Continued economic growth is a recipe for disaster because the world’s economy is already “full” and the world’s resources are finite, so consumption cannot be sustained even at its present level for more than a few decades.

Therefore the only way to preserve even a reasonable level of wealth is to transform towards a sustainable or “steady-state” economic model, says University of Maryland Professor Herman Daly.

(You can read the full professorial article and comments here, but this synopsis is hopefully easier to understand.)

This is not a new idea; the steady-state economic model is Classic Economics 101. And, in essence, steady-state economies have already been tested and found to be reasonably robust – the entire Middle Ages, from around 1000AD to the industrial revolution.

It was that revolution that led to the promotion of “growth” as the entrenched philosophy, as every capitalist (and many supposedly non-capitalists) suddenly found themselves competing on a global stage for harder-to-get resources to make and feed their machinery.

Growth was – and still is – seen as the panacea for the world’s ills: the way to feed the hungry, clothe the poor, and give everyone as many toys and doo-dads as they could manage to buy.

And, to the extent we – at least, those ten percent of us primarily in the privileged developed Western economies – now enjoy a standard of health wealth and technology unimagined even in our grandparents’ time, the pursuit of growth has worked.

Trouble is, very few modern economists (or politicians, or businessmen) have ever stopped to ask themselves two simple questions: how big should the economy be? And, how big is too big?

These questions have become urgent because a significant number of the world’s resources are, at present rates of extraction, due to be used up this century. Given this – but regardless of the timeframe - the idea of “endless” growth is quite simply an unachievable fantasy.

For the economy cannot outgrow the biosphere’s resources, and those resources are finite. Once you’ve used up whatever it is you need to use to make whatever it is you’re making, that’s it. You won’t be able to make any more.

Yet economists think of nature as a set of extractive subsectors of the economy - forests, fisheries, mines, wells, pastures, seeds. And the economy, not the biosphere, is seen as a whole, while nature is just a collection of parts.

This back-to-front take on the nature of reality (or the reality of nature, if you will) is the underlying premise of our entire financial and social system. 

Nature, however, doesn’t do bailouts. So what we urgently need to be asking ourselves is, at what point does growth actually become uneconomic?

That is, when the social, health, cultural, and environmental costs outweigh the “benefits” of further resource depletion.

Professor Daly argues that the “growth economy” model is already uneconomic; that positive growth for some is now causing poverty disease and social unrest for others, while negative growth – as in this recession – is in essence self-destructive. 

By contrast, the goal of a steady state is to sustain a constant, sufficient stock of real wealth and people for a long time.

One problem, which will doubtless take some adjusting to, is that a sustainable or steady-state economy will probably require us to learn to live with a lower level of wealth. 

But what is “real” wealth if not a better, healthier, more sustainable planet? Especially when the alternative is going flat-tack on a joy-ride that drives us right off the cliff – with no possibility of an ambulance at the bottom.

The answer, Professor Daly says, is “distressingly simple”. Without growth, the only way to cure poverty is by sharing; to cure overpopulation by population control; and to repair the environment by reducing consumption. Three anathemas and be damned, he grimly notes.

But the argument is compelling, and there appears to be no other likely economic alternative to save us from ourselves.

Because if the economy is a pot plant, then the soil it’s planted in is leached barren, the air it breathes is polluted, and there is precious little water left to stop its fruit withering on the vine.  For it to retain even a semblance of health, we better lay off feeding it artificial growth hormones and find ways to prune it to keep it happy.

More great Celsias articles:

Outsourcing Unrest

Bigger Isn't Better

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