Degrowth Criticism, Part 2

Don't let the poor have nice things.

Let’s continue with our exploration of the article, Four Problems for the Degrowth Movement. The author is Daniel Driscoll, a Postdoctoral Research Associate at the Rhodes Center for International Economics and Finance at Brown University.

2.      Degrowth doesn’t acknowledge that redistribution can drive growth.

Driscoll argues that since degrowth requires suppression of consumption and production, this would likely lead to income reductions for many people, most unfortunately for poorer populations. Therefore, degrowth supporters argue that a decrease in production and consumption must be accompanied by wealth redistribution.  

Driscoll correctly states that lower-income groups have a higher propensity to consume than more affluent groups. But with the level of inequality, we see in the developed world today, that is just not going to be a problem. Degrowth supports a reduction in the material throughput in society because we are producing and consuming so much that our environment can’t handle it. But if the wealthy decrease their consumption a little bit and the poor increase their consumption a little bit, you still get a huge reduction in emissions.

The problem is with the emissions of the wealthy. The wealthiest among us cutting our emissions a little has a huge impact. The poorest among us increasing their emissions a little bit is small potatoes. Look at this graphic from the recent Oxfam Annual Inequality Report 2024 and tell me with a straight face that a slight increase in the consumption of the poor is a problem.

You can’t because it’s not.

Let’s do a little math to make the point.

There were 36.8 billion tons of CO2 emitted in 2023. The richest 10% were responsible for 18.4 billion of those tons. The poorest 50% of humans on Earth were responsible for just 3.68 billion of those tons. If the richest 10% cut their emissions by 10%, we would eliminate 1.84 billion tons of CO2. If the poorest 50% of humanity increases their CO2 emissions by 10%, CO2 emissions go up 0.368 metric tons.

I’ll take that trade.

Don’t over-plan it.

Driscoll argues that a monumental global planning effort would need to be put in place to coordinate the downscaling of household emissions. Driscol shows concern that this will be nearly impossible to do because it will force the world to accept lower living standards.

No, it will take the richest ten percent to accept living standards that are still pretty damn amazing. The next richest 10 percent may have to cut back on some air travel and eat a little bit less beef. The rest of humanity can pretty much keep carrying on as they are. The poorest 10% are going to have to deal with the worst of climate change. I think it is fair for their lives to get a little better. Their economies can grow a little with negligible consequences.  

No one is going back to living in caves.

A study from 2022 showed that the average celebrity who traveled on private jets emits more than 3,300 metric tons of CO2 from their private jets alone. To put this in perspective, the average person emits just 7 metric tons of CO2 annually. Your average celebrity emits over 470 times the emissions of your average human – and that is just counting the emissions from their private jets. It doesn’t count as any other part of their lives.

If you examine the other parts of the lives of the richest 10%, I’m pretty sure you can find some CO2 savings.

Who is going to pay for this?

Driscoll correctly brings up the elephant in the room. Who is going to pay for this transition? The money has to come from somewhere. Driscol states that an increase in investment will be needed to address climate change. He’s right. He also says that many degrowth advocates call for a decrease in investment.

This is partially correct. Degrowth calls for a ceasing or winding down of things that are causing the problem (climate change). This includes winding down investment in fossil fuel production. At the same time, things that will help, such as green energy production, education, and care for rapidly aging populations – should increase.

So where is this increase in investment going to come from?

We as a species did go on a huge spending spree before to save humanity. We could do it again.

Adjusted for inflation, World War II cost the U.S. over $4 trillion dollars. By 1945 defense spending comprised about 40 percent of U.S. GDP.

Now, let’s talk about the present. A 2019 report by the World Bank estimated that we needed a global investment of over $90 trillion by 2030 to make the transition to a low-carbon economy to limit global warming to 2 degrees Celsius. That sounds like an insanely large number, and it is, but such action is doable. Global GDP per year is a little over $96 trillion. I’m writing this with 6 years left in the decade, and let’s generously assume that $36 trillion has already been spent on climate mitigation or will be picked up by the private sector. That leaves us about $60 trillion for 6 years or in this admittedly wildly back-of-the-envelope math - $10 trillion a year globally.

If governments around the world would agree to spend about 10 percent of global GDP on climate change for the rest of the decade, we could be well on our way to ensuring a 2-degree world or better. Remember the US spent 40 percent of GDP to fight WWII. Couldn’t we ask the world to spend 10 percent of GDP to solve this existential crisis?

We can ask.

Then consider that if we commit to following a degrowth path and cut down on the things that are destroying us (sorry celebrities, you may have to live without private jet travel), we likely don’t need $10 trillion per year. If our leaders are honest with us and tell us that for the rest of the decade, we won’t be living extravagantly – only quite comfortably - and we start to phase out the behaviors that are killing us and incentivize those that can help us, then we might be okay.

We can ask.

Who’s going to go first?