Time for prosperity without growth

If there’s one book you read this winter make it Tim Jackson’s Prosperity without Growth. We can have a stable climate and leave enough resources for future generations. Or we can continue with the fantasy of perpetual economic growth, with all the additional consumption that it entails – but we can’t have both.

That’s Jackson’s central message. In environmental and resource terms, endless economic growth is a slow but sure collective suicide pill. In economic terms it doesn’t work either. Jackson builds up the picture of how global economies were wound into financial freefall in September 2008. The 1980s and 1990s saw the paying down of a large amount of public debt only to be replaced by even greater private debt. Lending rules were deliberately eased in the US to squeeze out a bit more economic growth: contrary to what you might have gathered from other media sources, it was no regulatory bungle, at least in the US.

Economic growth relies on further economic growth; without further expansion the system collapses. This is all tied in to lending money out at interest. As more money must always be repaid than is lent out, an ever-expanding market is needed to service borrowings. Stop the music – continual growth – and economic depression hits the political dance floor.

US regulators knew that weakening the rules on borrowing would increase debt levels. This, in turn, would boost spending and more goods and services would be bought than in previous years – i.e. economic growth.

However, more economic growth isn’t making us any happier, a consistent finding across wealthier societies. It’s a bit like food: after a certain point, more is no longer better. Diminishing returns set in at income levels of around $15,000 a year per person.

If it isn’t making us healthier or happier, what is economic growth really doing? The main outcome of is the depletion of resources – water, land, fuels and minerals – and de-stabilising our climate. More importantly, by ignoring nature’s bounds, the way we organise ourselves is condemning future generations to poverty.

Jackson unpicks consumerism, the great lever for growth. It’s not so much what you have: it’s what you have relative to those around you. For so many people spending is wrapped up in status and vice versa. If it’s all about the accumulation of material goods, there’s never a point when enough is enough, so consumerism is a nothing short of a trap. Novelty seeking is the linchpin of consumerism. Thanks to new phones with extra functions, ever more clever cars, and countless other devices, the status-hungry human can buy endless new gadgetry to impress.

The resources laid waste in the mining, hauling, manufacturing and packaging of all these goods is a background affair, never impressed on the consumer, even if that is the greatest legacy.

One touted exit strategy is ‘decoupling’, which involves using less resources per unit of output. This is necessary, Jackson agrees, but it has never worked anywhere in practice. We do need it, but we need it to work on a scale never seen before. The amount of carbon released must be 130 times lower by 2050 than it is today per unit of output.

Sharing also has a huge part to play in the solution. More equal societies experience lower levels of stress, something Oliver James points out in his book, Affluenza. In fact, more equal societies record lower level of problems, and that includes lower levels of murder, mental illness, obesity, and infant mortality. Also, life expectancy, literacy, trust, social mobility and well-being are all higher in more equal societies.

The benefits of equality aren’t just confined to particular parts of society; the upsides are widely spread across the community. Kate Pickett and Richard Wilkinson have lead the way here and Jackson draws on their book, The Spirit Level, to conclude that a more equal society will be less anxious while less materialism will make us happier. (The Spirit Level contains the kind of in-depth research work that’ll make you think twice the next time someone says our tax system should just leave higher income earners alone.)

A key part of Jackson’s solution is a shift away from consumptive spending to be replaced by ecological investment. An example in Ireland’s case might be our blanket bogs, which are increasingly being cut away or compromised by non-native trees. Blanket bogs also have the capacity to arrest and retain large volumes of rainfall. Paying to keep blanket bogs on mountain sides is a much cheaper alternative than building massive concrete flood defences in towns. However, thinking about ecological investment in these terms is currently novel.

At a government level, we also need greater resource productivity, climate adaptation and green business. The seeds exist, according to Jackson, in “community energy projects, local farmers’ markets, slow food co-operatives, sports clubs, libraries, community health and fitness centres, local repair and maintenance centres, craft workshops, writing centres, local repair and maintenance services, craft workshops, writing centres, water sports, community music and drama, local training and skills”. In a year when libraries have never been busier, and more and more people are buying local and living greener, the move to prosperity without growth may already be under way.

Jackson’s work does suffer a frailty, however. Moving away from the growth-based economy seems virtually impossible without a ban, or some curtailment, on the borrowing of money at interest. That need to repay more than is borrowed is what mandates the growth imperative. Jackson doesn’t really get to grips with a restriction that would – in this part of the world today – be such a radical step.