“GDP measures the monetary value of goods and services produced in a country. It contemplates things like consumption, government spending, business investments, and net exports. But there’s also a lot it leaves out, such as unpaid work, sales of used goods, and, perhaps most important, general well-being. Generally, countries with stronger and growing economies have higher standards of living. But GDP is only a decent-ish indicator of how things are going for people.”
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“There’s a British economist, Kate Raworth, who once said in a book called Doughnut Economicsthat there’s one graph in economics that no economist ever wants you to talk to them about. And that is the graph of exponential GDP growth. A mainstream economist would probably consider a growth rate of about 3 percent GDP every year as a healthy, robust economy. At 3 percent, the economy would have to double in output roughly every 25, 26, 27 years or so. If I showed a 5-year-old this kind of graph, they would know that that’s patently insane. This is, however, precisely the reigning economic doctrine in every country in the world with the possible exception of Cuba and Bhutan.
It is destructive because it will plunder the world, it will destroy our ecosystem, because it works people to death, because it destroys economies, because it commodifies everything.
Let me give you an analogy. Say we’re passengers on a train racing toward a cliff, and the only metric that matters in that train is its increase in speed. Whether that train has an unfair distribution of income matters not at all, what we’re destroying on the journey does not matter, whether the train is comfortable does not matter. And, in fact, not even the destination of the train matters.”
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“The vast majority of people would agree we should care about the greatest well-being of the greatest number within the biophysical limits of the planet, for the most part. The problem is that we are currently operating in a system called capitalism, which requires growth. We are at this tragic moment in history in which we can say both that if we continue to grow, we will kill ourselves, and if we stop growing, we will suffer greatly within capitalism.
Capitalism requires growth. The economy doesn’t require growth, development doesn’t require growth, and welfare doesn’t require wealth. Since we are living in a global capitalist economy, when capitalism doesn’t grow, you and I know exactly what to call that: a depression, a recession, a crisis.
But the opposite is also true. If we continue to grow exponentially, that is a massive crisis. It is the reason why we are unable to address climate change successfully, why we don’t know how to address rampant inequality.”
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“If you are starving, and you’re on 200 calories a day, and I as a doctor set you on 400 calories, and then on 800, and then on 1,600, you will get well. But if I say I have the key to your health and well-being, I will continue to double your calorie intake, what will you look like pretty soon? You will get very sick, and you will die. Absolutely no question. The exact same thing is true for the economy at large.
Was it good and necessary at some point? Probably yes. Although there are lots of caveats there, too. Is that still necessary? Absolutely not. Certainly not in developed countries like the US or Germany or France or Denmark.”
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“I have done interviews with corporate CEOs who very frankly admit that the business model they’re currently operating under is not sustainable, that it will hurt the world and the planet in ways that are irreversible. But they don’t know how to change it. They say, “If I stop giving return on investment to my stockholders, they will fire me, that’s the end of that.””