By Frosty Wooldridge
Any economy cannot continue unlimited expansion, ever!
maturity, no entity can continue growing beyond its natural balance. If it does, it becomes obese or manifests
cancer, i.e., aberrant cell growth that ultimately kills its host. The United States, whether it likes it or
not, must move toward a stable population and a new paradigm that includes
‘steady state economics’.
Deitz said, “Here in
the United States and pretty much around the world, we suffer from a sort of
dementia. We have become confused about
the difference between economic growth and economic well-being. The confusion is so deep seated that most of
us, especially our leaders in business and government, believe that growth is
the same thing as wellbeing.
“Despite some of the
obvious problems with unfettered growth (e.g., species extinctions, global
warming, increasing gaps between the rich and the poor, and loss of ecosystem
services), the confusion is somewhat understandable. Prior to the industrial revolution, most
people faced tough conditions. Their
lives were typically occupied with back-breaking labor, and their own health
and the health of their families were constantly under attack. Over the centuries innovations such as
division of labor, availability of cheap and abundant energy, novel
technologies, and social systems that rewarded entrepreneurship led to an
upward spiral of economic growth.
experiencing such growth addressed some of the brutish conditions inherent in
the system, many people’s lives got longer and less difficult. When the world had relatively few people and
bountiful natural resources, economic growth served to increase wellbeing. During that phase of history, economic growth
coincided with economic wellbeing. They
coincided to such an extent that societies failed to differentiate between the
“Like any other economic
activity, growth has diminishing marginal benefits and increasing marginal
costs. This economic jargon means that as society produces another unit of
economic growth, the costs increase faster than the benefits. At some point, the costs of each additional
unit are higher than the benefits.
Although costs and benefits are notoriously difficult to measure, a
large body of evidence suggests that we are at a point in history where growth does
more harm than good, especially in the United States. Herman Daly, the wise and
eloquent patron saint of ecological economics, calls this situation uneconomic
growth, where "illth" increases faster than wealth. Note the irony – we believe we are pursuing
economic wellbeing by continuing to grow the economy, when in fact, we are
decreasing our health and prosperity with more growth.
“Economic growth is simply an increase in the production and
consumption of goods and services. At
the national scale, it is indicated by increasing gross domestic product
(GDP). Growth means getting bigger, not
necessarily getting better. Economic
wellbeing is not as straightforward to define as economic growth. Ulrich Schimmack has defined it as the degree
of realization of preferences, weighted by the importance of each
preference. The reason for weighting
preferences is that some are clearly more important than others. People are generally better off if they can
meet their most pressing needs.
“Researchers like Abraham Maslow and Manfred Max-Neef have
highlighted the importance of human needs in forming preferences and motivating
behavior. People who can fulfill basic
needs, such as the need for health, security, social connectivity, and strong
family relationships, experience more wellbeing than those who cannot.
"Wellbeing also tends to increase when people
have meaning in their lives and feel they can reach their potential. Wellbeing for a nation, therefore, is largely
dependent upon the degree to which the natural, cultural, and economic
environment provides sustained opportunities for preference realization. Current means of measuring wellbeing range
from composite indices like the Genuine Progress Indicator and the Human
Development Index to self-reported satisfaction with life as documented in
standardized surveys repeated at regular intervals.
to wellbeing are written into the founding documents of many societies, Bhutan
is the only nation in the world that officially pursues economic wellbeing as a
goal rather than economic growth. Bhutan
is advancing the concept of gross national happiness as an indicator of
wellbeing. GNH is meant to serve as an
indicator of prosperity rather than GDP.
“If economic growth is
not the same as wellbeing, and continued growth is decreasing wellbeing, what
should we do? The first and most
critical step is to change the goal.
Citizens need to recognize that economic growth is no longer an
appropriate goal in nations where consumption is sufficient to meet most
"Herman Daly has written that once
we decide to put a stop to the growth paradigm, realizing a steady state
economy will be trivial. That statement
may be a bit of an exaggeration, but Daly and other ecological economists have
developed a blueprint of the institutions and policies needed to run a
prosperous, yet non-growing economy. We
can still use the market to help allocate resources efficiently, but we must
also focus on the overall scale of the economy and just distribution of its
proceeds. Such an economy will be about
individual and social development. It
will be about quality rather than quantity, sustainability rather than expansion,
and balance rather than cycles of boom and bust. In short, the economy will serve up a healthy
dish of wellbeing instead of growth.”
As I talked to Rob
Deitz, he spoke about steady state dynamics in a forest. Although it remains
the same size for centuries, a forest enjoys tremendous dynamics within its boundaries.
All its inhabitants live within the carrying capacity of that eco system while
enjoying their lives. At some point, all
citizens of the USA and the world must move toward a long term balance with
planet earth. Steady state economics
paves the way.
Frosty Wooldridge has bicycled across six continents - from
the Arctic to the South Pole - as well as six times across the USA, coast to
coast and border to border. In 2005, he bicycled from the Arctic Circle, Norway
to Athens, Greece. He presents "The Coming Population Crisis in America:
and what you can do about it" to civic clubs, church groups, high schools
and colleges. He works to bring about sensible world population balance at www.frostywooldridge.com
He is the author of: America on the Brink: The Next Added 100 Million
Americans. Copies available: 1 888 280 7715