Prosperity Without Growth

Comment UK March 2009

 * Professor Tim Jackson, Economics Commissioner at the Sustainable Development Commission sets out 12 steps for transition to sustainable economy in Prosperity Without Growth ?, March 30

Prosperity Without Growth? is the culmination of a two year programme of work examining what prosperity might entail in a sustainable context. Contributors to the project include eminent economists and academics including Herman Daly, Paul Ekins, Kate Soper, Ziauddin Sardar and Tim Kasser.

Prosperity Without Growth? says that the current global recession should be the occasion to forge a new economic system equipped to avoid the shocks and negative impacts associated with our reliance on growth. Ahead of the G20 Summit in London this week, the report calls on leaders to adopt a 12-step plan to make the transition to a fair, sustainable, low-carbon economy.

Prosperity Without Growth? finds that our current financial crisis is directly linked to our pursuit of growth. Our reliance on debt to finance the cycle of growth has created a deeply unstable system which has made individuals, families and communities inherently vulnerable to cycles of boom and bust, while increasing consumption does not make us happier.

The report shows that economic growth has delivered its benefits at best unequally, with a fifth of the world’s population earning just 2% of global income. Even in developed countries, huge gaps remain in wealth and well-being between rich and poor.

The pursuit of growth has also had disastrous environmental consequences. In the last quarter of a century, while the global economy has doubled, the increase in resource consumption has degraded an estimated 60% of the world's ecosystems and led to the threat of catastrophic climate change.

The global economy is already almost 5 times larger than it was 50 years ago. If it were to continue to grow at the same rate, it would be 80 times larger by the end of this century.

While modernising production and redesigning goods and services have led to greater resource and energy efficiency in recent decades, the report finds that aspirations for 'decoupling' environmental impacts from economic growth are unrealistic. Even based on a moderate level of growth of 2% per year, meeting 2050 carbon reduction targets would mean achieving a carbon content of no more than 6gCO2 for each dollar spent - a staggering 130 times lower than the average carbon intensity today.

Recommendations
Recommendations include:


 * Creating the conditions for people to flourish
 * Includes tackling systemic inequality and removing incentives for unproductive status competition; sharing available work and improving work-life balance, and reversing the culture of consumerism
 * Building a sustainable macro-economy which is no longer structurally reliant on increasing consumption
 * An economy which can succeed without growth must be based on financial and fiscal prudence and improved macro-economic accounting, and prioritise investment in public assets and infrastructures over private affluence
 * Putting an awareness of ecological limits at the heart of economic decision-making
 * Treasury thinking must be governed by clearly defined resource and emissions caps; policy should promote technology transfer to developing countries and international ecosystem protection

Quotes
"Faced with the current recession, it is understandable that many leaders at the G20 Summit will be anxious to restore business as usual. But governments really need to take a long, hard look at the effects of our single-minded devotion to growth - effects which include the recession itself.

"For millions in developing countries, growth is clearly still vital to deliver basic standards of living and well-being. But, in developed countries including the UK, far from increasing prosperity, our debt-driven consumption has created an unstable system which has put jobs and livelihoods at risk, as well as damaging us psychologically and socially."

"It may seem inopportune to be questioning growth while we are faced with daily news of the effects of recession, but allegiance to growth is the most dominant feature of an economic and political system that has led us to the brink of disaster. Not to stand back now and question what has happened would be to compound failure with failure: failure of vision with failure of responsibility. Figuring out how to deliver prosperity without growth is more essential now than ever." Report author Professor Tim Jackson

"Fundamentally transforming the foundations of the economy is the biggest contribution we can make towards building a sustainable future. The current economic crisis may be painful, but it will be nothing compared with the crises we will face if we continue to grow in a way that threatens the life-support systems on which we rely." Jonathon Porritt, Chair of the Sustainable Development Commission

References