by Jay Walljasper
Today, the reigning policy orientation holds that the path to greater well-being is to grow and expand the economy. Productivity, profits, the stock market, and consumption: all must go continually up. This growth imperative trumps all else. It is widely believed that growth is always worth the price that must be paid for it—even when it undermines families, jobs, communities, the environment, and our sense of place and continuity.
The Limits of Growth
But an expanding body of evidence is now telling us to think again. Economic growth may be the world’s secular religion, but for much of the world it is a god that is failing—underperforming for billions of the world’s people and, for those in affluent societies, now creating more problems than it is solving. The never-ending drive to grow the overall U.S. economy hollows out communities and the environment; it fuels a ruthless international search for energy and other resources; it fails at generating jobs; and it rests on a manufactured consumerism that is not meeting the deepest human needs. Americans are substituting growth and consumption for dealing with the real issues—for doing things that would truly make us and the country better off. Psychologists have pointed out, for example, that while economic output per person in the United States has risen sharply in recent decades, there has been no increase in life satisfaction and levels of distrust and depression have increased substantially.
Economic growth may be the world’s secular religion, but for much of the world it is a god that is failing.
We need to reinvent the economy, not merely restore it. The roots of our environmental and social problems are systemic and thus require transformational change. Sustaining people, communities, and nature must henceforth be seen as the core goals of economic activity, not hoped for byproducts of an economy based on market success, growth for its own sake, and modest regulation. That is the paradigm shift we seek.
For the most part, reformers have worked within this current system of political economy, but what is needed is transformative change in the system itself. The case for immediate action on issues like climate change, job creation, and unemployment extension is compelling, but the big environmental and social challenges we face will not yield to problem-solving incrementalism. Progressives have gone down the path of incremental reform for decades. We have learned that it is not enough.
Growing Jobs and Well-Being, Not the Economy
It is time for America to move to a post-growth society where working life, the natural environment, our communities and families, and the public sector are no longer sacrificed for the sake of mere GDP growth; where the illusory promises of ever-more growth no longer provide an excuse for neglecting to deal generously with our country’s compelling social needs; and where true citizen democracy is no longer held hostage to the growth imperative.
Many of the policies that would help grow the kind of society most of us want to live in would actually slow GDP growth. For example, if productivity gains are taken as shorter worktime, personal incomes and overall economic growth can stabilize while quality of life increases. Juliet Schor points out that workers in Europe put in about 300 fewer hours each year than Americans.
Other policies that would point us in the right direction:
- greater labor protections, job security, and benefits, including generous parental leaves;
- guarantees to part-time workers and combining unemployment insurance with part-time work during recessions;
- restrictions on advertising;
- a new design for the twenty-first-century corporation, one that embraces rechartering, new ownership patterns, and stakeholder primacy rather than shareholder primacy;
- incentives for local and locally-owned production and consumption;
- strong social and environmental provisions in trade agreements;
- rigorous environmental, health and consumer protection, including full incorporation of environmental and social costs in prices—for example through mandated caps or taxes on emissions and extractions;
- greater economic and social equality, with genuinely progressive taxation of the rich (including a progressive consumption tax) and greater income support for the poor;
- heavy spending on neglected public services;
- and initiatives to address population growth at home and abroad.
Taken together, these policies would undoubtedly slow GDP growth, but well-being and quality of life would improve, and that’s what matters.
Of course, it is clear that even in a post-growth America, many things do indeed need to grow: the availability of good jobs; the incomes of the poor and working Americans; access to health care and the efficiency of its delivery; education, research and training; security against the risks of illness, job loss, old age and disability; investment in public infrastructure and in environmental protection; the deployment of climate-friendly and other green technologies; the restoration of ecosystems and local communities; non-military government spending at the expense of military spending; international assistance for sustainable, people-centered development for the half of humanity that lives in poverty.
The Work-Sharing Boom: Exit Ramp to a New Economy?To cope with the recession, some companies are cutting hours instead of employees. Will the trend have long-term effects?
Jobs and meaningful work top this list because they are so important and unemployment is so devastating. The availability of jobs, the well-being of people, and the health of communities should not be forced to await the day when overall economic growth might deliver them. It is time to shed the view that government mainly provides safety nets and occasional Keynesian stimuli. We must insist that government have an affirmative responsibility to ensure that those seeking decent paying jobs find them. The surest, and also the most cost-effective, way to that end is direct government spending—investments and incentives targeted at creating jobs in areas where there is high social benefit. Creating new jobs in areas of democratically determined priority is certainly better than trying to create jobs by pump priming aggregate economic growth, especially in an era when increases in GDP and productivity often don’t produce jobs.
Beyond policy change, another hopeful path into a sustainable and just future is to seed the landscape with innovative models. One of the most remarkable and yet under-noticed things going on in the United States today is the proliferation of innovative models of “local living” economies, sustainable communities and transition towns, andfor-benefit businesses which prioritize community and environment over profit and growth. The community-ownedEvergreen Cooperative in Cleveland is a wonderful case in point. As Gar Alperovitz and his colleagues have pointed out, state and federal programs can be crafted to support community development and finance corporations, local banks, community land trusts, employee and consumer ownership, local currencies and time dollars, municipal enterprise, and non-profits in business.
We Won’t Miss Growth
Running parallel to these changes in policy must be a change in national values. In particular, it’s time to move beyond our runaway consumerism. There are mounting environmental and social costs of American affluence, extravagance, and wastefulness. Even our larger homes and lots are too small to contain all the stuff we are accumulating. The self-storage industry didn’t exist until the early 1970s, but it has grown so rapidly that its floor space would now cover an area the size of Manhattan and San Francisco combined. We have a disease, affluenza, from which we need a speedy recovery.
The good news is that more and more people sense at some level that there’s a great misdirection of life’s energy. We know we’re slighting the things that truly make life worthwhile. One survey found that 81 percent of Americans think the country is too focused on shopping and spending; 88 percent say American society is too materialistic.
Psychological studies show that materialism is toxic to happiness, that more income and more possessions don’t lead to lasting gains in our sense of well-being or satisfaction with our lives. What does make us happy are warm personal relationships, and giving rather than getting.
Sustaining people, communities, and nature must henceforth be seen as the core goals of economic activity, not hoped for byproducts of an economy based on market success, growth for its own sake, and modest regulation
Building the strength needed for change requires, first of all, a political fusion among progressives, and that fusion should start with a unified agenda. Such an agenda would embrace a profound commitment to social justice and environmental protection, a sustained challenge to consumerism and commercialism and the lifestyles they offer, a healthy skepticism of growthmania, a democratic redefinition of what society should be striving to grow, a challenge to corporate dominance and a redefinition of the corporation and its goals, and a commitment to an array of pro-democracy reforms in campaign finance, elections, the regulation of lobbying, and much more. A common agenda would also include an ambitious set of new national indicators beyond GDP to inform us of the true quality of life in America. We tend to get what we measure, so we should measure what we want.
If some of the ideas just presented seem politically impracticable today, just wait until tomorrow. Soon it will be clear to more and more people that it’s business as usual that’s the utopian fantasy, while creating something very new and different is the practical, pragmatic way forward.
I doubt that we’ll miss our growth fetish after we say good-bye to it.
James Gustave Speth adapted this article for YES! Magazine, a national, nonprofit media organization that fuses powerful ideas with practical solutions for a just and sustainable world, from a speech he gave to the E.F. Schumacher Society. Gus is an environmental lawyer, advocate, and author, most recently of The Bridge at the Edge of the World: Capitalism, the Environment, and Crossing from Crisis to Sustainability.Interested?
- Equality and the Good Life
Research shows that the healthiest and happiest societies have in common is not that they have more, but that what they have is more equitably shared. - Putting the Science of Happiness Into Practice
Countries around the world are beginning to apply the science of well-being to the decisions they make.
- What is Real Wealth?
In an essay adapted from his new book, The New Good Life, John Robbins points out that we've been measuring happiness in all the wrong ways. How can we find true quality of life?
The Story of a New Economy
David Korten: We’re in the midst of a contest of competing stories—one fabricated to serve the interests of Empire; the other an authentic story born of the experience and aspirations of ordinary people.
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Shareposted Jul 11, 2011
This is the twenty-eighth of a series of blogs based on excerpts adapted from the 2nd edition of Agenda for a New Economy: From Phantom Wealth to Real Wealth. I wrote Agenda to spur a national conversation on economic policy issues and options that are otherwise largely ignored. This blog series is intended to contribute to that conversation. —DK
- Just as stories fabricated by Wall Street are an instrument of social control, authentic stories are an instrument of liberation.Photo by Yeonsang
Some years ago the Filipino activist-philosopher Nicanor Perlas shared an insight with me that has since been a foundation of my work. Each of the three institutional sectors—business, government, and civil society—has its distinctive power competence. Business commands the power of money. Government commands the coercive power of the police and military. Civil society commands the power of authentic moral values communicated through authentic cultural stories. Moral authority ultimately trumps the power of money and guns. Therefore, civil society holds the ultimate power advantage.
This simple frame helped me see the extent to which the global citizen resistance against the corporate misuse of multilateral trade agreements was a contest between competing stories—one fabricated to serve the interests of Empire; the other an authentic story born of the experience and aspirations of ordinary people. According to the story fabricated and promoted by Wall Street’s PR machine:
The use of multilateral trade agreements to eliminate national borders as barriers to the free flow of trade and investment is bringing universal peace, prosperity, and democracy to all the world’s peoples and nations.
Wow, that sounds wonderful. But even in the early 1990’s it was becoming evident that the reality was quite different.
A group of some 50 citizen activist-leaders from around the world began meeting in 1994 to share their actual experience with these agreements. They found a consistent pattern of results wholly contrary to the corporate story, broke the silence, and spread the real story:
Multilateral trade agreements are freeing global corporations from restrictions on their ability to exploit workers, ignore community interests, circumvent democracy, pollute the environment, and expropriate the resources of poor countries, with devastating consequences for people, community, democracy, and nature.
Just as fabricated stories are an instrument of social control, authentic stories are an instrument of liberation. Although corporations controlled the money and the media, the civil society story trumped the corporate story, because it was true to what people were actually experiencing. The awakening of public consciousness changed the political context of corporate-sponsored multilateral trade negotiations and brought them to a near standstill.
A similar process is now playing out. The fabricated story that there is no alternative to the existing Wall Street system is being challenged by the New Economy story that it is possible to create a world of strong communities and living economies. People across the United States and the world are organizing to make the new story a reality in the places where they live.
Once that connection is made between a possible human future and the soul’s deepest yearning, the lies of Wall Street advertisers and propagandists are exposed and trance is broken.
The New Economy story that we humans are capable of creating a vibrant, peaceful, cooperative world bursting with life resonates deep within the soul of all but the deeply psychologically damaged. Once that connection is made between a possible human future and the soul’s deepest yearning, the lies of Wall Street advertisers and propagandists are exposed and trance is broken. We are liberated to take responsibility for our future and get on with living the world of our shared human dream into being.
New Economy messages are spreading through countless conversations to challenge the false claims of the fabricated stories of the old economy culture that:
- It is our inherent human nature to be individualistic, materialistic, greedy, competitive, and violent.
- We live on an open frontier of endless resources that are free for the taking to grow the economy.
- Money is wealth, money defines the value of life, making money is our highest human calling, and everything related to money is best left to the market.
- Government is the problem and unregulated markets are the solution.
As pointed out in previous blogs, the truth is that:
- The human brain is wired to support creativity, cooperation, and life in community. That is our nature. The prevalence of materialism, greed, competition, and violence common in modern society is a symptom of severe cultural and institutional dysfunction.
- We humans inhabit a wondrous but finite living planet with a self-organizing biosphere to which we must adapt our lives and economies.
- Life, not money, is the true measure of value; money’s only legitimate use is in life’s service. An obsession with making money is a sign of psychological and social dysfunction.
- Markets are essential to the function of a healthy democratic society. Their proper function, however, depends on proper rules implemented by democratic governments under the watchful eye of a strong and dynamic civil society.
Story power is the ultimate power. Authentic stories liberate the human consciousness, build immunity to cultural manipulation, and give us the courage and insight to create a world of peace and prosperity for all.
David Korten (livingeconomiesforum.org) is the author of Agenda for a New Economy, The Great Turning: From Empire to Earth Community, and the international best seller When Corporations Rule the World. He is board chair of YES! Magazine and co-chair of the New Economy Working Group. This Agenda for a New Economy blog series is co-distributed by CSRwire.com andyesmagazine.org based on excerpts from Agenda for a New Economy, 2nd edition.Interested?
- 10 Common Sense Principles of a New Economy
David Korten on the foundations of a wholly different economy.
