Overshoot Day is one marker that reminds us of the growing challenges of global warming, pollution, resource depletion, the unnoticed extinction of plant and animal species, and the unsustainability of our “materialistic” lifestyles. Population growth and our success in lifting communities out of poverty only reinforce our assumption that we can grow indefinitely on a finite planet.
What worries me is not just that these indicators are pointing in a very negative direction, but that they are going unnoticed. I suspect I am among the majority of people who have not read anything in the news about this year’s Overshoot Day passing worryingly quickly.
Similarly, did anyone read about the International Degrowth Conference that took place in Pontevedra, Spain in mid-June? Even the official website did not report on the outcome of the conference. A quick search for reports turned up nothing. For a global movement aimed at moving away from unsustainable consumerism and forcing governments to rethink their blind pursuit of Gross Domestic Product (GDP) growth, the silence speaks volumes.
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Chinese consumers are saving money – what does this mean for the rest of the world?
Chinese consumers are saving money – what does this mean for the rest of the world?
Calls for degrowth surged from the early 2000s until the collapse of Lehman Brothers in 2008, and have grown again during the shock economic contraction caused by the COVID-19 pandemic, particularly across the political left and among environmental movements concerned about the dangerous pace of global warming.
Among mainstream economists, where GDP growth has been the ambition of governments around the world for over a century, talk of the need for degrowth feels like heresy and the concept has always been controversial.
At the heart of degrowth arguments was dissatisfaction with the shortcomings of GDP as a measure of progress: it ignores crime, resource depletion, housework, volunteering, and the value of higher education, while at the same time measuring prison construction and defense spending as positives. Degrowth advocates resented that in its measure GDP counts pollution twice, once when it is created and once when it is cleaned up.
Degrowth advocates called for additional indicators to better measure progress, such as universally accessible health care and education, taxation of the wealthy, status consumption, and taxes on products and services that harm the environment. They argued for universal basic income, community cooperation, and greater reliance on public transport. Above all, they wanted an alternative to reliance on GDP as the primary indicator of progress, and in 1995 they turned to the True Progress Index, or GPI. The GPI has strong and widespread support because it includes measures of happiness, health, and social and economic justice, but it remains problematic because it includes subjective values. Women in traditional dress at the Royal Highland Festival in Bhutan, which combines music, dance, and sports, in 2023. The kingdom is famous for its Gross National Happiness Index. Photo: Bassem Nyima
Many are working on such indicators, including the team at the University of Maryland’s Quality of Life Initiative. Claudio O. Delan and Yi-Han Yu of Baptist University measured the GPI in Hong Kong from 1968 to 2010 and found that while the GPI has been steadily declining in most countries, it has been rising in Hong Kong.
Why? First, the relocation of manufacturing to other parts of the Guangdong-Hong Kong-Macao Greater Bay Area has led to economic restructuring away from labor-intensive manufacturing and the relocation of polluting industries to mainland China. Second, the removal of subsidies to declining industries has allowed for more efficient investment. And third, Hong Kong’s smaller physical size has allowed for lower transportation costs and more efficient public investment. Unfortunately, the GPI has not been calculated since 2010, so questions remain about how it has progressed over the past 14 years.
The uncomfortable reality is that there is strong common sense that we need to improve the way we measure economic progress. Sadly, the GPI offers no silver bullet, and the degrowth movement seems to have done little to contribute. In March this year, Alessio Terzi of Cambridge University came to the depressing conclusion that degrowth is a politically impractical dead end: “The best degrowth advocates can hope to achieve is to nudge a privileged few towards more sustainable consumption habits.”
No matter how obvious the global need to reduce consumption may be, getting Western consumers to give up meat, SUVs, airplanes and other carbon-intensive products and services is unrealistic because “it is a poor bet on the moral uplift of humanity,” he writes.
“Avoiding climate catastrophe requires a multifaceted strategy with multiple solutions, but degrowth is not one of them,” he concluded. It is more urgent than ever to dramatically reduce our consumption of the planet’s resources and create a more effective measure of human well-being, similar to GDP. Sadly, what we have created so far has received little attention.
David Dodwell is CEO of Strategic Access, a trade policy and international relations consultancy focused on the developments and challenges facing the Asia-Pacific region over the past four decades.
