The word “Growth”, endlessly repeated by politicians during the present election campaign, is doing a lot of heavy lifting. Faith, Growth, but rarely Charity, are the cardinal virtues displayed for the mass media. When all the promises are ‘fully costed” but fall short of balancing, Growth is the shared panacea.
The trouble is growth post-BREXIT, Covid and Putin’s war looks feeble. No politician is reckless enough to explain exactly what they mean by Growth – though there are clues in the “Kick-start Economic Growth” section of the Labour Party Manifesto. Obviously, something organic and getting bigger - not to be mistaken for the magical money tree. Economists created a value they could express as a single figure or how would we all know if the economy, more precisely GDP, (Gross Domestic Product) was getting bigger, smaller or remaining unchanged? Not that there has ever been a clear consensus on what should be included in GDP. We still hang onto something of Margaret Thatcher’s homely simile that the national economy is like a huge domestic budget and managed in the same way. It isn’t. And, incidentally, domestic labour is one of the productive activities that economists leave out of GDP measurements. Were it to be included, the ILO, International Labour Organisation, estimate unpaid domestic work and caring to amount to be 9% of global GDP ($11 trillion) of which women’s domestic labour makes up more than two-thirds or 6.6%. Surprisingly, despite their prominence today, Growth and GDP are a relatively recent concern of economists. The history of Growth as a concept is set out in the opening chapters of Daniel Susskind’s brilliantly accessible Growth: The Reckoning Allen-Lane 2024. It was the economic crisis of the Great Depression (1929-1939) that triggered the search for some simple measurement of economies. During the Second World War the question of what proportion of the overall economy could safely be devoted to war production became pressing. “The American people have learned during the war the measure of their productive capacity’, President Roosevelt triumphantly declared to Congress in January 1945”. And it was not long before measures of Growth expressed as GDP were regarded as important indicators of who was winning the Cold War. Now, as the current election campaign nears the end, Growth has been established as the panacea for national decline. So today we have figures for GDP per capita over time telling us whether there is growth or ‘degrowth’. And because economics dominate our political thinking about what matters, while economists keep at arms’ length other things that matter, which they label as ‘externalities’, public political debate does not engage with questions about the price paid for Growth. Since the industrial revolution, whose origins lie at the end of the 18th century, what is now described as Growth brought unprecedented prosperity to much of the world, Africa is an exception, reducing poverty, dramatically improving education, enabling leaps forward in public health, feeding vastly increased numbers of people. But, looking at the UK – and not only the UK – nearly all these advances are now either stalled or going into reverse. The damage arising from blinkered, ungoverned Growth includes the fast-approaching climate catastrophe caused by carbon emissions, the degradation of our natural environment, the possibility of nuclear holocaust narrowly averted at least twice in the last century, ill-health caused by industrialised food, and growing inequality. The Growth dilemma is never “fully costed” nor raised in the barrage of interviewers’ questions about the economy on radio and TV. Growth as economic panacea remains a deceptive proposition unless its hidden trade-offs are acknowledged, shared with citizens for deliberation, and mitigated by government action. This is not the only message of Susskind’s revealing book, but it is certainly the most important one. Susskind sets Growth within the context of the common good, rather than in short-term party-political la-la-land. He poses fundamental questions about what kind of society in what kind of the world do, we, our children and grandchildren want to live in? Something you might have expected political leaders to talk about. And expected the electorate to want to hear about. Where Growth: The Reckoning is doubly helpful it is in resetting Growth within a discussion of trade-offs, rather than a simple binary argument, more growth or degrowth, and in proposing a direction of travel for social and economic development. Perhaps it is most insightful in its vision of Growth as meaning more than increasing the production of material things - and money- by adding ideas and innovation to the mix and proposing other ends to pursue. Susskind wants to redirect and redefine Growth not get rid of it. He distinguishes this approach from the temptation to insert socially desirable activities into the old, tired model which is yielding diminishing returns. What is considered socially desirable poses moral questions liable to be treated in a technocratic manner or left to market forces. This is not as theoretical as it sounds. As an example, Susskind uses the pool of networked ideas existing at the time of the COVID outbreak in early 2020 in the world of medical research which, with government funding, created COVID vaccines in an extraordinarily short time. And here the moral dimension of this innovation was evident in the failure to supply the global South adequately. Susskind delves more deeply into this terrain with an interesting discussion of intellectual property – the ownership of ideas - “the most important toolbox that societies have to shape the creation and distribution of ideas”. Balancing the costs of Growth, sacrificing one benefit for another, requires the widest possible deliberation and consultation. To achieve Growth Government must provide incentives the necessary means - such as a healthy educated workforce - and an enabling atmosphere. Yes, the other most repetitious campaign word “a plan”. It must include investment in research and development, and in public-private partnerships – which has some positive references in the Labour Manifesto and in James Naughtie’s exceptional exploration of Growth and innovation in The World at One on 23 June. Susskind also calls for citizen involvement in the form of civic assemblies to generate and evaluate new ideas but also to nurture comprehension of what is at stake, as well as support for progressive forms of government intervention. Susskind’s believes in “the innovative genius of humankind”. His book sustains a refreshing balance of ideas, academic analysis and down-to-earth realism drawn from his work in the policy unit at No. 10. The gulf between his book’s clarity, understanding, and vision and the mind-numbing repetition of the word Growth that political leaders, right now, feel obliged to utter under questioning is shocking. Have these six weeks locked in party-political-media inanity been democracy at work? If you don’t think so send this book to whoever gets elected in your constituency. See TheArticle 27/06/2024
2 Comments
Sushila Zeitlyn
29/6/2024 08:18:24
Thanks for this thought provoking review. You have made me want to read Susskind’s book
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Peter Nathanielsz
1/7/2024 10:14:22
I agree with Sushilla. You have written an exciting review for Susskind’s book. Perhaps one issue is that the type of growth proposed generally is that which enriches the proposal. Thus the suggestion Of growth being dependent on less Business tax is at the forefront of the policies of the right Ring and Business community. One he is very little about Gross due to decreasing expenditure on the illness produced by mass produced processed food and high sugar content items. Thank you again for writing such stimulating comments, on our Common situation .
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