“Bigger Isn’t Better”
A thoughtful op ed from today’s Ottawa Citizen by Peter Victor, the author of “Managing Without Growth” (Edward Elgar)Â on the case for a no growth future.
Here’s an extract:
“Although no 21st-century Keynes has emerged to prepare the intellectual ground for such a change in thinking, we do have a body of knowledge built up over many decades and now thriving under the name of “ecological economics.”
Ecological economists understand economies to be subsystems of the earth ecosystem, sustained by a flow of materials and energy from and back to the larger system in which they are embedded. It is understandable that when these flows were small relative to the earth they could be ignored, as they have been in much of mainstream economics. Economists are not alone in treating the economy as a self-contained, free standing system largely independent of its environmental setting. It is a widely held view that environmental protection is just one among multiple competing interests to be traded off against the economy.
And anyway, this mainstream perspective teaches that if resource and environmental constraints are encountered, scarcities will be signalled by increases in prices that will induce a variety of beneficial changes in behaviour and technology. Should this system of scarcity-price-response fail then economists can estimate “shadow” prices which can be imposed directly through taxes or used indirectly through policies based on cost-benefit analysis to fix the problem.
To ecological economists, this is an inadequate response to the myriad problems of resource depletion, environmental contamination and habitat destruction confronting humanity in the 21st century. They question the pursuit of endless economic growth and contemplate a very different kind of future.
In my own work, I have examined whether and under what conditions a country like Canada could have full employment, no poverty, much reduced greenhouse gas emissions, and maintain fiscal balance, without relying on economic growth. Using a comparatively simple model of the Canadian economy I have explored scenarios in which these objectives are met. The ingredients for success include a shorter work year to reduce unemployment yet retain the advantages of technological progress, a carbon price to discourage greenhouse gas emissions, and more generous anti-poverty programs.