What economic degrowth would mean for the future of geopolitics

If the Labour Party’s objective of an annual 2.5% growth in GDP is met, how long will it take for the British economy to double in size? While the most maths-savvy minds of Imperial might laugh this question away with a quick ‘28 years’, there is value in analysing the underlying stakes; our society is built on the hope that its output can double in size with each generation. In other words, we accept a promise of endless growth at an exponential rate, in a world where limited resources replenish linearly. 

All of those who are daunted by this prospect will be reassured to know that they are not alone: although less noticeable in the UK than within continental Europe, the global movement for degrowth has recently seen a surge in both credibility and impact. While its serious proponents in the general population constitute a marginal niche at best, they have always included influential voices, that of Tim Jackson (economist and author of the widely acclaimed Prosperity without Growth), or public speaker Jean-Marc Jancovici. 

Put simply, degrowth is a policy of intentional and controlled decrease in an economy’s total production, achieved through a gradual reduction of its energy and material use, to ensure its long-term sustainability. In more concrete terms, it’s renouncing the superfluous goods and services of the modern world so the essentials can always be provided to populations in the future.

Rainbows and butterflies

I myself was extremely sceptical of the idea, regarding with some disdain what I considered to be a task too big to succeed in a system too big to fail. That was until stumbled upon an interview of Mr Jancovici defending his eye-opening thesis: degrowth is not a question of if, but when, and most importantly how. 

Growth is intrinsically linked to the consumption of resources and energy, and will inevitably falter when those run out. Further miniaturisation, increases in efficiency, and circularisation of the economy could only push the doomsday back. And even that remains contentious. The ever-larger cars introduced on the market exemplify the limits of this model: as theorised by the Jevons paradox, advances in efficiency are often offset by profit incentives, and quickly caught up by our consumerist appetite.

The now fashionable argument in favour of so-called “dematerialised economies” is equally misguided. Such economies are only dematerialized at the level of their logistics, as all digital services depend on physical processes, either as a means (think Internet servers for Netflix) or an end (think commodities for a hedge fund). 

It remains tempting to point at the 30-odd countries that have managed to decouple their emissions and GDP over the last couple of decades, but scientists agree that this transition to green capitalism is much too slow to keep the Earth on track to net neutrality by 2050. To avoid a return to the unforgiving lifestyles of the past, democratic decisions must therefore be made on the fair allocation of the indispensable “carbon credit”, ensuring the basic needs of all are covered. 

It would be unfair to force degrowth upon all countries: most economies aren’t as wasteful and damaging as Western ones. Crucially, the populations of the Global South count on growth to escape from poverty, just as Western populations did in the last century. 

By contrast, some scientists suggest that growth has begun to have negative consequences on the welfare of high-income nations, which are now plagued by soaring cases of obesity and social isolation, while Healthy Life Years are either stagnating or falling. This is a first in human history: the theory holds that growth and ease of living go hand-in-hand. Choosing to reallocate our carbon credit to essential technology only, notably in the field of medicine, might not only reverse those trends but also result in the delocalization of fewer emissions to the developing world. 

Goodbye, votin’!

A major challenge of a radically different nature must then be considered. A successful policy of degrowth would result in an unprecedented change in the power balance of the world, to the detriment of democracies. Indeed, the world’s largest polluters per capita (excluding some Gulf states), also rank at the top of human rights, press freedom, and democratic transparency indices. Degrowing these economies would greatly reduce their weight in global decision-making, while the autocrats and warmongers who tend to have little regard for matters of sustainability or responsible governance would benefit from increased economic power. 

The correlation between high emissions and high peacefulness does not mean that poorer, less democratic countries will liberalise as their status converges with that of the West, as democratic backsliding has been reported in the last decade independently from economic success. China, which has further plunged into autocracy this decade, enjoyed a growth rate of over 5%, and Russia’s democratic crackdown and unjustified invasion of Ukraine followed a decade of relatively stable economic advances. On the whole, the global level of democracy as reported by the Economist Intelligence Unit has dropped continuously from 2015 to 2021, while the World’s GDP per capita has increased by around 16% over the same period. 

Furthermore, the sobriety of a shrinking Western economy would make it both practically impossible and politically unthinkable for its governments to pursue military aid deliveries to Ukraine and would do little to deter China from walking the talk of its expansionist threats. These two particular situations could be short-lived, but they are certainly only preambles to the trouble that lies ahead. Being short on resources and battered by an unbridled climate exacerbates violent tendencies. 

Whatever awaits us, a bad reputation still clings to the very idea of degrowth, and its full integration within the policy of any government likely won’t be seen soon. Attacking what researcher Erik Assadourian considers to be among the “sacred myths of modern culture” is often assumed to be another utopian dream, brandished only by the hippies and tree-huggers most decision-makers would rather pay no attention to. Growth remains a key electoral promise of candidates to power. 

And yet, European governments ritually fail to deliver on it: just a month ago, the Draghi report on productivity in the European Union warned that – unless radical policy changes are enacted – the bloc’s economy would have the same size by 2050. Inequalities, on the other hand, will likely do a better job at growing. Politicians beware, unplanned degrowth will be a bitter pill.