Post-Growth and Post-Extractivism: Two Sides of the Same Cultural Transformation

Yes to Life: No to Mining
By: Alberto Acosta. Translated by Dana Brablec.
Originally published by alternautas.net

Mainstream thinking – embedded within capitalist globalisation – leads us to accept the impossibility to imagine an economy that does not promote growth, as much as a world without oil, mining and agribusiness is impossible. Within this mainstream thinking, we can find people from every political stance, from neoliberals to socialists.

Reality, however, is that we must overcome such views, that is the great task of this moment. On the one hand, we must rethink the question of economic growth, and free ourselves from its shackles before we enter into a global socio-environmental debacle with unforeseeable consequences. On the other, it is increasingly urgent to move from an extractivist perspective focused on the demands of capital, towards a view that prioritises a dignified life to its fullest extent and enables the construction of structurally democratic societies. This task puts the capacity of critical thinking to test, as well as the capacities of our societies, states, and that of social and political organisations to engage in innovative and creative thinking.

Closing the door to this debate would entail closing the door on democracy itself.

Economic growth, a dead end

For much of the planet’s human inhabitants it is very difficult to imagine an economy without growth. They are even unable to imagine a society without economic growth. Therefore, without going into further analysis of what really happens in each case, countries with high rates of growth are touted as successes, such as China or Peru. In these cases, they are successful only because they have had significant rates of economic growth for a substantial period of time. The Chinese case is particularly significant to the extent that China has already become the world’s largest economy, measured in GDP terms. But it is important to question whether these countries have actually achieved development. This question can be extended to major industrialised countries, where we also find “mal-development” (Tortosa 2011).

Even some Marxist perspectives assert – without hesitation – that growth cannot be stopped. That would lead, they say, to stopping the evolution of productive forces which – from their point of view – are the basis for the development of civilisation. It is these same forces which, eventually, through adequate control and distribution schemes, will solve all our problems.

It is wearily repeated that we should grow – a concept that is often confused with accumulating money – to be able to address the issue of poverty, to technologically develop, and even to solve environmental problems caused by growth itself.

A true conceptual gibberish dominates the debate.

The environmental limits of economic growth

In environmental terms, the global emission limit of 400 parts per million of CO2 has already been surpassed. The fact that we will never return to a lower figure, and its already detrimental effects are a clear warning of the dangers of continuing down the same path. Endless material growth could culminate in a collective suicide.

The environmental effects of economic growth, driven by the demands of capital, are obvious: it is sufficient to consider the impacts of increased atmosphere warming, the deterioration of the ozone layer, the loss of fresh water sources and wild biodiversity, agricultural erosion, the high level of nitrogen in the atmosphere, the soil degradation or the accelerated disappearance of the living spaces of local communities. Therefore, Eduardo Gudynas (2009) is right when he concludes that there is no future in the mechanistic and endless accumulation of material goods, ensconced in the indiscriminate and growing exploitation of Nature. Furthermore, this process has not led or will lead to development – quite the opposite.

Consequently, what do the economy and the society of growth represent should be urgently examined. There is a kind of obsession regarding economic growth, as Herman Daly (1989) stated in 1971. Earlier, this same economist, in line with the thinking of Nicholas Georgesku Roegen, of Romanian origin and the great pioneer of ecological economics, anticipated threats in the making. He therefore concluded on the need to contemplate an economic slowdown or de-growth, as growth constitutes a kind of harakirifor humanity. He said, “the most desirable state is not an unchanging state but a state in de-growth. Undoubtedly, this growth must cease or, indeed, change sign” (Daly 1971). Kenneth Boulding (1966), an economist who saw the Earth as a spaceship – also in line with Georgesku-Roegen – is credited for claiming that “anyone who believes that exponential growth can go on forever in a finite world is either a madman or an economist.”

However, at certain times, to assume these biophysical limits, as warned by the Club of Rome Report in 1972 (Meadows 1972), was seen as part of an imperialist proposal. Its real intention, according to some critics, was to limit the possibility of development for countries in the global South. Even the particular thesis of the right to development emerged then, which today is used, for example, by China.

The key point to question the continued growth of the economy focuses on the fact that Nature has limits economies must not exceed. Climate change, especially due to the overconsumption of energy and the transformation of land use, provides undeniable evidence. Meanwhile, mainstream thinking, functional to capital accumulation, limits itself to reflect and propose the transformation of “environmental goods and services” into tradable commodities, through the endowment of property rights over these functions. Others rely with blind faith on technological progress. This situation can be understood as the generalisation of a selfish and short-sighted behaviour, unable to recognise that a resource has a limit or threshold before collapsing, while also ignoring the inherent constraints of technologies.

The critical position expressed here does not reflect a conservative view on the idea of rogress, but questions its meaning. Modern technology is subsumed to the process of valuation, which makes it harmful in many ways. But perhaps the problem is deeper and involves questioning the meaning of what is human at a time when barbarism appears to be approaching, as Rosa Luxemburg warned. From that perspective, in order to have a different kind of technique, it is necessary to transform the conditions of social production. At the same time, it is necessary to pay attention to the so-called “rebound effect”, which is reflected in the increase in consumption as a result of efficiency gains.

Now, when the limits of the world’s sustainability are literally being surpassed, it is essential to build environmental solutions seen as a universal task. A reference framework could be established, in conjunction with the proposal for a Universal Declaration of the Rights of Nature, to give depth to this task that falls to all humankind.

The economic and social limits of economic growth

It is imperative to rescue the classic reflections of development thinkers such as Albert Hirschman, who in the late fifties stated that development economics must avoid borrowing from growth economics. As we have seen, this recommendation has not been adequately followed. People have continued to believe for decades that growth was synonymous with development. Somehow, that vision still prevails in broad sectors of society and in almost every government.[i]

However, the fact that economic growth is only a means, not an end, has been gradually making its way. Amartya Sen (1985), the only Nobel prize in economics that comes from an “underdeveloped” country, was very clear on this matter:

I believe the real limitations of traditional development economics arose not from the choice of means to the end of economic growth, but in the insufficient recognition that economic growth was no more than a means to some other objectives. (…) Not merely is it the case that economic growth is a means rather than an end, it is also the case that for some important ends it is not a very efficient means either. (Sen 1985).

We could go a bit further down this path and remember an economist and professor at Columbia University, Jagdish Bhagwati, who already in 1958 argued that growth could even be impoverishing growth (Bhagwati 1958). This has occurred in several occasions. When the rate of natural resource extraction and their export increases, looking to maximise income, the economy might grow, but the country can receive less income added to the loss in reserve of such resources.

This indicates that it is possible to grow and not achieve development, and that it is even possible to grow and to under-develop – a common experience in the impoverished world. How many countries have managed to sustain significant economic growth rates for relatively long periods? – only a few. And of those few, how many have actually developed? – even fewer. Moreover, to complicate things, it is well known that actually “mal-development” prevails even among those considered developed countries.

However, some argue that growth may be necessary in certain circumstances, especially to overcome critical gaps, for example in education and health. But that does not justify any type of growth. Manfred Max Neef was very clear on this. In an open letter to the Chilean Minister of Economy, in December 4, 2001, he wrote:

If for example, I dedicate myself to fully plunder a natural resource, my economy may grow, but at the expense of ending up poorer. In reality people do not realise the aberration of mainstream macroeconomics, which counts the loss of heritage as an increase in income. Behind all growth figures there is a human history and a natural history. If these stories are positive, growth is welcome, because it is preferable to grow poorly but to grow well, rather than to grow a lot but in bad conditions.[ii]

In rich countries, for example, having more and more material goods does not mean that there is greater happiness. Studies show how the growth of GDP per capita in the United States, for example, has been sustained in the past six decades, but happiness levels have not, rather, they have remained stable. The contributions of Jürgen Shuldt (2004), especially his book Bonanza macroeconómica, malestar microeconómico, explain well this line of thought.

Thus, we can state that economic growth, caused by the greed of capital, which engages in accumulation by production and speculation, occurs on the basis of growing structural inequality. Perhaps this also explains the high levels of frustration and unhappiness that exist in affluent societies. Widening the horizon, we observe the social inequality of the planet, so characteristic of capitalism. In this regard, the civilisation of inequality is a matter that occurs globally and even in economies considered to be successful.

It suffices to look at some of the figures on the unequal distribution of wealth in the world: the 85 richest people in the world have as much as the poorest half of the world population – 1.7 million people according to a report by Oxfam (2014). This report also shows that 1% of the richest population owns almost half of the global wealth. Reviewing inequality figures in Germany, the country of the “inventors” of the much-touted social market economy, is equally sobering: in 2008, the richest 10% of the German population owned 53% of assets, while half of the population owned 1% (Der Spiegel 2014).

It follows then that the very organisation of the economy must change in profound ways. This is perhaps one of the biggest challenges. Economic growth, transformed into a fetish to which the world powers and large segments of the population pay homage, must be unmasked and disarmed. Something easy to say but hard to do without consensus and popular participation.

From that perspective, we must take into consideration all that is derived from these readings to realise the geophysical and socioeconomic boundaries of today’s economy, and its engine, growth. It is alarming that, rather than seeking radical and profound solutions to the runaway train in which humanity travels, the deepening of essentially predatory practices continues. We will have to see if the redoubled effort to deepen the mercantilist logic of the so-called green economy – which continues to expand the frontier of colonisation on the planet, for example, with the carbon market – is the commercial response to environmental problems.

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