Economic growth has lifted billions of people across the globe out of poverty, giving countless millions a path to prosperity. The impact is truly immeasurable in the innovation, productivity, and human well-being it produces.
But along comes an article in The New Yorker explaining that some on the Left want to stop all that. They are “giving birth to the ‘de-growth’ movement, which calls on advanced countries to embrace zero or even negative G.D.P. growth.”
Economic growth, they claim, fuels climate change and leads to income inequality. Prosperous countries—the United States in particular—need to intentionally put on the brakes.
Ignore the ability of technology and free-markets to produce cleaner and less resource-intensive growth and that having a job and an income are foundations of human growth and dignity.
Among leaders of the movement are two winners of the 2019 Nobel Prize in Economics, Abhijit Banerjee and Esther Duflo, but others agree that “a stagnant economy is a sign of success,” John Cassidy writes in his New Yorker article.
These dark ideas are driving political thinking and must be taken seriously.
Forget President Kennedy’s acclaim that “a rising tide lifts all boats.” All of the remaining Democratic presidential candidates and many European countries have endorsed this new Green Growth. “In a low-growth world, it is essential to share what growth there is more equitably,” Cassidy writes.
For developed countries, they call for federal job guarantees, a universal basic income, high carbon taxes, and cutting the work-week to 21 hours so two people can share the same job. People could focus on “art and nature” rather than work and consumption.
And what about the developing countries that would lose any chance at prosperity if “major industrialized economies were to cut back their consumption and reorganize along more communal lines”? Who would buy the products that Bangladesh, Indonesia, and Vietnam produce? “De-growthers have yet to provide a convincing answer to these questions,” Cassidy writes.
I will tell you what would happen: We would see more economic disparity, crushing income, carbon and wealth taxes that fuel much bigger governments, a collapse of innovation, and eventually rationing of scarce basics like food, health care, and energy.
This all came into focus for me on Wednesday when I attended a day-long conference organized by The Rippel Foundation. We were given thought exercises where we tried to get outside our daily work and peer 30 years into the future. As it happened, our table had the task of imagining worst-case scenarios—a dark and stormy future.
So this New Yorker article absolutely connected with me—along with the presidential primary debate later that evening.
“Free” government-run health care inevitably leads to rationing, poorer quality of care from under-funded hospitals and “providers,” price controls, and reduced innovation.
Carbon and wealth taxes would lead to declining economic growth which would put the planet into a perpetual recession.
Democrat John Yang has dropped out of the presidential race, but he got traction in promising everyone $1,000 a month, no questions asked. That’s a start on the “basic universal income” that climate change advocates understand would be needed in economies that no longer produce nearly enough jobs.
The rich always figure out how to get what they need, but the poor who are just getting a taste of prosperity would be the ones who would suffer the most, ripping away their chance of a brighter, more secure future.
Poverty or prosperity. That’s a basic choice before us.