Krugman on degrowthies

update: I got P3'd.
I'm always interested when a mainstream economist pipes up about growth vs degrowth. As the wikipedia page says, degrowth is a `political, economic, and social movement based on ecological economics and anti-consumerist and anti-capitalist ideas'. The CASSE book Enough is Enough reflects this - not least because it emerged from a conference-wide braindump. It's a recognisable web of `ideas that tend to go together'; I'm unsure they're consistent. (I like standing on the sidelines and sniping too.)

So, Krugman just stuck his oar in, albeit only for about three sentences. It's obviously not possible to judge based solely on that, but it seems weirdly simplistic. In particular:

It's worth pointing out that they [the degrowthies] have a much too narrow notion of what it means to have a growing economy. It doesn't necessarily mean more stuff! It could be better stuff, or more services — and there are also choices to be made in how we produce and distribute stuff. There is absolutely no reason to believe in a one-for-one link between real GDP and greenhouse gases.

Well, no, there's not a one-to-one link. Really, no-one ever said there was. Let me have a go at stating my own position. Growth of material extraction can't go on forever. Economic growth can't be completely decoupled from physical output and that will eventually hit limits (is perhaps already). But that eventuality is some way off yet - any transition to a post-carbon economy requires growth for a few decades yet - a point that first hit home hearing Ruth Wood explain the economy's reaction to an increase in output of green tech using input-output models. But it's good to be arguing about this stuff right now. That web of ideas needs unpicking and re-assembling, and it's not a bad time to be doing that while economics as a whole is going through a serious navel-gazing period.

I also still have this vague sense that the concept of growth itself is being misapplied. As I've heard several people say who've been studying it in-depth, no-one really knows what the source of growth is. Jane Jacobs' ideas are enough part of my DNA for me to wonder if development wouldn't show up as growth in the kinds of indicators we use - which is what Krugman's implying, I think. A rainforest might be `steady-state' but it's ever-evolving. And actually, human development - while sharing some characteristics of evolving systems - has its own dynamic that's more a mash-up of attentive artistry and evolution. Which leads me to worry about building an entire political theory around an abstract target of zero-growth. I think other goals make more sense and would achieve genuine sustainability far more effectively than attempting some global-scale bound.

But Krugman is way more dismissive than I think the issue deserves. Jorg Friedrichs' back of the envelope numbers did more to convince me of that than anything else recently. Assuming 3% per annum growth, he points out, would require the resource intensity of the economy by 2100 to be reduced by 95% if resource levels were to be kept steady. And that's not even stopping their through-put - it's just keeping them as they are now. Any model of McDonough-style cradle to cradle metabolism using the same material set is going to be harder still (but, ultimately, necessary).

Another aspect that worries me: abstract concern about growth vs degrowth as an armchair-philosophy pursuit is one thing. The reality of resource extraction globally is quite another - and it's not a pretty story. Many people are vulnerable to exploitation, even to simply being killed for others to get access to the resources (though nice to see, googling for that, turns out someone actually got prosecuted for murder).

I'm still generally much more sympathetic to Krugman's economics than ideas put forward under the steady-state banner, but I've also been to a few evenings put on by CASSE here at Leeds - they've bought many thought-provoking speakers in and (notwithstanding the obligatory Trot taking questions as an opportunity to proselytise) the conversations have been great brainfood. There's especially still a huge gulf between the understanding of the money system - and claims about what should be done - between degrowthies and orthodox economics. Degrowthies seem way too sure of their ideas on this - again, I'm only sniping from the sidelines, and it's great that the arguments are happening.

But yes - prompted to write because I would have liked a more in-depth look at Krugman's thoughts on this stuff. Instead, all we get is: `such people have no power, and therefore don't do any real harm.' Nice!