Policies for the Steady State Economy
In a democratic society, the people have a say about the policies enacted. We can all look for opportunities to support policies that will lead to a sustainable economy rather than a growth economy. Ecological economics suggests three foundations to a long-term, healthy economy: (1) sustainable scale, (2) just distribution, and (3) efficient allocation. We list some policy options for you to consider and support when you have a chance in your work or at the ballot box.
Policies for Sustainable Scale
- Monetary policies that tighten the money supply.
- Tax reforms that tax "bads" (e.g., pollution) rather than "goods" (e.g., value added by labor and capital).
- Taxes that provide incentives to limit throughput (e.g., carbon taxes).
- Policies that favor energy conservation (e.g., vehicle mileage and exhaust standards).
- Zoning policies that limit sprawl and promote energy conservation.
- Incentives for limiting population growth.
- Tradeable permits with quotas for limiting pollution.
- Individual transferable quotas for extraction of natural resources.
Policies for Just Distribution
- Caps on income (especially unearned income) and wealth (e.g., inheritance tax).
- Policies that support a minimum income.
- Removal of public subsidies for extraction of natural resources with distribution of royalties to the public (see the Alaska Permanent Fund for a prominent example of this type of policy).
- Increased urban land taxes coupled with decreased property taxes on structures.
Policies for Efficient Allocation
- Subsidies for ecosystem preservation.
- Inclusion of non-market values in prices of natural resources (e.g., inclusion of the value of flood control and water purification in the price of timber from an intact forest).
- Limits on the scale of advertisement to prevent wasteful consumption.
Center for the Advancement of the Steady State Economy
5101 South 11th St., Arlington, VA 22204
