GROWTH CRITICISM AND SOCIAL-ECOLOGICAL TRANSFORMATION

By Norbert Reuter

[This article published on January 19, 2015 is translated from the German on the Internet, http://www.gegenblende.de/++co++7f8dc74e-a0ba-11e4-9c14-52540066f352.
Norbert Reuter is an economist with the German service union Ver.di.]

“The strain on the earth system by humans has reached an extent where sudden global changes of the environment are possible.” [1] So Johan Rockstrom, director of the Resilience Center at the University of Stockholm, summarized the critical state of our environment in 2009. The present economic mode in advanced industrial countries flagrantly ignores the planetary limits. This economic mode is the cause of intensifying global problems like global warming, rise of the sea level, environmental disasters, dying off of species and extreme weather. This change will occur – either by targeted “design” or as a consequence of ecological and/or social “disaster.”

An attempted “international steering” could anticipate the crisis-conditioned, chaotic course of transformation. [2] From an ecological view, the first goal of transformation must be an exit from the traditional growth logic. From an economic perspective, this can only succeed when the framing conditions are changed so the economic reproduction function can be maintained, ecological reconstruction made possible and resource-sparing technical development carried out. From a social perspective, a guarantee of paid labor (quantitative and qualitative) and an adequate income are necessary.

However the simultaneous attainment of all three goals in the course of a creative transformation needs “magical” forces so to speak since there are substantial conflicts. Some goals, for example guaranteeing economic conditions and maintaining incomes and jobs, can be achieved parallel while others compete against each other. Lower growth of the gross domestic product (GDP) and a shriveling of the economic output threaten jobs and incomes. A successful transformation can only succeed when conflicts are recognized and counter-productive effects in the particular areas are minimized.



THE ECOLOGICAL DIMENSION

According to data of the current Living Planet Report (WWF 2012), humanity would need two planets in 2030 to continue living as in the past and cover its needs in food, water and energy. Three planets will be needed by 2050. Since the main causal agents are the advanced industrial countries, the demand from the ecological perspective is obvious and indispensable: immediate exit from economic growth with the goal of shriveling to ecological health. Matthias Schmelzer and Alexis Passadakis regard a 25 percent decline of the GDP as necessary in industrial countries. [3] The remaining 75 percent of the present economic output is enough. On this level, an economy is possible “that ensures global social rights for all and does not exceed the ecological limits.” [4] Such a decline of the GDP – requiring a “negative growth” over many years – would be joined with considerable economic and social dislocations making the broad population dependent on work- or transfer income – into losers of that kind of transformation.

THE ECONOMIC DIMENSION

The possible consequences of a massive shriveling of the GDP can now be seen in southern Europe. In these countries, the GDP fell as a result of the global financial- and economic crisis since 2008. In Greece, the GDP between 2008 and 2013 declined around 25 percent, the amount described as ecologically desirable by Schmelzer/ Passadakis.

Whether Greece will now observe the ecological limits is not known. Increased use of wood as a fuel occurred which led to considerable additional air pollution since the costs for imported heating oil rose enormously in the course of the crisis. [5] Relief of the environment was not a result of this economic shriveling process. The economic and social consequences are disastrous. Unemployment rose dramatically; youths are barred entrance in the labor market. In Greece, every second youth under 25 is unemployed. The other southern European crisis countries Spain, Italy and Portugal look similar. The economic conditions are massively disturbed. A continuous vicious circle of increasing unemployment, lower demand and lower investments etc. threatens.




THE SOCIAL DIMENSION

Social problems intensify tremendously in shriveling economies. Experience even shows a successive decline of growth rates that has characterized all developed industrial countries for several decades (6) speeds up tendencies of social decomposition. More people than ever (42.7 million) are gainfully employed in Germany. Nevertheless only a minimal rise of the working hours of the economically active (work volume) faces this ascent of seven percent in gainful employment between 2000 and 2014. Paid work – through the increase of different forms of precarious work (subcontracted labor, mini-jobs, one-euro-jobs, pseudo-independence etc) was merely allocated to many heads.

An increasingly unequal distribution of income and assets goes along with the declining growth rates. Although the national income has fallen for 15 years, business profits are rising again. Thus only the receivers of work income feel the consequences of lower economic growth.

As a result of this redistribution of income, wealth is concentrated in an ever-smaller and ever-richer group of households. In the meantime the richest ten percent of households in Germany possess 67 percent of the net assets; the richest one percent have a third. This statistic points to the enormous distribution crisis that the state and society must face with a decline in economic output. Chances and possibilities of redistributing income and wealth appear in the framework of an economic and social transformation.

PLANES OF TRANSFORMATION

Despite all the debates around the limits of growth, a purely optimistic growth attitude still dominates in politics and the economy. For a long while conducting a social debater about the sustainable definition of prosperity was unsuccessful. When the economic- and social-political consequences of declining growth rates are discussed, this usually happens with the goal of adjusting society to renunciation – cuts in pensions, dismantling the social state and cuts in public spending – [7] or propagating a neoliberal policy for higher growth rates through privatization, liberalization and deregulation. [8] Distribution consequences are hardly mentioned in the growth debates. [9] Increasing environmental-, distribution-, meaning- and prosperity-problems require focusing on qualitative changes instead of quantitative growth.

When increasing prosperity is central and not one-dimensional growth or shriveling, the conditions for that prosperity must be defined in a democratic process (“What society do we want?”. The conditions for the necessary reorganization can be named on the different planes enterprise, nation and Europe.

DEVELOPMENT INSTEAD OF MERE GROWTH

A development of the economy and society that is based on a broad democratic consensus and considers ecological, economic and social demands would speed up transformation and lead to a new economics. Growth like the shriveling of the GDP would not be an “absolute” goal because individual areas must grow in the future while others shrivel. For example, a growing public transportation system (OPNV) would face a shriveling individual transportation. Extensive building insulation would face a lower use of energy. This substantive evaluation of economic development whose success must be measured with sound indicators would overcome the dubious orientation in the GDP indicator. [10] Whether the latter then shows growth or shriveling would not be the question any more but rather would be irrelevant. Only the kind of development and the quality of social-ecological transformation would be crucial.

NOTES

[1] Pressemitteilung des Stockholm Resilience Centre an der Universität Stockholm, des Potsdam-Instituts für Klimafolgenforschung (PIK), der Australian National University, der Universität von Kopenhagen und der University of Minnesota vom 23.09.2009 https://www.pik-potsdam.de/aktuelles/pressemitteilungen/archiv/2009
[2] Ulrich Brand benutzt den Begriff „Transition“ im Sinne politisch-intentionaler Steuerung und den der „Transformation“ für den ablaufenden Veränderungsprozess. Vgl. Brand, Ulrich: Transition und Transfomation: Sozialökologische Perspektiven, in: Brie, Michael (Hrsg.): Futuring. Perspektiven der Transformation im Kapitalismus über ihn hinaus, Münster 2014, S. 249f.
[3] Zur Problematik des BIP als Indikator für die ökonomische Leistungsfähigkeit und zur Untauglichkeit als Wohlstandsmaß vgl. Reuter, Norbert: Die Degrowth-Bewegung und die Gewerkschaften, in: WSI Mitteilungen, Nr. 7, 2014, S. 555f.
[4] Schmelzer, Matthias/Passadakis, Alexis: Postwachstum. Krise, ökologische Grenzen und soziale Rechte, Attac Basistexte 36, Hamburg 2011, S. 65.
[5] Vgl. Markantonatou, Maria: Der Fall Griechenland. Wenn Wachstumsgesellschaften nicht mehr wachsen und die Sparpolitik die Probleme nur verschlimmert, in: Atlas der Globalisierung. Weniger ist mehr (Exklusive Vorschau), Berlin 2014, S. 10f.
[6] Vgl. Reuter, Norbert: Der Arbeitsmarkt im Spannungsfeld von Wachstum, Ökologie und Verteilung, in: Seidl, I./Zahrnt, A. (Hrsg.): Postwachstumsgesellschaft, Marburg 2010, S. 89f.
[7] Vgl. Miegel, Meinhard: Exit. Wohlstand ohne Wachstum, Berlin 2010.
[8] Vgl. hierzu v.a. Paque, Karl-Heinz: Wachstum! Die Zukunft des globalen Kapitalismus, München 2010.
[9] Eine rühmliche Ausnahme stellen die seit 1975 jährlich erscheinenden Memoranden der Arbeitsgruppe Alternative Wirtschaftspolitik dar. Vgl. dazu etwa das jüngste „Memorandum 2014“ unter dem Titel „Kein Aufbruch – Wirtschaftspolitik auf alten Pfaden“, Köln 2014.
[10] Vgl. zur Indikatorendebatte umfassend Deutscher Bundestag: Enquete-Kommission „Wachstum, Wohlstand, Lebensqualität – Wege zu nachhaltigem Wirtschaften und gesellschaftlichem Fortschritt in der Sozialen Marktwirtschaft“, Schlussbericht, Berlin (Bundestags-Drucksache 17/13300), Berlin 2013, S. 231-351.


RELATED LINKS

Frithjof Bergmann, A 2020 That We Could Attain
http://newworknewculture.com/sites/default/files/2020WeCouldAttain.pdf

Luxemburg Arguments, “On the Myths of a Green Economy,” 2012
http://www.rosalux.de/fileadmin/rls_uploads/pdfs/Argumente/lux_argu_GreenEconomy_eng.pdf

Nancy Owano, “Germany sets weekend record for solar power,” May 30, 2012
http://phys.org/news/2012-05-germany-weekend-solar-power.html