Degrowth Handbook - Part IV

I know I said I would dedicate this article to discussing the limits to growth, but as I was writing it became obvious that I have to embed economic growth in its historical context, and in the spirit of keeping these articles short to accommodate our 21-century attention span, I shall split this topic in two.

Economic growth is a concept that will be familiar to you, in our imaginaries and collective common senses it’s understood as, first and foremost, a good thing. We can define economic growth as the increase in the total production of goods and services in an economy over a given period of time. Goods and services can be pretty much anything that is traded- if you clean someone’s car and they pay you (a service), if you dig gold out of the ground and sell it to someone (a good), and so on. The time period we usually use to measure economic growth is quarters or years.

The way we have decided to measure economic growth and economies more generally is through GDP (gross domestic product). GDP is a monetary measure of total goods and services, so if you sell gold to someone for currency, that’s counted towards GDP, if you volunteer at your local homeless shelter, or take care of your neighbour’s child, that’s not counted, even though they’re services. Note that GDP includes every monetary exchange, so things like cleaning up an oil spill or buying missiles to send to Iraq are all included.

Economic growth seems to be pretty much beyond criticism, if you ever listen to politicians or corporations setting out their programs, they’re likely to mention that x will be good for economic growth, and the sentence will finish there. Economic growth is seen as both an end in itself and a panacea, a sort of cure-all. They say that a growing economy is “growing the pie”, or that “the rising tide lifts all boats”, implying that everyone benefits from a growing economy as there’s more stuff to share, even if some people sometimes get more than others. Economic growth is depicted as beneficial for so many reasons- in theory, more growth means more wealth, which means more wealth you can tax, which means more you can spend on hospitals, more growth means more jobs, and so on.

These two concepts of GDP and economic growth seem eternal, they are ...