Most economists favor economic growth as the most effective means of increasing opportunity and prosperity. The left-leaning economist Benjamin Friedman wrote “The Moral Case for Economic Growth” to remind others on his side of the moral and environmental benefits of growth. On the right, Nobel laureate Robert Lucas famously said, “Once you start thinking about economic growth, it is hard to think of anything else,” which is often regarded as an illustration of economist’s propensity to believe that all problems can be solved through growth.
However, many on the left, both lay people and economists, have begun to describe themselves as anti-growth, largely due to environmental concerns. Growth is seen as having damaging implications for natural resources as humans expand their impact on ecosystems (such as prairies, forests, ocean reefs, and other wilderness areas). Some have argued, for example, that economic indicators should take into account the negative long-term effects of growth on natural resources. For others, particularly on the right, concern about impact on wild habitat should not outweigh the needs of human beings. From this perspective, battles against economic growth (and attempts to redefine growth to include negative repercussions in the natural world) are seen as strange and fanatic - examples of misplaced priorities.
In addition, some have voiced concerns over the way the wealth produced by growth tends to further entrench the power of the already economically powerful. Again, economic indicators have been proposed that take into account social issues such as wealth inequality and quality of life for those at the bottom of income scales. They point to measures of growth such as the GDP (Gross Domestic Product), and claim that the distortions inherent in these measures have placed blinkers on our ability to see what is going on around us. Defenders of the GDP point out that even if it is somewhat flawed, it does align fairly closely with other indicators of well-being such as life expectancy, adult literacy, and educational enrolment. Why change what already works?
Some, on both left and right, point to our currency system as a prime (and unwelcome) driver of growth. Since money is “loaned into existence” (with interest), the lending classes naturally favor economic growth, as there is never enough money in the system to pay back all the loans, and thus, in what feels to some similar to a Ponzi scheme, there is a need for an ever-expanding economic system to continually pay back the loans that result when the monetary supply is expanded.
QUESTIONS TO PLAY WITH:
- Do you see economic growth as a primarily good or bad thing? What makes you say that?
- It’s 2149, and the world economy has grown by 200 percent. How is the world a better place, and how is it worse?
- If you think growth is a problem, is there any way, in your opinion, to decouple economic growth from environmental destruction and social inequality? What could we do?
- If you think growth is a boon, is there a limit to the benefits of growth? Is there a point where the value of growth might change? Where is that point?