Economic Growth Drives Climate Change and Biodiversity Loss
“Anyone who believes that exponential growth can go on forever in a finite world is either a madman or an economist”. Kenneth Boulding1
Economic growth (EG) is an increase in the production and consumption of goods and services in the aggregate. It is facilitated by increasing population and increasing per-capita consumption.
Because we can’t make the goods from nothing, EG can also be defined as an increase in throughput or flow of natural resources from the global ecosystems through the economy and ultimately returning back to the environment as waste.
It has given many of us our current standard of living as well as our quality of life. But can we have an increasingly better standard of living while, at the same time, depleting the very ecosystems and resources that provide us with that standard of living?
Anyone who understands modern physics and ecology also understands that ecosystems, and the resources within them, are not infinite (see It’s Not Rocket Science). And no amount of human ingenuity will make them infinite despite what conventional economists tell you.
Continuous EG may have seemed reasonable when the Earth was relatively empty of people but things have changed. There are now over 8 billion humans on the planet, each demanding various amounts of the Earth’s finite resources. See Population Growth.
“The pressure we are placing on the natural world is driving an escalating nature crisis which, in turn, is undermining its ability to provide crucial services, including climate change mitigation and adaptation. Our destruction of nature is also increasing our vulnerability to pandemics, while placing the most vulnerable at the greatest risk.2 Are we really better off in the long run if we continue to rely on EG for our wellbeing?
The solution to the problem of economic growth
The solution to this problem is quite simple: move from the unsustainable, growth economy we currently have, one that is devastating our global ecosystems and driving climate change, to a sustainable, steady state economy.
A steady state economy is:
“… an economy of stable or mildly fluctuating size. The term typically refers to a national economy, but it can also be applied to a local, regional, or global economy. An economy can reach a steady state after a period of growth or degrowth. To be sustainable, a steady state economy may not exceed ecological limits.” 3
Decision makers need to:
- Engage human ingenuity and good will to transition to a Steady State Economy via a period of degrowth.
- Develop new policy and regulations internationally, including development of new indicators and regular monitoring programs.
- Plan all communities and their populations to lie within the local and regional carrying capacity – this includes limiting further population growth.
- Continue to protect areas as buffer zones in which various lifeforms will have a better chance of survival. They must, however, be seen as “stop gaps”, while the root causes of biodiversity loss are addressed.
- Ensure that at least 50% of the Earth’s ecosystems are protected and left in their natural state in order to provide sufficient ecosystem
This may seem difficult to implement, but in “Towards a Steady State Economy”, Herman Daly outlines ten transitional policies and explains why he feels they would work:4
“While these transitional policies will appear radical to many, it is worth remembering that, in addition to being amenable to gradual application, they are based on the conservative institutions of private property and decentralized market allocation. They simply recognize that private property loses its legitimacy if too unequally distributed, and that markets lose their legitimacy if prices do not tell the whole truth about costs.”
Our two choices are to be 1) sustainable or 2) not sustainable. Currently we’re choosing the latter, which doesn’t bode well for humanity.
References
1Why economic growth is not compatible with environmental sustainability.
2 Living Planet Report, 2022, p. 100.
4Daly, 2008. Towards a Steady State Economy, p. 13.