You have stolen my dreams and my childhood with your empty words. And yet, I’m one of the lucky ones. People are suffering. People are dying. Entire ecosystems are collapsing. We are in the beginning of a mass extinction, and all you can talk about is money and fairy tales of eternal economic growth. How dare you! For more than 30 years, the science has been crystal clear. How dare you continue to look away and come here saying that you’re doing enough, when the politics and solutions needed are still nowhere in sight.(1) (Greta Thunberg 2019 )
With these powerful words, Greta Thunberg, a 16-year-old Swedish climate activist at the time, accused heads of state and government of failure at the UN Climate Summit in September 2019. Instead of "empty words" and the "fairy tale of eternal growth," she called for a fundamental shift in thinking to implement the policies and solutions needed in light of the climate crisis. With such a critique of economic growth, analyses and positions in the young climate justice movement are currently radicalizing. But what exactly is this fairy tale? How did it become so powerful that, one can rightly argue, it is dominating high level policy debates around the globe? And how can it be debunked?
WITHOUT GROWTH, EVERYTHING IS NOTHING
My book The Hegemony of Growth. The OECD and the Making of the Growth Paradigm is an attempt to give historical and social depth to our understanding of this ‘fairy tale’ of endless growth, not least because a proper understanding is necessary if we aim at overcoming it. I propose to understand the growth paradigm as a historically constructed and powerfully hegemonic ideology.
To put it shortly, the fairy tale of growth says that growth is good because it improves people’s lives. Growth is imperative because it’s a necessary prerequisite for societal progress and without it, societies are in crisis. Growth is a universal solution to all kinds of other challenges facing modern society – from reconstruction after the Second World War, to massive unemployment in the 1970s, to environmental protection in the 1990s. And growth can continue forever if the right governmental and international policies are pursued.
The fairy tale of growth is invoked continuously by basically all political parties around the world – memorably in the recently retired German chancellor Angela Merkel government declaration in 2009 when she introduced the so-called ‘growth acceleration act’:
Without growth there is no investment, without growth there are no jobs, without growth there is no money for education, without growth there is no help for the weak. And vice versa: with growth comes investment, jobs, money for education, help for the weak and - most importantly - trust among the people. That is my conviction, a conviction that is based on my fundamental view of politics. (2)
In this view – as summarized in a different occasion by Angela Merkel – “growth is not everything,” because after decades of research showing beyond doubt that GDP does not measure human wellbeing, this now has to be acknowledged – “but without growth, everything is nothing.”(3)
IF AFFLUENCE IS THE PROBLEM, WE CANNOT IGNORE ECONOMIC GROWTH
This view has become such a deeply ingrained ‘common sense’ that without many people realizing, is dangerously impeding an unprejudiced approach to our collective current human predicaments, most importantly the climate catastrophe and mass extinction. For example, the climate scenarios of the IPCC largely ignore pathways without economic growth – a fundamental error justifying the need for dangerous negative emission technologies (4). Yet independent studies have demonstrated that achieving the necessary reductions in emissions is much more likely and possibly only possible if industrialized countries move to policies beyond economic growth (5)(6)(7)(8)(9). If affluence is the problem, growth needs to be addressed as a core driver of climate change and cannot any longer be ignored (10). This was also acknowledged in the draft of part III of the upcoming IPCC report that was leaked in 2021 (11). So yes, Greta is right – the fairy tale of eternal economic growth that can become sustainable, green and climate-friendly is largely “empty words” when confronted with the science – yet we are still in the grips of what I call the growth paradigm.
THE HEGEMONY OF THE ECONOMIC GROWTH PARADIGM
Economic growth has become and largely remains what scholars from various fields, including renowned historians, have described as a “fetish” (John R. McNeill) or “obsession” (Barry Eichengreen, Elmar Altvater), an “ideology” (Alan Milward, Charles S. Maier), a “social imaginary” (Cornelius Castoriadis, Serge Latouche), or an “axiomatic necessity” (Nicholas Georgescu-Roegen). However, while growth is at the center of both public and academic debates, the question of how economic growth actually attained its status as an overarching priority in the first place has not received much attention by historians, nor by researchers in other disciplines. Even more striking is the absence of any historical perspective in the various current efforts to overcome the focus on growth. Both the search for new statistical measures “Beyond GDP” and the lively debates about political alternatives to the growth fetish – postgrowth or degrowth – often tend to be a-historical. They largely ignore and underestimate the long-term historical roots, path dependencies, and power relations of statistical standards and the growth paradigm more generally.
I took up this challenge by asking the simple question: How did economic growth come to be almost universally seen as a self-evident goal of economic policy-making and how was this constantly reproduced in changing circumstances? In order to answer this question in a transnational context and grounded in historical and institutional developments, I focused on the emergence and evolution of knowledge about economic growth within the OECD and its predecessor, the Organization for European Economic Co-operation (OEEC), one of the least researched international organizations. I researched the archives of this organization and of some of its key member countries, read texts by key protagonists on growth theory, growth debates and the critique of economic growth, and discussed my arguments with colleagues and fellow activists. Digging deep into history and analyzing growth-thinking at the transnational level and the interface of academia, national bureaucracies, and international organizations reveals the complex and contested history and politics behind the emergence, functioning, and evolution of what I describe as the “economic growth paradigm.”
The resulting book is both profoundly historical – retelling in detail the making and remaking of the growth paradigm in the second half of the twentieth century – and topical for current discussions around inequality, climate change and the end of growth. It argues that the pursuit of economic growth is not a self-evident goal of industrialized countries’ policies, but rather the result of a very specific ensemble of discourses, economic theory, and statistical standards that came to dominate policy-making in industrialized countries under certain social and historical conditions in the second half of the twentieth century. Thus, I aim at analyzing the idea of economic growth in its historical genesis in a similar way as this has been done with regard to the idea of “development” by cultural anthropologists of the so-called Post-Development school, focusing on the close nexus of power and knowledge. It rests on the thesis that the exceptional position of economic growth as a core policy goal is based on the hegemony of the growth paradigm, and cannot be adequately understood without taking into account the complex structure and historical evolution of this paradigm.
THE GROWTH PARADIGM IN THE HISTORY OF CAPITALISM
The making of this core feature of the religion of capitalism has to be situated within longer-term developments that reach back to the onset of intensified capitalist industrialization in the early eighteenth century, or even further to colonial expansion. At that time, a secularized conception of economic progress and a first generation of classical growth theories emerged which, however, fell into oblivion with the rise of econometrics and neoclassical economics in the later nineteenth century. Building on statistical developments in the early twentieth century, it was only in the context of the Great Depression that a renewed interest in macroeconomic questions gave rise to the modern conception of “the economy,” and to interventionist economic policies geared toward stability and employment. Yet it was not before the late 1940s and early 1950s in the context of World War II, European reconstruction and Cold War competition, that economic expansion became a key policy goal throughout the world.
The growth paradigm emerged as part of what has been called “high modernism,” a system of beliefs and practices aimed at increasing the power of the state in line with what was believed to be scientific ideas, in order to reshape societies by maximizing production to improve the human lot. Four unquestioned allegations were specifically relevant in reinforcing the hegemony of growth and collectively rationalized, universalized, and naturalized the growth paradigm. These assumed that GDP, with all its inscribed reductions, assumptions, and exclusions, adequately measures economic activity; that growth is a panacea for a multitude of (often changing) socioeconomic challenges; that growth is essentially unlimited, provided the correct governmental and inter-governmental policies were pursued; and that GDP-growth is practically the same as or a necessary means to achieve essential societal goals such as progress, well-being, or national power.
GROWTH AS IDEOLOGY – AN "IMAGINARY SOLUTION OF REAL CONTRADICTIONS"
The growth paradigm became hegemonic in the sense of justifying and sustaining a particular perspective – the allegations mentioned above – and the underlying social and power relations as natural, inevitable, and timeless. Growth came to be presented as the common good, thus justifying the particular interests of those who benefited most from the expansion of market transactions as beneficial for all. The hegemony of growth depoliticized key societal debates about what societies value, how they interpret their current position historically and within the globalized economy, and how they conceptualize the good life and future developments. Growth turned difficult political conflicts over distribution and the goals of policy-making into technical, non-political management questions of how to collectively increase the economic output of the nation state. By transforming class and other social antagonisms into apparent win-win situations, it provided what could be called an “imaginary resolution of real contradictions” (Terry Eagleton).
ECONOMIC GROWTH AND THE SUPERIORITY OF ECONOMISTS
Moreover, by transforming contested and changing societal goals into technical economic problems, growth discourses have deeply colonized our imaginaries. They not only reinforced the dominance of economic thinking and arguments by turning political or social questions into economic problems (what could be called “economism”), but they also strengthened the privileged positions of economic technocrats within modern societies and underpinned the primacy of the economy over politics. Growthmanship was mutually reinforced along with the increasing importance of economic knowledge production as a key justificatory basis for policy-making within the modern state. The economists’ ability to measure, model, and steer growth made them increasingly indispensable for managing modern societies based on growth, and thus reinforced the “superiority of economists” just as the expansion of economic approaches also strengthened the growth paradigm. Even though the mid-twentieth century saw the proliferation of growing armies of experts, ranging from international relations theorists to demographers, anthropologists, sociologists to agronomists, economists were the only ones who managed to claim the mastery over what had become a fetish throughout the world: economic growth.
These arguments – and others – are weaved into the various case studies discussed in the chapters of the book. They focus on issues such as the international standardization of national income accounting, the transnational harmonization of growth policies, the development of growth into a universal yardstick, the replication of growth policies in the context of decolonization and the ‘development of others,’ the OECD-Club of Rome nexus, the birth of environmental politics and social indicators, as well as the more recent turn to neoliberal growthmanship.
OVERCOMING THE GROWTHOCENE
To conclude, overcoming what’s recently been called the “growthocene” demands a thorough understanding of what we are up against – both materially and socially as well as ideologically. For the climate justice movement to be successful, we have to do many things – but also to debunk the “fairy tales of eternal economic growth,” as Greta put it (12). We have to dismantle the growth paradigm that has deep historical roots and is embedded in and thus supported by powerful institutions and structures such as the nation state, capitalism, established understandings of “the economy,” or the power of economists in societies.
Most importantly, however, growth has arguably become one of the key justificatory ideologies of capitalism. Not only large scale inequalities – as recently publicized by Thomas Piketty – and the divergence of uneven development between rich and poor nations are justified as of a temporary nature, to be overcome by more growth in the future, but similarly societal cleavages along the lines of class, race and gender. Recent research has shown how skewed the global distribution of the benefits of economic growth are – while the bottom 50 percent hardly benefitted at all from the growth between 1995 and 2021 (13). The richest 1 percent of the global population captured 38 percent of it. With climate change, resource limits, and secular stagnation, this make-believe “resolution of real contradictions” reveals itself as clearly “imaginary.” Consequently, in order to dismantle the hegemony of growth, climate movements have to develop a profound and critical understanding of the real societal contradictions, hierarchies and power dynamics shaping capitalism and transform them in new ways beyond growth.
(1) Transcript: Greta Thunberg's Speech At The U.N. Climate Action Summit (2019) https://www.npr.org/2019/09/23/763452863/transcript-greta-thunbergs-speech-at-the-u-n-climate-action-summit?t=1638456285589
(2) Own translation: Regierungserklärung von Bundeskanzlerin Dr. Angela Merkel (2009). https://www.bundesregierung.de/breg-de/service/bulletin/regierungserklaerung-von-bundeskanzlerin-dr-angela-merkel-795246
(3) Own translation: "Was wir vorhaben, ist ein Befreiungsschlag zur Senkung der Arbeitskosten". https://www.zeit.de/reden/deutsche_innenpolitik/200349_merkelcduparteitag/seite-13?utm_referrer=https%3A%2F%2Fwww.google.com%2F
(4) Kuhnhenne, Kai. (2018). Economic Growth in mitigation scenarios: A blind spot in climate science – Global scenarios from a growth-critical perspective https://www.boell.de/sites/default/files/endf2_kuhnhenn_growth_in_mitigation_scenarios.pdf
(5) Wiedenhofer, Dominik et al (2020). A systematic review of the evidence on decoupling of GDP, resource use and GHG emissions, part I: bibliometric and conceptual mapping. Environ. Res. Lett. 15. https://iopscience.iop.org/article/10.1088/1748-9326/ab8429/meta
(6) Hickel, Jason & Kallis, Giorgos (2020) Is Green Growth Possible?, New Political Economy, 25:4, 469-486. https://www.tandfonline.com/doi/abs/10.1080/13563467.2019.1598964
(7) Parrique T., Barth J., Briens F., C. Kerschner, Kraus-Polk A., Kuokkanen A., Spangenberg J.H., (2019). Decoupling debunked: Evidence and arguments against green growth as a sole strategy for sustainability. European Environmental Bureau. https://eeb.org/library/decoupling-debunked/
(8) Keyßer, L.T., Lenzen, M. 1.5 °C degrowth scenarios suggest the need for new mitigation pathways. Nat Commun 12, 2676 (2021). https://www.nature.com/articles/s41467-021-22884-9
(9) A Societal Transformation Scenario for Staying Below 1.5°C
Kuhnhenn, K., Costa, L., Mahnke, E., Schneider, L., Lange, S., (2020) Volume 23 of the Publication Series Economic & Social Issues. Heinrich Böll Foundation and Konzeptwerk Neue Ökonomie. https://www.boell.de/de/2020/12/08/faqs-zum-societal-transformation-scenario-sts
(10) Wiedmann, T., Lenzen, M., Keyßer, L.T. et al. (2020) Scientists’ warning on affluence. Nat Commun 11, 3107. https://www.nature.com/articles/s41467-020-16941-y
(11) We have leaked the upcoming IPCC WGIII report (2021) https://scientistrebellion.com/we-leaked-the-upcoming-ipcc-report/
(12) Parekh, Payal & Rackete, Carola. (2021). How can the climate movement escalate to shift power?https://parekhpayal.medium.com/how-can-the-climate-movement-escalate-to-shift-power-b43f411acf51
(13) Chancel, L., Piketty, T., Saez, E., Zucman, G. et al. (2022). World Inequality Report 2022, World Inequality Lab. https://wid.world/news-article/world-inequality-report-2022/