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Who Will Get This Economy Going? No One

by Dave Gardner

“We’ve got to get this economy going again!” Unless your cave lacks wifi, cable or satellite, you’ve heard this once or twice in the last four seconds.

Job creation and economic growth dominate the November election in the U.S. — perhaps more than any election in history. Campaign ads for local, state and national candidates all promise jobs. The presidential election this year has become a referendum on who can breathe new life into our economy.

News Flash: Neither presidential candidate will succeed.

What if our unexamined assumptions about the need and possibility of perpetual economic growth are wrong? What if robust economic growth is our civilization’s way of driving off a cliff? What if the planet is incapable of supporting continued increase in global economic throughput?

We’ll excuse almost anything if it happens in the name of jobs. At last count the U.S. Congress had passed 247 anti-environmental measures in its current term. The Republican Party wants to throw environmental regulations overboard because they throttle back the unfettered growth we must have. Across the aisle, many who normally exhibit a stronger environmental ethic are joining the massacre, so strong is the mandate to grow the economy and create jobs. Few, if any, are apologizing for sacrificing environmental protection on the altar of economic growth.

Our Democratic president, who four years ago promised to stop the rise of the oceans and heal the planet, is now approving drilling in the Arctic, promoting hydraulic fracturing, and bragging about his support for fossil fuel exploration in national debates. Climate change has not even been on the table this election year.

Social critic Noam Chomsky observes: “The two major parties both propose that the colossal machine of everyday life in America can not only run indefinitely, but continue expanding, and include ever more member people who trade ever more schwag. All that is required, they say, is twiddling the settings of the machine, to get it back to running smoothly as it did in the good old days before the mystifying crash of 2008. They disagree slightly on which dials to twiddle.”

Politicians are ignoring the cascade of environmental crises, all tied to the huge scale of the human enterprise (population and economy) on the planet:

  • Climate disruption;
  • Species extinctions;
  • Depletion of soil fertility;
  • Collapsing fisheries;
  • Air and water toxification;
  • Fresh water supply crises;
  • Deforestation and desertification.

No question many people are struggling and feeling true pain from this “great recession.” Everyone needs meaningful work, a roof overhead, and a chicken in the pot. Yet throwing our natural world under the bus in an attempt to restore the robust economic growth we knew during the last century is not an intelligent way to secure these things. We ought not burn down the house to keep warm. We must leave for the next generation a world worth inheriting.

What is the business case for destroying the planet?
–Ray Anderson, founder and chair of Interface, Inc.

It’s time to examine the unexamined assumptions, time to re-evaluate our goals, our metrics, and our definitions of success — including what we mean by “progress” and the “American Dream.” They don’t have to mean more stuff. We’ve reached a point where our quest for MORE is detracting from the quality of our lives. It’s time to acknowledge that quality is more important than quantity.

The definition of the American Dream got hijacked.

In my film, GrowthBusters: Hooked on Growth, Raj Patel, author of Stuffed and Starved, calls our society’s infatuation with economic growth a “fetish.” He has many allies in suggesting that GDP growth is a poor measure of life satisfaction. Former World Bank economist Herman Daly tells us growth has become “uneconomic,” meaning its costs outweigh its benefits.

In an empty world, it was a safe bet that growth was making us richer, but we no longer live in an empty world. We live in a full world.
–Herman Daly, Former World Bank Economist

The evidence is compelling enough to convert smart people who spent much of their professional lives in pursuit of growth. Commentaries are appearing in major financial and global affairs publications questioning the possibility of perpetual growth. Financial gurus — Jeremy Grantham, Paul B. Farrell, Jeff Rubin, and John Fullerton, to name a few — are warning us we are hitting the wall of resource scarcity.

We are experiencing The End of Growth, as energy expert Richard Heinberg describes in his thought-provoking book. It’s a brutal truth we must face. We have hit peak oil, peak food, peak biodiversity and peak water. We had a good run, but the party’s over. The days of 3% annual GDP growth and ever-increasing material wealth are behind us. Stimulus packages, tax cuts, deficit spending, austerity — it doesn’t matter what we try, we cannot repeal the laws of physics.

 Yet the political climate demands that our representatives and candidates avoid telling us the truth. We don’t want to hear the truth. Recent history tells us we can have it all; that is all we’ve known for the past 300 years. Ronald Reagan swept into office telling us we could and would have more.

There are no limits to growth, because there are no limits of human intelligence, imaginations, and wonder.
–Ronald Reagan

Chomsky offers: “Reality knows we have entered a long-term compressive economic contraction; that there is no way we can persist in the current living arrangement; and that the necessary outcome to avoid immense human suffering can be described as the downscaling and re-localizing of everything we do.”

We need a modern-day Martin Luther King, Jr., a true leader with the integrity and courage to tell us the truth, and the charisma to inspire us to follow. We hold these truths to be self-evident:

  • The pie isn’t getting bigger, and over 7 billion of us want a slice.
  • We do not get to be materially richer next year than we are this year.
  • Our children don’t get to have more money and more stuff than we had.
  • That’s okay, because money and stuff are not what really matter in life.

Not one of the candidates on the ballot for U.S. President is telling us this. The most hopeful sign in the political landscape is a write-in campaign for two steady-state economics candidates, Rob Dietz (editor of the Daly News) and Bill Ryerson (CEO of The Population Institute and President of Population Media Center). The centerpiece of their platform is to transition the U.S. to a steady-state economy. Of course, this ticket is a few hundred million dollars shy of being a contender. And it’s a cold political reality that today no candidate can win election on a platform that respects the laws of physics on a finite planet.

Regardless of whom we elect as the next U.S. President, in four years we’ll still be in the great recession. The only difference between the two major candidates is how much damage we’ll have wreaked on the environment in our futile efforts to restore growth, and how much the rich will profit while we waste precious time.

We can live sustainably, practicing the intergenerational golden rule, and — in so doing — live good and happy lives. But this requires us to recognize growth is no longer delivering the goods, and it can’t continue anyway. It requires that we seek not a growing economy, but a healthy economy — one that is not liquidating the planet’s resources. The sooner we do this, the sooner we can enter the next phase of true human progress.

Dave Gardner’s documentary, GrowthBusters: Hooked on Growth, includes interviews with Brian Czech, Herman Daly, and Peter Victor. The film is being rereleased this week in a special edition. The “Final Cut” is a lean 54 minutes and includes new bonus features, some previously unseen. For more information, visit www.growthbusters.org.

Obama Steps onto Slippery Slope

by Brian Czech

Brian Czech PhotoHe’s finally done it.  Barack Obama has taken the tantalizing trail to a notoriously slippery slope.  In an op-ed for the Wall Street Journal last week, the President promised, “federal agencies (will) ensure that regulations protect our safety, health and environment while promoting economic growth.”  In other words, we will have our cake (the environment) and eat it too (for economic growth), and federal agencies will be there to dish it all up.

Obama was explaining the executive order he issued that day (January 18) and touted in the State of the Union address.  The order was clearly designed with political convenience in mind, and who could begrudge him a bit of that?  He is, after all, a politician.  However, the order – and the rhetoric used to describe it – could tarnish his legacy as a true defender of the environment and the economy.

For much of his first year in the White House, the President steered clear of fallacious win-win rhetoric.  His economic and environmental agendas had clear and separate goals.  His economic focus was on rescuing the financial system and creating jobs.  He seldom used the phrase “economic growth,” and there was even some evidence that he supported a “paradigm shift” away from unsustainable growth toward a truly sustainable steady state economy.  Meanwhile, he promised to protect the environment, period, and the BP oil spill gave him a platform (pardon the pun) to put the environment first.

Some would argue that Obama was necessarily promoting economic growth when he bailed out the banks and called for job creation.  But they wouldn’t necessarily be right.  Bailing out banks and saving the insurance industry was necessary for stabilizing the financial system, which needed to happen with or without economic growth.  It was needed especially to protect the modest lives of relatively innocent borrowers and customers (even though wealthier swindlers benefited too).

As for jobs, it is true that GDP growth is seen as a job creator through the lens of conventional economics.  Technically, though, more jobs can be created while capital expenditures decline.  In other words, employment can increase without growing GDP, and a president can call for more jobs without promoting economic growth.  Such “labor intensification” has its limits, naturally enough, but it can solve short-term unemployment problems while more important issues are dealt with.

And what issues are more important than full employment?  For starters, how about full employment for your kids, say five years from now, or for your grandkids in a couple of decades?  How about the environment – air, water, soil, minerals, timber, fisheries, etc. – the foundation and building blocks of the economy?  How about the other species on the planet?

Unfortunately, it’s too easy for critics to hone straight in on “other species” and rant, “Who cares about other species – we’re talking about the economy!”  But we better care, because these other species are like canaries in the coalmine of the grandkids’ economy, and we’ve been shooting them down like targets at a county fair.  Splat goes the spotted owl, poof goes the polar bear; 1,372 federally listed species on the ropes and, with very rare exceptions, down for the count.  And what took the environmental building blocks from these unfortunate flora and fauna?

It’s not a mystery.  The causes of endangerment in the U.S. are well-documented.  They’re a veritable Who’s Who of the American economy.  They reflect a human economy out of control, sweeping across the countryside, wiping out the economy of nature and using up the building blocks faster than new ones can be crafted by Mother Nature or imitated by Monsanto.

Yet for decades we’ve been subjected to the rhetoric that “there is no conflict between growing the economy and protecting the environment.”  Though developed by environmentalists hoping to counter opposition to environmental protection, such rhetoric backfires incessantly.  It results in policies (such as regulation-loosening executive orders) that allow us to pluck the grandkids’ goose while presuming to protect it.

Fortunately, the days of this rhetoric are numbered.  Recent research has demonstrated conclusively the fundamental trade-off between economic growth and environmental protection, as so many prominent scientists have agreed.  The trade-off is fundamental because it is based on physics and ecology.

What we need now is a president who will parlay this knowledge into public support for policy reform.  The President can clarify once and for all that we can’t have our cake and eat it to.  Can you almost hear him?  “We need to balance our concerns about environmental protection with our concerns about full employment, and that doesn’t square with growth everlasting.  What we need is a healthy, steady state economy balanced with a healthy environment, not an overgrown economy and a shrunken environment.”

How would a president and other policy makers help concoct a steady state economy, even if it was publicly supported?  First, policies designed to “grow the economy” would be discontinued.  Next, steady state policy tools (such as resource capping) would be employed.  There is no shortage of policy options.  But the horse must come before the cart.  The steady state economy has to be a goal with widespread public support before a suitable policy framework can be constructed.  Presidential leadership is needed to generate such support.  Then, with widespread public support, a steady state economy would be engendered from the “demand side,” too, with temperance trumping conspicuous consumption.  In other words, with widespread public support, less policy reform would be required for establishing a sustainable steady state.

It’s not too late for Obama to be the Truth Teller in Chief.  He’s tested the slippery slope of win-win rhetoric – gotten his foot muddied a bit – but he hasn’t committed himself to a mudslide yet.  The trade-off between economic growth and environmental protection is perhaps the most inconvenient of all truths to acknowledge, but it’s better than a full slide down the slippery slope of green growth rhetoric.  That could be a legacy breaker.