TOP 2013-05-07

Growth is Not Necessary

Many have been deceived into thinking that economic growth is completely necessary, even urgently so, including many whose political sympathies purportedly lie on the left. Of course, production is necessary, labour is necessary, but growth is another animal - growth is not about producing what is necessary and doing the necessary work, it’s about producing more than before, about consuming more than we did in the previous year. Why, I ask, is that necessary? Is that not, in fact, wasteful, extravagant and damaging to the environment?

Suppose you generally consume one loaf of bread every five days. How many loaves of bread will you need, in total, over the next 30 days? We can do a simple division and conclude that you will need six loaves of bread. But to an economist, this is the wrong answer. One loaf of bread every five days is a constant rate of consumption - where is the growth? No, the economist says. You may be able to make do with one loaf for the first five days, but in the following five you will have two loaves, and in the five subsequent days you will have four, thus ensuring growth in your consumption of bread products. In the following five days you will have eight loaves, then 16 and then 32, for the rate of growth, according to the economists, must be exponential. So the answer to the original question, as far as the economist is concerned, is not six but 63: you will require 63 loaves of bread over the next 30 days. Do you really need so many? It doesn’t matter - at least the economy has grown at an exponential rate.

You have a computer. When it eventually breaks, don’t just repair it or replace it, because then you would still have just one computer - to ensure growth in your computer consumption you should buy an additional computer, and the next time it goes wrong you should buy two additional ones and then four. Indeed, it has been the challenge of the high-tech industry and its marketing outshoots to ensure that business and even our personal lives have come to depend so much on computers, to the point where a continual growth in computer consumption has been possible, regardless of whether it is necessary or not.

Suppose your hair needs cutting once every six weeks. How many times will your hair be cut by the end of 60 weeks (just over a year)? Hopefully you’ve got the hang of this now and can give the correct answer: you will have 1023 haircuts, ensuring exponential ‘growth’ in your use of the hairdressing service. Unfortunately, this is probably impossible. In the last six weeks of the 60 week period, you’ll be having 512 haircuts, despite the 256 that you already had in the previous six weeks, so there is every reason to believe that you won’t have quite that much hair to be cut. As we can see, growth can come up against natural barriers very quickly.

More generally, however, we can see the madness involved in adhering to a growth ‘imperative’ at any cost. Growth is seen to be inexorably necessary regardless of whether it fulfills anybody’s actual needs or not. The examples here may be playful anecdotes, but they can be extended to the economy at large too: whether we need it or not, production and consumption are exhorted to grow exponentially year on year, forever, in the face of all logic.

The ideal economy, we might say, is one in which production expands and contracts in order to meet real need as required, which suggests that growth is sometimes necessary. Nevertheless I would like to maintain the position that ‘growth is not necessary at all’. This brings us to an important question - that of developing countries. It might be argued that growth is necessary in order for these parts of the world to develop. But the forces of production have already grown to such an extravagant extent that actually, all seven billion people on the planet could be provided with a very comfortable and satisfying life if the overall rate of production and consumption stayed the same or even, significantly reduced. This is true on a global level. Production and consumption in developing countries might need to grow, and in that case they could contract in developed countries in order to balance this out: growth of the overall, global GDP is certainly no longer necessary. We’ve already got enough power to ‘develop’ the entire world. Granted, it will require a radical shift in policy, distribution and provision of goods and services in order to realise this ideal without growing the economy any further; it will take nothing less than revolution, but possible it most certainly is.

Even more generally, growth is not necessary in order for our quality of life to improve. Under capitalism, our quality of life is extremely poor, and will get more so as capital encroaches more and more on our lives - in other words, as the system undergoes growth. Happiness and quality of life are quite attainable with very little material stuff. Even a radical contraction of the economy would be sufferable, and, in theory, developing countries do not ‘need’ to develop. A revolution of their material circumstances is desirable, but a revolution of the distribution and access to material circumstances, an economic revolution coupled with a rekindling of community and participation, would be sufficient to bring a good quality of life to developing countries, without the need for economic growth. That’s exactly what the developed world needs as well. But as far as the material question of production and consumption is concerned, we just need to meet in the middle: the developed world will produce and consume far less; the developing world will produce and consume more. Because of how wasteful capitalism’s growth imperative is - as the above anecdotes explain - there will be no detriment to our quality of life. In fact there will be a dramatic improvement.

Finally, many people are convinced that growth is necessary in order to come out of the current economic and financial crisis. Again, propagandistic folly is slithering its insidious tentacles into our minds. It is true that economic growth is required in order for capitalism to come out of its crisis and for capitalism to continue to grow and to survive. Yes, capitalism can only be saved and can only then survive by feeding it and then feeding it more and more, and then more and more and more. But that is the worst possible and least desirable “way out” of the crisis. We need to take advantage of capitalism’s inevitable periodic crises for advancing the revolution, because the revolution is the most desirable way out of the crisis that there is. Growth is not just unnecessary, it is harmful - this growth is like an unsightly tumour, feeding on everything in the world. It is high time that we slice out the tumour of capitalism and heal our world.