Degrowth’s Radical Political Project to De-Develop the World
Will the Netherlands become the next Cuba?
On 8 March 2023, Jason Hickel addressed the Dutch parliament. It was claimed as a “historic moment not just for the global degrowth movement, but also for parliamentary history and economic thinking in the Netherlands.”
Who is Jason Hickel, and what is the degrowth movement? Described as a “Marxist ideologue” by Harvard psychologist Steven Pinker, Jason Hickel is a proponent of the degrowth movement. The latter is a “marginal left-wing” movement consisting of a few scholars in high-income countries who want economies to stop growing and reduce economic output and throughput, incomes, and consumption. Hickel said, “it’s time to ‘de-develop’” countries such as the Netherlands.
According to Hickel and his fellow degrowthers, economic growth will result in a environmental catastrophe. They believe that humanity, in a “plague phase,” consumes too much, resulting in untenable resource pressures. After all, our planet is finite, facing fixed boundaries — as the Reverend Malthus pointed out in the 18th century, growth is ultimately limited. Therefore, Hickel is convinced that there is no other way but degrowth to avert the collapse of civilisation. Economies must shrink.
Moreover, rich countries, being to blame for overexploiting the Earth’s bounty, must first degrow and de-develop to allow low-income countries to raise their living standards (somewhat) and reduce global inequality. Hickel is Malthusianism on steroids: unlike typical Malthusians who see growth and development as naturally limited by inherent dynamics of populations and environmental pressures, Hickel and fellow degrowthers such as Giorgos Kallis wants societies to collectively self-impose limitations on consumption and energy use and reduce GDP before this happens eventually — if at all.
This collective self-limitation or “limitarianism” is described as nothing less than a “radical political project.” Others claim this ecosocialism is “a powerful oppositional Marxist ecology that represents a path to a truly sustainable Earth.”
Paragons of degrowth virtue…
By some strange logic, Hickel suggests that this will be good for us. By reducing our incomes and consumption, we will experience “radical abundance.” He admires Cuba, Sri Lanka, and Costa Rica as prime examples to emulate. According to Hickel, we should regard Cuba, with a per capita income of US$6000, “not as underdeveloped, but rather as appropriately developed.” The Netherlands, with a current per capita income of US$58,000, would thus have to downsize its economy by 90%. At most, according to Hickel, what could be allowed is US$11,000, beyond which “it makes little sense to call for growth” — which would still mean a downsizing of 80%.
Sri Lanka is a poster child for Hickel because it has banned synthetic fertilisers. Unlike the Netherlands, where the use of synthetic fertilisers has helped turn the country into one of the world’s top food producers. Hickel tweeted in July 2022 that “if the world were to converge to Sri Lanka, global average life expectancy would increase by 4.5 years, while global resource use would fall by 80%, and global emissions would fall by 70%.” What Hickel does not say is that if the Netherlands were to converge to Sri Lanka, the country could face the same outcome as Sri Lankans faced at the end of 2022: a collapse of the government, decimated agriculture, food inflation at 81%, government debt default, IMF emergency assistance, growing hunger, politician violence! More radical than abundant. Sri Lankans are voting with their feet — massively emigrating in desperation.
Costa Rica is a better development model to hold up than Cuba or Sri Lanka. Still, it is inconsistent with the call of the degrowthers for developing countries to decouple from developed countries and limit international trade. Degrowthers considers international trade problematic because it allows a country to consume much more than its local environment allows — it is akin to “importing land from someplace else.” This is why degrowthers like William Rees do not like the Netherlands as a development model — decrying that its carrying capacity “has been artificially inflated by its appropriation of bio-capacity from other parts of the planet.”
In this respect, Costa Rica is inconsistent with degrowth ideas, as it is a small open economy heavily dependent on trade with high-income countries — like the Netherlands. But unlike the Netherlands, Costa Rica is still a developing country. By 2020, 19.8% of its population lived below the poverty line of US$6.85 per day, and its inequality shot up by 43% since 1986. Moreover, its carbon emissions per ton per capita increased by 78% between 1990 and 2019 — unlike the Netherlands, where emissions per capita declined by 18% over the same period. Whatever development progress it booked over the past two decades heavily depended on foreign investment and being integrated into the global computer and ICT supply chains. Moreover, if developed countries degrow, Costa Ricans would pay a hefty price, as they did during the COVID-19 pandemic when their GDP contracted by almost 5%.
Deconstructing degrowth
Wanting to save the planet and reduce global inequality are lofty goals. Climate change, a symptom of the broader ecological consequences of human activity, is a crisis — as are biodiversity losses, pollution, and waste. The apparent inability of the global capitalist economy to reduce carbon emissions fast enough to keep global warming below 1.5 degrees Celsius or prevent the world from being racked by multiple crises — pandemics, war, energy price hikes, financial instability — deserves our complete concern. Economic growth — measured by changes in Gross Domestic Product (GDP) — does not necessarily only have positive outcomes for everyone equally, nor is it a perfect measure of well-being, as economists have been at pains to stress ever since GDP was first proposed in the 1930s.
Degrowth may be dirty
But degrowth, as proposed by Hickel, is, however, no panacea. It is by design inadequate to reduce carbon emissions significantly. For example, “even a radical degrowth scenario would still require a GDP equal to 80% of today’s GDP if one is to provide universal access to basic services […] In such a scenario, 80% of the current GDP still needs to be decarbonised.” By demanding that only advanced economies like the Netherlands degrow and de-develop, the degrowth movement will achieve little, as most of the current growth in carbon emissions comes from developing countries, not developed economies. If all developed countries stopped carbon emissions, emissions in developing countries would continue to grow at such a rate as to make the achievement of the IPCC target of limiting global warming to 1,5 degrees Celsius impossible.
Not only will degrowth be ineffective, but it may also make matters much worse. Most likely, “degrowth might turn out to be dirty.” Under degrowth, we will have fewer resources to invest in renewable energies and the decarbonisation of the economy. Businesses may de-develop (!) and substitute more expensive cleaner production techniques for cheaper but more polluting technologies. Remember that billions need to be invested in scaling up reliable renewable energy; helping developing countries adapt to climate change, and providing insurance against the impacts of global warming. If we stop GDP from growing, we must limit these because the investment will drive GDP upwards.
Furthermore, unemployment will rise, and government revenues will drop — these are inevitable consequences of economic shrinkage. Governments would not be able to borrow further to spend on social and basic needs or environmental protection. They would need to repay their existing debt — in the EU, the rule that government debt cannot exceed 60% of GDP implies that, if GDP declined, debt would also need to fall. This is one reason why “there are no countries that show an increase in well-being together with a decrease in GDP.”
Low income households in rich countries will revert to deforestation and environmental destruction as they did during the past winter in Europe when faced with rising energy prices. Degrowth in Global North will also severely curtail development in the Global South because of the intertwined nature of the global economy. Ultimately, low-income households will pay the price — not the rich. According to the director of the Center for Green Growth at the BI Norwegian Business School, “The degrowth people are living a fantasy where they assume that if you bake a smaller cake, then for some reason, the poorest will get a bigger share of it [….] that has never happened in history.” Indeed, it has been suggested that herein lies a paradox of degrowth in that “its proponents may want to overthrow capitalism, but their ideology is actually empowering the globalist capitalist elites they claim to be fighting.”
Decreasing carbon emissions by degrowth is, however, way more expensive than any currently comparable technological investment. It has been calculated that if the world shrinks GDP per capita by 10% (around US$7,000 billion), it will reduce carbon emissions by about 3.3 gigatons, meaning a cost of US$ 2,100 per ton of emissions. A recent study published in Nature put the social cost of carbon dioxide (SC-CO2) at US$ 185 per ton of emissions.
The conclusion is that “Degrowth is, in essence, a form of ecological austerity for working-class people” that may, according to Ted Nordhaus “, do more harm to the planet than good.”
Degrowth is redundant
Hickel’s arguments for why we need degrowth, and moreover degrowth by an overthrowing of democratic capitalism, to achieve a reduction in consumption and environmental impact do not add up. Global redistribution will increase aggregate consumption through the well-known “growth through redistribution” effect — inequality reduces economic growth. Nor is it clear that we need the spectre of environmental destruction to convince people to change their consumption patterns. Or why a poorer — and ultimately less populated planet — will necessarily have less of a destructive environmental impact.
The obsession in the degrowth movement with capitalism, and replacing it with centralised planning ignores the massive environmental damage, including carbon emissions that occurred in centrally planned and communist regimes such as the Soviet Union and China. Global carbon emissions dropped massively when the Soviet Union collapsed in the 1990s.
Degrowthers also ignore planetary ecosystem destruction that was wreaked by pre-industrial societies — which were less numerous and wealthy than modern society. For example, “roughly three quarters of deforestation in temperate forests occurred before the industrial revolution.” In contrast, Europe’s forests have increased by a third between 1900 and 2010. Higher GDP is associated with reforestation across the world, not deforestation.
It also ignores the significant economic development and decoupling of growth and carbon emissions over the past four decades under global capitalism (despite its imperfections). Hickel believes, against the meticulously documented facts (e.g., in Pinker and many others), that there has been no “meaningful development” over the past four decades. For Hickel, the inconvenient fact is that under democratic capitalism, life has gotten much better over the past four decades. Life expectancy for the average world citizen increased by 17%; immunisation of babies against measles increased by 581% over the past four decades; the maternal mortality ratio dropped by 38%; The poverty headcount ratio (at $6.85 a day) declined by 32%! And between 1980 and the cost of solar energy has dropped 400 times! The lower price of solar is not good news for degrowthers, who consider “barreling forward on renewable energy” to be “one of the more disruptive decisions we could make.”
One can go on. Barack Obama had it exactly right when he said, “the truth is, if you had to choose any time in the course of human history to be alive, you’d choose this one.” It isn’t likely that any of the degrowthers will soon relocate to Cuba or Sri Lanka, or if they could travel back in time to live in the post-industrial era, before electricity, antibiotics, or Novocain.
Degrowth is coercive
More generally, not only does the degrowth movement prefer not to acknowledge progress, but it underestimates that“individual human rights, individual spatial/social mobility, freedom of conscience, sexual orientation, sexual expression and a cultural commitment to cosmopolitan diversity” are the achievements of and “non-negotiable features of modern society” that is inextricably linked to our system of democratic capitalism.
Because of democratic capitalism, Hickel is free to speak his mind to the Dutch parliament, unlike in Hickel’s utopia of Cuba, where, as Amnesty Internationaldocuments, “Those who voice views beyond those permitted by the authorities continue to be intimidated and harassed, arbitrarily detained or imprisoned after unfair, often summary, trials.”
When proposing specific policies to achieve degrowth and de-development, degrowthers typically advocate run-of-the-mill policies such as basic incomes, reduced working hours, environmental and consumption taxes, and controls on advertising. These are not novel. Most are or have already been implemented — most extensively in market economies. Capitalist countries routinely provide social security, spend on basic income, levy environmental and consumption taxes, and control advertising. The whole notion of the strong welfare state was born during the German industrial revolution in the 1870s. In capitalist economies, working hours have declined significantly over the past century, and many countries are experimenting with a further reduction of the working week. The first deliberate policy intervention to reduce the working week was in the USA in the 1930s.
Maybe these do not go far enough for the degrowthers’ radical political project, as they envisage an authoritarian collective enforcing these. As Kallis, one of Hickel’s fellow degrowthers, declared, “People were alright without shopping malls and televisions a few decades back, and rest sure they will so be if they have to live without them in the future.”
Degrowth is about politically imposed limits
Given that it is ultimately politically infeasible, degrowth is distracting from our genuine environmental challenges. And as its Marxist roots suggest, it is not really about climate. It may be more about a “crisis of meaning for the affluent. ”
Ultimately, economic growth is limited on a finite planet, with declining population growth and decreasing returns to innovation, and ultimately with a sun that will burn up in 5 billion years. Even long before the sun burns up, if the world’s energy use continues to grow as it did over the past century by around 2,3% per annum, even if it is wholly decarbonised, the waste-heat generated would boil the surface of the Earth in 400 years.
The mantra that economists believe in unlimited growth is a straw-man argument. In a recent paper in the flagship economics journal American Economic Review entitled “The End of Economic Growth?” Stanford economist Charles Jones calculates that world GDP growth could drop to zero somewhere between 85 to 250 years from now. Thus, there are limits to growth, but these limits are still far in the future. Why then, one may ask, “would we need a self-declared, political limit on resource use that is much lower than the physical limit that sets the true boundary?
Conclusion
The degrowth movement does not offer politically or economically viable proposals. Degrowth is no panacea for the genuine crises of climate, ecology, and inequality that humanity is facing. More importantly, it is not necessary to tackle these crises through collectively enforced degrowth, which may worsen these crises. If not distracting, degrowth is “redundant at best and coercive at worst.”
What degrowthers miss is that economic growth and population are, in any case, globally in decline. We live in the Great Stagnation. Society is gradually ossifying. For economist Dietrich Vollrath, this is a “sign of success”, reflecting that our economies are shifting to creating value without resulting in GDP growth as measured. For example, much of what we spend our time with and consume is free - or almost free — digital services. The value of free internet services is worth more than US$100 billion to consumers.
Degrowth also offers no answers to questions that an increasingly stagnating global society must answer. These questions include maintaining critical infrastructure without growth and profits and generating sufficient tax revenue to support ageing populations. The degrowth movement cannot answer these, halt climate change or reduce global inequality because it does not have a solid scientific basis.
Answers to the questions raised in the previous paragraph may be more likely found in what Nate Hagens describes as an involuntary adjustment to a “great simplification” characterised by slow or zero growth once energy quality declines and its costs rise significantly. It may also be found, however, in what Mariana Mazzucato called “missions” to drive the right kind of growth through the right kind of (green) innovation, and which Nobel Laureate Joseph Stiglitz, economist Nicolas Stern and co-authors recently called “new approaches to the economics of climate change.” The latter refers to “the potential of finding a new, cleaner, more efficient and more attractive form of growth, with better health and less pollution, in which case the apparent ‘costs of action’ may turn out to be negative [….] The successes in innovation in the past decade suggest this optimistic scenario may not only be a possibility but perhaps a probability.”
In the late 15th century, the Dominican Friar Girolamo Savonarola predicted an imminent apocalypse, which he judged to be the deserved punishment for humans’ over-consumption of material goods. In fits of mass hysteria, he and his followers burned all luxury consumption goods they could lay their hands on in what is now known as the “Bonfire of the Vanities.” Fortunately, this movement was short-lived, and the hysteria passed. The threat of apocalypse may still hang over us, but we do not need a new bonfire of the vanities to avert it.
