In an attempt to reverse the financial meltdown and get the economy growing again, heads of state, Wall Street financiers, Federal Reserve economists and CEOs are all scrambling to arrange bailouts for banks and businesses. I believe that if these leaders continue down the bailout trail, they will only make matters worse. Financial shell games aimed at coaxing more growth out of an already overgrown economy just add fuel to the fire.
If economic growth is the answer, how did we arrive at this mess in the first place?
Three frightening features of the economic landscape come to mind:
- A debt-riddled financial system coupled with growing unemployment and inequities between the haves and have-nots;
- Profound environmental problems such as climate change, loss of biodiversity and deforestation that are the unintended consequences of market activity;
- Increasing demand for energy despite dwindling supplies and intense international competition for the Earth’s remaining resources.
After 60 years of growth, these problems have only worsened. Despite decades of political rhetoric to the contrary, economic growth conflicts with environmental health. At this juncture in history it is time to re-envision our economic goals and shift from pursuing a bigger economy to pursuing a better, non-growing, steady state economy. Such a shift toward “right-sizing” is the path to sustainability and true prosperity. It’s time for economists and our business leaders to poke their heads outside the neoclassical economics box.
_Rob Dietz is the executive director of the Center for the Advancement of the Steady State Economy (CASSE), www.steadystate.org. Voice support for the steady state economy by visiting CASSE’s website and signing the common sense position on economic growth.