In the years leading up to the financial crisis of 2008, there was a small but vocal movement calling for GDP to be “dethroned” as a policy objective and for a “steady state economy”, i.e. zero growth. Britain’s relatively successful economy between 1993 and 2007 made some people so complacent that they openly embraced the coming recession. When the Great Recession failed to “purge our coarsened souls” — as one journalist hoped it would – growth-scepticism became less fashionable. Even the New Economics Foundation, a think tank that had been the standard bearer for a steady state economy in the 2000s, seems to have given up on the idea. 

But it never disappeared and it appeals to too many of the instincts of wealthy anti-capitalists to ever go away entirely. You can see it in the Bloomsbury Group’s abhorrence of mass consumption and in J. K. Galbraith’s distaste for advertising. You can see it in the romanticisation of pre-industrial society that is implicit in Marx and explicit among many environmentalists. And there will always be people who simply like the idea of only having to work 21 hours a week or being paid to do nothing.

The anti-GDP movement rests on several mistaken beliefs

The anti-GDP movement rests on several mistaken beliefs, such as the peculiar idea that the British government is gripped by an urge to grow the economy at all costs. If this were remotely true, it would have repealed the Town and Country Planning Act and it would not be attempting to deindustrialise the entire economy, nor would it be regulating everything from the straws in drinks to the sale of cats. Anti-growthers also rely on the conceit that GDP is something the government can turn off and on like a tap, rather than being the result of millions of people striving and innovating.

It is under the guise of environmentalism that the anti-growth ideology is most often promoted today. For eco-mentalists, the aim is not just zero growth but degrowth. Wrongly assuming that economic growth is incompatible with tackling climate change, they want economies to produce less. This is a fringe view and it would lead to appalling consequences if acted upon, so it was a little worrying to see it recently espoused in one of the world’s most prestigious scientific journals. Last month, Nature published an article titled “Degrowth can work — here’s how science can help”, written by eight academics including Jason Hickel who believes that mankind existed in a state of plenty until capitalism came along and that the phenomenal reduction in global poverty since 1980 hasn’t actually happened. These people have been given €10 million by the European Research Council for a project “that will study how to escape from a growth economy”.

Economists already have a word for degrowth. That word is “recession” and it is something we try to avoid because it makes people poor and miserable and creates unrest. Hickel et al. acknowledge that recessions are “chaotic and socially destabilizing”, but claim that degrowth will be different because it “is a purposeful strategy to stabilize economies and achieve social and ecological goals”. The strategy, such as it is, involves “scaling down” various large industries, including “fossil fuels, mass-produced meat and dairy, fast fashion, advertising, cars and aviation”. Aside from a few sin taxes here and there, it is not clear how this will be achieved. Even if the production of these goods could be suppressed, wouldn’t consumers switch to other goods, thereby increasing production elsewhere in the economy? Perhaps a few more million euros from the European Research Council will help iron out these details. 

Meanwhile, they want to introduce a four-day working week, lower the retirement age and “ensure universal access to high-quality health care, education, housing, transportation, Internet, renewable energy and nutritious food”. They also promise to “end unemployment” by putting millions of people to work “installing renewables, insulating buildings, regenerating ecosystems and improving social care”, presumably by force in some instances.

This all sounds very expensive and the cost will fall on governments that will be generating less tax revenue as a result of the economy shrinking. The authors suggest new taxes on aviation and meat, but those are hardly going to make up the shortfall. Nor will wealth taxes, which typically generate trivial sums of money while encouraging capital flight. To their credit, they accept that “Economies today depend on growth in several ways. Welfare is often funded by tax revenues. Private pension providers rely on stock-market growth for financial returns.” This is very true, so how to square the circle?

Governments that issue their own currency can use this power to finance social and ecological objectives.

Modern monetary theory klaxon! They want central banks to print money to pay for nice things that would otherwise be paid for by the proceeds of growth. But wouldn’t that create inflation — just like it did in 2021-22 — especially since the money supply would be growing at the same time as productivity was falling? A classic case of too much money chasing too few goods? Well, yes, but the degrowth experts have already thought of that and advise that “inflationary risks must be managed”. They don’t say how this is to be achieved except that “earmarking currency for public services reduces cost-of-living inflation.” I have no idea what that is supposed to mean, but it sounds like nonsense.

The other problem with central banks printing money and lending it to the government is that the government ends up with a big pile of debt which is hard enough to pay back when the economy is doing well, let alone when the economy is being deliberately suffocated. The authors acknowledge that this is a “risk”, but offer the following soothing words: “Research suggests that managing this risk requires careful coordination of fiscal policy (how much governments tax and spend) and monetary policy (how price stability is maintained).” This is disconcertingly vague.

A question the authors never ask is whether people actually want degrowth

A question the authors never ask is whether people actually want degrowth. A four-day week seems tempting until you see your wages fall by a fifth. Hickel et al. insist that “recent evidence” shows that workers on a four-day week “can maintain productivity by reorganizing their work”. This is doubtful and there are many workers, such as doctors, postmen and train drivers, for whom it is obviously untrue, but where would it fit into a degrowth strategy if it were true? Isn’t the whole point to make people less productive? 

An extra day off work sounds appealing, but the authors give the strong impression  that people should use it to grow vegetables and darn socks, and they are concerned that they might use it to enjoy themselves instead. “More travel or shopping during free time could increase emissions”, they warn. Fortunately, there is a solution because “these effects could be mitigated if production in problem sectors is scaled down.” The list of “problem sectors” presumably includes shops, pubs, butchers and motor dealers. An explanation of how they are to be scaled down is, again, missing.

I think even the authors would admit that their vision for the future is not fully developed. They don’t even explain “how science can help” (a cynic might say that they only put that in the title so the article could be crowbarred into a scientific journal). They conclude with a call for citizen’s assemblies and greater involvement from the United Nations, which is what activists usually do when they have run out of steam and need someone else to do the heavy lifting. They do, however, have one firm recommendation: “Research on degrowth and ecological economics needs more funding, to increase capacity to address necessary questions.” The rest of us might have to tighten our belt, but there must be no austerity in left-wing academia. Deep dig, taxpayers!