Challenging the Dominant Political Idea that 'Economic Growth' is Desirable

Only a year ago anyone that challenged the political idea that economic growth was a desirable thing would be simply ridiculed, but I sense that now may be the time for a major push, and that certainly local politicians are open to a conversation. What can we do to accelerate progress?

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Interesting question, which i’m Sure many others will have opinions on. Having listened to Lord Stern (leading economic light in thinking around sustainability) I’ve come to the view that we still need significant investment to transition to a low/zero carbon economy. That could mean we accept a growth economy to achieve these ends whilst preparing the systems to adapt to a zero growth economy. Lord Stern was clear- if you talk about zero growth on an international stage in conjunction with sustainability you wouldn’t be a welcome member of the conversation.

The problem is our economy is predicated upon growth. If we didn’t have growth investments and pensions would fall.

In my view we need to adapt systems whilst attracting significant investment to decarbonise the economy.

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Sometimes I feel that “economic growth” gets put together with “growing use of natural resources” but these are actually 2 separate issues. The economy can grow in all sorts of ways without causing problems for future generations. However, I think it’s certainly time to challenge the idea that higher growth is good for its own sake and take a look at how that growth is being generated.

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It’s certainly the case that we want to encourage growth in renewable energy infrastructure, housing, transport and agriculture - but when it provides for our needs, we then need to stop and monitor our economy around its successful provision against our basic needs, whilst avoiding penetration of planetary boundaries. GDP is singularly ill equipped for this function - where of course a suite of indicators is required. As it stands, measurement by GDP does serve to accelerate consumption of natural resources, it fails to focus the use of natural resources into sustainable production, and it accelerates the production of waste (including CO2).

New Zealand are onto this: https://www.huffingtonpost.co.uk/entry/new-zealand-well-being-budget-happiness-economy_n_5cf4f7e1e4b0e8085e3cf4b0 Seems a great approach to me - very interested to see how it pans out for NZ. Zero chance of this in the UK right now though

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Standard economic commentators often dismiss any challenge to the growth paradigm by claiming that it has been/can be decoupled from CO2 emmissions with vague notions of efficiency improvements and a transistion to the digital/service economy. This always seemed suspect given our ever increasing consumerism and outsourcing of manufacturing to China amongst other countries, so I decided to look into the data.

Below is a plot to examine the correlation between world GDP and atmospheric CO2. (every decade is highlighted in purple to make things clearer)

As you can see from 1940 until 2014 there is very close correlation (0.99) between atmospheric CO2 and GDP. We are yet to see any significant decoupling of economic growth and emissions.

Another way to look at it is the increase in atmospheric CO2 caused by an increase of global GDP by $1 trillion (2011 prices)

GDP%20efficiency%20ppm%20per%20USD2011

If 3% annual GDP growth is to be maintained without causing climate catastrophe then this measure needs to drop to 0 or less immediately. From our past progress this seems highly unlikely.

The sources of these data are:

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