An Alternative to the Growth Economy

On my first day as a student in the Green Collar Communities Clinic (GC3) at EBCLC, my supervising attorney Sushil Jacob challenged me and the other clinic participants to define capitalism. I struggled to come up with a definition that covered my mixed emotions about the word. I saw capitalism as an unsustainable economic system that perpetuated environmental degradation and widened economic inequalities. But another voice in me said perhaps capitalism done right could be a tool to lift people out of poverty: after all, at GC3 we work with low-income entrepreneurs starting sustainable local businesses.

From the discussion that ensued I came to realize that what I really take issue with is this particular form of capitalism: an economic system based on relentless growth.

Growth itself is value-neutral: it creates both costs and benefits. Expansionist corporate growth has led to the shuttering of small, local businesses in our communities and around the world, as the mega-chains and retail giants find new markets to peddle their cheap goods. But when a filmmaker friend of mine interviewed local shopkeepers in southern Mexico who were struggling after a Wal-Mart came to town, she was surprised to learn that they actually shopped at the Wal-Mart themselves. They had access to a greater variety of products that were much cheaper than their fellow local artisans could afford to produce. This means that, despite the costs to the local economy, we can’t necessarily label the effect of Wal-Mart and other corporate chains as absolutely negative.

So while it’s debated whether economic growth is inherently neutral, it is extremely problematic for one simple reason: unending growth is not sustainable in a system of finite resources. The drive for constant economic growth, without valuing natural resources, creates a constant pressure on the environment. From climate change to increasing concentrations of toxic pollution, the ecological consequences of unyielding global economic growth are readily apparent. According to data from the Global Footprint Network, the world’s footprint exceeded the biological capacity of the planet in the mid- to late 1980s. In other words, for virtually my entire lifetime we have been living in a way that is beyond what the earth is capable of supporting.

So it is not really surprising that there is a growing movement in economics, under the banner of “ecological” or “steady-state” economics, which reminds us of an age-old adage: we must live within our means. The basic theory behind “steady-state economics” is that our economy can only be truly sustainable in the long-run if we consume at stable and sustainable levels (i.e., if we live within our means). A steady-state economy is dynamic – it changes and develops over time, but it remains balanced with the natural environment. Sounds great, right? But how do we get there?

To realign our economic activity with what the natural environment can support, we actually have to de-grow certain aspects of our economy and focus growth in other aspects. We need to produce (and consume) less of what is resource-intensive, and produce (and consume) more of what is resource-friendly. What would this look like? According to a recent conversation with my old economics professor, we should consume more poetry and symphonies, and produce fewer airplanes and iPads (and alleviate the resource-intensive processes they require). Tim Jackson, a professor of sustainable development and author of “Prosperity Without Growth: Economics for a Finite Planet,” explained recently in the New York Times that being “less productive” can actually lead to a greater sense of wellbeing and fulfillment. By placing greater value on activities that require more human care (and less environmental damage), like education, social work, medicine, and the craft and cultural sectors, we can keep people employed and “de-grow” our natural resource consuming economy to reach sustainable levels.

At the heart of this is finding a new way to measure economic wellbeing. The traditional measurement of Gross Domestic Product (GDP) is too narrow and focuses too much on material wealth, measuring only the production and consumption of goods and services of a given country. GDP does not encompass non-economic indicators of societal wellbeing, like the value of a long and healthy life or personal satisfaction. In Bhutan, a small country in the Himalayas where I had the privilege of teaching before coming to law school, they measure the wellbeing of their people in terms of Gross National Happiness. The concept approaches economic development from a holistic perspective, giving equal weight to non-economic aspects of wellbeing, like psychological wellbeing, cultural diversity, good governance, community vitality, and ecological diversity and resilience. In his recent EBCLC blog post, Bren Darrow envisions measuring our economy in “Gross Domestic Chances,” where success would mean a ripple effect giving people the opportunity to turn things around. These and other creative ways to measure success and wellbeing are important to counter our tendency to see all things through the narrow lens of GDP and economic growth.

Finally, to achieve a steady-state economy, where both people and the planet prosper, we also have to reshape our ways of doing business. This is where GC3 comes in: we support low-income entrepreneurs starting worker-owned cooperatives that value the health and vitality of their people and their environment. We work with social businesses that aim to create a more just and equitable society and exist harmoniously with their community and the environment. This is the Next Economy that Sushil described recently: where there is emphasis on both economic and environmental sustainability. In important ways, GC3 and our partner organizations like the Sustainable Economies Law Center are replacing the dominant form of growth-oriented, resource-intensive capitalism, and I’m incredibly excited to be a part of it.

Jen Barnette is a second year law student at Berkeley Law and a law clerk in the Green-Collar Communities Clinic of the East Bay Community Law Center.

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