Why ‘green growth’ is an oxymoron: Brian Czech of CASSE

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Posted Jul 26 2020 by Brian Czech of CASSE
Brian Czech of CASSE : why green growth is an oxymoron

This is part 2 of an interview with Brian Czech (part 1 is here), the president of CASSE (Centre for the Advancement of the Steady State Economy). He served in the U.S. Fish and Wildlife Service from 1999-2017, and as a visiting professor of natural resource economics in Virginia Tech’s National Capitol Region. He is the author of Supply Shock, Shoveling Fuel for a Runaway Train, and The Endangered Species Act: History, Conservation Biology, and Public Policy, as well as over 50 academic journal articles.

I read your article criticising the circular economy. I agree. When you look at the PACE website (Platform for Accelerating the Circular Economy), it’s endorsed by major multinationals like Procter & Gamble, Shell, Nissan, Unilever etc. Now they all want to maximise profits, and all support economic growth. Plus they seem to have forgotten that recycling takes energy – and even renewable energy needs factories producing solar panels, and trucks to deliver them, and mines for the materials. Plus that we can never recycle 100% of any material – some is always lost. So – recycling and circular economy – sure, as long as we don’t think it can magically mean that we can have a perpetually growing economy.

Yes. As I pointed out in the article, we can strive for circular flows here and there, but if we think about the economy in the aggregate, I call it the triangular economy, because at the broad base are the agricultural, extractive and energy pursuits that allow all the rest of the economy to happen. Nothing else in the economy exists without the primary extraction of agriculture, mining, fishing, forestry etc. There’s not much circularity there. In pockets, yes, but in terms of the overall economy, it’s misguided.

Because we operate in green circles, we hear a lot about sustainable growth, or green growth, and it drives me insane – it’s such an oxymoron. Have you come across Jason Hickel?

We’ve seen reference to his work. He writes about degrowth issues.

He’s doing some great work on why there’s no such thing as green growth or sustainable growth. If you google him, he writes about studies that have shown that ‘decoupling’ of GDP growth and resource use has never happened, and in fact can’t happen. He’s very good. We passed the 100 billion tonnes mark for annual global extraction of raw resources from nature – like minerals, timer, fish etc. Only a few years ago, we were trying to keep it under 50 billion tonnes – as that was what was considered the limit for sustainability. People are struggling to work out what to do about it, and I just ask ‘why are you surprised – if global GDP keeps rising, there’s no way to keep resource extraction under any kind of limit – it will keep growing’.

Yes, that goes back to the ‘triangular economy, with the trophic base. If you want GDP growth, you have to keep increasing that base, to provide the resources for the rest of the economy, including research and development. That expanding base means increasing environmental impact and deterioration of the planetary ecosystem.

I came across this ‘decoupling’ idea about 20 years ago, when I applied for govt. funding. They provided info that said the UK had decoupled nitrous oxide and sulphur dioxide emissions from GDP growth, and now they were going for carbon. They linked to a study – so I looked into it, and they didn’t include the emissions from goods that we consume that aren’t made in this country – which is almost everything. So we’ve exported the emissions, we haven’t stopped them. It’s our demand that’s causing the emissions. plus they didn’t include emissions from flights or cargo ships into and out of the country.

That sounds like a pathetic study.

So green growth is impossible – and yet it’s an important part of the UN’s Sustainable Development Goals. Lots of greenies support that – but one of the goals is economic growth.

Going back to your previous question about how difficult it is to get this concept across, recognising that the UN champions this notion of green growth. We’re swimming against the current of political economy, but we are making progress. Ban Ki Moon came very close to signing the CASSE position on economic growth. About 2 months ago at the National Geographic Auditorium.

What stopped him?

His entourage. His bodyguards wanted him to move more quickly. But he gave a nice response in the open forum after his talk. He basically agreed with our position. We do have big political players who get it, but they’re also in that current, that river of political economy, and so they’re stuck, and they will be for a while.

And have you come across Jevons’ Paradox?

Yes. That’s a nice explanation. It’s more than a metaphor. What Jevons said about coal applies macroeconomically as well. He said that efficiency in the use of a resource never actually reduces the use of that resource – it always does the opposite, because it becomes cheaper to use.

I was surprised when I first came across this paradox – because it doesn’t seem to make sense when you first hear it. If there’s a new technology that can produce the same results with fewer resources, instead of reducing the use of that resource, it will increase it. James Watt’s engine was Jevons’s example. It used far less coal to do the same amount of work as previously, with Newcomen’s engine, and so they assumed that this would save coal. The opposite happened of course, because steam engines boosted the economy. Resource efficiency only reduces the amount of resources used if the economy doesn’t grow.

Jevons’ Paradox is not paradoxical to us, or to the broader community working in ecological macroeconomics. It takes heavy investment just to raise the bar a little more, because all the easily-available natural capital has been liquidated a long time ago. To provide the funds for that investment, more activity is required at the base of the economy, which causes ecological damage.

So the CEOs of large corporations would be ousted if they didn’t maximise returns to shareholders. So how can we even talk to corporate executives about not constantly trying to grow their companies? Why would they listen?

I’ll use the American example, which would be the least likely place to find a solution to this problem. Our government operates pursuant to a constitution. We’ve looked at the US constitution carefully, and we feel that it’s conducive to a steady-state economy. The emphasis of the constitution by the Founding Fathers is not capitalism, it’s democracy. We need good, strong policies enacted through their public officials, to put a cap on energy consumption. Corporations will still strive to maximise returns to shareholders, but it’s a bit like a salary cap in a sports league. It makes the league more competitive, and as capitalists have supported competition for a long time, then great – let’s have that competition, but with a cap on consumption.

It’s interesting about capitalism. For me, capital accumulation and debt-based money, with interest attached, guarantee growth; but if you removed those things, you wouldn’t have capitalism any more. I always think in terms of post-capitalism – a new kind of economy that isn’t based on capital accumulation or debt-based money. I can’t see how capitalism as a system can stabilise.

That’s fine by me – but we do have to realise behind this term capitalism, with its technics and its history, there’s a tremendous amount of semantics. Words have different meanings to different people, and I think the word capitalism is the king in that respect – there are so many permutations and connotations.

A lot of people think that if you’re talking about a new economy that isn’t capitalism, then it must be communism, as if there are no other alternatives. A group of us are trying to build a mutual credit network – a moneyless trading system, that doesn’t allow large accumulations of wealth, and doesn’t involve interest. So it could form the basis of a steady-state economy. But it’s not at all communist – it doesn’t involve any state control, and it’s a freer market than capitalism. But still, a lot of people see you as a Stalinist if you question capitalism.

That is frustrating and ridiculous. I sometimes think that’s part of the PR campaign of Wall St. – to build a straw man of those of us concerned about sustainability, and to label us communist. In the US you get labelled a socialist, and I guess in Europe, where there is a lot of socialist history, you get labelled a communist.

Anyway, the old communist countries, and China now, are just as committed and actually more successful at creating growth than capitalist countries. So obviously a steady-stater is not going to be in favour of communism.

Absolutely. And people forget about the Cold War. It was a race in which the score was kept with GDP. And as I said, I think the US constitution is perfectly suited to host a steady-state economy, and would be very useful in international diplomacy for steady-state economics.

What are your ambitions?

On the legislative front, we’re pushing for a ‘Full and Sustainable Employment Act’ in the US. The central economic policy of the US is the Employment Act of 1946. There weren’t any major amendments until 1978, and there haven’t been any since. But in 1978, Congress in its wisdom, got the Fed involved in the growth game – got the US government pushing formally for GDP growth. So we want to reverse that. So it’s clear that with the new title, the Full and Sustainable Employment Act, the central policy would be the long-term goal of a steady-state economy.

What are the next steps towards that? What’s top of your agenda at the moment?

We have a zillion different projects going on, but Covid has taken over for a while, and that has us writing, thinking about the right kind of messaging etc. But the Full and Sustainable Employment Act is our long-term priority. We’re not going to get it passed in this congress, or the next. We’re looking at 15-20 years down the road. A lot of the environment will be gone by then, and a lot of jobs permanently lost, because the environmental base needed to support those jobs will be gone. But it’s better late than never.

Internationally, we have in mind a Convention on Economic Sustainability. This would kick off steady-statesmanship globally. This would come out of the Full and Sustainable Employment Act, in the same way that CITES, The Convention on Trade in Endangered Species, came out of the Endangered Species Act. So an Act of Congress can establish internal policy, and direct the government in international endeavours as well.

What are your biggest barriers?

It’s tough to get funding, so we depend a lot on volunteers. Wall St. is a barrier, and neoclassical economics is still pumping out academics who still believe in the landless production function, and who believe that the economy can be dematerialised, and that we can have ‘green growth’. But we can see that barrier crumbling rapidly now.

I do get the impression that more people are getting it.

I think so.

What can people do if they want to help?

Go to our website and look around. There are plenty of opportunities to get involved, or to donate. You can sign the CASSE position. Please join CASSE. We’ll send you a copy of a little primer called ‘Best of the Daly News’ – named after steady-state economist Herman Daly.

I read his book ‘Steady-State Economics’ years ago. It really influenced me.

The primer is a collection of 33 of the best articles of the hundreds we published from 2008 to 2018.

We’ll get that on our books page, and we’re very happy to re-blog articles from the Daly News. We’ll continue to point people your way, and I’d love to talk about different ways we might be able to work together.

There’s one thing I forgot. We’re looking for additional material for our blog, called the Steady-State Herald. We’re moving from one or two articles per month to daily articles. We’re looking for solid articles, ready to go, 1-2000 words, and very relevant to limits to growth and the steady-state economy.

Highlights

  1. What Jevons said about coal applies macroeconomically as well. He said that efficiency in the use of a resource never actually reduces the use of that resource – it always does the opposite, because it becomes cheaper to use.
  2. It takes heavy investment just to raise the bar a little more, because all the easily-available natural capital has been liquidated a long time ago. To provide the funds for that investment, more activity is required at the base of the economy, which causes ecological damage.
  3. Wall St. is a barrier, and neoclassical economics is still pumping out academics who still believe in the landless production function, and who believe that the economy can be dematerialised, and that we can have ‘green growth’. But we can see that barrier crumbling rapidly now.