Those of us who believe that the economy should
serve us instead of the other way around is conflicted. We know that the
only way to end unemployment at home and poverty around the world is to make
the economy grow faster. But we also know that nothing can grow forever, that
the faster the global economy grows, the sooner we will run out of essential
resources, including fossil fuels, water, arable land, healthy ecosystems and a
moderate climate.
Economists and politicians cannot admit it, but
the laws of physics apply, no matter what the latest polls tell us. The Earth
has finite resources that will someday limit our economic growth.
The Earth cannot forever support billions of
people. And yet we have staked our future - individually, nationally, and maybe
even as a species - on that impossible dream.
Some people are in denial. They believe that the
Earth’s resources are limitless and that a beanstalk can grow to the sky. Or
perhaps they know deep in their heart that we are on the road to an
environmental and economic catastrophe, one that they think they alone will
survive through wits, gold, and guns.
Others believe fervently that technology will
bail us out yet again, that clever primates will always find a new tool that
will help us extract ever more stuff from the planet. They laugh at the
warnings of Rev. Thomas Robert Malthus, who warned in the 19th century that the
population would inevitably outgrow the food supply, leading to periodic mass
death due to wars, famines and plagues.
Malthus was wrong, of course...so far.
Improvements in agriculture, finance, government, manufacturing and
transportation kept pace with the population growth. Even with the population
about seven times greater than in Malthus’s time, the percentage of the human
race that is truly poverty-stricken has fallen. On average, we live longer and
better lives than our ancestors did. More people have enough to eat, clean
water to drink, a secure shelter and basic healthcare.
Precarious poor
But the position of those poor billions in Asia,
Africa, Latin America and even in America is precarious. The global recession
hurt the poor and the nearly poor the hardest.
The only working model of growth the developing
world knows is to export more stuff to the rich countries. It turns out that
the best way we have found to reduce poverty in Asia is for the rich in North
America and Europe to consume more.
It is the ultimate trickle-down economics. It
takes ever-increasing consumption by those in the developed world to keep the
hands of the developing world busy and their bellies full. They have outsourced
the production but not the consumption.
But because they have outsourced productive jobs,
many of them in the developed world cannot afford to increase their
consumption. The answer? More debt to pay for more stuff to keep the economy
growing.
Debt is merely a claim on tomorrow’s real wealth
- actual productive assets and actual goods and services. Unfortunately, paper
wealth (debt) has grown faster than real wealth.
Money cannot buy love.
Everyone knows money cannot buy happiness but we
run our economy as if it does. Although it is plainly true that we do need to
eat to survive, our well-being cannot be accurately measured by the sum of what
we produce and consume.
A few economists have rejected the premise that
the economy must grow forever. In Britain, the New Economics Foundation has
created a Happy Planet Index as an alternative to the traditional measures of
economic progress that focus on only growth, not on well-being or
sustainability.
According to the Happy Planet Index, people who live in the richest countries are not any happier than those who consume less of our dwindling resources. A certain level of economic development is essential to our well-being but our quality of life is also determined by how free we are politically, how equal we are socially and by the opportunities we have to be creative or to live in a loving community.
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