sustainability

I can understand why capitalists are opposed to democracy: the impulse of the masses is – usually – to redistribute some of the loot downwards to their own pockets and away from those who “earned” it. I suppose it all depends on what you mean by “earned”.

I have a harder time understanding why some progressively minded folk are equally opposed to democracy. For instance, in practically every left of center journal or conversation we will trip over comments decrying “infinite growth”, the lack of “sustainability”, and other evils stemming from the breakout to general prosperity the last two hundred years has seen. As I see it this criticism is anti-democractic. The masses have benefited mightily from the surge in economic activity. They will be the first to suffer from its ending. The rich and the powerful, after all, have always and will always, find ways to immunize themselves from the evils of deprivation. they will simply scarf up a greater percentage of the spoils for themselves.

The language of the sustainability advocates veers towards the apocalyptic. The end is nigh. The earth is headed to ecological disaster. We must stop growth dead in its tracks in order to preserve resources and to prevent climatic catastrophe. And this imminent disaster is usually laid at the feet of something called global capitalism. An example of this attitude can be found in this Salon article by Tim Donovan.

You will notice that in Donovan’s case the article’s reference to technology is a red herring. It isn’t technology that can’t save us, he seems to argue, but own our inability to marshal technology. We know what we have to do, we don’t seem able to do it.

That’s politics, not economics. It’s still an issue, but it isn’t one to do with either economic theory or technology.

The key question, to me at any rate, is: sustainable with reference to what?

To our current level and type of technology? To our current resource mix? To our current state of knowledge?

To me concepts like sustainability are relational. They are contextual. So too is the notion of scarcity. This is one of the problems I have with much of contemporary economics. It argues as if today’s context is the only context. Which, of course, it isn’t. Sustainability and scarcity were not the same in 1800 as they are today. Nor will today’s versions be the same as they will be two hundred years hence.

An example: I live in Vermont. A hundred and fifty years ago Vermont was largely stripped of its forests and was a state of rolling farmland with a larger population than today’s. Now the state is heavily forested and its farming is different. Which of those two versions of Vermont was/is hurtling towards apocalypse? Or another example: the earth’s supply of oil reserves was not a constraint a thousand years ago, it is only a constraint in the context of modern technology. It is not, necessarily, a constraint in the future. Maybe. Maybe not.

This is not an argument for inaction. It is an argument for more throughout about what we mean. Especially if the consequences of our reaction is to cause growth to come to a screeching halt. Rather than simply decrying the consequences of industrialization and its unequivocal impact on our climate as an evil associated with capitalism, we ought to think what impact our reaction might have on democracy. Is it possible to force a halt to growth and not disrupt our social freedoms? How will we allocate our newly static wealth? For a call to end growth is a call to end the accumulation of more wealth.

And it isn’t just the sustainability advocates who fall foul of this analytical error. We get a taste of it in recent discussions about stagnation. Only this time the argument is usually from the right wingers. There the error is expressed in terms of our having reached an end to high growth because recent innovation isn’t having the same impact on productivity. The much heralded benefits of “digitization” seem not to have had the life changing impact that the availability of electricity did, so, the argument goes, we ought to recalibrate what we think our growth potential is. And that re-calibration is, inevitably, downward.

So we have both left and right suggesting the great era of growth is past us. One side because it cannot envisage growth as positive given supposed resource constraints. The other because it cannot imagine how newer technologies might have the life altering impact of those that came before.

The problem, as it appears to me, is one of limited imagination. My view is that the economy evolves as we learn and as we learn to apply what we learn. It ratchets up on itself. Such learning is not limited to the invention of new technologies, but also includes how we organize our societies for our benefit. In this way I see the emergence of democracy, which in its modern incarnation is a post industrial phenomenon, as a social technology we put in place to mitigate the more egregious depredations of pure capitalism. I agree with Deirdre McCloskey: it isn’t just so-called scientific advance that builds our knowledge store and enriches us, but it is also our social advance, and in this case, our acceptance that there are rewards to innovation which spillover to the rest of us and so we ought to tolerate within bounds those who benefit from innovation.

Note thought the word “advance”.

Contemporary society is not static. It is propelled by innovation. We capture some, but all, of that forward movement as “growth”. We measure growth very roughly in things like GDP, which is a flawed measure, but is not a hopeless one either.

At which point let me introduce another frustration I have with my sustainability advocating friends: that GDP measures bad things like pollution clean-up as accreting wealth does not condemn it necessarily. Why? because pollution clean up generates activity, jobs, wages and so on, and GDP tries to capture all such activity. Yes, it would be nice if all economic activity was positively based. But is not a clean-up positive? And what if the source of the needed clean-up is a natural disaster? Recovering from a mistake is a way to learn. We consider that a move forward, we do not attribute it a permanently negative tone. We do not place all our value on the error and none on the subsequent recovery. So why do we impugn GDP because it also includes recovery from mistakes and errors such as pollution?

All this is just my way of suggesting that much of the call for sustainability to feature in a new economics is premature until we decide what we mean by sustainability. There are those, for instance, who argue that economics already handles the issue: the much heralded price system will deal with the problem. Presumably as resources are run down they become more scarce and thus more pricey. Then there is the well known problem, already embedded in economics, of externalities and how to deal with them.

It isn’t as if contemporary economics isn’t riven through with flaws. It is. Its model of human behavior is, in my opinion, a naive farce. Its theoretical closure, and its careless tossing outside of what ought to be inside the system being studied is breathtaking. And then the insistence on building upwards from that limited and naive foundation simply compounds the errors and condemns the entire enterprise to irrelevance.

I’m just not so sure that our fix would include a special nod to sustainability early on. I think a solid general theory would handle the issue anyway. We don’t need to create a special case.

And, as I said, sustainable with respect to what?

We need to figure out the moving parts, don’t we?