Left Side of the Aisle #107 - Part 3

An introduction to a "steady-state economy"

There's an odd thing about that suit against the EPA's authority to regulated greenhouse gases; odd, that is, if you have a functioning grasp of logic and a basic sense of morality. It's that the drive by those industries to prevent regulation of greenhouse gases may appear to make selfish sense in the short run, it is of course profoundly stupid and destructive in the long run. Now it's possible that the folks involved are thinking that their wealth will protect them from the effects of climate change and by the time it really starts to bite, well, they'll be dead so what do they care.

But going on the assumption that while they might not care about what sort of future most of us will face they might still care about the future their own children and grandchildren will face, a perhaps more likely notion is found in the comment - I don't remember the originator - the comment that "It's hard to make someone see the truth when their livelihood depends on them not seeing it."

Last week I mentioned the criticism of Matt Yglesias over his comments about the factory collapse in Bangladesh - the death total is over 500 now, by the way - but I said that what his comments really showed was the grip the concept of "The Market" had on his thinking. That kind of thinking, one that has as its root the idea that "The Market" is the source of all economic wisdom, is the same thinking that these captains of industry are expressing in the suit against the EPA. In that case, it works to their selfish advantage, obviously, but - here's an important point - that doesn't mean they don't believe it. It doesn't mean that they don't actually believe that "letting 'The Market' work" without hindrances like government regulation is the best way to go.

And it's not just them, the commitment to the idea of "The Market" pervades our society, it surrounds us, it's part of our shared social experience, it's an assumption that we all have absorbed to some degree or another. It is a basic part of our culture, and the real distinction across most of our entire political spectrum is whether or not there needs to be some regulation of "The Market" to smooth its rough edges and if so, how much. The idea of "The Market" is sacrosanct.

And it is true that it has produced for us here in the US abundance for - in comparison to what's been seen in societies over the long run of history - a large portion of the population.

But right there is where it starts to get sticky. For one thing, that abundance has been based to a significant degree on economic domination and exploitation of other nations, other cultures, other peoples. In less polite times we used more direct but more emotionally-charged terms like colonialism and imperialism. But even if you feel those terms are overdrawn, the indisputable fact remains that our abundance has been to a fair degree built on others' lack of abundance.

Related to that is the fact that while "The Market" has produced opulence for some of us and abundance for many, it has not provided sufficiency for all. Let me expand on that to make it clear: "The Market" has produced sufficient for all - there is more than enough to go around - but it has not provided sufficiency for all; there always have been, are, and will be those left behind and out despite their best efforts. And that will remain true despite our best efforts to change it so long as we continue to let the idea of "The Market" determine the limits of our concepts.

Because "The Market" can't provide sufficiency for all. By its very nature it can't. "The Market" by its nature requires that a few have a lot, others can have some, and still others must little or nothing. It can't function any other way.

Which means that of necessity "The Market" runs smack into a moral wall. And now, it's coming up against physical walls: Our economic system depends on growth, on there always being more stuff, on people buying more stuff and wanting still more stuff. But that means using up resources, it means depletion of food stocks, degrading the environment, it means global warming. And the bigger it gets, the more it grows, the faster those problems grow and the faster those ultimate physical limits approach. The bottom line, which is a particularly appropriate expression in this context, is that "The Market" not only requires large and growing inequality, it simply is not sustainable in long term.

So I want to raise an alternative, an alternative that's often called a "no-growth economy," but which I prefer to call a "steady-state economy." It's an economy where growth, where improvement, is reflected in things which the Gross Domestic Product does not measure. I intend to get into the shortcomings of the GDP as a measure of our condition next week, but for now I'll just say that the problem is the the GDP measures economic activity - all economic activity, whether it improves our lives or not. If a corporation produces and dumps toxic wastes, that adds to the GDP. The money we have to spend to clean up their waste adds to the GDP. If you get sick from exposure to that waste and have to go to the hospital, that adds to the GDP. It's all the same to the GDP.

A steady-state economy would measure things differently. I'm going to give you a simple, even a grossly oversimplified, example just to give an idea. Suppose you have a job working five days a week, a full-time job that provides for you and your family. Congratulations, I'm happy for you. But you're offered a raise which you can take one of two ways: You can continue to work five days and get paid more, or you can have your same income and benefits but only work four days.

The first way increases the GDP: You can get more stuff, more money is flowing through the economy. Your gain is in stuff. The second way you can't get more stuff - but you get more time to do whatever it is you want to do apart from work. Your gain is in time - which is not reflected in the GDP.

Again, that's a very oversimplified example, but it's just to make the point that there are ways to measure gains that do not involve getting more stuff. And to say that it's possible to build an economy that is sustainable into the future by bearing that fact in mind.