Is `de-growth' compatible with capitalism?

By Alejandro Nadal

July 15, 2010 -- TripleCrisis -- A serious campaign in favour of “de-growth” has been going on for some time and has made important contributions. This movement has opened new avenues for debate and analysis on technology, credit, education and other important areas. It’s an effort that needs support and attention, and we must applaud their initiators and promoters for their boldness and dedication.

De-growth is defined as “a reduction of production and consumption in physical terms through down-scaling and not only through efficiency improvements”. Kallis-Schneider-Martínez Alier explain that de-growth is a smooth, voluntary and equitable downscaling of production and consumption that insures human wellbeing and ecological sustainability locally as well as globally on the short and long term. Thus, de-growth is not limited to a technological dimension.

A conference in Barcelona presented several policy measures aimed at bringing de-growth to fruition. Some of these are related to macroeconomic policies but their effectiveness remains unclear. For example, monetary reform with the elimination of fiat money may or may not lead to de-growth or stable steady state economies.

But there is a fundamental problem with de-growth (or zero growth) theories: they perceive growth as stemming from manias, fetishism, cultural or psychological roots. The best example of this worldview can be found in Serge Latouche.

The problem with this perspective is that the cause of growth becomes psychological, a question of mentalities and even fashion. The idea that growth could originate from forces within capitalist economies is ignored.

Capitalism's purpose

Growth is not only a cultural phenomenon or a feature of a maniac mentality. It is the direct consequence of how capitalist economies operate. This is true of capitalism as it operated in Genoa in the 16th century, and it is true today with the mega-corporations that rule global markets. The purpose of capital is to produce profits without end, that’s the meaning of its particular form of circulation. Its purpose is not to produce useful things or useless stuff, its object is to produce profits without end and produce more capital. This is the engine of accumulation and it is fuelled by inter-capitalist competition.

In the words of Karl Marx’s Grundrisse,

Conceptually, competition is nothing other than the inner nature of capital, its essential character, appearing in and realized as the reciprocal interaction of many capitals with one another, the inner tendency [presents itself] as external necessity. Capital exists and can only exist as many capitals, and its self-determination therefore appears as their reciprocal interaction with one another.

By the forces of competition, “capital is continuously harassed: March! March!”. Thus, Marx’s analysis shows convincingly that capital can only exist as private centres of accumulation that are driven by (inter-capitalist) competition. This is why, in its quest to expand and survive (as an independent centre of accumulation) capital is continuously opening new spaces for profitability: new products, new markets. The corollary of this is that the only way in which we can get rid of “growth mania” is by getting rid of capitalism. It is not possible to have capitalism without growth.

Technological fix?

Is there a technological fix out of this? In other words, can we have such an efficient technological infrastructure (in buildings, energy and transport systems, manufacturing, etc.) that even with growth the ecological footprint could be reduced? This remains to be seen, but one phenomenon seems to conspire against this: the rebound effect. As technologies become more efficient and unit costs become smaller, consumption increases. Either existing consumers deepen their consumption, or more people have access to the objects or services being put on the marketplace. The end result is that the positive effects of greater efficiency are cancelled by deepening consumption rates. And let’s not forget what happens when consumption stops or slows down: those centres of accumulation cannot sell their commodities, inventories grow, unemployment soars and we have recessions, depressions and crises.

From the side of production, for those individual centres of accumulation every gadget, every nook and cranny in the world, or any vast expanse of geographical space is a space waiting to be occupied for profits. From pep pills to tranquilisers, food and water, health and even genetic resources or nano-materials, to the anxious eyes of capital all of these dimensions are but spaces for profitability. Talk about investing in “natural capital” as a way out to the dilemma is devoid of any sense.

It could very well be that, in the words of Richard Smith we either save capitalism or save ourselves, we cannot do both.

[This article first appeared at TripleCrisis blog and is posted at Links International Journal of Socialist Renewal with permission.]