Exploring the Pros and Cons of Degrowth Theory
The basic idea behind traditional economic logic is that bigger economies are better, and finding ways to keep or speed up growth is important for making society better. But what if expansion, at best, does little to address the world's issues and, at worst, contributes to the planet's deterioration and jeopardises its future?
This is the radical message of the "degrowth" movement, which has been warning for decades that growth can't keep going on forever. Now, as the pandemic has forced people in some parts of the world to reconsider what makes them happy and as the scale of change required to address the climate crisis becomes obvious, its ideas are gaining traction — even as concern grows about what might be a terrible global recession.
Growth has long served as a guideline for economists and politicians of all kinds. It is a vehicle for creating jobs and raising money for public services in wealthier countries while decreasing poverty and hunger in poorer ones.
However, degrowth advocates believe that an insatiable need for more – larger national economies, more consumption, and larger corporate profits — is myopic, misguided, and ultimately detrimental. They say that the Gross Domestic Product (GDP) is not a good way to measure the well-being of society.
Furthermore, they see a global economy that has already doubled in size since 2005 — and, at 2% annual growth, would be more than seven times larger in a century — putting the emissions targets required to save the globe out of reach.
“An innocent 2 or 3% per year, it’s an enormous amount of growth — cumulative growth, compound growth — over time,” said Giorgos Kallis, a top degrowth scholar based at the Universitat Autònoma de Barcelona. “I don’t see it being compatible with the physical reality of the planet.”
The goal of the degrowth movement is to stop making things that aren't necessary and cut down on the demand for those things.
This unconventional school of thought has many critics. Bill Gates has criticised degrowthers, saying that trying to get people to use less stuff to help the environment is a losing battle. Even believers admit that their paradigm is a political nonstarter, given how difficult it is to imagine how weaning off growth might look in practice.
“The fact that it’s an uncomfortable concept, it’s both a strength and a weakness,” said Gabriela Cabaña, a degrowth advocate from Chile and doctoral candidate at the London School of Economics.
But in some places, it's becoming less of a taboo, especially as governments and businesses fail to keep the planet from warming more than 1.5 degrees Celsius, which would make some effects of climate change impossible to fix.
The UN Intergovernmental Panel on Climate Change recently mentioned degrowth in a very important study. Kallis and two other people have been given about $10 million by the European Research Council to study "post-growth" policies. In addition, the European Parliament is holding a symposium next spring dubbed "Beyond Growth." Ursula von der Leyen, President of the European Commission, is expected to attend.
Even those on Wall Street are paying closer attention. Investors should examine what happens if degrowth gains traction, according to investment bank Jefferies, emphasising that "climate-anxious" younger generations have distinct consumer priorities.
Recognising a problem
In the debate over how to avoid climate catastrophe, there’s a key point of consensus: If the worst effects of global warming are to be averted, the world needs to slash annual carbon emissions by 45% by 2030. After that, they need to decline steeply and fast.
Most plans for how to do this involve a major reorganisation of economies around clean energy and other ways to reduce emissions, while also promoting new technologies and market changes that make these things cheaper. This would allow the global economy to keep growing, but in a way, that’s “green.”
Degrowth advocates, on the other hand, are pessimistic that the world can reduce emissions over time — and protect fragile, interconnected ecological systems — while pursuing unlimited economic expansion, which they claim would eventually necessitate the use of more energy.
“More growth means more energy use, and more energy use makes it more difficult to decarbonise the energy system in the short time we have left,” said Jason Hickel, a degrowth expert who is part of the team that received funding from the European Research Council. “It’s like trying to run down an escalator that is accelerating upward against you.”
Even if energy can become green, growth also requires natural resources like water, minerals, and timber.
The end of growth?
Degrowth can be difficult to discuss, especially when fears of a global recession mount, with all the misery that implies in terms of lost employment and shattered businesses.
However, advocates, who frequently refer to recessions as symptoms of a flawed system, make it clear that they are not advocating austerity or advising emerging countries eager to improve their living standards that they should not benefit from economic development.
Instead, they talk about sharing more goods, minimising food waste, shifting away from privatised transportation and health care, and making products last longer so that they don't need to be purchased at such regular intervals. Cabaña defined it as "thinking in terms of sufficiency."
Degrowth would require a radical rethinking of market capitalism, which has been accepted by almost every society on the planet in the past few decades.
However, certain recommendations may be feasible within the current system. A universal basic income, in which everyone, whether or not they work, gets a lump sum payment, is often proposed. This would help the economy depend less on polluting industries.
“When people have more economic security and have more economic freedoms, they make better decisions,” Cabaña said.
The IPCC, which is the UN's expert on global warming, said in a recent report that "addressing inequality and many forms of status consumption and focusing on wellbeing enhances efforts to reduce climate change." This is one of the main goals of degrowth.
However, even among climate researchers and activists with similar goals, degrowth faces strong opposition.
“The degrowth people are living a fantasy where they assume that if you bake a smaller cake, then for some reason, the poorest will get a bigger share of it,” said Per Espen Stoknes, director of the Centre for Green Growth at the BI Norwegian Business School. “That has never happened in history.”
Green growth supporters are confident that their strategy will succeed. They mention promising instances of decoupling GDP benefits from emissions, ranging from the United Kingdom to Romania, as well as the rapid surge in renewable energy affordability.
Microsoft co-founder Bill Gates, who has emphasised investment in climate innovations, agrees that changing global energy networks is a Herculean task. However, he believes that increasing access to the right technologies can still bring us there.
Degrowth advocates are well aware that their criticisms are divisive, and in some ways, that is the intent. They believe that a more revolutionary strategy is required, given that the UN estimates that global warming would reach between 2.1 and 2.9 degrees Celsius based on present climate promises.
“The less time [that] is left now, the more radical change is needed,” said Kohei Saito, a professor at the University of Tokyo.