The End of Growth: Adapting to Our New Economic Reality (37 page)
Read The End of Growth: Adapting to Our New Economic Reality Online
Authors: Richard Heinberg
Tags: #BUS072000
The End of “Development”?
For decades agencies that either actually or ostensibly aimed to aid impoverished nations have employed the terms “developed,” “developing,” and “underdeveloped” to refer to countries at various stages of industrialization. In ordinary usage, the word
develop
often means “to progress from an embryonic to an adult form”; thus its application to processes of economic and social change has conveyed an implicit assumption of inevitability. By calling rich industrialized countries “developed” and poor non-industrial countries “underdeveloped,” policy makers were in effect saying that industrialization is equivalent to the healthy biological process of maturation, and should be the goal of all human societies. Through a trade-led process of economic expansion, non-industrial countries with subsistence economies and large indigenous populations must aim to become urbanized, consumer-driven, cosmopolitan manufacturing centers (according to this view): it is their right and destiny to do so.
This set of assumptions was always questionable. Indeed, it has been attacked with some vigor by Vandana Shiva, Helena Norberg-Hodge, Martin Kohr, Jerry Mander, Doug Tompkins, Gustavo Esteva, Edward Goldsmith, Ivan Illich, Manfred Max-Neef, David Graeber, and other prominent development critics (sometimes also known as post-development–theorists).
38
The critics of development claimed that the project of using loans and aid packages to fund huge infrastructure projects in poor nations, or to build factories there for multinational corporations, was at its core merely a continuation of colonialism by other means. Since two-thirds of the world’s nations were defined as “underdeveloped,” this meant that people in most countries needed to look outside of their own cultures for economic, agricultural, and educational models. Poor Third World nations were encouraged to take on enormous amounts of debt, and to flush young people out of the countryside and into cities. All of this came at both a human and an environmental cost.
Development, according to the critics, was actually a euphemism for post-war American hegemony; and indeed it was the US (along with its European allies) that provided the loans, trade rules, educational templates, and media images that would reshape societies across the global south.
BOX 5.3
Development and Freedom
Nobel Prize-winning economist Amartya Sen argues that a country’s development should be measured by the freedom of its citizens.
42
Sen points to political freedom, civil rights, economic freedom, social opportunities (access to healthcare, education, and other social services), transparency guarantees (dealings with others and the government that are characterized by a mutual understanding of what is expected and what is offered), and protective security (unemployment benefits, famine and emergency relief, and general social safety nets) as comprising an interdependent bundle of freedoms that are instrumental in enabling people to live better lives.
Sen refers to these freedoms as “capabilities,” arguing that they contribute to human functioning.
43
He sees life as a set of “doings and beings” — i.e., being healthy, being employed, being safe, and so on. Capabilities are a person’s ability to do or be what they want given the resources they have. Civil rights, government transparency, education, and famine relief all make people better able to do and be what they want with what they have. And, for Sen, it is the ability and freedom to achieve what one wants that is the hallmark of development. Within the capabilities approach, development can be understood then as a process by which capabilities and freedom are expanded — not one where large increases are achieved in national GDP.
In this view, developed countries are not those with the highest per capita incomes, but those where people are best able to do and to be what they want.
One way to understand capabilities, development, and freedom is to think of them in the context of food security. It is widely understood that today people typically go hungry not from lack of food, but from their inability to access it. Poverty, social exclusion, and corrupt governance can all result in people being denied access to food. For example, a person may have the money to buy food and still go hungry due to unequal social status that results in exclusion from food networks. The way to remedy this is not by money alone, but by expanding capabilities and freedom. What the individual needs is civil rights and equal protection under the law. And the best way to achieve this, according to Sen, is through democracy. Sen argues that there has never been a famine under a democratic government. This is because in a democratic system people are better able to petition the government to act in emergency situations; also, democratic accountability provides incentives for leaders to act.
Sen’s capabilities approach has been incorporated into some welfare and poverty measurements being used today. The best example is the UN Human Development Index (HDI). This measure looks at education and life expectancy along with income to measure and understand a country’s development. It is interesting to note that the HDI does not correspond directly with a ranking of countries by GDP, or even GDP per capita — a measure that tends to mask inequality. For example, Norway ranks first on the HDI and 25th by national GDP. Conversely, China ranks second by national GDP and 89th on the HDI.
Another important consequence of the capabilities approach is that it allows for some real welfare improvements to be made that do not rely on increased resource use. For example, rooting out political corruption and ineptitude does not require much energy or resource throughput. However, other “capabilities,” including education, health, and nutrition may be more problematic in this regard. In their paper “Energetic Limits to Economic Growth,” Davidson, Brown, et al. argue that it has not been possible to increase socially desirable goods and services like nutrition, education, healthcare, technology, and innovation without increasing the consumption of energy and other natural resources.
44
Two books galvanized anti-globalization activism and epitomized the arguments of development critics:
Ancient Futures
(1991) by Helena Norberg-Hodge, and
Confessions of an Economic Hit Man
(2005) by John Perkins.
39
As a graduate student in linguistics in the 1970s, Norberg-Hodge had chosen to do field work in Ladakh, a remote Buddhist region in northern India. She found there a traditional village-based society virtually untouched by the modern Western world. The people had their problems, as people everywhere do, but the culture had evolved to suit its ecological constraints and opportunities; most people seemed generally happy, helpful, and friendly. Norberg-Hodge has continued her work in Ladakh up to the present, documenting how development has uprooted families, upended cultural norms, turned self-sufficiency into dependency, and created more misery than satisfaction.
John Perkins, a former chief economist at a Boston-based strategic consulting firm, claims he was groomed in the 1970s as an “economic hit man,” in which capacity he helped needlessly to plunge poor nations like Indonesia and Panama into debt. Perkins tells how he used purposefully over-optimistic economic projections to persuade foreign governments to accept billions of dollars in loans from the World Bank and other institutions in order to build dams, airports, electric grids, and other infrastructure that he knew they couldn’t afford and didn’t need. Construction and engineering contracts were routed to US companies, with bribes to top foreign officials smoothing the way. However, the resulting debts ultimately had to be shouldered by the taxpayers in the poor countries. When payments couldn’t be made, the World Bank or International Monetary Fund would jet in a team of economists to dictate the country’s budget and security agreements. Perkins contends that this all amounted to a clever way for the US to expand its global influence at the expense of citizens in poor, often largely indigenous nations.
The defenders of development have always maintained that such claims are either fabricated or overblown, and that the real purpose of loans and aid packages has been to raise the standard of living of people in the world’s poorest countries. Statistics lend support to this view. The recent 2010 UN Human Development Report concludes that people in poor nations are generally healthier, wealthier, and better educated than they were 40 years ago.
40
Surveying human progress in 135 countries — 92 percent of the world’s population — the report shows that average life expectancy rose from 59 to 70 years, primary school enrolment grew from 55 to 70 percent, and per capita income doubled to more than $10,000. The report’s authors do devote a section to discussion of the “weak association between [GDP] growth and quality of life indicators such as health, education, political freedom, conflict and inequality,” and also note that, “Within countries rising income inequality is the norm.”
BOX 5.4
Development or Overdevelopment?
Development critics place significant emphasis on these latter points. It is relatively easy to measure GDP; it is more difficult to quantitatively assess the integrity of families and communities. Also, much of the measured “progress” of the past few decades has occurred in a few rapidly industrializing nations, while many very poor countries have actually lost ground in terms of most citizens’ access to food, water, and shelter. Averages and totals can obscure important and worrisome details.
Environmental preservationist and publisher Doug Tompkins, among others, uses the term “overdeveloped” to refer to what are conventionally called “developed” nations, and “nations on the road to overdevelop-ment” for those usually classified as “developing.” In this view, the goal of “development” as typically pursued is a condition that is clearly unsustainable, hence the term used to refer to it should reflect that fact.
45
The term also is logically required as a counterpart to the more commonly employed concept of “underdevelopment.” Questioning how and why nations develop unevenly can lead to greater insight into the process whereby certain nations commandeer resources and labor to become “overdeveloped.”
The discussion about development’s efficacy was important during the heyday of economic expansion. However, now that growth is ending, the goal of conventional economic development — whether or not it ever made sense from humanitarian and environmental points of view — may have become largely unachievable.
41
Without cheap transport fuel, the advantages of globalization begin to disappear, as we saw in Chapter 4. Scarce and expensive petroleum also undermines the project of industrializing agriculture and makes highway construction nonsensical. And the global credit crisis spells an end to big loans for unneeded infrastructure projects.
The priorities of poor nations have just changed. From here on, competing in the global economy will recede in importance; the primary challenge will be to adapt to post-growth world economic conditions and ever-worsening environmental challenges.
The UN Human Development Report does not address the resilience of societies in the face of declining global energy resources, the rising scale environmental disasters, or the end of economic growth (only the potential impacts of climate change are mentioned, though not taken fully into account). But in the decades ahead resilience will count for far more than economic competitiveness.
Urbanization, the industrialization of food systems, and the building of highways may have contributed to GDP over the short term, but they have created societal vulnerability over the longer term. In a world of Peak Oil, scarce fresh water, unstable currencies, changing climate, and declining trade, true “development” may require implementation of policies at odds with — sometimes the very reverse of — those of recent decades.
The phrase “sustainable development” entered the development lexicon in the late 1980s with the publication of the Report of the Brundtland Commission (the World Commission on Environment and Development); it was defined as development that “meets the needs of the present without compromising the ability of future generations to meet their own needs.” While this ideal has often been watered down in the process of implementation, if taken seriously it could help poor nations identify sound strategies for dealing with the end of growth.
All the world’s nations need to continue solving basic human problems (i.e., providing food, education, healthcare, and security) in the face of global environmental and economic change, without drawing down Earth’s nonrenewable resources or saddling future generations with onerous debt. And they have to do this in a way that protects fragile ecosystems — including forests, river systems, soils, and ocean fisheries — while, if possible, restoring them.
Nations whose subsistence farmers still form a significant proportion of the over-all population, though in recent decades termed “underdeveloped,” may in fact have some advantages in the post-growth world. Rather than continuing with ruinous attempts to install fuel-guzzling food and transport systems, these countries should be adopting the “appropriate” or “intermediate” technologies that have been advocated for several decades by E. F. Schumacher and others. Appropriate technology (or AT) is typically labor- and knowledge-intensive rather than capital-, resource, and energy-intensive. Examples include the use of local natural materials for building, the small-scale generation of local power from methane digesters, and the purification of water in households with porous ceramic filters.
People in currently wealthy nations may well find themselves adopting similar technological strategies in the decades ahead. In the process, there may be a substantial reversal of the trend, seen since the beginning of the Industrial Revolution, toward greater wealth inequality among nations.
