The false promise of growth-led development
It’s time economic planners and the global elite radically change their modus operandi
A representational image showing people walking at a subway in UK. PHOTO: REUTERS
Despite another UN summit in Madrid on tackling climate change, addressing the true scale of the current environmental crisis needs a much more radical shift. Boosting economic growth, which has been the main objective of development for the past 70 years, must be revised. It’s about time we acknowledge that using growth to address deprivation is simply not working, and that it will not work in the future either. To make the world a better place for everyone, we need to look beyond the false promises of economic growth.
The global economy continues growing exponentially, but the trickle-down effect which is the primary mechanism through which the benefits of growth are supposed to reach the masses, is not working. Yet, orthodox economists insist that all the world needs is yet more growth.
In 1970, an international team of researchers at MIT began a study of the implications of continued worldwide growth, and pointed out in their seminal book, The Limits to Growth, that the idea of exponential economic growth was simply unsustainable. Now, most scientists agree that we have exploited the Earth’s finite resources with reckless abandon, overstretched our planet’s total bio-capacity, and that the adverse implications of our prevailing growth obsessed economic models are no longer tenable.
For years, economic pundits have tried to deflect attempts to rethink who gets what share of the “pie” by promising to increase the overall size of the pie, so that everyone can get a bigger slice. Now, continuing to pursue economic growth at all costs is no longer an option. Overconsumption by the haves has put our combined future, and that of our planet, at severe risk. Even the current levels of average global consumption are no longer tenable.
Thus, instead of pushing developing countries and the poor to “catch up”, it’s time to slow down and using redistributive means to address deprivation. Yet, more “radical” possibilities of reducing global consumption, and helping developing countries meet their vast unmet needs in ways which are more equitable and less polluting, have also not got the endorsement and financial commitment they require. Progressive elements calling for more public support for the poor funded by greater taxation of the rich remain marginalised. Instead, populists blame outsiders, and the “others” within their own midst, for the frustrations of the working class, who continue gaining traction in rich and poorer countries alike.
It’s time economic planners and the global elite radically change their modus operandi. The potential of technological fixes and glib market-based strategies to keep pursuing elite-led growth which is more sustainable and equitable at the same time is limited at best. It’s time the World Bank and other big donor agencies realise the limitations of market and profit driven mechanisms to achieve human development. Unfortunately, the UN’s much-touted Sustainable Development Goals (SDG) do not provide an adequate answer, because they are not allowed to challenge dominant economic interests. Despite the rhetoric of “inclusive” and “sustainable” growth, UN agencies are increasingly aligned with big business interests, and thus reluctant to threaten the interests of the global elites.
One is not calling for another failed Bolshevik Revolution here. But business as usual cannot work either. Prominent international donors need to stop funding environmentally damaging “development” projects. Bolder attempts such as banning internal combustion engines, drastically scaling up public transport, abandoning fossil fuels (despite their strong lobbies), and even changing our diets and agricultural production patterns, need more serious attention.
Decision makers and planners in the so called “developing” and “developed” countries must abandon their obsession with production driven and consumption enhancing economic strategies to eradicate poverty. Or else, many of the recent gains against poverty will be lost, and the world will become an increasingly dangerous and unstable place.
Published in The Express Tribune, January 3rd, 2020.
The global economy continues growing exponentially, but the trickle-down effect which is the primary mechanism through which the benefits of growth are supposed to reach the masses, is not working. Yet, orthodox economists insist that all the world needs is yet more growth.
In 1970, an international team of researchers at MIT began a study of the implications of continued worldwide growth, and pointed out in their seminal book, The Limits to Growth, that the idea of exponential economic growth was simply unsustainable. Now, most scientists agree that we have exploited the Earth’s finite resources with reckless abandon, overstretched our planet’s total bio-capacity, and that the adverse implications of our prevailing growth obsessed economic models are no longer tenable.
For years, economic pundits have tried to deflect attempts to rethink who gets what share of the “pie” by promising to increase the overall size of the pie, so that everyone can get a bigger slice. Now, continuing to pursue economic growth at all costs is no longer an option. Overconsumption by the haves has put our combined future, and that of our planet, at severe risk. Even the current levels of average global consumption are no longer tenable.
Thus, instead of pushing developing countries and the poor to “catch up”, it’s time to slow down and using redistributive means to address deprivation. Yet, more “radical” possibilities of reducing global consumption, and helping developing countries meet their vast unmet needs in ways which are more equitable and less polluting, have also not got the endorsement and financial commitment they require. Progressive elements calling for more public support for the poor funded by greater taxation of the rich remain marginalised. Instead, populists blame outsiders, and the “others” within their own midst, for the frustrations of the working class, who continue gaining traction in rich and poorer countries alike.
It’s time economic planners and the global elite radically change their modus operandi. The potential of technological fixes and glib market-based strategies to keep pursuing elite-led growth which is more sustainable and equitable at the same time is limited at best. It’s time the World Bank and other big donor agencies realise the limitations of market and profit driven mechanisms to achieve human development. Unfortunately, the UN’s much-touted Sustainable Development Goals (SDG) do not provide an adequate answer, because they are not allowed to challenge dominant economic interests. Despite the rhetoric of “inclusive” and “sustainable” growth, UN agencies are increasingly aligned with big business interests, and thus reluctant to threaten the interests of the global elites.
One is not calling for another failed Bolshevik Revolution here. But business as usual cannot work either. Prominent international donors need to stop funding environmentally damaging “development” projects. Bolder attempts such as banning internal combustion engines, drastically scaling up public transport, abandoning fossil fuels (despite their strong lobbies), and even changing our diets and agricultural production patterns, need more serious attention.
Decision makers and planners in the so called “developing” and “developed” countries must abandon their obsession with production driven and consumption enhancing economic strategies to eradicate poverty. Or else, many of the recent gains against poverty will be lost, and the world will become an increasingly dangerous and unstable place.
Published in The Express Tribune, January 3rd, 2020.