking down the growth fetish

Today, we face four major crises, two immediate and two slow-burn. There’s an immediate economic crisis due to folly in the banking sector and an immediate crisis of social frustration due to – but I’ll come to that.

The slowburn crises are the threat of disruption from climate change within the next 50-100 years and the threat of loss of species and habitats due to economic and population growth within 20-40 years.

The existence of these crises is beyond reasonable doubt. But what about the solutions?

Climate change

If we keep on as we are we can expect a two degree temperature increase well before 2100 followed, almost certainly, by much more rapid rises as positive feedback effects cut in. I’ve discussed the likely social and political consequences in two scenarios (refs).

It’s fairly obvious that to avoid this we need to reduce greenhouse gas (GHG) emissions sharply and globally. This requires us to decarbonise energy production, make less stuff and travel less. The exact mix and timing of these actions is far from obvious – except that a start is already overdue. We need to give up our fixation on growth in consumer goods.

Since we emit GHGs mainly to benefit the rich countries (and elites in poor ones) whilst the costs fall largely on the poor justice requires that we allow the poor to improve their situations whilst taking most of the cuts in the developed countries. We also need to stabilise and then reduce world population.

Species loss

We are already losing species and habitats at an alarming rate. Headlong development is decimating the rain forests whilst the ecology of the sea is already impoverished. These losses contribute to climate change, by removing forests, and deprive us of potentially valuable plant products such as medicines. There’s also a more subtle loss when beautiful things are lost.

To avoid these losses we need to stop treating land and sea as infinite resources. In recognising that we are already using many at unsustainable rates we see that current rates of extraction and use are unsustainable. Again growth in physical activity, and especially our fixation on growth, can be seen to be a key driver of the crisis.

And, again, since the rich nations and elites have created these problems (Britain cut down its forests centuries ago) it’s only just that they should bear the brunt of change.


The financial crisis has already destroyed jobs, undermined pensions and frightened many people. The policies of many governments, including that of the UK, ensure that much of this will continue for years.

At the root of the crisis are irresponsible risk-taking by bankers who believed, rightly, that they had nothing to lose and weak regulation by governments who overlooked the eternal truth that nothing lasts for ever. It’s easy, and certainly right, to condemn the individuals who took the risks and weakened regulation. But behind individual errors we see again the pernicious ideology of unfettered growth. Growth in business, no matter how silly! Growth without limit!

It was the ideology of unlimited growth that led buyers to believe that house prices could only rise and led Gordon Brown to believe that he could relieve poverty out of growing taxes. All were wrong.

The remedies include tighter bank regulation, bank taxes and penalties for excessive risk taking and for bankers to compensate the rest of us for their folly. But we also need to set business and national objectives that are not elaborate ways of saying “Give me more”.

Social frustration

There’s more to a good society than consuming more goods and services each year. We all know that and value relationships, families and our communities. Margaret Thatcher may have said “there is no such thing as society” but not even the Tories now believe this.

There are many social problems to worry about, from litter and obesity to crime and drug abuse. And there are differentials, such as the shorter lives of the poor, that ought to be cause for constant outrage in a civilised society.

Sociologists Richard Wilkinson and Kate Pickett have shown in The Spirit Level that inequality of income is the single biggest cause of these social problems. In Affluenza Oliver James has shown how this affects individuals. Faced with this evidence a desire for greater equality is more than a political choice, it’s an absolute imperative if we are to live in a more healthy and congenial society.

There are many barriers to reducing inequality. One is the vested interest of the rich – but Wilkinson and Pickett have shown that all but the top few percent would be happier and more fulfilled in a more equal society. Another is our belief that we must, at all costs, have growth.

The fetish of growth

And so we come back to growth.

Growth is the modern philosopher’s stone. It will relieve poverty, reward entrepreneurs, fund social services and provide our pensions. Even to suggest that it’s a problem is enough to mark you as a freak whilst no party except the Green Partyopposes it. Yet growth, in its current form, is entirely unsustainable.

The growth fetish is maintained by a combination of vested interests and a lack of imagination and because, above all, growth is simple. A single number is the measure of economic value.

But no one number is the measure of human value. So I propose the creation of a set of metrics and a process, the social impact statement, to assess them.

The social impact statement

The social impact statement (SIS) is analogous to the environmental impact statement required for a development project. Government, indeed anyone promoting a policy, should be required to produce a social impact statement for that policy. This statement should estimate the impact of the policy on a set of key metrics including economic inequality, health, crime as well as GNP.

Since the relationships between policies and outcomes are often contested we should create an Office of Social Responsibility (analogous to the Office of Budget Responsibility) to help government departments produce sound SISs. The OSR would be funded to commission good research on the consequences of policies and the relationships between policies and the key metrics.

These changes would not produce a revolution. They would not in themselves block vested interests or defuse the bile of the tabloid press. They would be embarrassing for all parties since all have indefensible policies.

But they would contribute to a rational discussion of policies from which we would all benefit.


Shahrar Ali said...

Right on the money here, David, well argued.

Isn't an office for social responsibility going to be too unwieldy a beast to assess the social impact of all development projects? A noble goal but surely better to take place in the public sphere, to allow and encourage widespread debate of social, ecological and environmental impacts; and to recognise how such values, some of which are bound to be contested, interrelate and require negotiation.

Also, we are running out of time. You refer to disruption in 50-100 years, whilst recognising that a start is overdue. I might say that we are in the -50 (minus) to 50 yr window already. People are already dying as a result of man-made climate change.

So, given that we should have started the day before yesterday, we need everybody to sign up to the Greens' quality of life-climate change mitigation agenda, by challenging and overturning bad economic ideology at source, ie. in the wider society.

Social impact and evaluation already takes place - eg. transition towns, Green political and campaign offices, your blog :) - but they need to be enlarged, joined up and extended through civic engagement.

For too long, we have collectively treated the planet as if it were fit only for our purposes. We need to get all our offices (actual and metaphorical) in order.

Shahrar Ali

David Flint said...

I don't think the existence of an OSR would prevent wider public discussion - it might even stimulate it. I'm inclined to think that an authoritative body would help to discipline government. Precedents include the Audit Commission and NICE, and the OBR more recently.

I agree that "we need everybody to sign up to the Greens' quality of life-climate change mitigation agenda" but we both know that can't happen fast. It should but it won't. So my proposals are for steps that might move use forward.

crabsallover said...

Hi David,
>anyone promoting a policy, should be >required to produce a social impact >statement for that policy. This >statement should estimate the impact >of the policy on a set of key >metrics including economic >inequality, health, crime as well as >GNP.

can you give some example cases where a SIS would be useful.

David Flint said...

Well crabs, a SIS is needed for any policy that aims to increase growth. Many of these policies have adverse 'side effects' (ie foreseeable effects that it would be embarrassing to admit.)

The most obvious example is tax cuts that benefit the rich and punish the poor. However, in order to judge any proposed tax change we need to know the effect on inequality - since that drives so much that is bad.

Similarly many changes in education policy have consequences for inequality and social cohesion.

Likewise media policy. In fact I suspect that most policy proposals have significant side-effects of this kind.