By Adam Stromme
At the Detroit economic conference back in February, then-presumptive presidential candidate Jeb Bush reassured his audience that– if, hypothetically, he was to run– his policy was “growth above all else.” To drive home exactly what kind of growth he was talking about, he set down a plank of his not-campaign right then and there, promising four percent economic growth under a Bush III administration. Other candidates, such as Marco Rubio, Ted Cruz, and even Rand Paul have been backed by the notoriously partisan “Club for Growth.” It seemed no matter where you turned in political discourse today, the world was going to end unless the amount of things consumed by all people (as measured by Gross Domestic Product, or GDP) increases.
Indeed, perhaps more so than any other issue, the subject of “economic growth” has become a fount of platitude in politics today. It is the golden assumption for the well being of Americans. Thus every candidate needs to assure Americans that they plan to help “grow the economy”, “create jobs”, or perform some other form of magic trick to make people happy. Avoiding specifics at any and all cost, what instead replaces substantive discussion and argument is a familiar blend of sentences mixing in the words “strong”, “national competitiveness”, “creating opportunity”, presumably for “small businesses” and, if the fountains of platitudes were being truly honest with themselves, they might as well just say they would take us back to “the good old days.”
It seemed no matter where you turned in political discourse today, the world was going to end unless the amount of things consumed by all people (as measured by Gross Domestic Product, or GDP) increases
But the economy, while certainly not perfect, has been growing over the course of the last couple of years, yet we have noticed a remarkable lack of progress in terms of numerous indicators. Even by its own right, household wealth has effectively stagnated in the United States for the vast majority of the population, job insecurity has become built into our economic system, and a flatly inadequate health care system continues to leave Americans vulnerable despite the fact that we spend almost a fifth of all income in the sector. In short, preaching for economic growth in and of itself does little but for those who are invested in making returns on that growth.
While austerity– or fiscal responsibility, as it is popularly yet nonsensically called– continues to be the cornerstone of political ideology, America is looking at a jobs gap in excess of 11 million, an infrastructure in shambles, and lending and interest rates so low that the United States government would effectively be being paid money to take out loans. Even from the conventional narrative’s standpoint, we are looking at perhaps the most obvious and straightforward remedies for our own economic woes in history, and yet orthodoxy is desperately trying to convince us to look somewhere else, away from the evils of big government.
Preaching for economic growth in and of itself does little but for those who are literally invested in seeing the benefit of that growth
Whatever your views on government intervention in the economy, there is nothing “fiscally responsible” about refusing to use the government for what it was intended for. The obsession of the Right, and the establishment Left to a lesser extent, with making the public sphere smaller and converting everything else into something capable of fulfilling the profit motive is having an asphyxiating effect on public discourse. What one could reasonably conclude is that such fetishization of economic growth exclusively allows for no nuance in explaining complicated issues, no relativization or prioritization, and has ripple effects in all aspects of society that inevitably begin to leak into the omnipotent “economic sphere” one way or another.
This is a conventional criticism– and it is perfectly valid in and of itself. But there is another. While easily branded as radical, what further analysis lends itself to is that it is actually far more holistic than the conventional narrative, and it comes in two parts.
The first part asks us to challenge how we analyze economic issues to begin with. A classic example of this is the “Gross National Happiness” index used by the small forest kingdom of Bhutan. Although it may seem absurd– as, indeed, all things which are new or novel to us are– it is worth noting that polling people about their welfare and prioritizing needs accordingly is a far more general measure of progress than merely measuring the amount of money in their bank accounts on an annual basis.
While austerity– or fiscal responsibility, as it is popularly yet nonsensically called– continues to be the cornerstone of political ideology…we are looking at perhaps the most obvious and straightforward remedies for our own economic woes in history
This is but one example. Other more statistically friendly but wider scoped ways of measuring progress include comparing depression rates or other adverse effects on well being, life expectancy, or holistic measures like the recently developed Social Progress Index— a powerful tool developed by the Social Progress Initiative and Harvard Business School.
Once we recognize the limited nature of the conventional means of measuring happiness and well being, the second part comes naturally. It asks us to challenge the imperative of economic issues entirely. How important is money and the consumption it enables above other sources of happiness? Why does it form the cornerstone of our approach to economics? Psychology suggests, not very. The Easterlin paradox suggests that at thresholds as low as $75,000, monetary income becomes dramatically less important for individuals than far less quantifiably friendly factors such as health, stability, and a sense of belonging.
But how would we go about analyzing and, more importantly, acting in such a way that fulfills these otherwise squishy and seemingly ill defined measures of happiness? The answer is not nearly as daunting as it seems. One of the most thought provoking economists you’ve never heard of has already written widely on the topic, and it is worth the read precisely because it is accessible to the economist, the lay economist, and people who want nothing to do with conventional economics.
The best place to start is here, and while a summary of his main points is below, there is truly no substitute with grappling with his work directly.
His name is Manfred Max-Neef, a Chilean born economist famous in academic circles for pioneering the concept of “Barefoot Economics,” or surveying economic circumstances by way of a direct experience with the people and culture. Having worked in the slums of numerous countries, Max-Neef, a developmental economist, said he was inspired to investigate the deficiencies of economics when face to face with destitution and poverty:
“I was standing in the slum, across me was another guy… a short guy, thin, hungry… and suddenly I realized I had nothing coherent to say to that man in those circumstances. That my whole language as an economist was absolutely useless. Should I tell him that he should be happy because GDP had grown five percent? Its absolutely absurd!”
Inspired by his experiences, Max-Neef laid out five parameters for promoting the social welfare, and one value principle. They are as follows: Postulate one: “The economy is to serve the people, and not the people to serve the economy.” Postulate two: “Development is about people and not about objects”. Postulate three: “Growth is not the same as development, and development does not necessarily require growth.” Postulate four: “No economy is possible in the absence of eco-system services.” Postulate five: “The economy is a sub-system of a larger and finite system, the biosphere, hence permanent growth is impossible.”And his value judgement, pure and simple: “No economic interest, under any circumstance, can be above the reverence for life.”
If one becomes tempted to relativize Max-Neef’s findings in the context of the conventional narrative, they swiftly find that it is almost impossible. We already know that the first maxim is nigh impossible so long as people have no autonomy in the workplace. The second principle, while certainly capable of having its progress measured by conventional tools, otherwise by definition rejects the primacy of virtually all conventional indicators of economic growth, from GDP, to gross national product (GNP) to foreign direct investment (FDI) and beyond. The third indicator is something one would think of as being obvious, yet we would be hard pressed to find a single candidate, even Bernie Sanders, who would subscribe to it without reservation. The fourth and fifth, together, are anathema to the Republican party, despite the terrifying repercussions of ignoring the former and the mathematical certainty of the latter.
And yet, even as we recognize the patent insufficiency of the conventional narrative, the vapid shrieks for more growth– effectively equating human welfare with the imperative of a cancer– and the like, one cannot help but ignore the final consequence:
What then of the value principle?