Over at dotcommonweal, I have posted a lengthy discussion of Fred Hirsch’s The Social Limits to Growth, and the light that this 1970’s overlooked classic sheds on our acute problems of poverty and inequality.
Our problem now is that “more of the same solution” won’t work… and we are very reluctant to understand and acknowledge this. Why won’t it work? The best explanation of this problem still lies in a prescient book from the mid-1970’s by economist Fred Hirsch, called The Social Limits to Growth. As opposed to the rising popularity of what became “Reaganomics,” Hirsch’s book provides a different and very sophisticated two-pronged critique of the possibility of sustaining the “economic growth for all” Keynesian model that predominated in the post-WW2 situation. These two prongs are the “social limits to growth” – that is, limits on the extent to which economic growth powered by individual self-interest produces collective well-being.
Read the whole thing here.
Thanks for this great overview, David. Tonight I heard Juliet Schlor speak on her new book, True Wealth, which also deals with the limits of growth. Instead of a growth solution, she encourages “Plentitude,” by which she means:
1. Using increases in productivity to decrease our hours at work, which would give us more time, lower unemployment, and result in less damage to the planet.
2. New ways of consuming (the Sharing Economy).
3. High Tech Self-Provisioning (using modern knowledge and technology to grow food, build homes, manufacture things, etc.).
4. Community Economics (investing in cooperatives).
To move beyond advocating more redistribution, we need to listen to economists like these.
Julie – I agree with you and her 4 points are great…the problem is this doesn’t move beyond advocating more redistribution. In order for increased productivity to lead to decreased hours that requires redistribution and a change in the profit sharing structure. We have witnessed drastic increases in productivity and efficiency in the last 40 years with stagnate wages and increasing hours, not decreasing hours required to survive as a family.
David -Thank you for your piece over at commonweal. It is a book i would like to read…Getting from the status quo to what is envisioned by both, I wonder if either take on the idea of “bad wealth” and a critical evaluation of “wealth creation?” (Something my dad’s written a little about in a book called Rediscovering Abundance….
i also think there are some good examples of community economics in Spain that would be interesting to see tried in the USA.
Meghan,
This was actually the question I wanted to ask Schor, but I didn’t have a chance: To what extent is her solution dependent on government or corporate action? She is definitely critical of inequality and spent a lot of time showing the increasing concentration of wealth and arguing that this was detrimental in all kinds of ways. I have just ordered the book, so I’m not completely sure, but I think she places more hope in what people are doing at the grassroots, both by living in more sustainable ways and by investing and sharing in ways that help others.
Lots of Catholic Workers were there to hear her, and I’m guessing that they found proposed solutions encouraging. I don’t think this rules out advocating for higher wages and salaries, but it might shift the focus away from growth. And her model seems more appreciative of what modern knowledge and technology have to offer than say, Wendell Berry (much as I appreciate his work).
The three of us need to get together and do a panel/article/book on this. Schor and Robert Frank (of Cornell – see his excellent book on inequality that elaborates some of Hirsch’s points – it’s called Falling Behind) are both excellent examples of what I might call “post-Keynesian” critics of capitalism. But (as you can see on the commonweal thread), it’s pretty easy for these debates to fall right back into the old patterns.
Schor, Frank, McKibben, Hirsch, Christopher Lasch, some Catholic distributists like John Medaille… and I would argue BXVI in Caritas in Veritate… are all arguing for some kind of alternative economy oriented to basic needs in dignified and sustainable ways (Schor’s #2 and #4), where good work and ownership – while not “primitive” in the Wendell Berry sense – are certainly more scaled back (a la E.F. Schumacher).
I think the question here is not so much government action or not, but what government action? The post-Keynesians are all talking long-term here – that there needs to be a long-term shift away from the dominant economic structures of 1945-present. The question is what government policies promote these “durable” structures, especially in making them more accessible to lower-income populations, rather than boutique practices of those with ample economic resources. I stress that, even as practices of the wealthy, these practices are beneficial because they contribute to workers/work that is more dignified and communal – it’s better for me to shop at the co-op than the safeway or the target, as it’s better for me to buy foods produced by my neighboring farmers. That is, it’s better for the co-op workers and the farmers, too. The question is: what government action (or inaction) would support these structures?
The fact is, the more I study economics, the more I realize that the main actors are the corporations and the consumers. Basic government “floors” for economic security and regulation are essential, but we need virtuous corporations and virtuous consumers to make these changes work. The Germans have all three. They may have their own problems, but the Germans (like the other successful European states) do not only have government programs and structures imposed on unwilling corporations and tax-hating consumers. They have government programs that are facilitated by corporations who act like citizens and are governed by multiple-stakeholder boards (not just shareholders) AND they have a much more developed sense of willingness to sacrifice personal consumption in favor of social goods (and time).
Meghan – I quote that chapter multiple times in my book… it is great!
Or, if you want to know what the conservative version of post-Keynesian growth looks like, try this: http://www.nytimes.com/2013/10/07/opinion/when-wealth-disappears.html?pagewanted=all