Growth & Degrowth: What Should Ecosocialists Say? – Part One

Ecosocialist groups are currently debating whether growth or degrowth is the appropriate demand for the movement. In this first part of a two article series, John Molyneux explores the concept of growth.

Throughout most of the existence of the labour and socialist movement the dominant position has been to favour economic growth.

Many trade union, labour or social democratic conferences have passed resolutions calling for governments to adopt policies of economic growth. ‘Go for growth!’ has been a recurring slogan.

The justification has always been simple: economic growth is essential to maintain and create jobs and is the most favourable set of circumstances for raising living standards. And for the vast majority of reformist and social democratic politicians, and trade union officials, unwilling to contemplate any sort of challenge to capitalism, jobs and increased living standards were pretty much the limit of their aspirations.

Hence, the mainstream of the labour movement is attracted to Keynesianism. Faced with economic crisis, recession, cutbacks, and austerity, a belief in the economics of John Maynard Keynes – the expansion of public spending to stimulate the economy on the basis of ‘deficit financing’ – enabled them to blame all these evils not on capitalism itself, but on the wrong policies of the government due either to stupidity or an ‘ideological’ commitment to monetarism, neo-liberalism and the free market; a problem that could be corrected by the election of an alternative (social democratic) government which would restore economic growth.

Left criticism of this approach came mainly from left reformists such as Tony Benn, Jeremy Corbyn and various Communist Parties who proposed ‘alternative economic strategies’ which also argued for economic growth within a capitalist framework, but through a greater injection of public ownership (nationalisation) and state planning.

Further to the left stood Marxist and revolutionary socialists who questioned the idea of a left government working on the basis of capitalism.  The revolutionary Marxist critique generally maintained that the contradictions inherent in capitalism – tendency to overproduction, tendency of the rate of profit to decline etc – made recurring economic crises inevitable and sustained economic growth impossible. The achievement of the latter required the overthrow of capitalism, through workers’ revolution, and transition to democratically planned socialist economy.

In this perspective the idea of economic growth as such was not challenged although, of course, it was argued that economic growth would be made to serve very different purposes – social need not private profit, welfare not warfare; schools, hospitals, housing and culture, not capital accumulation and luxury consumption.

The advocacy of economic growth was also linked in the thinking of many on the left with the need for economic ‘development’ in what was called the Third World, now the Global South, to end the scourges of extreme poverty and so-called dependency. Indeed, for many self-described Marxists in, or in solidarity with, the countries of the Global South, economic development came to be seen as not only a prerequisite of socialism but also as virtually identical to it. This in turn was associated with the argument, shared by Stalinists and many Trotskyists alike, that the high rates of industrial growth achieved by the Soviet Union in the 1930s through to the 1950s were proof of its socialist or, at least, non-capitalist character.

Trotsky himself described, ‘the economic successes of the soviet regime… [as] the experimental proof … of the practicability of socialist methods’¹ and argued that ‘Socialism has demonstrated its right to victory, not in the pages of Das Kapital, but in an industrial arena comprising a sixth part of the earth’s surface – not in the language of dialectics, but in the language of steel, cement and electrification.’²

Finally, socialist commitment to economic growth could be seen as deeply embedded in the idea central to Marxist historical materialism of a dialectic of the forces and relations of production. According to the Marxist theory of history, the fundamental driving force in human history was the development of the forces of production which conditioned or shaped the social relations of production.

At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or – this merely expresses the same thing in legal terms – with the property relations within the framework of which they have operated hitherto. From forms of development of the productive forces these relations turn into their fetters. Then begins an era of social revolution. The changes in the economic foundation lead sooner or later to the transformation of the whole immense superstructure.³

Thus, socialism came to be identified with the further development of the forces of production, no longer fettered by capitalist relations of production.

This identification was further cemented by the fact that in so far as there was criticism of this ‘growth’ model , it seemed to come from anti-socialist right wing of the environmental movement and to be associated with two ideas that were (rightly) anathema to socialists: a) the reactionary and potentially racist notion of overpopulation as a driver of the environmental crisis; b) the related proposition that what is required to save the planet is a reduction in consumption by the mass of the population.

Growth or degrowth?

The question now, as we face up to the implications of the anthropocene, is: has the imminence of catastrophic climate change and of numerous other threats to the biosphere changed all this?

Are socialists and, especially, those of us who would identify as eco-socialists, now obliged to see continued economic growth as a threat to human survival and should be abandoned? And should ‘degrowth’ as an aim or slogan be adopted?

There are two obvious Marxist responses to these questions which do not require any substantial rethinking of the Marxist paradigm.  The first is that, regardless of the past statements or practice of various socialists, it is not socialism but capitalism which is really committed to endless economic growth.

Moreover, the commitment is not just, or even primarily, ideological. It is neither a prejudice nor a mindset but, as Marx demonstrated in Capital, a material drive inherent in capitalist relations of production imposed on each capitalist unit, be it corner shop or multinational corporation or capitalist state, by the relentless logic of competition. Capitalism and capitalist governments can no more renounce growth than a crocodile can go vegetarian.

On those occasions where cyclical recession or some external catastrophe (such as the Covid pandemic) imposes a period of degrowth on capitalism, it is a catastrophe from which the system strains every nerve and sinew to escape regardless of the long-term consequences for humanity or nature.

The second reply is that there are some sectors of the economy, some forces of production which socialists would certainly want to ‘de-grow’ or eliminate entirely, such as the fossil fuels industry, the car industry, the arms industry, perhaps the advertising industry. Yet, other sectors we would want to greatly expand such as production of renewable energy, education, health care, public transport and so on.

These answers, in themselves, seem valid to me but they leave open the question of whether a sustainable future requires economic degrowth overall and on a global scale.

Before answering that question, and in order to answer it, we have to we have to step back a moment and ask what we mean by economic growth and by the development of the productive forces, as well as what we understand by a socialist society.

The meaning of ‘growth’

At first sight it might seem that the meaning of economic growth is obvious: more and more production of more and more ‘things’ or ‘stuff’.

Thus writing in The New Internationalist, Giorgios Kallis, a prominent advocate of ‘degrowth’, argues:

The Left has to liberate itself from the imaginary of growth. Perpetual growth is an absurd idea (consider the absurdity of this: if the Egyptians had started with one cubic metre of stuff and grew it by 4.5% per year, by the end of their 3,000-year civilization, they would have occupied 2.5 billion solar systems.). Even if we could substitute capitalist growth, with a nicer, angelic socialist growth, why would we want to occupy 2.5 billion solar systems with it?

You would have thought that Kallis might have asked himself how it is, if his argument is sound, that after not three but five thousand years Egypt, which started with much more than one cubic metre of stuff, has not even filled up Egypt – it remains mostly empty desert – let alone billions of solar systems.

In fact, economic growth doesn’t mean making more or bigger ‘stuff’ at all.  What drives capitalism to grow, what compels it to grow, is not a relentless desire to produce stuff but a relentless desire to produce profits. The production of a new generation of computers constitutes huge growth for Microsoft and for the US economy, but a decrease in physical size. A boom in the production and sale of luxury Rolex watches constitutes a very considerable amount of economic growth but adds next to nothing in terms of quantity of ‘stuff’.

The best known measure of growth is GDP (Gross Domestic Product). Despite its name this is not a measure of physical product but of monetary value, that is, the market value of all the final goods and services produced in a specific time period.

The OECD defines GDP as “an aggregate measure of production equal to the sum of the gross values added of all resident and institutional units engaged in production and services (plus any taxes, and minus any subsidies, on products not included in the value of their outputs)”.

An IMF publication states that, “GDP measures the monetary value of final goods and services—that are bought by the final user—produced in a country in a given period of time (say a quarter or a year)”. There are various technical debates about how accurate a measure GDP is, but whether the choice is ‘GDP (nominal) per capita’ or ‘GDP per capita at purchasing power parity (PPP)’ or ‘GNP (Gross National Product)’ or ‘GNI (Gross National Income)’ the fact remains that all these concepts are measures of monetary value and not physical production.

It might be objected that even if this is technically true there is, in practice, a general link between economic growth and growth in physical production, and here the key point is that it is physical production, not monetary value, that damages the environment.

Actually, any consistent link or correlation is hard to establish. According to the World Bank the following are the ten countries with the highest per capita GDP: Macau, Luxembourg, Singapore, Qatar, Ireland, Cayman Islands, Switzerland, United Arab Emirates, Norway, and the USA.

Of these only the US is a significant maker of ‘things’. And some on the list such as Macau and the Cayman Islands produce next to nothing. Ireland is another example of the same point. In 2015 Ireland announced a 26.3% rise in GDP, later revised to an extraordinary 34.4% in July 2016 by the Irish Central Statistics Office. But these figures had nothing to do with increased production and simply marked the distortion of Irish economic data by tax-driven accounting flows.

Paul Krugman famously called this ‘leprechaun’ economics, arguing it was a feature of all tax havens:

Now, I’ve coined a few economic phrases I’m proud of: “leprechaun economics” for the distortion of statistics caused by multinational corporations in search of tax havens.⁴

This conceptual decoupling of ‘growth’ from physical production does not, however, let capitalist growth off the hook. The point about capitalist growth is that it is a compulsion. It is enforced by competition on every capitalist company, including all the most environmentally damaging (such as Exxon Mobile, BP, Shell, Toyota, Volkswagen, Boeing), and every capitalist state, including those who are doing the most harm to the planet as a whole (such as the US, China, Brazil, India, Saudi Arabia and so on).

Given the crucial role played by fossil fuel and automotive capital within contemporary capitalism, it is unavoidable that capitalist economic growth will continue to drive climate change and other environmental damage, but this does not mean that it is possible to draw such conclusion from ‘growth’ as such, as an abstraction.

I shall return to the matter of growth under socialism shortly but first let us consider the question of the forces of production.

Just as some people think of economic growth as making more stuff, some people think of the productive forces as just machines and technology. However, this was not Marx’s view.

In The Poverty of Philosophy, Marx wrote that ‘of all the instruments of production the greatest productive power is the revolutionary class itself’.⁵

He was right because machines are made by people and then require human labour/workers to set them in motion. Moreover, the level of scientific knowledge and skill of the makers, of the society at that moment, is a major factor in determining what machines can be made and how productive they are.

Therefore, the productive forces should be thought of as the general capacity of society to produce goods and services, which will therefore also include natural resources.

In The Critique of the Gotha Programme, Marx insisted that nature, as well as labour, was a source of wealth; and in Capital, he referred to the worker and the soil as the two ultimate sources of wealth.⁶ ‘As the earth is his [humankind’s] original larder, so too it is his original tool house… The earth itself is an instrument of labour.’⁷

If the productive forces constitute society’s general capacity to produce, then their development or advance need not necessarily result in more production of things at all but might equally result in producing the same amount in less time. Marx, himself, put a lot of emphasis on this economy of labour time as he saw it as having the potential to free human beings from necessary labour, reduce the working week and enhance human freedom.

Real economy – savings – consists in the saving of working time…but this saving is identical with the development of productivity…To economise on labour time means to increase the amount of free time, i.e, the time for the complete development of the individual, which again reacts as the greatest productive force on the productive force of labour.⁸

From this it follows that the development of the productive forces is not an inherent threat to the environment even if their development within capitalist economic, social and political relations most certainly is.

This article was first published by the Global Ecosocialist Network.

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1. Leon Trotsky, The Revolution Betrayed, London, 1967, p.1
2. ibid. p.8
3. Karl Marx, Preface to A Contribution to the Critique of Capitalist Production, 1859
4. Paul Krugman,  ‘Opinion‘, New York Times, (28 January 2020).
5. Karl Marx, Cited in D. McLellan, The Thought of Karl Marx.  p.38
6. Karl Marx, Das Capital, Vol 1 p.475
7. ibid. p.175
8. Karl Marx,  The Grundrisse, cited in D.McLellan, Marx’s Grundrisse, MacMillian, London 1971, p.148