De-growth and an Economic Kyoto Protocol
We need "to build up an economic-growth "Kyoto protocol" in which
- (a) the world growth rate is calculated so as to be a cap on humanity's ecological footprint,
- (b) that world growth rate is furthermore adapted downward (if necessary) or upward (if at all possible) according to what is required for social and cultural protection norms to be practiced by all countries on an equal footing, and
- (c) most importantly, poorer countries get a growth credit while richer countries are asked to settle for the lowest possible (negative, if really necessary) growth rate.
This would mean that as the planetary growth rate gets gradually reduced for ecological and/or alienation-related reasons, differentiated treatment would be given to the few already superlatively opulent and to those innumerable human beings whose communities and countries still need to achieve positive real growth per capita. This is precisely what economist Peter A. Victor emphasizes when, in his landmark book Managing Without Growth, he writes that "rich countries that have benefited most from economic growth should manage without growth to make room for the poorer countries where the case for growth is much stronger" (p. 21). He explicitly presents this as a matter of communicating vessels: less growth for the rich "makes room for" more growth for the poor. And this, of course, requires a macroeconomic framework which Victor is currently developing and which Tim Jackson is calling for under the label of an "ecological macroeconomics."
- planet-wide "de-growth," that is, an aggregate reduction in material throughput and output -- whereas the current trends all point in the opposite direction, despite all the technological progress and all the increased energy efficiency (because so much more less energy-intensive units of goods get produced, so that the per-item effect is more than offset by an explosion in the number items produced -- a phenomenon well known as the "rebound effect")
- de-growth in the richest part of the planet so that there can be massive "re-growth" in the many maimed and all but destroyed economies of Africa, Asia, and South America (and, since there is to be net de-growth at the world level, this means a much more than proportional reduction in throughput and output in richer countries)
- selective de-growth within richer countries, too, since there is no reason why even with a negative macroeconomic growth rate, countries such as the US or Germany should not have positive growth in certain selected sectors (Education and health? Public services? "Love-miles" or human-relations-related transport? etc.)
The domestic growth objective for poor countries would most likely not be achievable through FDI from richer countries now slowing down their own economies. Thus, within a global de-growth compact to be institutionalized (see the next post on new governance structures), the transition of poorer countries towards a high-growth regime will most probably have to occur by a high premium being given to the buildup of domestic, local human, social, and economic capital. This is truly a huge task for the elites as well as the citizens of such countries, but some of the most frontline development economists of our time (such as Jeffrey Sachs and, in a very different vein, Esther Duflo) are confident that with the right mixture of top-down steering, citizen-oriented (rather than elite-oriented) expertise, and bottom-up citizens' participation, significant progress can be made towards experimenting with culturally differentiated as well as locally adequate incentive schemes and governance structures.
To be sure, a global de-growth compact in which the rich countries stand to lose a great deal of prima facie comfort and know they will have to abandon time-honored reflexes of extraction and accumulation is a tall order. With an environmental Kyoto protocol, every political leader could still come home and try to argue that reducing emissions could still be made into a new growth engine. This proved to be very difficult in most cases, and that's why virtually no progress (beyond bouts of rhetoric) was made in Copenhagen in 2009 and in Cancun in 2010. Still, with the continuation of the Kyoto protocol looming in 2012, climate experts and environmentalists (not all of whom come across as neo-Luddites) are convinced that there is no other solution but to push greenhouse gas reductions further down. But while a post-carbon economy can be presented as a growth-boosting opportunity, a de-growth economy leading the developed world to have to rely on the long-lost virtues of stationarity, on increased social justice in the distribution of current stocks of resources and flows of goods, and on reasoned relocalization as well as selective deglobalization, is by definition not a very attractive prospect for growth as classically construed... We therefore need to create new accounting tools, new legal frameworks, and a new worldview in which anthropologically oriented, "human," relational, qualitative growth can be institutionalized into measurements and in which a materially stationary, less trade-intensive, and less hyper-productive economy can actually be seen to generate positive value and to "grow" in dimensions where today's growth-obsessed economies are faltering dismally. Herman Daly, Douglas E. Booth, and Peter A. Victor have, for quite some years (in the wake of the pioneering work of Nicholas Georgescu-Roegen), been busy trying to work out a credible framework for such a balanced, realistic global de-growth and first-world de-growth scenario, one in which third-world re-growth is included as a crucial aspect. There will be other posts in the future about this scenario and about various aspects of de-growth, since it is so crucial to the overall success of a genuine transition.
Global de-growth and first-world de-growth combined with third-world re-growth is the objective which an "economic Kyoto protocol" should aim for. With such a protocol as a major, frontline framework condition binding all nations of the planet, huge progress would already have been made towards a new logic and the possibility of justifying the need for, and action towards, a genuinely plural economy. Of course, such a protocol has no chance of ever seeing the light of day without intensive citizen advocacy and, perhaps even more so, without a set of national and supranational institutions to implement and monitor it." (http://eco-transitions.blogspot.com/2011/04/what-transition-part-4-creating-right.html)