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Growth and Sustainable Development

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Growth and Sustainable Development GROWTH AND SUSTAINABLE DEVELOPMENT Joachim H. Spangenberg 1 1 SERI Sustainable Europe Research Institute Germany e.V. Vorsterstr. 97-99, D-51103 Cologne, Germany, [email protected], +49-221-2168-95 Abstract When analysing the relation of economic growth and sustainable development, three aspects should be distinguished: 1. The growth discourse; 2. Growth politics and a specific economic ideology; 3. The real impacts of economic growth. Ad 1: The discourse claims that the central factor for social, economic, political and environmental progress is economic growth – it is assumed to create wealth, and provide the necessary means for social and environmental purposes. Thus the focus of politics, it is assumed, should be on enhancing growth. The optimal growth rate is assumed to be the maximum possible rate. Ad 2: Different growth policies can be legitimated by the growth discourse, based on different economic and political ideologies. For instance, Keynesian policies try to stimulate growth by strengthening the demand side of the economy, increasing salaries, redistribution measures and public investment. Neoclassical economics demands the lowering of social and environmental standards, and leaving the regulatory function to the market. Ad 3: The EU council has called for “sustained and sustainable growth” – leaving the latter undefined. The “inequation of sustainability” has been developed to assess the sustainability of the growth according to selected minimum conditions. Sustainable development policies need to get rid of the growth fetish, to define social, economic and environmental criteria for sustainable economic development in their own units of measurement. Following these lines of thought (i.e. with growth explicitly no policy objective, but a more or less relevant side effect) scenarios indicate the possibility to reduce environmental, achieve full employment, eradicate poverty and contribute to gender equality. In these calculations economic growth the dependent variable (rebound effects included). Knowledge Collaboration & Learning for Sustainable Innovation ERSCP-EMSU conference, Delft, The Netherlands, October 25-29, 2010 1 Keywords Sustainable development, economic growth impacts, growth policy impacts, policy preference formation, economic theory. 1. Introduction According to the full definition (usually only the first half is referred to) of the Brundtland Commission (WCED 1987) “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. I contains within it two key concepts: 1. The concept of “needs”, in particular the essential needs of the world’s poor, to which overriding priority should be given, and 2. The idea of limitations imposed by the state of technology and social organisation on the environment’s ability to meet present and future needs.” The economic mainstream can neither accommodate the orientation towards meeting the needs of the poor nor the limits imposed by the carrying capacity of the environment (aware of the fact that carrying capacity is socially constructed): 1. Only the needs expressed in the market are taken into account. As these are based on the purchasing power involved, the needs of the rich have overriding priority against those of the poor, contrary to sustainability demands. 2. As according to neoclassical economic thinking for every good there is a fully equivalent substitute, there can be no resource scarcities in functioning markets. And as technology will solve all problems, there is no need to take potential environmental limits into account – technology will provide solutions to any such problems. Unfortunately, the fate of the poor and the state of the environment clearly indicate that such expectations are illusionary and the belief the market would solve them, thus undertaking no targeted action is frivolous. Rather obviously, an economics which makes equilibrium and efficiency its highest objectives, assuming that we are at or close to an equilibrium situation to be maintained by reducing market interferences is misguiding in a situation where not stabilising the situation but enforcing massive changes for the benefit of the poor and the environment are more urgent than ever (Ackerman 2007). This is all the more urgent due to the regressive effects of climate change and biodiversity loss. As more than 20 years since the report of the WCED have mot been sufficient to realise the massive changes necessary (rather to the contrary), and as the window of opportunity for turning the tide and avoid uncontrollable effects of The 14th European Roundtable on Sustainable Production and Consumption (ERSCP) The 6th Environmental Management for Sustainable Universities (EMSU) 2 climate change (massive damages are already unavoidable), it is high time for radical changes in politics and public attitudes. Cherry picking (i.e. looking for win-win situations) is no longer an option – if it has ever been one. However, radicalism is no end in itself. Derived from the Latin radix, the root, it simply means that we have to identify and address the causes of the current situation, and not only combat the symptoms. We simply cannot go on dealing with the bubbles on the surface and not asking what keeps the pot boiling. However, what are the causes, and what the symptoms? Is growth per se bad? Or only specific kinds of growth? Or only growth exceeding certain limits? Or is simply the measurement wrong (beyond GDP)? Will no growth or low growth solve the problems, or create new ones, or both? Is growth the core of the problem, or is it just the contemporary expression for older ideal like progress? Or is it a result of militarism and imperialism? Or is capitalism the core problem? Or our excessive consumer societies? What is the objective: reducing CO2 emissions and our land use (ecological footprint), plus halting biodiversity loss, i.e. measures against specific pressures, or a general reduction of throughput (Daly 1991)? Would that mean a steady state economy (Daly 1973) or first of all a reduction of its biophysical size (Georgescou-Roegen 1976), by reducing material flows by a factor 4 or 10 (von Weizsäcker et al. 1997; Schmidt-Bleek 1994) or through the human appropriation of nature’s surplus and substance (Haberl 2004)? Does it include preserving species diversity or only ecosystem services, efficiently provided by a limited number of specialised species? Does technology provide a way out, or are new technologies just a drop in the bucket? Should the focus be more on social factors, such as poverty, income and wealth distribution (and the correlated consumption impacts), and the enduring gender imbalances and justice deficits? Or must we even go deeper and overcome archaic human instincts, the ape within ourselves (Rötger 2002)? 2 Method This paper cannot answer all the questions mentioned above. However, it introduces a differentiation of “growth” as a research topic which is intended to bring them closer to an answer. For this behalf it is suggested to distinguish three different aspects of the growth problem: 1. Driving forces, orientations : The growth discourse, claiming the centrality of the growth issue for societal development; 2. Pressures, mechanisms : Growth politics, which follow a specific economic ideology, and Knowledge Collaboration & Learning for Sustainable Innovation ERSCP-EMSU conference, Delft, The Netherlands, October 25-29, 2010 3 3. Impacts : The real social, environmental and economic effects of economic growth. Whereas the latter point deals with the impacts of economic growth in real time and space, the former two are governance challenges since they refer to certain elements of the institutional system causing driving forces and pressures. For policy analysis purposes, the political science definition of institutions can be applied, comprising the three levels of organisations, mechanisms and orientations (Czada 1995). Organisations are not analysed here, as they can act into different modes and directions, depending on the orientations and mechanisms setting the compass. From an impact analysis and policy consultation perspective the DPSIR model can be applied, illustrating the linkages between drivers, pressures, impacts (changes of state) and policy responses (Figure 1). 3 Three aspects of growth In the public debate, the growth discourse, growth policies and growth impact are all too often discussed in a mix which confuses effects and makes it difficult to design mitigation and prevention strategies. Despite their close relationship and mutual influences, the three aspects are delineated and dealt with separately in this paper. 3.1 Driving forces, orientations: the growth discourse The public growth discourse is based upon statements from politics, the business sector and has a strong foothold in the media, all claiming the necessity of more economic growth. Its second base are the public expectations of (or at lest the hope for) continuous improvements of their quality of life; this expectation provides a resonance body for the “growth is necessary” messages. They claim that the central factor for social, economic, political and environmental progress is economic growth – it is assumed to create wealth, and provide the The 14th European Roundtable on Sustainable Production and Consumption (ERSCP) The 6th Environmental Management for Sustainable Universities (EMSU) 4 necessary means for social and environmental improvements (thus the European
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