The G-Word

More growth? Get over it. Ecological economist Peter Victor says there’s a better, slower way.

by Michael Todd

How much is too much? How do we know when to stop? What will happen if we don’t? And what, if any, are more sustainable alternatives to past economic growth policies? These are some of the questions around the “G-word” that economist and York environmental studies Professor Peter Victor contemplates daily (and did so long before the current economic crisis). Victor, an ecological economist, defines himself as “an economist who understands economies not as stand-alone systems, but as subsystems embedded in, and dependent upon, the biosphere.”

Victor lays out his take on growth in detail in his newest book, Managing Without Growth: Slower by Design, Not Disaster (Edward Elgar Publishing, 2008). He conceived of “economies as subsystems of the biosphere” years ago. It all began when he was working on his PhD at the University of British Columbia in the late 1960s. His research from that time was later published as a book with the title Pollution: Economy and Environment (1972). “At UBC I got caught up in the environmental movement and my PhD research gave me the opportunity to break new ground. I remember the literature review in my thesis covered only three papers – there was so little written on this then.”

Victor’s work on slow/no growth dates back to 2001 when he got a call from his old thesis supervisor Gideon Rosenbluth (now in his 80s and still going strong) to collaborate on research about growth and the environment. “We settled on the question of whether it is possible to have full employment, eradicate poverty, maintain fiscal balance and protect the environment without economic growth,” says Victor. They published several papers and then Victor decided to embark on his book in 2006 with Rosenbluth’s encouragement.

In the book, Victor doesn’t advocate a knee-jerk reaction to economic crisis so much as a thoughtful approach that will carry us through decades to come. How? By choosing green over brown-based economies, he says. “The burden placed on the biosphere by global economic growth since the end of World War II is simply unsustainable,” says Victor. “A better approach would be to deliberately manage the economies of developed countries on the basis of little or no growth.”

It’s not a matter of quitting the production/consumption model cold turkey. Instead, he says, rich countries need to gradually reduce their dependence on growth in the long term. According to Victor’s research and systems modelling, an economic slowdown could be achieved without sacrificing prosperity. If the economic growth rate, as measured by increases in gross domestic product, was deliberately slowed, even to zero, between 2010 and 2035, Victor says, Canada could continue to provide enough jobs and revenue to fund government services and dramatically reduce poverty and greenhouse gas emissions.

“I’m not saying zero growth should become the overarching goal of economic policy,” says Victor. “But I don’t think we should bother with growth as a policy objective.” Economic growth in rich countries has been disappointing, he says, noting that growth in Canada hasn’t eliminated poverty and may, in fact, have increased it. He notes also that growth has not brought full employment, and has increased demands on the environment. “The burden placed on the environment by the economy for natural resources and waste disposal has risen. When economies were small in relation to the environment – in the sense that these material and energy flows were modest – maybe it was acceptable for economists to ignore them,” he says. “But now they are large – so large that some scientists refer to our current age as the ‘Anthropocene’ in recognition of the magnitude of human impacts on the planet.”

Victor argues there is the possibility that increases in GDP do not necessarily require an increase in material and energy inputs in the future. Over time, he says, we have reduced the material and energy requirements per dollar of economic output. “The material and energy intensities of economies have already declined,” he notes. “The trouble is these reductions in intensity have been too small to keep up with the increases in the scale of the economy, so the combined effect has been increases in the use of material and energy.”

Of course, in the end, we may learn nothing from past mistakes and could plunge once more into a same-old-same-old model of production, consumption and debt. Says Victor: “I’m worried we’ll rely on Band-Aid solutions to the recession. The short-term severity of the current crisis may distract government from the long-term dangers of relying on growth alone to keep economies afloat. Growth is not the answer.”

YorkU Magazine, Summer 2009 edition