What Comes After The “Economic Growth” Paradigm? The “Personal Growth” Paradigm
“Growth for growth’s sake is boring, unimaginative and driven by ego. It is also destroying the planet and dividing societies”, Starting a Revolution
There are many things that we do not know about Covid-19 aka Corona, but there is one thing we know for sure. In the short term at least, it is affecting our GDP. And that, we are told, is something to be alarmed about. The idea that countries should be growing their GDP year on year is so deeply embedded into our conscious that we hardly ever really questioned it. I still look with mild panic at headlines designed to terrify us, “UK economy shrinks for first time in seven years”, “German economy slips into negative growth”, not fully understanding what they mean, but nevertheless pondering what horrors they hold in store. I assume that this is also the sort of thing that former civilisations concerned themselves with, going right back to the Greeks and Romans. Indeed, probably even Jesus felt some blessed relief on reading that the economy in Jerusalem had grown by 0.6% in the final quarter, right?
So it was with some surprise that I recently found out that the idea of national economic growth as a primary goal and measure of success is an entirely modern concept, something that emerged only in the middle of the 20th Century in fact. It was only during the 1950s that “economic growth” became a key notion within economics, politics and the general public. Economic Historian, Matthias Schmelzer writes, “Scholars from a variety of fields, including renowned historians, have described growth as a “fetish”(John R. McNeill) or “obsession” (Barry Eichengreen, Hermann van der Wee), an “ideology”(Charles Maier, Alan Milward), “social imaginary”(Cornelius Castoriadis, Serge Latouche), or an “axiomatic necessity”(Nicholas Georgescu-Roegen).” It has led to “the general acceptance of growth as an incontestable dictum” whereby GDP is its measure. It stands synonymous with progress and stability and bears no limits.
To a certain extent that did make sense. Economic growth was, for a time, synonymous with an increase in living standards for most of the global population even, as Schmelzer points out, extremely unevenly. But this has come at a cost and, certainly for the Global North, it simply no longer holds true. Our collective fetish around growth at all costs has cost us dearly environmentally and in terms of social equality, both of which in turn destabilise that which was intended to be stabilised. And we are not getting any happier. Economic growth can no longer be accepted as a suitable measurement for human progress, and certainly not in the Global North.
And so it is that the metric we use to assess economic performance and social progress, i.e. wellbeing of a society, is no longer fit for purpose. Joseph Stiglitz, a Nobel Prize winner, wrote an article in the Guardian just a few weeks ago to reinforce this position: “The world is facing three existential crises: a climate crisis, an inequality crisis and a crisis in democracy […] yet the accepted ways by which we measure economic performance give absolutely no hint that we might be facing a problem. Each of these crises has reinforced the fact that we need better tools to assess economic performance and social progress.” He argues that a new set of metrics is required that takes into account environmental degradation, resource depletion, inequality and wellbeing.
Imagine what that would look like now, if we didn’t have to feel like it were a choice between “saving the economy” and “saving lives”, because we had a different way of measuring the wellbeing of the nation that took into account both. Making it not an “either / or” but an “and”.
Read the rest here.