A steady-state economy requires more innovation, not less

There’s a myth out there about creating a sustainable, steady-state economy that has to be overcome before we can start thinking seriously about the issue.

That’s the assumption that such an economy would be stagnant.

This gets expressed in various ways: a belief in the power of progress, a sense that change always implies growth, or just the belief that without growth all is lost.

All of these are wrong.

Innovation and progress are requirements just to stand still. This is a finite planet, and it is therefore endowed with a finite set of resources. No matter how much there is, the amount of anything isn’t infinite (even solar power is limited by the amount available: a very large number of kilowatt-hours, to be sure, but a finite number, and if we used more than that per hour we would exhaust even the sun’s output to us).

Some of those resources are renewable: if I use 10,000 kW/h of solar power this hour, I can do so again next hour, for the sun produces more. Some are not: if I burn 10,000 litres of oil this hour, I can’t burn that oil again, for new oil is not produced in the ground for me to extract over and over again (at least, at any rate worth mentioning).

As resources are used, those that do not renew on their own — like solar power — such sources as still remain become progressively more difficult to extract. Simple technology extracts the cheapest deposits (the rest are out of reach to it). More complex technologies are needed to extract more difficult sources. Sources also tend to decline in quality and quantity as we go along, for we quite naturally, given two sources of differing quality and quantity, pick the best (cheapest) and biggest first, to maximize our return on our efforts.

So I need ever more innovative technologies simply to stand still.

I also need ever more innovative approaches to deal with other issues: what British Prime Minister Harold Macmillan called the bane of governing, “events, my dear boy, events”. Weather events or infestations alter crop yields, interrupt transportation, cause the mix of what’s being provided to change. As I increase intensity — more complex innovations in use to handle more difficult sources — I also become far more exposed to the effects of events. So I need more innovation to be steady-state simply because over time my steady-state economy becomes more complex due to its source inputs.

So a steady-state world would, in fact, require on-going innovation and change. So much for that objection.

Yet change need not always imply growth. Let’s take an analogy: you are an adult in your early twenties. For twenty-odd years you have been growing: each year saw you need bigger shoes, bigger clothes, a bigger baseball glove, etc. Now all that’s stopped. You’ve got five year old Oxfords and sneakers, five year old T-shirts and jeans. As long as you aren’t incautious in your habits, your sizes won’t change again (also known as “growing out instead of up”). Yet change continues, even though from here on in you don’t grow.

Another analogy may show something even more: when you read Eric Voegelin’s magisterial five volume Order and History, what you find is a discourse on the differentiation of symbols. Simpler understandings, using a compact symbol, change to reveal nuances, requiring the symbols to differentiate or complexify. One of his examples is the growth in the content and understanding of the Jewish idea of G-d, and how the Christian faith differentiated an overloaded sense of a monotheistic God into the Trinity of three persons. (Clearly, such a break where both persist means that such a differentiation is not always “progress”, nor should it be assumed to be, but it is change — and, given the subsequent history, quite a bit of growth, too.) But Voegelin — in Order and History and in The New Science of Politics — is also at pains to point out that sometimes we back away from differentiation. Carroll Quigley, in The Evolution of Civilizations, points out that we shift our attention from one field of endeavour to another, losing ground in one but gaining it elsewhere.

So a steady-state world need not be change-free at all: it could constantly be shifting its attentions, differentiating and re-compacting elements of itself, without “growing overall”. (An element which was differentiated but which now falls outside the horizon of interpretation of the current framework is “lost” — at least for a time — simply by falling into disuse. That of which is not thought does not persist in ideas.)

The story of “growth”, it turns out, is the story of ever-increasing abundance, whether that be personal wealth, societal wealth, or just ever more gadgets and diversions.

That you are reading these words is certainly a drop of evidence in favour of the notion that growth and prosperity comes in forms other than the material or financial, since you have paid for this what I have been paid for writing it (in those terms). Yet I find this rewarding — and if you are 855 words into this, as you are at this moment, so, too, do you.

Yet no measure of an “economy” could find the passing of this post, could it?

We have no need, actually, to constantly grow in the ways we have. Indeed, how many times have we heard of a person who says “but they took my home town away from me”, when endless development has taken away its character, its calm, its safety? How do we feel when the only evidence of our own culture is found in the names of long-gone merchants and companies that were bankrupted, or absorbed, by giants from elsewhere, so that every street is like every other street?

Growth, in other words, isn’t all it’s cracked up to be — and we, in our hearts, look around and know it.

The one place growth is essential is when you have a money economy where money is debt. (As we do.) Then growth is required to pay the interest that mounts inexorably.

There, in fact, growth is required simply to stand still. No wonder people who can’t see past “growth” think steady-state means decline!

Nature requires us — the universe requires us — to recognise that childhood has ended.


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