Dr. Trevor Hancock
25 April 2023
Last week I discussed some of the problems that result from our focus on the economy rather than on ecologically sustainable human and social development. This week, I turn to a more in-depth exploration of the impacts of continual economic growth, and in particular the way in which growth, if unchecked, will dramatically increase inequality.
The inexorable logic of continual growth is one of several things we fail to understand about our economy. (Others include what constitutes true wealth and the illogicality of seeing GDP as a measure of social progress.) Indeed, reporters covering the economy are always obsessing about the rise or fall of the GDP. They seem pleased when it goes up, clearly not understanding the implications of continual growth.
It is not uncommon to see aspirations for economic growth of 3 or 3.5 percent annually. So what happens if we have annual growth of 3 or 3.5 percent annually throughout our lifetimes?
There is a handy rule of thumb that converts a percentage growth rate into a doubling time: 70 divided by the percent growth gives you the approximate doubling time. So an economy, a population or an environmental impact such as our ecological footprint that grows at 3.5 percent annually will double in size in 20 years. (It will actually increase 1.99 times, but close enough.)
Think about that: What if the economy and its resultant footprint grew at that rate throughout the more than 80-year life expectancy of an infant born today? A doubling every 20 years – so four doublings – leads to a 16-fold increase in size.
Now does anyone seriously think the Earth can withstand an economy 16 times the size it is today, given the massive damage our current economy is causing? As it is, in 2018 the world had a footprint equivalent to 1.8 Earths, according to the Global Footprint Network. So at that growth rate, by 2098 the footprint would be the equivalent of nearly 28 Earths! OK, 80 years is a long time away, but what if we look at just 40 years from now, when anyone 40 years or younger is likely to still be alive? With two doublings, we would still need almost 7 planets.
Then let’s add in the impact of inequality. The average footprint per person of the 48 high-income countries is equivalent to using 3.75 Earths (Canada, with a footprint of 5.1 Earths per person is one of the highest of the high-income countries), while the average footprint per person of the 36 low-income countries is 0.68 planets. If the whole world lived the way high-income countries live, then with a 3.5 percent annual growth rate, we would need nearly 15 planets by 2058 and almost 60 planets by 2098! And if they all lived like we do in Canada, make that 20 planets by 2058 and almost 80 planets by 2098.
Even if the whole world lived the way low-income countries do, with that growth rate we would need 2.7 planets in 2058 and 11 planets by 2098. Clearly, continual economic growth, if it translates into a similar growth in our ecological footprint, is completely unsustainable, especially in high-income countries.
People living in low-income countries currently get less than their fair share of the Earth’s biocapcity and resources. They need economic development and its accompanying footprint to meet basic human needs for their people – a process, importantly, that also leads to smaller family sizes. This will mean enabling them to have a somewhat larger ecological footprint.
But there is only so much biocapacity on our finite planet, and we already exceed the limits. So if they are to get their fair share, we need a redistribution of the glaringly unequal consumption of the Earth’s biocapacity and resources, which means a reduction in the share currently taken by high and middle-income countries.
As Dr. Kenneth Boulding, a former President of both the American Association for the Advancement of Science and the American Economic Association told the US Congress way back in 1973: “Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist.”
I am off on vacation, my next column will appear May 28th.
© Trevor Hancock, 2023
Dr. Trevor Hancock is a retired professor and senior scholar at the
University of Victoria’s School of Public Health and Social Policy