Undercover Economist

What the pandemic teaches us about our priorities, our planet, and the degrowth movement

Certain environmentalists have long argued that economic growth must end for the sake of the planet. “Degrowth” is concisely defined by one proponent, Riccardo Mastini, as “the abolition of economic growth as a social objective”.

Degrowth represents the view that sufficiently sharp reductions in carbon dioxide emissions cannot be achieved through new technology, pricing incentives or even major investment in energy and transport systems. The only thing that will work is economic growth itself coming to an end, permanently.

The pandemic is giving us a taste of what an end to growth might look like. So what lessons should we learn?

The lockdowns have indeed suppressed carbon dioxide emissions, but less than we might hope. The climate science website Carbon Brief estimates that emissions in 2020 are likely to fall by about 5 or 6 per cent relative to emissions last year. That would be the largest fall on record.

What might be a surprise is that it is not enough. If the cuts were compounded at that rate for the rest of the decade, we’d still fall short of what the UN Environment Programme estimates would be needed to restrict global temperature rises to 1.5 degrees. (A 2 degree target would be easier: five pandemics in the next decade would suffice.)

Evidently, hitting demanding emissions targets through crude degrowth would be hopeless. The human misery would be immense.

So would the political backlash. Relative to the slow-burning crisis of climate change, coronavirus is vivid and immediate. It is killing people by the thousand, every day, often in the world’s richest and most famous cities. It should be easy to get people to rally round the idea of making sacrifices to defeat the virus. Yet there is still a vocal minority opposed to any economic sacrifice whatsoever. That should unnerve any of us who worry about the far more diffuse threat of climate change.

Refined policies beat crude ones. The reason we opted for the hardship of a lockdown was that we hadn’t developed any better options. We didn’t have a vaccine, we didn’t have much in the way of treatments and, in many countries, we couldn’t even get together the basics such as testing stations, contact tracing and protective equipment for medics.

Refined beats crude for climate change, too. We could, of course, crush livelihoods to prevent ecosystem collapse, just as we have crushed them to prevent mass death from Covid-19. But that, too, would be a last resort, an admission that we had no alternative.

We do, in fact, have plenty of alternatives, although we have hesitated to use them: research subsidies for green technology; support for the smart grids necessary to harness ever-cheaper solar and wind energy; carbon pricing. The last has been a tough sell, politically, but I am willing to bet it polls better than a deep green perma-depression.

Of course, while many environmentalists would nod along with Greta Thunberg’s sentiment about “fairy tales of eternal economic growth”, most would acknowledge that the priority is not actually to reduce gross domestic product growth to zero or below, but instead to reduce emissions, restore natural ecosystems and sustain human flourishing and freedoms.

Fine. Yet if ending growth is not the objective, but the means to an end, might I suggest that it is not a very effective means? “Abolish economic growth” works as a radical political slogan, but when we’re looking for policy levers to pull we find ourselves coming back to specific taxes, subsidies, public investments and regulations. So why don’t we stop talking about degrowth and focus on the particular policies that might address environmental degradation?

We might find that those policies, applied with sufficient vigour to save the planet, would indeed have the side-effect of bringing economic growth to a halt. I doubt it. But the way to find out is to try; we might be pleasantly surprised at how flexible economic activity can be, and how much fun we can all have while respecting planetary limits.

Here, again, the pandemic sharpens the point. Because in the short term we have left ourselves few options, we have fought the virus with lockdowns. The lockdowns have damaged growth. But there are no “degrowth epidemiologists” arguing that throttling economic activity is the aim rather than the unwelcome side-effect, and that vaccines and contact tracing are fairy tales peddled by neoliberal economists.

The virus has taught us that our way of life is more vulnerable than we might hope. It has taught us the importance of making sacrifices now to prepare for predictable risks in the future. It may even have reminded us that driving to work, or flying half way around the world for a meeting, are not always necessary, and of the joys of walking or cycling through quiet streets.

These lessons may help us deal with the threat of climate change that still looms over us. But my friends in the environmental movement should take one more lesson to heart: if degrowth is the only solution we can find to our problems, perhaps we haven’t looked hard enough.

Written for and first published in the Financial Times on 1 May 2020.

My NEW book The Next Fifty Things That Made the Modern Economy is out in the UK in May and available to pre-order; please consider doing so online or at your local bookshop – pre-orders help other people find the book and are a huge help.

Receive these posts by email

(You can unsubscribe at any time)