October 23, 2017

Exposing the myth of economic growth

Foreword to The Growth Illusion: how economic growth has enriched the few, impoverished the many and endangered the planet, by Richard Douthwaite.

Published by Green Books, April 1992.


Modern industrial man regards economic growth (or ‘economic develop­ment’, as it is called when it occurs in the Third World) as synonymous with progress, and thus sacred. It is seen as providing a veritable panacea for all our problems, and signalling the path that we must religiously follow in order to create a material and technological paradise here on Earth.

This is the fundamental tenet of what is, in effect, the religion of industrial man, with which we have all been imbued since our earliest childhood: one that underlies all the disciplines into which modern knowledge has been divided – whether it be economics, sociology, physics, or even the reductionistic or mechanistic ecology currently taught in our universities, one too that is fervently promoted by corporations and their political allies throughout the world.

To give credibility to this myth, we increasingly interpret our problems as being of a purely economic nature, and ascribe them to insufficient growth or development, thus identifying human welfare with Pigou’s “economic welfare” and implying that economic growth is the only answer. The World Bank, for example, insists that the goal of the vast and highly destructive schemes which it continues to finance throughout the world is the eradication of poverty.

Bilateral aid agencies seek to maintain the same fiction. The principal purpose of USAID, a former Secretary of State told his country’s Senate Foreign Affairs committee, is “to meet the basic needs of poor people in the developing countries”. This is difficult to reconcile with the fact that about 75 percent of both US and British bilateral aid is ‘tied’ to the purchase of their technology, in particular power stations, large dams, and other installations which mainly provide services to the urban rich.

The rapid degradation of the world’s remaining agricultural lands is also invariably attributed to traditional agricultural practices. Thus USAID, regardless of the fact that such practices have been used sustainably for thousands of years, links the deterioration of the “soil resource base” in arid lands to mismanagement, arising from the use of “traditional technology and agricultural practices”.

Mrs Thatcher, in her 1989 address to the United Nations General Assembly in New York, blamed what she called “cut-and-burn” agriculture, and recommended “action to improve agricultural methods – good husbandry, that ploughs back nourishment into the soil”, a rosy picture of modern industrial agriculture.

Malnutrition and famine are also associated primarily with archaic agricultural practices, even though, on the admission of the ex-US Secretary of State for Agriculture Bob Bergland, agriculture in China “produces nine times as many calories per acre as we do in the United States”. The Food and Agricultural Organization of the United Nations (FAO) even produced a report in 1984 entitled Land, Food and People to show that food availability in the Third World is directly proportionate to the amount of fertilizer used, no mention being made of the diminishing returns on fertilizer use experienced wherever modern agriculture has been introduced.

The FAO cites poverty as another cause of malnutrition and famine. People starve because they do not have the money to buy the food they need, a problem which clearly can be solved only by further economic development. No one points out that, despite the unprecedented economic development of the post-war years, more people than ever before lack the money with which to pay for their food; nor, for that matter, that malnutrition is now a serious problem in the United States of America, the most highly ‘developed country’ in the world, where upwards of 30 million people are said to be affected.

The population explosion is also ascribed to poverty: poor people’s insecurity leads them to produce more children, who can be put to work to earn money for their parents. Rapid economic development will make them rich and provide them with the requisite security, thereby assuring a ‘demographic transition’ such as has already occurred in the industrial world.

Again no one mentions that this transition occurred only once per capita income had reached a level incomparably higher than that which Third World people can ever possibly achieve; nor that in the meantime economic development, by destroying people’s families and communities, annihilating their natural environment and forcing them off their land and into the slums, is in fact the greatest source of their present insecurity.

Even global warming is increasingly perceived as an economic problem. The National Academy of Sciences in its recent report, Global warming: policy implications, actually suggests that the solution might reside in ‘geoengineering': for instance, siting 50,000 one-square-kilometre mirrors in space so as to reflect heat from the sun away from the earth – the financing of which would obviously require an unprecedented spurt in economic growth or development.

Attacking the myth of economic growth, as Richard Douthwaite has done in this brilliant and highly documented book, is thus a very subversive enterprise – one which must undermine the whole structure of modern knowledge and, one might add, that of modern society itself. For the corporations into which our society is organized cannot continue to expand – as they must to survive – if our ever more daunting problems do not provide them With the appropriate commercial opportunities.

The demolition of this myth, however subversive it may be, is of vital importance, for, in reality, economic growth is the main cause of social and environmental destruction and the associated poverty and misery. The living world, ever less capable of absorbing the impact of our activities, will otherwise inevitably become degraded to the point at which it can no longer support complex forms of life.

Only when the myth of economic growth has been totally discredited will it be possible to imbue people with the world-view consistent with a less destructive way of life, enabling us to inhabit the beautiful planet we have inherited without systematically destroying it. For this reason, Richard Douthwaite’s book is of greatest importance to us all.

Edward Goldsmith

Richmond, London, January, 1992.

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