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Why the Economy Should Stop Growing—And Just Grow Up


Why the Economy Should Stop Growing—And Just Grow Up

David Korten

Listen to the political candidates as they put forward their economic solutions. You will hear a well-established and rarely challenged narrative. “We must grow the economy to produce jobs so people will have the money to grow their consumption, which will grow more jobs…” Grow. Grow. Grow.




See if you can read this simple line and LEARN something to offset your oft' repeated LIE that there's a magical line between the upper 50% and lower 50% as if the financial equation is a pie merely cut into two halves:

"The assets of the world’s 62 richest individuals equal those of the poorest half of humanity—3.6 billion people."


A well written article. However, economies, much like mathematics, do not respond well to emotional appeals. Economies produce full employment and alleviate suffering by growing. Shifting focus to rebuilding caring and place-based communities is a utopian dream. Solving resource limitations and gross income inequalities requires a better imagination and the heavy lifting of tax reform. Please put attention on the possible.


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As long as the human population continues to grow our economies are going to need to grow too.


Money on its own is meaningless, and thus so are the numbers.
WE put the values on things. and consequently the exchange system.



I thought she died due to anorexia?


What does Karen Carpenter's demise have to do with this article? The author is making a key point, that obsession with "growth" has become out of date and insane. Cancer is also growth. I can stop drinking 4 bottles of wine each day and change to drinking only 2. This would be "sustainable" alcoholism. GDP should be Gross Domestic Progress in cleaner air, better soil, better water, real affordable food, housing, good jobs, leisure time, worker health and safety, happiness and a better future for the children. We've only just begun to think this way. The author is right.


A "steady-state economy" or "zero-growth" is a situation where human needs are in balance with the resources needed to satisfy them. Such a society would already have decided on the most appropriate way to allocate resources to meet the needs of its members. This having been done, it would only need to go on repeating this continuously from production period to production period. Production would not be ever-increasing but would be stabilised at the level required to satisfy needs. All that would be produced would be products for consumption and the products needed to replace and repair the raw materials and instruments of production used up in producing these consumer goods. The point about such a situation is that there will no longer be any imperative need to develop productivity, i.e. to cut costs in the sense of using lesser resources; nor will there be the blind pressure to do so that is exerted under capitalism through the market. Technical research would continue and this would no doubt result in costs being able to be saved, but there would be no external pressure to do so or even any need to apply all new productivity enhancing techniques.

Since the needs of consumers are always needs for specific goods at a specific time in a specific locality, we will assume that socialist society would leave the initial assessment of likely needs to a delegate body under the control of the local community (other options are , of course , possible and feasible ).
In a stable society such as socialism, needs would most likely change relatively slowly. Hence it is reasonable to assume that an efficient system of stock control, registering what individuals actually chose to take under conditions of free access from local distribution centres over a given period, would enable the local distribution committee to estimate what the need for food, drink, clothes and household goods that would be required over a similar future period. Some needs would be able to be met locally: local transport, repairs and some food produce are examples as well as services such as libraries and refuse collection. The local distribution committee would then communicate needs that could not be met locally to the bodies charged with coordinating supplies to local communities.

The individual would have free access to the goods on the shelves of the local distribution centres; the local distribution centres free access to the goods they required to be always adequately stocked with what people needed; their suppliers free access to the goods they required from the factories which supplied them; industries and factories free access to the materials, equipment and energy they needed to produce their products; and so on. Production and distribution in socialism would thus be a question of organising a coordinated and more or less self-regulating system of linkages between users and suppliers, enabling resources and materials to flow smoothly from one productive unit to another, and ultimately to the final user, in response to information flowing in the opposite direction originating from final users. The productive system would thus be set in motion from the consumer end, as individuals and communities took steps to satisfy their self-defined needs. When introducing new products it is not necessary to start out producing millions of units. You make a few thousand prototypes with some form of consumer testing and feed-b ack and measure how rapidly consumers take them from the store. Whether it will be the individuals whose job is to develop new products (chemical engineers, mechanical engineers, etc.) who can decide on their own to submit the requisition for resources to the manufacturing line, or whether some degree of community endorsement is also needed, will be society's policy choice. It wouldn't be the workers' choice whether or not they want to make them.

Socialist production is self-adjusting production for use. It will be a self-regulating, decentralised inter-linked system to provide for a self-sustaining steady state society. And we can set out a possible way of achieving an eventual zero growth steady state society operating in a stable and ecologically benign way. This could be achieved in three main phases.

First, there would have to be urgent action to relieve the worst problems of food shortages, health care and housing which affect billions of people throughout the world.
Secondly, longer term action to construct means of production and infrastructures such as transport systems for the supply of permanent housing and durable consumption goods. These could be designed in line with conservation principles, which means they would be made to last for a long time, using materials that where possible could be re-cycled and would require minimum maintenance.
Thirdly, with these objectives achieved there could be an eventual fall in production, and society could move into a stable mode. This would achieve a rhythm of daily production in line with daily needs with no significant growth. On this basis, the world community could live in material well-being whilst looking after the planet.


Yeah, well the human population is about to hit an environmental brick wall and collapse. You can project all you want, but there is no way we can sustain the population we have now, let alone a projected 9 billion people. Also, why would ANYONE want to live in a World like that? We have two choices: A rational, radical attrition-based reduction in population over two generations; or, a horrible and violent disease and resource collapse-based population crash. Continuing on the current path is not an option.


So, you are saying that human populations can grow without limit? That human economic activity and environmental impact can grow without limit? Is this what Korten is wrong about? Are you saying that consumption is unrelated to economic growth? If so, it is no wonder that the whale spit you out (since you are still here writing weird stuff).

It is obvious that high levels of consumption drive the environmental impacts of economic growth. It is obvious that the arithmetic average for global human consumption can exceed the replenishment and absorption rates of environmental services for only a limited time. The logical consequence of these two statements is that the difference between the highest consuming people and populations and the lowest consuming people and populations must be within the same order of magnitude. Until that is understood and made true no one's "dribble at the mouth" will matter.


Maybe if we lived on a planet the size of Jupiter it might be possible.


An updated summary of Limits to Growth: http://www.unice.fr/sg/resources/docs/Meadows-limits_summary.pdf



I am sick of Governments, Federal, State, Local and worldwide, promoting “growth” as the only measure of success!

The measure they use GDP, “Gross Domestic Product” seems to be the only way they can think of to show they are doing a good or bad job during their period in office. Congratulations if GDP is bigger than the month or year before, “recession” if it does not “grow” for three consecutive quarters and “depression” if it actually goes backwards.

There is no doubt that “growth” fuels some businesses, just as increasing population creates the need for more accommodation, more services and hospitals to service them, more cars on the road and more roads to carry them. More fuel to power them, more carbon dioxide to contribute to global warming etc. etc!

GDP seems to me like a giant worldwide Ponzi Scam, where the economy and Government can only be funded by more and more growth, to support industries that have evolved to depend on growth for their sales. And whose tax paying employees then provide the money that runs the Government and the army of public servants needed to keep track. No wonder they start to panic when GDP stops growing. Just like Ponzi scams, when growth stops there is no way to pay the bills and the whole thing collapses.

In Bhutan the Government is judged on the basis of a happiness index. This is a measure of the level of prosperity and contentment of the population and is not concerned about the amount of growth or building or business conducted.
Maybe our Australian Government and other western democracies could learn from Bhutan and start focusing on the things that matter to the people they are supposed to represent. Work for all is a good objective; No time for leisure and no spare funds to enjoy it, is the reality. Housing for all is good, but families mortgaged to the maximum, working to pay for the house, with no time to spend with each other or the children is the reality.
Ian G Brisbane Australia


I get it; you just make it up and are rude to cover your lack of knowledge. That you misunderstand the deep basis of the Malthusian idea -- he was only working within the immediate examples available to him -- disqualifies you. As far as logic and philosophy of science I suspect that your limits have been reached.


Good post!

I finished reading a book a few weeks ago that goes into detail much of what you posted. It talks about participatory economics. I couldn't put the book down. I read it in two sittings.

Below is good article on the economics of a socialist society based on the principles of libertarian socialism/anarchism for the period after capitalism.



Anarcho of Beyond Socialism is most definitely on a similar wave-length and i have in the past exchanged comradely e-mails with him.

I'm aware of Robin Hahnel and his one-time collaborator Michael Albert but not read the book you recommend. I'll try and acquire it. (If it is online i'd appreciate the link).

I do have some serious issues with Parecon (although it may be more with Michael Alberts expositions of it) which briefly is that Parecon is attractive to those who dislike capitalism but it must be terribly deflating for a person to have devoted so much time and energy in creating an elaborate, complex, convoluted construct to offer an alternative to capitalism and then to have others declare that it was totally unnecessary and that the answers and solutions already existed and stood on firmer foundations.

Parecon projects on to socialism the insatiable consumerism of capitalism, paying no heed to the changes in social outlook that would occur when people's needs are met and people feel secure, when the world is no longer based upon dog-eat-dog that in distrust, where the ostentatious accumulation of material goods cannot validate an individual's personal worth or their status since access is unrestricted. Goods and services made freely available for individuals to take without requiring these individuals to offer something in direct exchange creates a sense of mutual obligations and the realisation of universal interdependency arising from this would change people’s perceptions and influence their behaviour in such a society.

In the final analysis, Parecon lack confidence that either there are sufficient resources on the planet to provide for all, or that human beings can work voluntarily, and co-operate to organise production & distribution of wealth without chaos, and consume wealth responsibly without some form of rationing . Pareconists remain fixated to the lazy person, greedy individual critique of human behaviour.


Assuming we could cope with the gravity of such a large mass of solid rock...........


ummmm....isn't Australia the Land of the Long White Holiday any more?

"and start focusing on the things that matter to the people they are supposed to represent"

And wasn't the present Australian Prime Minister the former CEO of Goldman-Sachs (Australia)? One should not be economical with the truth.