- As policymakers prioritize an economic rebound, scholars are backing an idea that pushes social and ecological wellbeing over a system that pursues relentless economic growth.
- Degrowth would require societies to abandon the idea that the percentage change in gross domestic product is an accurate indicator of progress, and instead learn to live better while producing less.
- "We must ask ourselves; do we really want to pursue aggregate growth if it's going to put our planet — and our civilization — at such extraordinary risk?" Jason Hickel, an economic anthropologist, told CNBC via telephone.
LONDON — A group of economists, ecologists and anthropologists is seeking to challenge a central plank of global economic policy — that more is better.
The "degrowth" movement has received renewed attention in the wake of the coronavirus pandemic after the spread of the virus last year coincided with the worst economic downturn since the Great Depression of the 1930s.
Yet, as policymakers prioritize an economic rebound, scholars are backing an idea that pushes social and ecological wellbeing over a system that pursues relentless economic growth.
Degrowth would require societies to abandon the idea that the percentage change in gross domestic product is an accurate indicator of progress, and instead learn to live better while producing less.
Giorgos Kallis, an ecological economist and a leading proponent of degrowth, told CNBC via telephone that the movement "is a critique to the idea that economic growth is considered something good and necessary. Instead, we think it is part of our current crisis and problems."
Kallis was careful to stress that the degrowth movement does not call for a reduction in personal income, adding that high-income countries already have more than enough resources to secure good lives for everyone.
"As a society, we are so locked into the ideology of growth that it becomes almost impossible for anyone to question it. Growthism has a kind of totalitarian character, to the point of precluding critical thought," Jason Hickel, an economic anthropologist and senior lecturer at Goldsmiths, University of London, told CNBC via telephone.
"We need to be able to have an open, democratic conversation about it."
What is degrowth trying to do?
The objective of degrowth is to reframe humanity's goals to address the climate emergency by dramatically scaling down aggregate energy and resource use back into balance with the living world.
At the same time, the idea is seeking to reduce inequality and improve wellbeing, through measures such as job guarantees, a shorter working week and potentially a universal basic income.
In practice, it is likely to result in a slower rate of GDP growth or perhaps even a reduction in GDP, but scholars say this should not be a cause for concern because GDP is not a proxy for progress.
Advocates of degrowth are quick to point out that the idea is fundamentally different from a recession since degrowth is a planned reduction of energy and resource use. A recession, however, is an unplanned event that can exacerbate inequality and reduce wellbeing.
"Ultimately, this is the core insight of degrowth. Right now, we assume that every sector of the economy must grow, all the time, regardless of whether or not we actually need it. A more rational approach would be to think about what sectors we actually need to grow, like public transportation and renewable energy, and what sectors are clearly too big and should be scaled down: like SUV production, private cars, the arms industry, advertising, and so on," Hickel said.
"Huge chunks of our economy are totally irrelevant to human wellbeing. We must ask ourselves; do we really want to pursue aggregate growth if it's going to put our planet — and our civilization — at such extraordinary risk? We need to be smarter than that."
Why does it matter?
In a word: climate.
Those pushing for degrowth to go mainstream argue that the current economic system sacrifices both people and environments at a time when everything from shifting weather patterns to rising sea levels is global in scope and unprecedented in nature.
"We have a system that is not only not delivering social benefits, it is also accelerating planetary disasters," Julia Steinberger, ecological economist and professor from the University of Lausanne, told CNBC via telephone.
Steinberger, who is also a lead author for the U.N.'s Intergovernmental Panel on Climate Change, said: "We are talking about a planetary disaster that is really cataclysmic in its dimensions. On our current trajectory, we are talking about climate change endangering roughly half of all plants and all insect species, as well as a quarter of vertebrate species, within the century."
"Something that the people who dismiss degrowth don't take into account is that economic growth is just not viable as a mechanism for future prosperity. In fact, it is associated with future cataclysm."
What about the arguments against it?
In a webinar entitled "Going for Growth" on Feb. 8, John Van Reenan, professor of economics at the London School of Economics, sought to defend economic growth against criticism that it is inevitably bad for the environment.
The economist said there were three considerations as to why an emphasis on growth would be important when it comes to addressing the climate emergency. He cited the importance of green innovation, more appropriate measures of growth that incorporate the depletion of natural capital and argued good productivity growth would be more likely to coincide with a political will to enact climate policies.
"For all of those reasons, I don't think that there's any necessary connection between growth and environmental degradation. In fact, I think that growth can be a way of actually helping us deal with the problems that we face with climate change if we think about growth in the proper way," Van Reenan said.
When asked about the concept of degrowth, Van Reenan told CNBC that for an individual, it may well be that choosing to consume less may make them happier. "But, imposing degrowth on society as a whole is going to be difficult."
"Being told you should get used to being no better off than your parents is a tough message to give. Nor do I think it's necessary: as I argued, I think we could boost growth through better policies — we don't have to accept this as inevitable," he said.
Advocates of degrowth rejected this criticism, arguing that many around the world are already on a much lower trajectory of wealth accumulation than their parents and grandparents — underlining the fact that this has occurred under a growth-orientated economy.
Where do we go from here?
The degrowth movement has seen some green shoots of progress in recent years.
The government leaders of Iceland, Scotland and New Zealand have all publicly pledged to prioritize wellbeing in future, instead of just solely focusing on economic growth.
"You know, 20 years ago if someone had done something like this, people would have laughed in their face," Hickel said. "But things have changed. Each time a government announces a shift toward post-growth economics, it goes viral on social media. People are clearly eager for a different kind of approach and are ready to embrace alternatives."