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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

Gittens on economic growth « Previous | |Next »
May 7, 2008

Ross Gittens has an interesting op-ed on economic growth in the Sydney Morning Herald. He says that for nearly all economists, business people and politicians the need to maximise the growth of the economy is a self-evident truth and should not be questioned. Those who do so, eg., Clive Hamilton, are treated with scorn by economic rationalists and libertarians, even though economic growth is commonly seen as a means to achieve the good life, rather than an end in itself.In short, there's more to life than money, and the more than is usually understood in terms of wellbeing.

Surprisingly, the 2020 Summit failed to question economic growth as an end in itself. One of their new ideas was to try harder to maximise economic growth---to increase "gross domestic product per capita so that Australia is among the top five countries in the world on this measure, with strong, stable economic growth."
How strange. I presume that it hasn't occured to them that one could have wealth but live a damaged life. A
damaged life in the sense of a loss of the full experiential richness of life at the hands of the “technological, schematized modes of human thought and power relations which dominate neo-liberal capitalist modernity.

The economic section of the final report of the 2020 Summit has the following ambitions:

Australia should be the best place in the world to live and do business. This will require urgent action to increase economic capacity through the creation of a truly national, efficient, sustainable and inclusive economy supported by seamless regulation. We should set national goals for Australian prosperity in which all Australians share:
• Increasing GDP per capita so that Australia is among the top 5 countries in the world on this measure, with strong, stable economic growth; and
• Inflation between 2% and 3%.

Nothing about wellbeing there. The target is given and the emphasis is placed on the implication for meeting the target for economic growth in the coming decades--- world-class infrastructure.

Is the failure to question this growth fetish in terms of the wellbeing of the population a failure of intellectual nerve?

| Posted by Gary Sauer-Thompson at 8:12 AM | | Comments (8)
Comments

Comments

GDP growth being equated to the well-being of citizens (Human Development indices like mortality, morbity - physical and mental, education, etc) is like CEOs measuring success by sales rather the profits (and capital expenditure for growth).

It can actually be counterproductive, like suggesting weight-gain is the measure of infant welfare.

Does inflation contribute to GDP? Why don't we hear more about the GINI? What about a "GINI" for mortality and morbidity?

Better metrics that measure the proper objectives of government, defined and reported by the ABS, publicized by media and politicians, are necessary.

Take infant mortality figures - a really useful metric: Cuba's is better than the USA.

Tristan Ewens has an interesting piece at OLO on some of what's wrong with our current economic wisdom. It's generating a worthwhile comments thread.

It's odd.The pro growth crowd say that there is no environment without the economy. Lets grant that a prosperous and efficient economy is not just useful but necessary. Where would it be without a health y environment. Haven't these blokes thought through the implications of what is happening in the Murray Darling Basin or with climate change.

Climate change is about economics as it is the greatest market failure the world has ever seen. And the pro-growth crowd went protectionist in their response to climate change. They defended economic growth by refusing to export Australian jobs to Asia and they rejected market-based solutions to address global warming in order to protect the coal industry and big energy users.

One of the things that really bothers me about many economists is that they can't see the inherent problem with endless growth within a finite system. I excuse the politicians and business people to some extent, because most of them have no mathematics to speak of.

Lyn,
Ewin asks some good questions about what makes a “Good Society”

Should such a thing be measured in purely material terms? What of free time; of family and friends; of room to develop ourselves as human beings? How best to pursue such aims as human liberty, social justice, democracy, as well as compassion and provision for the needs of the poor and vulnerable?

How to negotiate conflict between the liberal right of individuals to invest their wealth as they choose, and the imperative to alleviate or eliminate the exploitation of labour?

And how best to balance conflicting modes of social organisation: to allow for spontaneity, as well as instances of planning, and the proper functioning of markets where appropriate?

Gary,
I've just finished reading Brendan Gleeson's very long, and very waffly, essay in the new Griffith Review on urban planning. He ties current economic thinking in with all sorts of problems, one of them the perceived divide between urban and suburban and climate change.

Where wealth concentrates, mostly in urban areas, so does consumption and waste. Consumption in the McMansion suburbs is constrained by debt, as we're seeing now.

Economic growth and consumption for the sake of it are not only unsustainable, but also self defeating. Gleeson anticipates that water, power and oil will be rationed eventually. What, then, is the point of permanent economic growth if you can't have parallel consumption growth from a lifestyle point of view?

I'm unable to read it as it is behind a subscription wall. They must have changed their open access policy. They have a public subsidy from the Australia Council and they privatise the work with no open access. Shame.

I presume, from what you are saying is that Brendan Glesson is talking about the idea that modern life is in some sense a damaged life. Am I right?