Can Economic Growth Deliver the Future We Want?

With Britain’s economy slipping into a double dip recession there is an urgent need to stimulate economic growth. This is widely seen as a panacea that will save us from austerity but can the pursuit of economic growth deliver the future we want?

The post-war period saw many nations equating economic growth with progress driven by technological innovation. While capitalism and the quest for economic growth have produced many benefits, this has come at a cost to the natural environment which is often not reflected in the balance sheet. The expansion of the production of good and services has required large amounts of labour, materials, energy and capital. Economic production has produced pollution and waste, degraded natural habitats and depleted natural resources to an extent that our future survival is now under threat.

In 2008 the world experienced multiple crises with regard to finance, fuel and food that contributed to the worst international economic recession since the 1930s Great Depression. The global financial crisis led to global per capita income contracting and the volume of world trade declining. It demonstrated serious flaws in our current western economic model of development and highlighted the need to reconsider the principles that have guided our economic policy making.

It is now time to think again about economic growth and how we actually measure it. Gross Domestic Product (GDP) has been used as a key indicator to measure the sum of all goods and services produced in a country over time. However, this national indicator of economic progress does not consider inequality, pollution or damage to people’s health and the environment. Critics have called for GDP to be replaced with new indicators that better measure how our national policies can truly deliver a better quality of life for all.

Economic debate has tended to imply a choice has to be made between going green or going for growth. Yet we have no choice if we are to address simultaneously the current crises in global economic and environmental systems. The traditional pursuit for growth has expanded the economy to such a size that it now must conform to global environmental constraints.

Further growth will be uneconomic because it will produce more social and environmental costs than it does benefits. The only option is for ‘green’ growth that meets the dual objectives of economic growth and environmental protection with a focus on better outcomes not more outputs – a shift from quantity to quality.

In Prosperity Without Growth Tim Jackson argues that this will require a different kind of economy for a different kind of prosperity – one where human beings can flourish within the ecological limits of a finite planet. Our growth economy is driven by the consumption and production of novelty which locks society into an iron cage of consumerism. Change at the personal and societal level is necessary to make the transition to a new form of prosperity that does not depend on unrelenting growth.

In June world leaders were called upon to commit to a revolutionary paradigm shift from traditional quantity-oriented fossil fuel dependent growth towards green growth. More than 100 heads of State and government attended the United Nations Earth Summit in Rio de Janiero to shape new policies to promote prosperity, reduce poverty and advance social equity and environmental protection. The Summit marked twenty years since the original 1992 Rio Earth Summit that set out the framework to address climate change and implement sustainable development into practice.

A transition towards a greener economy requires long-term sustainable growth and the efficient use of natural resources, reduction of carbon emissions, and eradication of poverty. This will require developing a green economy in the UK and working at an international level to tackle long term challenges.

In the short-term the transition to a green economy will involve additional costs and difficult choices. We will need to transform what we produce and how we produce it and take advantage of resource efficiencies. This will be achieved by using new technologies and adopting different ways of living and working, and investing in infrastructure. All economic sectors will need to grow without undermining the capacity of the environment to support our future quality of life. They will need to develop greater resilience to future environmental challenges such as climate change, material, energy and food insecurity and natural disasters.

The transition to a green economy will allow businesses to benefit from resources efficiencies and market opportunities and contribute to creating new green jobs. UK business could save as much as £23 billion a year through efficiency savings by improving the way they use energy and water, and by reducing waste. In addition, they could take advantage of the global market for environmental goods and services which has been estimated to be worth about £2.27 trillion, with forecasts predicting 4 per cent growth on an annual basis.

However, a recent report by the Institute Public Policy Research (IPPR) examined the views of over one hundred British industries on the transition to a green economy, particularly in the energy, transport and manufacturing sectors. Despite David Cameron’s Coalition government claiming to be the greenest government ever, IPPR found that industry was critical of the Coalition due to a perceived disconnect between the rhetoric of ministers and the policies they were pursuing.

Recent policy changes such as the feed-in tariffs for solar photovoltaic installations were seen as shifting the goal posts and doing little to maintain business and investor confidence in the green growth agenda. The report highlighted the need for policymakers to taken on a more active role in addressing the barriers to green growth faced by many manufacturing and energy-intensive industries.

Greening the economy will undoubtedly be good for business, people and the planet. The Earth Summit resulted in the International community simply affirming the need to achieve a green economy. However, the rhetoric contained in the final report of the conference needs to be matched by action. Clear financial incentives are need to encourage greener investment and behaviour in government, businesses and consumers.

If we are to create the future we want we need to need to develop a new form of prosperity that is not dependent on continual growth. Fundamental change to the structure of society and the market economy is needed if real environmental gains are to be achieved. Change on the scale achieved in the industrial revolution is required driven by clean, efficient and sustainable renewable energy technologies. The only solution to austerity is to ensure the UK is firmly placed at the forefront of this new global green revolution.

© Gary Haq 2012

Putting the SIZZLE into Going Green

GOING Green is a bit like making love – nearly everyone likes the idea of it. Some people do it on a daily basis, some every week, others less frequently, while some individuals just do not get around to doing it at all.

GOING Green is a bit like making love – nearly everyone likes the idea of it. Some people do it on a daily basis, some every week, others less frequently, while some individuals just do not get around to doing it at all.

Back in 2007, at the peak of our eco-awareness, climate change and the carbon footprint seemed new and interesting. There was unprecedented media coverage of green issues and the public, politicians and business leaders were all developing a passion for the planet.

Prince Charles’s recently undertook a green tour of Britain on a bio-fuelled royal train. Despite green living receiving royal approval, there are signs of “green fatigue” setting in as political, public and media interest in environmental issues begins to wane. The UK’s new coalition Government’s decision to get rid of the Royal Commission on Environmental Pollution and the independent watchdog, the Sustainable Development Commission, clearly signalled the downgrading of environmental issues.

This is despite David Cameron’s promise to put the environment at the heart of government. Former chair of the Sustainable Development Commission, Jonathan Porritt, described the decision as “crass, unfounded, self-defeating and ideologically-motivated”.

The climategate and glaciergate fiasco has increased public scepticism over climate change science. A recent Ipsos Mori survey of UK public attitudes to climate change found that although the majority of respondents believe that climate change is happening, levels of concern have fallen since 2005, and less than one-third of the population currently consider it to be a purely man-made phenomenon. However, most people consider that it is their responsibility to take action and feel that they personally can make a difference.

The waxing and waning of public interest in environmental issues is nothing new. In 1967, Britain experienced its first major oil disaster when the oil tanker, Torrey Canyon, struck a rock, causing the oil pollution of 120 miles of the Cornish coastline.

Dramatic environmental disasters such as this, together with key publications on the ecological limits to economic growth, increased public concern.

By 1972, environmental issues were placed on the international political agenda when nations gathered together for the first UN Earth Summit in Stockholm. It resulted in governments establishing ministries of the environment and introducing environmental legislation.

Although the 1970s’ oil price rises dampened public interest in green issues, a decade later interest was renewed by the Chernobyl nuclear disaster, a rise in green consumerism, ethical investment and increased activity of Friends of the Earth and Greenpeace. In 1992, the Rio Earth Summit ensured that world leaders embraced the idea of sustainable development and initiated action for a global convention on climate change.

When we are doing well, we are motivated to go green but during an economic downturn we tend to lose interest. It is therefore not surprising that in this new age of austerity we are starting to suffer from green fatigue.

In an economic recession consumers tighten their belts, sales figures fall and companies close down and stop producing polluting emissions. For example, in 2009, EU greenhouse gas emissions fell by seven per cent. A lower demand for energy has been linked to the economic recession as well as cheaper natural gas and increased renewable energy use.

Nowadays most people are familiar with the concept of the carbon footprint. Unfortunately, being aware of the environmental impact of our individual lifestyle choices does not necessarily mean we will change our behaviour. After all, we know that smoking can cause lung cancer, eating junk food can lead to heart disease and obesity and binge drinking is bad for the liver, but we still carry on regardless.

For too long, green campaigns have sold the threat of what would happen if we do not mend our ways. The danger of a “climate hell” has caused some people to switch off.

Back in the 1940s, US salesman, Elmer Wheeler, advised businesses on his “Don’t sell the sausage, sell the sizzle!” marketing approach. Wheeler’s big secret to successful selling was that you do not advertise the sausage itself as it is the desirable sounds and smells of the “sizzle” that make people hungry and want to buy it. There is increasing recognition that the “selling the sausage” approach to green issues is not delivering the fundamental changes required for us to stay within ecological limits.

A report by Futerra, a green communications consultancy, on “Selling the Sizzle: the new climate message” argues that in order to reinvigorate public and media interest, campaigns need to focus on a vision of a greener life that is positive and appealing to all.

Gary Haq discusses green issues with Ed Milliband
The recent election of Ed Milliband as the new leader of Labour Party, now the official opposition to the British government provides hope for many environmentalists.

Mr Milliband was the former Secretary of State for the UK Department of Energy and Climate Change and is a passionate advocate of action on climate change.

He recently reiterated his belief that “climate change is the greatest global threat facing our generation “, adding that “it should be at the very heart of our plan for a successful economy, at the centre of our foreign policy and integral to our mission to change Britain”.

Many environmentalists are hoping that Mr Milliband will now put climate change back on the political agenda after he has criticised the Coalition Government’s claim to be the ‘greenest ever’ as an empty gesture.

So far, environmentalists have failed to effectively communicate a compelling vision of a greener future. It is therefore time to stop selling the notion of a climate hell and start selling a “green heaven”. Let’s put the sizzle back in to going green and demonstrate that a transition to a low carbon society ultimately means a better quality of life for everyone.

© Gary Haq 2010

Photo credits: Shutterstock