Why Prosperity Without Growth Didn’t Work For Me

Reading Prosperity Without Growth – Tim Jackson’s highly praised discussion about achieving some variant of capitalism which doesn’t produce unsustainable resource consumption – took far too long. It’s not a complicated book and it’s not a long one, but the incoherency and general sense of futility it produces made the reading process longer that it should have been. The book has three main themes:

1)   Economic growth drives resource consumption and causes carbon emissions. These cannot readily be de-coupled. This poses a problem because our resources are finite and global warming will destroy us. So far so good.

2)  The notion that consumption driven economies don’t improve our happiness, as informed by recent literature on inequality and the social scientists who argue that values like affinity, community life, meaningful work and self-acceptance make us happier. Again, I don’t disagree.

3)   Therefore, following some sort of unexplored change in general opinion, we are to collectively pursue a macro-economic system that functions that doesn’t pursue consumption or growth. Here is where things start to get shaky.

The problem isn’t that Jackson is wrong, but that his worldview doesn’t really make room for power, competing interests or history. Since I don’t think it’s that worthwhile going through the book chapter by chapter – towards the end the structure seems to breakdown and become quite repetitive repetitive anyway – I’m just going to briefly look at the two main flaws in the book: the absence of power and the indivisibility of capitalism and growth.

Let’s do growth first. When, on page 197, Jackson brings up the question I’d been waiting for (is this no growth model really capitlalism?) he doesn’t really answer it. First there is a discussion about how the constraints of ecology will limit growth potential, but then makes the confusing observation that:

“Turning now to the question of capitalism, we have to settle on a useable definition of the term. Not easy in the first place. But let’s start with Baumol’s assumption that capitalistic economies are those where ownership and control for the means of production lies in private hands, rather than with the state.” (200)

Leaving out technical questions about the distinction between ownership and control, between private and state-based, what’s frustrating here is that this is as theoretical as the book gets. In fact, later on Jackson tells us that, ultimately, the question of whether something is capitalism doesn’t really matter.

This is a problem simply because a mislabelling of capitalism is lethal for any useful analysis of growth and it’s alternatives. The capital of capitalism, more than anything else, is the use of money to generate more money. For a more articulate way of putting it, here’s David Harvey:

“There is a big difference between the circulation of money as a mediator of commodity exchange and money used as capital. Not all money is capital. A monetized society is not necessarily a capitalist society. If everything revolved around the C-M-C circulation process then money would be merely a mediator, nothing more. Capital emerges when money is put into circulation in order to get more money.” [A Companion to Marx’s Capital pp. 76]

Unless money can yield more money – what’s called profit – as it’s final result, there is no sense in investment for the capitalist, or indeed anyone with a lot of money lying around. Indeed, it was the desire to enhance the speed of this process – financial gambling yielding far higher returns than, say, investing in a car factory over the long term – that drove the move towards a largely financialized economy.

I don’t understand how you can have profits without that new money generated through successful capitalism in turn creating more demand (and it’s really rich people’s consumption, far more than population, that is putting pressure on resources) and generating more growth. Indeed, profit, along with interest and inflation are not really explored, despite being the main engines of growth.

The other problem is that power is nowhere in this book, along with history. So while the financial collapse of 2008 is name-checked and brought in to serve as a bogeyman for capitalism can fail, it is virtually alone as a point of real-world reference. There is nothing about the coagulation of the power of the elite, the immense wealth owned by the few, and nothing about the repeated acts of violence and oppression committed to protect ‘strategic resources’. This is crucial because it deprives the conflict here – between humanity and growth – essentially one of people versus ideas, and something we simply need to overcome in debates. The fact that there are real agents of capital, the same people who threaten disinvestment at even the slightest tremor of courage among the population, is largely ignored. Similarly, how investment is to be decided with anything more that an apolitical technocracy, is not really explored. There is certainly a ‘we’ in here, but I didn’t feel like it included me.

We need – and are in the process of developing – real alternatives to the current system. I feel like Jackson has the right sense of urgency about the environmental issues which have not been a major part of the 99% discourse from what I can tell. However, while there are plenty of nice ideas in here, like shortening the working day, more employee organized business, less advertising and so on, I feel like it misses the inherent conflict between the needs of the population which he rightly identifies, with the prerogatives of the extremely wealthy. The book is a plea for a ‘revolution without a revolution’ in all its well-meaning indignation.

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  1. #1 by Tom Shackell on August 8, 2012 - 7:23 pm

    Yes, I think this is a very central question: does capitalism require growth to function?

    If the answer to this question is “yes it does”, then clearly it isn’t sensible to argue for a no-growth capitalism (as Tim Jackson does).

    Capitalism in it’s current configuration certainly does seem to require growth, we only need to look at recent events to see that a non-growing capitalism is not a well-functioning system. What features of modern day capitalism give rise to this behaviour? How much of the system would we need to change to make a no-growth capitalism? Is the need for growth actually inherent in the structure of any system of capitalism? These questions are fundamental I believe.

    Sadly this issue is very rarely discussed, and yet it seems to me that it couldn’t possibly be more important. One of the rare articles that really does look at this question in depth is by Richard Smith.

    http://www.paecon.net/PAEReview/issue53/Smith53.pdf

    Which is well worth a read if you haven’t found it yet. I wouldn’t say I necessarily agree entirely with his perspective, but it’s certainly thought provoking.

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