Degrowth: Is it time to live better with less? | CNBC Explains

Summary

Over 1,100 economists and activists advocate for 'degrowth', a movement challenging the pursuit of endless economic growth. They propose a shift towards prioritizing happiness and health, suggesting rich countries reduce inequality and resource use while low-income nations sustainably grow. Degrowth aims to reject constant expansion, focusing on necessary sectors like public transport and renewable energy, contrasting with unplanned recessions. Despite the 2020 economic downturn, degrowth supporters see a planned, equitable contraction as the solution, not a crisis.

Takeaways

• 🌱 The concept of 'degrowth' challenges the belief that economic growth is always beneficial, advocating for a focus on quality of life over constant expansion.
• 🌐 Over 1,100 economists and activists from 60+ countries support degrowth, aiming to shift economic systems to prioritize well-being and sustainability.
• 📉 Degrowth proposes that rich countries should reduce inequality and resource consumption, while allowing low-income nations to grow sustainably until they reach parity with middle-income countries.
• 💡 Proponents argue that instead of growing all sectors indiscriminately, there should be a focus on essential sectors like public transportation and renewable energy.
• 📈 Critics are concerned about the risks of a slowing economy, pointing to the 2020 economic downturn as a cautionary example.
• 🔄 Degrowth advocates differentiate their approach from recessions, emphasizing that degrowth is a planned, equitable contraction, unlike the unplanned and inequitable nature of economic crises.
• 🌿 The movement's roots can be traced back to the 1970s, with the publication of 'Limits to Growth' and French philosopher Andre Gorz's introduction of the term 'décroissance'.
• 🌍 The United Nations has recognized the climate emergency as a defining issue, with the necessity of reducing global emissions to zero by 2050 to limit global warming.
• 🌿 The Covid-19 pandemic led to a temporary decline in global emissions, but pollution levels rebounded as economies reopened, indicating the need for sustained, systemic change.
• 🏛️ Some countries like Scotland, Iceland, and New Zealand have started prioritizing well-being over economic growth, reflecting a potential shift in global priorities.

Q & A

What is the main argument against pursuing economic growth at all costs?

The main argument is that relentless economic growth can lead to environmental degradation and social inequality, and that the focus should be on improving people's happiness and health rather than just increasing GDP.

What is the concept of 'degrowth'?

'Degrowth' is an economic and environmental movement that advocates for a reduction in consumption and production, with the goal of improving well-being and reducing environmental impact.

Why do degrowth advocates believe GDP is not a good measure of progress?

Degrowth advocates argue that GDP does not account for factors like environmental degradation, income inequality, and well-being, and thus should not be the sole indicator of a country's economic health.

What measures might rich countries take to reduce inequality according to degrowth principles?

Rich countries might implement job guarantees, reduce working hours, and potentially introduce a universal basic income to address inequality.

How does degrowth propose to tackle the idea of constant economic sector growth?

Degrowth suggests focusing on sectors that improve public welfare and sustainability, like public transportation and renewable energy, rather than growing sectors like arms and automotive industries.

What are the potential risks associated with a slowing economy according to degrowth critics?

Critics of degrowth worry about economic contraction leading to job losses, reduced standards of living, and increased inequality.

How do degrowth proponents differentiate their planned contraction from a recession?

Degrowth proponents argue that their planned contraction is equitable and intentional, focusing on well-being and sustainability, whereas a recession is unplanned and can exacerbate inequality and reduce well-being.

What is the stance of degrowth on personal income in rich countries?

Degrowth does not call for a reduction in personal income; instead, it emphasizes that rich countries have enough resources to ensure a good life for everyone.

When did the degrowth movement first gain prominence and who was involved?

The degrowth movement first gained prominence in the early 1970s, with French philosopher Andre Gorz coining the term 'décroissance' in 1972.

What was the main prediction of the 'Limits to Growth' report published by the Club of Rome?

The 'Limits to Growth' report predicted that civilization could collapse in the 21st century due to the unsustainable nature of continuous industrial growth.

How does the United Nations view the environmental crisis in relation to economic growth?

The United Nations recognizes the environmental crisis as the 'defining issue of our time' and calls for global emissions to be cut to zero by 2050 to limit global warming.