“Capitalism, as a system, is based on growth, some of it extremely harmful: there has been enormous global expansion in air and water pollution, soil erosion, and the burning of forests. This adds an ironic twist to capitalism’s ‘grow or die’ challenge. As capitalism has kept on growing and expanding on a global scale over the past two centuries, both nature and indigenous civilizations are being bulldozed in the process. We must face up to the fact that eventually any group, species, or system based on endless expansion must collapse. Endless growth, as any doctor will tell you, is the way of cancer. It is death. If unchecked, such growth guarantees our own extinction as a species in relatively few generations.”1
This passage from my book, Dollars or Democracy,(2004) incorporated a frontal attack on the dependence of politicians and the entire economic system on growth. As I pointed out at the time, growth at a level of 2 per cent per year could not continue for very long. The mathematics of such accumulations are simply prohibitive. And yet politicians around the world are acting as if they were deaf and blind by continuing to uphold “growth” as their best slogan for re-election. Those in power refuse to recognize that capitalism, which brought us out of feudalism and from the industrial revolution to the digital age has now become a failed system in the battle against environmental extinction. They are in denial: We admit that capitalism never was a stable system but are reluctant to recognize that it has become downgraded from being a force for development to being a tool for the hyper-rich to become ever richer. But then the end logic of capitalism has always been capital accumulation.
The crash of 2008 did not resolve any of the basic economic problems facing mankind, like the environment, runaway technology, and the shift away from labor to automation. I had expected that a collapse of the economic system would lead to a rethink and eventually to a complete overhaul of what existed. I had proposed an entirely new economic model, “The Incentive Economy,” which would bring back hope into the way we lived. Instead, the inept and basically venal banking system was propped up by the injection of hundreds of billions of dollars which saved the bankers and the corporate world and made a few at the top even richer. Where I had proposed an end to the corporate structure and its transformation into a cooperative one, the multi-national corporations grew ever more powerful through newly formulated global tax evasion. Yes, the corporate world embraced that kind of growth.
Mathematics, statistics, and reading ability should all tell the people that economic growth is not like that of springtime greens. And yet, despite the alarms coming from environmental scientists that we must stop the devastating side-effects of growth, insufficient notice is being taken. The writer Naomi Klein has emphasized that economic reforms so essential to controlling the environment “are extremely threatening to an elite minority that has a stranglehold over our economy, our political process, and most of our major media outlets.”2
Another outspoken writer, George Monbiot, has come out with one editorial page analysis after another clearly spelling out the simple message that the impact of economic expansion is destroying our planet. Monbiot, repeatedly warns that there is no alternative policy accepted by mainstream political parties to replace growth addicted capitalism: “Why are we wrecking the natural world and public services to generate growth, when that growth is not delivering contentment, security or even, for most of us, greater prosperity? Why have we enthroned growth, regardless of its utility, above all other outcomes? Is it not time to think again? To stop sacrificing our working lives, our prospects, our surroundings to an insatiable God?”3
However, all too few economists are listening. They are in denial. Many cling to 20th Century prospects. All too many still continue to regard labor as a commodity! They categorize workers as input in the production of wealth. Perhaps it is that many economists are so dependent on the current economic system that they cannot afford to consider the critical need for an alternative. Adam Smith would not for an instant have tolerated the corrupt economic world we live in today. Justice was central to Smith’s critique of the crony capitalism which was just then (around 1800) forming. Today all too often the crooked capitalism of many corporations, banks, auditors, lobbyists and tax evaders are calling the (false) tune. To my amazement, economists still consider free markets (characterized by individual selfishness and social competitiveness) as the ideal form of economic organization. The truth is that free-market encouragement of selfish behavior has led to the increasing breakup of communities, rising divorce rates, increased loneliness for the young and old, soaring drug use and a massive decline in trust.
Richard Smith, an outspoken economic outsider, has been clear in charging that “Capitalism is, overwhelmingly, the main driver of planetary ecological collapse. From climate change to resource overconsumption to pollution, the engine that has powered three centuries of accelerating economic development revolutionizing technology, science, culture, and human life itself is, today, a roaring out-of-control locomotive mowing down continents of forests, sweeping oceans of life, clawing out mountains of minerals, drilling, pumping out lakes of fuels, devouring the planet’s last accessible resources to turn them all into “product” while destroying fragile global ecologies built up over eons of time.”4
Daniel Cohen (an economics professor of Paris’s Ecole Normale Superieure) maintains “Powerful software is doing the work of humans, but humans thus replaced are unable to find productive jobs.”5 McKinsey, an eminent consultancy firm, estimates that new technologies will put some 140 million service jobs at risk in the next decade. Another study estimates that 47 percent of all employment in the United States is susceptible to automation over the next two decades. Few believe that job creation is going to keep pace with automation.”6
The manifest failures of the prevailing materialistic outlook have led to growing loneliness and depression writes economics analyst Hugo Dixon: “In pursuing growth, other precious things can get damaged. This includes our social environment — our communities and networks of friendship and family — as well as our physical environment.”7 Dixon believes that it is necessary to focus more on quality than quantity and take better care of the social fabric. Ultimately, the economy should service society rather than the society servicing capitalism.
In Dollars or Democracy? I clearly spelled out the prospects of an alternative “Incentive Economy ” with enormous social changes but little financial growth. I proposed that a basic income would be the right of every adult: Those without a regular job could volunteer their time on sick and elder care, child mentoring, community gardening, as well as innumerable cultural projects. Instead of growth the aim would be for greater social and economic equality, cooperation, sharing, community and creativity. Education, for example, could develop and expand with next to zero impact on the environment; so could most of the arts from music to painting and writing as well as film and video making. Yes, there are creative human alternatives to the artificial economic growth being manufactured by speculators, bankers, corporate executives, advertising agencies, real estate tycoons, and national treasuries.
I should like to conclude with a ten year old paragraph from my book:
“The new paradigm that we must forge together is one of a globally civil society based on economic cooperation rather than competition and cancerous growth. What is needed is not an affirmation of money, in the form of dollars or euros, but a sustainable way of life and human community…Reconciling our new technologies with our economy is one of the challenges of the twenty-first century I have tried to address. Obviously the social norms that still worked for the 19th century have been disrupted by economic advances on many fronts and society has failed to catch up. The planet desperately needs a global discussion about our economic future, specifically targeted at the long-term weakness of plutocratic market capitalism. The promised land of tomorrow may seem like a distant dream, but I would like to think that we could advance in the right direction. As the Bible proclaimed: We too have it in our power to “make all things new.”
1Yorick Blumenfeld, Dollars or Democracy? (2004) p.75
2Naomi Klein, “This Changes Everything,”(2015)
3George Monbiot, “Growth: the destructive God that can never be appeased,” The Guardian, November 19, 2014
4Richard Smith, “Capitalism and the destruction of life on Earth: Six theses on saving the humans,” World Economic Review, #64.
5Daniel Cohen, “When the growth model fails,” The New York Times, February 13, 2015.
6Kastrin Bennhold, “After jobs dry up, what then?” New York Times, March 11, 2015
7Hugo Dixon, “Growth vs. what really makes life good.” The New York Times , December 7, 2014