"The Growth Pressure is Deeply Entrenched"
Counter-strategies have a hard time because growth and capitalism are closely related. Much criticism that was once engaging is only weary remembrance
By Hannes Koch
[This article originally published in: die tagesanzeiger, August 2001 is translated from the German on the World Wide Web, www.taz.de.]
When the business cycle falls, politicians and economists of all colors cling to the hope that the cycle will soon go upward again. "I believe unchanged that growth in Germany will accelerate", economics minister Werner Muller said.
Such declarations have a religious character. They are built on the idea that the god of the market will change everything for the better. The faith healing hardly corresponds to the facts. Rather within a few months between winter 2000 and spring 2001, the western world skidded from an economic boom into a sharp depression. "Stagnation prevails" is the German Central Bank's description of Germany. Similar conditions exist in other countries like the US, Italy and the Netherlands. Firms collapse, tens of thousands of employees lose their job, stock market barometers like the Dax post new all-time lows. Yesterday the banks corrected their business cycle prognoses for Germany. A growth of only 1 to 1.5 percent is expected.
The more local phenomena intensify into a global crisis, the more pressing are the growth conjurations. According to most politicians, the highly economically developed nations will not be able to survive without permanently increased production.
Once upon a time, this was different. In the 70s, citizen initiatives and leftists first thematicized the environmentally destructive power of a system that produced an infinitely swelling stream of goods in a finite world. In the legendary 1972 report "The Limits of Growth", international scholars of the Club of Rome described how the strategy of eternal growth must ultimately break down. The German Greens transported these ideas in the parliament. The Greens declared in their 1986 economic program: "Growth as the highest possible output of goods can no longer be the economic goal."
Only a weary remembrance of these initiatives is left today. In the draft for a new Green program of principles, the gross domestic product is "no longer the only measure of prosperity". In day-to-day politics, the Greens accept the imaginary necessity of raising the gross domestic product - the value of all goods and services produced within German borders - two or three percent every year.
The pressure to growth is deeply entrenched. Once capitalism and growth were not naturally connected but were closely related. Businesses can reach their goal, increased profit, by increasing the quantity of purchased products or inventing new goods. Other possibilities exist for increasing profits - raising prices or productivity, lowering capital costs - but the expansion of the market is a popular mechanism.
Secondly, the growth pressure enjoys the rank of a law in Germany. "Measures should be taken that contribute to a constant and appropriate economic growth", declares the 1967 law for the promotion of stability and growth. In the intention of the social market economy, the population should share in the enhanced prosperity. This is easier when the cake to be distributed becomes larger every year.
Unemployment serves as justification for increased production. Through technical progress, businesses can turn out the same amount of goods every year with fewer employees. Fewer people would find work if additional factories and offices cannot sell more goods.
Whoever rejects this strategy must persuade either employees or entrepeneurs to renounce engendering the collapse of a social consensus. As a consequence, the debate has taken another direction since the beginning of the 90s. In the radius of the 1992 environmental summit of Rio de Janeiro, the term "sustainability" moved into the foreground with the hope of "uncoupling" consumption of nature from economic growth. The increase of production isn't so bad, according to the argument, when the environment is less encumbered. In some areas, hopes are beginning to be fulfilled. Energy consumption in Germany fell in the last years even though the economy grew.
Whether the uncoupling will succeed on a worldwide scale seems questionable. Use of resources must fall more than half to make possible a living standard comparable to German conditions for all humanity without damaging the environment.
Whoever considers this unrealistic returns to the starting point: Must the quantitative growth of the gross domestic product be controlled and if so how? The ex-unionist and growth critic Rudiger Kalupner is one of the few who try to find the set screw. He pleads for a radical tax reform. Work must be credited and the use of machines and capital burdened. This could slow down the rise of productivity and the increase of production. This step to a society beyond the growth ideology does not appeal either to the alliance of German industry or the German union alliance.