Economic Growth and Development: Why ID Can’t Save the World

A few weeks ago, I had the opportunity to attend a presentation held by the Waterloo Institute for Complexity Innovation (WICI).  The title of the lecture was “Alternatives to Economic Growth”.  In it, Dr. Steve Mock lectured on the difficulties associated with the end of economic growth, and Dr. Steve Purdy argued for a renewed commitment to global governance in order to facilitate a smooth transition away from a growth-based economic paradigm towards an alternative system.  The most poignant aspect of this presentation, however, was the fact that both lectures were focused on finding solutions to the problems that humanity will face when global economic growth stops.  Importantly, these solutions are not merely answers to hypothetical problems necessary if growth to stops. The end to growth is inevitable, and the only choices we have relate to how we will deal with this fact.

This is because, in our current economic system, growth = consumption.  As economies grow, consumption increases, and as consumption increases, resources are depleted at faster rates.  Once resources are depleted, we can’t use them anymore.  This means that humanity essentially faces a choice: grow until we collapse, or create a new system based on long-term sustainability and steady-state economies.  Unfortunately, under our current global system, economic growth involves an increase in consumption rates, which in turn speeds us toward our eventual demise.  And, like it or not, international development is intrinsically tied to economic growth.  This means that, under our current economic paradigm, international development is hastening our society towards its own eventual destruction.  Honestly, this isn’t what I signed up for.

But it’s unavoidable.  Economic growth is intrinsically connected to every international development endeavor.  Any time a family living in poverty is able to augment their income, any time a microfinance loan helps a woman obtain financial freedom, or any time a child receives an education that leads to meaningful employment, the result is economic growth.

And all economic growth, even economic growth that is equitably distributed, holistic, and inclusive, is fueled by one thing: consumption.

So, global economic growth must come to an end, either through a managed transition or a sudden collapse.  And international development under the current system is taking us faster and faster towards the latter option.  I would suggest that every development practitioner, be they neo-liberal, neo-Marxist, or neo-feudalist, would agree to two things: that the goal of development is to increase human well being, both now and in the long-term, and that many living in the Global South need economic growth in order to confront the many difficulties that they face.  So if the Global South needs to grow and the world needs to move away from growth, the only place where the end to growth can be discussed is right here in the Global North.

Obviously, the transition away from growth will be difficult.  But here in the Global North our society enjoys unprecedented levels of wealth and freedom.  And while it may be a hard conversation to have, international development can only make sense if it is accompanied by action taken right here in the overdeveloping world.  Unfortunately, this issue is not politically popular, and is therefore unlikely to gain any serious traction among politicians. But unless we are able to change things, beginning right here at home, international development will never be able to change the world for the better.  So we may as well try.

Thanks for reading, and I’d love to hear comments,

Dan