by Maureen McAllister, E-RYT 500, YACEP
As a small business owner, this blog, in particular, feels a bit odd to write. For the third month of the Attenborough Challenge, I'd like to explore the paradox surrounding limited natural resources and unlimited Gross Domestic Product (GDP) growth as the standard of health for an economy. I believe that Kate Raworth's TED Talk, A healthy economy should be designed to thrive, not grow, said it best when she describes GDP as "the plane that can never be allowed to land." This idea is taken from W.W. Rostow's 1960 book, The Stages of Economic Growth: A Non-Communist Manifesto, which describes five stages needed for economic growth and ends with us flying off into the fifth stage, "the sunset of mass consumerism." Rostow recognized the problem with unlimited growth but was unable to answer it in his book, as an advisor for John F. Kennedy at the time, who was running for election on the promise of five-percent growth. In 1962, one of Kennedy's advisors, Arthur Okun, coined Okun's Law: "for every 3-point rise in GDP, unemployment will fall 1 percentage point. The theory informs monetary policy: Keep growing the economy, and everything will be just fine."
Although initially, it was Simon Kuznets, an American economist at the National Bureau of Economic Research, who created the idea of GDP in 1934--"one stat to rule them all." It was quickly adopted as the primary measure of a country's economy at the Bretton Woods conference of 1944 (not too long ago!--and coincidentally the name of a country club I worked at for good while). I think it is intuitively clear to everyone why this model is unsustainable--we have a limited amount of resources on earth, and if every economy were to reach the unlimited growth symbolic of countries like the United States and China, we would quickly be in our third World War for resources. There's just not enough to go around indefinitely in the current "take --> make --> use --> lose" model of consumerism.
Raworth, who is an Oxford economist, believes that we as people have developed a financial, political, and social addiction to the idea of growth.
Financially: we are obsessed with the idea of the highest rate of monetary return to a shareholder. Banks create money as debt, bearing interest, which must be repaid with more, (anyone with student loans is familiar with this structure).
Politically: how do you raise tax revenue without taxes? GDP is a solution. There is also political pressure felt from other countries--if your economy is not growing, what are you doing? This is not just the politician's fault, unfortunately, this is the pressure that we as consumers put on lawmakers.
Socially: the nephew of Sigmund Freud, Edward Bernays, coined his uncle's ideas to create and popularize the idea of mass consumerism by selling to people's emotions rather than intellect. We can "transform" how we feel about ourselves with products.
Couple this with the fact that most GDP gains get returned to the 1% and the reality that our current way of doing and thinking about things is rapidly destabilizing the planet. There is also something to be said for how the "take --> make --> use --> lose" one-way drip of products affects our mental psyche and well-being as humans and co-habitators of a space. Ideas do not stay compartmentalized, they seep over into our way of thinking and viewing just about everything around us. You only have to look so far as social media, music, and pop culture to see an abundance of posts and media propagating the idea of throwing away people who have displeased you or disagree with your worldview. Originally we might not agree with these ideas, but by being introduced to them in microdoses slowly over time, we start to think that there might be something there.
Raworth argues for the idea of a sustainable economy, or a circular economy, which is already being implemented by the European Union in their European Green Deal, as they strive to become the first climate-neutral continent where "no person and no place is left behind." Already they seek to decouple economic growth from resource use "by turning climate and environmental challenges into opportunities" for new industries and technologies. Raworth's ideas (outlined below) also asks for a new American economic plan that strives for the lime green donut and equates the poetry of a circle to this cyclical symbol of well-being in many cultures:
Maori Takarangi
Taoist Yin-Yang
Buddhist Endless Knot
Celtic Double Spiral
So how does one go about redefining and creating a whole new way of thinking about the economy? Frankly, I have no idea--luckily we have very intelligent people like Bill Gates who is committing his fortune to move the world beyond fossil fuels and enlisting the help of some extremely wealthy investors and countries. Gates released his book, How to Avoid a Climate Disaster: The Solutions We Have and The Breakthroughs We Need in February of this year, which sets out a plan for the energy miracle the world needs to "get to zero greenhouse gas emissions in time to avoid a climate catastrophe." (It is worth noting that Gates also predicted our current pandemic predicament in 2015). Recently he and other venture capitalists founded Breakthrough Energy Ventures "a $2 billion investment fund for companies that want to solve difficult climate-change problems" with investors like Jeff Bezos, Jack Ma, Richard Branson, Michael Bloomberg, and Ray Dalio. In detail, he lays out what each of us should do to play our part as citizens, consumers, and employees or employers: read here (also outlined below).
There was a bittersweet reverberation to the aftermath of lockdowns this past year as human activity came to a grinding halt and the wildlife and oceans immediately started to thrive. As Gates noted in his blog, "COVID-19 is awful. Climate change could be worse." It will be our duty this year as human activity opens back up to push against returning to the status quo, and instead push for more sustainable and clean energy, stocks, and companies. I recently heard it described by Jon Kabat-Zinn that we are all cells living on the same body, working together for the benefit of the larger whole. It doesn't make sense for the cells to attack the lungs or the liver because they look different or have a different structure--this would be considered an autoimmune disease and lead to disaster. Similarly, we view unlimited and unchecked growth like cancer. This challenge for widening our circles of compassion to include the natural world is captured in the following letter from Albert Einstein to a grieving father after the death of his child:
A human being is part of a whole, called by us the “Universe,” a part limited in time and space. He experiences himself, his thoughts and feelings, as something separated from the rest — a kind of optical delusion of his consciousness. This delusion is a kind of prison for us, restricting us to our personal desires and to affection for a few persons nearest us. Our task must be to free ourselves from this prison by widening our circles of compassion to embrace all living creatures and the whole of nature in its beauty.
This will first and foremost take a significant shift in mindset. One of the reasons writing this blog feels so weird is that 44% of our economy relies on small businesses and the exchange of goods and services. There are so many people I support and want to see succeed in their business ventures--however, for all of us, myself included, it's worth asking how much we've bought into Bernay's consumerism mindset. In contrast, if you want to see how one of the happiest and most green countries in the world does it, there's an inspiring talk here from one of Bhutan's monks. In 2016, Bhutan was the only carbon-negative country in the world and measured the "Gross National Happiness" of their citizens as more important than Gross National Product: a legacy from their fourth king, Jigme Singye Wangchuck. Inspiring, really.
For this month's challenge, I will be borrowing Bill Gates' ideas for both myself and the business---since he is the smartest cookie of the bunch. You are welcome to join me and I would love to hear your thoughts on this topic!
The Bill Gates Challenge:
As A Citizen: Elected officials will adopt specific plans for addressing climate change if voters and constituents demand action. Creating a sense of urgency will lead to legislation and regulation that reduce emissions.
Make calls, write letters, attend town halls. Showing up and making your voice heard is the best way to move lawmakers – especially when you ask questions and make specific demands.
Look local as well as national. Federal elected leaders aren’t the only policymakers we need to reach. Governors, mayors, state officials, and city councils all wield important power over climate policy and are accountable to voters.
Run for office. Many people in public office today started out running at the local or state level, and we need more climate advocates and policy experts to step into the arena.
As A Consumer: Buying power is power. And as consumers we can create the demand for clean energy and technology by making the right choices when we buy. You can send a signal to the market that people want clean choices and are willing to pay for them by taking steps like:
Sign up for a green pricing program with your utility. In a growing number of communities, households have the option to choose whether they sign up for traditional sources for the energy that powers their home or to pay a little more for a clean option.
Reduce your home’s emissions. Homeowners can also choose to upgrade their heating and cooling systems and appliances to reduce their own carbon footprint – and potentially save money with more efficient devices and insulation.
Buy an electric vehicle. The more people buy electric vehicles instead of internal combustion engine vehicles powered by gas, the faster we can transition our fleet to low-carbon and zero-carbon transportation.
Try a plant-based burger. Every time you buy a plant-based burger instead of a beef burger (which is made from cows that are a leading producer of methane), you’re showing demand for a cleaner alternative, so innovators will continue to make better and tastier plant-based burgers and more people will eat them.
As An Employee or Employer: Both big companies and small businesses – especially those that work through local chambers of commerce – can have a huge impact on the market by adopting clean standards and getting more involved in the development of climate policy and solutions.
Prioritize innovation in low-carbon solutions. Companies in the aerospace, materials, and energy industries can devote more of their revenue toward research and development of low-carbon innovations. The largest companies can even partner with government to offer their practical commercial expertise to public research efforts.
Be an early adopter. Companies buy a lot of things – from vehicles for corporate fleets to the materials used to build and renovate their buildings and the electricity to run them. By committing to clean standards and using renewable power, companies can send a signal to the market about the value of developing low-carbon solutions.
Engage in the policy-making process. Businesses – and the people they employ – can advocate for more R&D funding and speak out on behalf of policies designed to incentivize lower greenhouse gas emissions.
Connect with government-funded research. Businesses can provide great value by using their practical and commercial knowledge to advise government research programs – or help fund government R&D through joint projects and cost-sharing agreements.
Help early-stage innovators develop, grow, and commercialize their technologies. Established businesses can help promising researchers turn their ideas into products by offering access to their testing facilities and data. They can provide fellowship programs, invest in new innovations, and finance new projects.