A Sustainable World – Balance is the Key

Continuous Economic growth is the goal which every country aspires to. It is the promise of every political party worldwide at every election and yet it is a myth. The drive towards growth has not delivered any form of sustainability for any country at any time. It has only delivered dilution of human values, waste, pollution, climate change, fresh water shortages and irreversible degradation of the environment and extinction of entire species. This notwithstanding, we are still being told that growth is good. Sure, children grow, that is good. Cancer cells grow too, not so good. Growth of itself means nothing and can be as dangerous as it can be useful.

Financial news is rife with talk of economic growth measured by quantifying national output (GDP). The mantra of economic growth has been embedded in our psyche by incessant repetition. Repetition of this mantra has not made the concept any more tenable but it has made us numb to alternatives. Infinite growth can only be based on infinite resources or resources that can replenish themselves infinitely. When we talk of resources we mean the resources that are essential parts of Earth’s life support system or buried in the Earth’s crust – there are no other resources apart from these. The Earth’s resources are in fact finite and human activity guided by unrealistic ideologies has exploited these limited resources to the point where we have severely inhibited the Earth’s ability to replenish them. If we could get our head out of the sand even for an instant we would feel shame and guilt at the betrayal of our birthing place.

Quantifying national output is useful in order to have a measure of economic activity. Placing this single mathematical formula, however, as the supreme measure of success or failure is wrong. Economic activity is just one of a number of factors that should be considered when assessing the state of a nation. I had written more extensively on this subject in an article called ‘Gross Domestic Product – Not Fit for Purpose’ published by this newspaper on the 29th January 2017.

A country’s ultimate economic goal should be one of balance and not of growth. Balance implies that growth or de-growth may be required depending on the needs of the particular country and its stage of development. Nations coming towards the end of their economic growth path for the time being, should be aware of it and transition to a balanced economy. The important point here is that when growth or de-growth is sought, this should be in the pursuit of balance. The economy of any country will always be work-in-progress, continuously needing adjustment to keep it in balance. We exist in nature and in nature everything is about balance and nothing grows forever. It is therefore irresponsible to take decisions on the basis of continuous growth.

Growth fosters conflict and rivalry and this wastes resources. Balance fosters collaboration and is far more rewarding for all. Another very important element to consider is that balance cannot be achieved globally at the same time – balance can be achieved individually by regions such as small countries or significant parts of larger countries, where communities share common purpose, history and values.

As economic endeavour should be a means to an end, in order to reach the desired end, we need to articulate our goals. We need to be mindful that indiscriminate economic growth is for the benefit of the few and is based on the concept of economic activity swinging between extremes – where the up and down cycles apply to the many and hardly ever to the few (political elites and business lobbies) who mostly only have upsides. The media tells us that business lobbies fund political candidates and that in return for their funding they get favourable government policies and contracts. Just by way of example, it was reported that during the 2012-13 USA:EU Transatlantic Trade and Investment Partnership (TTIP) negotiations, 520 (90%) out of the 560 meetings held by the EU politicians and bureaucrats were with corporate lobbyists. It is illogical for us to blame political elites and business lobbies for the ills of the world when it is us who vote in politicians and it is also us who buy the products that make business lobbies so powerful. We should perhaps be more discerning when we come to cast our vote or make our purchases.

We should also question our belief in the inevitable swing of the pendulum, as it does not always have to get worse before it gets better.

Simon Kuznets, who created the first national income matrix (GDP calculation) in the 1930s for the US economy, was well aware of the limitations of such a matrix if used as the supreme measure of well being. In fact he became its most outspoken critic by the 1960s. “Distinctions must be kept in mind between quantity and quality. Goals for more growth should specify ‘growth of what and for what?”.

In the 1972 ‘limits to growth’ report, Donella Meadows echoed Kuznets concerns “growth of what, and why, and for whom, and who pays the cost, and for how long, and what’s the cost to the planet and how much is enough?”

1998 Nobel memorial prize winner, Economist Amartya Sen reiterated that the focus of development should be “advancing the richness of human life, rather than the richness of the economy in which human beings live.”

Although having a sustainable and regenerative economy balanced between Earth’s ecological boundaries and humanity’s social aspirations makes perfect sense, these voices of reason over the decades have repeatedly fallen on deaf ears. It appears that we find the idea of an economy based on growth to be fatally attractive. I suspect that this is so because it follows our mental bias and is easy to understand. Moreover governments say that growth is good and as they have our best interest at heart, it must be so.

The economy of a country is made to appear complex and beyond our understanding – it actually is not so. We should move away from the situation where a few lead and the many follow blindly to a situation where we all understand what is actually going on.

The first in a series of five articles on sustainabilityArticle published in the Sunday Times of Malta, 18th February 2018

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