mandarine

A post about the bright side of the impending energy crisis: what if sustained development was the next big growth reserve for our greedy economy?

About growth

Economy needs growth. I hate to admit it, but I now believe it is true. Let us use my canonical model to illustrate why. Imagine that everybody in the village stops believing that moving their butts will make any difference. Either because they have everything they could possibly need. Or that everything will stay the same, whatever effort they devote to themselves, their children, their neighbors. Or that everything will deteriorate, whatever they do. You can imagine how gloomy and dull life in this village might become. People need something to get going. People need ideals. People need motivation. People need to know that today’s effort will be rewarded tomorrow somehow.

For want of better words, let me call growth this specific trust that we can make tomorrow a better day. In today’s narrow-minded western economy habits, it is considered equivalent to a very deceitful indicator called GDP increase rate. You measure how much more goods were produced this year compared to last year. An increasing GDP means that your country is getting richer (cough). As getting richer is what everybody wants most, people are bound to pursue GDP growth, hence tomorrow will be a better day, right? (cough cough)

But when my standard of living reaches a level where I have fulfilled all my fundamental needs, it takes an unhealthy amount of greed to go on working my ass off for an extra DVD player, an extra SUV, an extra yacht. I think fewer and fewer people are under the illusion that earning more money and owning more stuff will bring them more happiness. Maybe this is why so many western economies are now in and out of stagnation: our stomachs are full, our homes are warm, our health is under control — it is not clear how it could get much better than this.

I have friends who believe there is a limit to our needs and desires. This would mean that every economy is bound to end up stagnating (assuming a stable demography). Stabillity could be all right, but unfortunately stagnation is a slippery slope that leads straight down into the dim prospects of recession and crisis and misfortunes for many.

But maybe there is no limit to our wishlist, and we are just prisoners of a materialistic view that does not allow wishes outside the narrow box of what money can buy. We could use more friendship; we could use more quality time with our families; we could use more solidarity; we could use more smiles; we could use more love. None of this can be bought. None of this can be measured by GDP. So maybe there is a brand new world of growth potential beyond the realm of money and its narrow boundaries. However, our economy is not ready to cross that boundary, and we have to make do with whatever tools we have.

What if ?

If we have to cope with a materialistic economy, it means that further growth can only come from new material needs. Information technology has aroused new needs and fueled our growth over the past decade, but I believe the momentum is gradually slowing down. Almost everybody around here now has a computer, a cellphone, an MP3 player, a digital camera, now what? Are we just going to replace those every second year to be disciplined growth-wary consumers? What new technology leap could be as big as the advent of the digital era? Probably none until personal fusion reactors are developed.

But I see a new deal inching its way into the big economic playground of the next decades. It looks creepy and gloomy, and is called energy crisis and climate upset. This new player will alter all the rules of the game. It will make us change our life styles, our consumer routines, our houses, our cars, our household apparatus, our jobs, all our habits. And we know it. A lot of people are now realising that things cannot go on the way we got used to, and the outlook can appear quite frightening indeed. But what if the new player put a little makeup, and pinned a new name tag saying ‘energy revolution and climate challenge?’ Wouldn’t we be keener to play along and tackle this new frontier with renewed motivation?

Armed with a mighty stick that was so scary that it managed to get everybody’s attention in 2006, the new deal now wields a very big carrot that western economy will most certainly go after quite soon. 2006 was the year the public at large got the message that everything will have to change. My educated guess is that 2007 will be the year the words spreads to big businesses and they start investing in the changing landscape. As they observe more people carpooling, buying organic food, choosing sober vehicles, riding their bicycles, shopping in fair trade networks, big idle capitals will certainly change course and start paddling along to catch up on the monster wave that looks too good to be surfed.

It all seems so easy:

1. There is a lot of money out there just hesitating where to be invested, when fewer and fewer traditional industrial niches can guarantee 10% profit. We already see skyrocketing sales for wood stoves, solar heating systems, lambswool for roof insulation, hybrid vehicles: where else can investments bring double-digit yearly profits?
2. There is no long-term expensive R&D to conduct: we already know how to make sober vehicles, solar heating, energy-neutral housing, etc. This is low-tech, short-lead, high-volume industry, unlike telecommunications or aircraft manufacturing.
3. The public is already prepared. Environmentalist whistle blowers have already done all the costly advertising work: everybody knows they will have to buy a new car, dump their old oil boiler, re-insulate their house or even build a new one.
4. It will take decades to fulfill the new needs. This growth reserve runs really deep. Just think that a lot of the industry and the farming world will also have to re-equip to face the new energy challenge.
5. The US are far behind. It can look like a drawback. But they have the money and the American public and business could very well be the fastest to U-turn into the wind of change. Starting from farther back makes for more growth reserves.

Running along

I acknowledge that this is a race against the clock: if the energy crisis and climate changes are faster than us, all of this will be in vain, and the economy will shatter to the ground. If we have a new ‘29 great depression, a third world war, a global Argentine crisis overnight, money will be useless before people know what hit them. But probably there is a chance to outrun the catastrophe. And when big business swims in the same direction, it can make a real change.

Many believe the industry and the capitalist economy are short-sighted and conservative. I wager that it can be otherwise, especially when there is big money to be made. Once Exxon, GE, Procter & Gamble, Wall-Mart, DuPont or Monsanto decide that I have to buy smaller cars and carpool, buy low-power light-bulbs and go to bed at sundown, buy eco-friendly washing powder and cutback on the laundry, buy fair trade food and eat less, buy straw-based insulation for my adobe house and take it easy with the thermostat, sow organic grain and reduce my red meat intake, there will be no resisting. And if both the public and the money row together, politics will miraculously follow.

In a nutshell: either the apocalypse is at hand, or it is not. Then I know where the promised-land-cum-brand-new world-cum-goldmine is: it is called sustained development. And the sooner I get there, the happier/prouder/richer I will be.

This entry is filed under economy, environment, viewpoints. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.