The limits to green growth

Observers expect the green economy to deliver sustainable economic growth, but this transition will not be automatically achieved through technology and economics alone. Instead, the green transformation is a political task, say experts.

solar panels pixabay
Solar panels on a rooftop. Proponents of green growth believe it will enable us to break free from our dependence on fossil fuels, without sacrificing growth. Image: Pixabay

In recent years, the push to build a “green economy” that can deliver the world from continual environmental and economic crisis and usher in a new era of sustainable growth has been gathering force.

But the push has been a source of unexpected controversy, with many predicting little more than business as usual with a coat of green paint. Will reconciling environmental and economic imperatives be harder than we think?

In a word, yes. The mainstream perception is that the green economy will enable us to break free from our dependence on fossil fuels, without sacrificing growth. Many argue that the shift to a green economy can even spur new growth. But, as appealing as this idea is, it is not realistic, as we show in our new book Inside the Green Economy.

To be sure, it is possible for a genuinely “green” economy to be prosperous. But the model that prevails today focuses on quick and easy solutions. Moreover, it reasserts the primacy of economics, thereby failing to recognize the depth of the transformation that is required.

Instead of rethinking our economies with a view to adapting their functioning to environmental limits and imperatives, today’s green economy seeks to redefine nature, in order to adapt it to existing economic systems.

We now attach a monetary value to nature and add it to our balance sheets, with the protection of “natural capital,” such as ecosystem services, offsetting environmental degradation, gauged by the global abstract currency of carbon metrics.

New market-based mechanisms, such as the trading of biodiversity credits, exemplify this approach. None of this prevents the destruction of nature; it simply reorganizes that destruction along market lines.

As a result of this narrow approach, current conceptions of the green economy have so many blind spots that the entire enterprise should be regarded as largely a matter of faith. The most powerful talisman is technological innovation, which justifies simply waiting for a cure-all invention to come along.

But, though new ideas and innovations are obviously vital to address complex challenges, environmental or otherwise, they are neither automatic nor inevitable.

Innovation, particularly technological innovation, is always shaped by its protagonists’ interests and activities, so it must be judged in its social, cultural, and environmental context. If the relevant actors are not working to champion transformative technologies, the results of innovation can reinforce the status quo, often by extending the life of products and systems that are not fit to address society’s needs.

Consider the automotive industry. Though it produces increasingly fuel-efficient engines, it puts them in larger, more powerful, and heavier vehicles than ever before, eating up efficiency gains through the so-called “rebound effect.”

And it faces the temptation to spend more energy learning to manipulate emissions readings, as Volkswagen did, than on developing genuinely “green” vehicles.

Biofuels are not the answer, either. In fact, the use of biomass wreaks ecological and social havoc in developing economies, while de facto extending the lifetime of an obsolete combustion technology.

Clearly, the automotive industry cannot be blindly trusted to spearhead the radical reorganization, away from private vehicles, that is needed in the transport sector. And that is exactly the point. If we are to decouple economic growth from energy consumption and achieve real resource efficiency in a world of nine billion, much less ensure justice for all, we cannot let the economy lead the way.

Instead, we must view the green transformation as a political task. Only a political approach can manage, through genuinely representative institutions, differences of opinion and interest, guided by the kind of open debate, engaging civil society, that is vital to a pluralistic democracy.

Of course, not all countries are pluralistic democracies. In many that aren’t (and even in some that claim to be), those who campaign for a more socially, economically, and ecologically equitable world face severe repression.

If they are to fulfill their indispensable role in driving forward the transformation that is needed, democratic countries must put respect for basic human rights, such as freedom of speech and peaceful assembly, at the top of their foreign-policy agendas.

 If we are to decouple economic growth from energy consumption and achieve real resource efficiency in a world of nine billion, much less ensure justice for all, we cannot let the economy lead the way.

These basic rights are the normative foundation upon which transformative strategies will have to be negotiated.

After all, the biggest obstacle to the socio-ecological transformation that the world needs is not, in the end, technological; much of what is required, from organic farming to networked mobility systems that don’t rely on private vehicles, is already within reach.

The real problem is the lack of political will to implement and scale up those innovations opposed by vested economic interests. The challenge is thus to overcome these minority interests and ensure the protection of the broader public good – a task that is often left to civil society.

Some might argue that calling for radical transformation, rather than incremental change, is inappropriate. At a time when the world faces so many pressing challenges, from economic stagnation to political upheaval to massive refugee flows, any progress toward sustainability should be viewed as a victory. Pragmatic, politically feasible solutions to the environmental crisis should be celebrated, not criticized.

But this view implicitly underestimates the seriousness of the environmental crisis that the world faces, and assumes linear change when the needed transformation will be non-linear.

While some features of the green economy – resource conservation, the transition to renewable energies, specific technological innovations, and effective economic incentives, such as taxes – are undeniably important, they do not add up to the large-scale change needed to protect the interests of present and future generations.

The task that the world’s democracies face today is to continue the project of modernity, embracing the latest knowledge about planetary boundaries, while advancing broad democratic participation and reducing poverty and social injustice.

This is no small undertaking, and requires passion and tenacity. But it is not beyond our capacity. The first step is to recognize the constraints that the “green economy” places on thought and action.

Thomas Fatheuer, a former director of the Heinrich Böll Foundation office in Rio de Janeiro, is a social scientist and philologist. Lili Fuhr heads the Ecology and Sustainable Development Department at the Heinrich Böll Foundation. Barbara Unmüßig is President of the Heinrich Böll Foundation.

© Project Syndicate 1995–2016

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