Degrowth won’t solve – targets the wrong problem, worsens the environment, shifts the problem to the Global South

Ultimately, the proposal for degrowth as proposed by the Degrowth movement turns out, much like that of green growth, not to be a solution. Most importantly, degrowth has been criticised that its proposal to reduce the GDP of advanced economies will have no significant impact on reducing the world’s Material Footprint (MF), or carbon emissions, significantly enough to avoid an ecological overshoot. This is because most (63%) of current carbon emissions come from developing countries - where it will only continue to increase in the foreseeable future. The 2022 Emissions Gap Report notes UNEP (2022, p. 67) that “virtually the entire future increase in global primary energy demand is expected to occur in these [developing] economies.” And after the GDP of rich economies are downsized - say by a significant 40%, there would still remain a footprint of 60% and 60% of their economies to de-carbonise (Hickel and Hallegatte, 2022). van den Bergh (2011, p.885) concluded that “Even if we would manage to ‘scale the economy down’ to 50% [....] we still only would have reduced the size of the environmental problems by half. But this is by far insufficient for most environmental problems.” It is clearly insufficient to halt the growth in material footprints and carbon emissions and not reduce these “tout court.” Phillips (2019) uses the example of the successful reduction in the hole in the ozone layer to illustrate the shortcoming of the Degrowth proposal, explaining that: “we embraced degrowth with respect to ozone depletion by attempting to arrest growth in, say, the number of fridges in the world—or even reduce the total number—instead of regulation to enforce technology-switching, disaster would have befallen us. Saying ”this many fridges and no more” would only have arrested the growth in emissions, not emissions tout court” (Phillips, 2019). Moreover, even if the GDP growth of all countries, not only that of the developed countries, could be curtailed, it may still not be effective to reduce carbon emissions and MF sufficiently to achieve climate goals. This can easily be seen using the so-called IPAT identity, used to gauge the drivers of the environmental impact of the economy (Bretschger, 2021; Stijn, 2021). The IPAT identity decomposes the environmental impact (I) of an economy into the consequences of population (P), affluence (A) and technology (T) (Holdren, 1993). It can be written as follows (where a ‘hat’ over a variable indicates a rate of change): I = Pˆ + Aˆ P + Tˆ A (1) If affluence (A) - say measured in GDP - is reduced as per degrowthers’ proposal, it will lead to a reduction in impact (I ). This is the basis of degrowth. However, if Pˆ continues to grow, and if technological innovation (Tˆ) declines or remain slow, then the reduction in impact caused by GDP degrowth would be offset. The important point to note is that both of these offset mechanism are more likely to apply at lower levels of GDP. Furthermore, if reduced GDP lead to a reduction in technological innovation in the richer countries, the environmental impact may be even worse. Holdren (1993, p.5) shows in this regard that “a change for the worse in the technology of production is more serious environmentally if it occurs in a populous, affluent society than if it occurs in a small, poor one” - which are the type of the societies that the Degrowth movement want to downsize. Worse even, not only is downsizing the economies of rich countries not likely to be effective, but it may worsen ecological overshoot in several ways. “degrowth might turn out to be dirty” (van den Bergh, 2011, p.882). One is that countries will have less resources to invest in climate change mitigation and adaptation technologies, and hence they will be more vulnerable to the impacts of ecological deterioration (Phillips, 2019). A second is that firms may substitute more expensive cleaner production techniques for cheaper, but more polluting, technologies. Third, government revenues will drop - an inevitable consequence of economic shrinkage. Governments would not be able to borrow further to spend on social and basic needs or environmental protection. They would need to repay their existing debt - in the EU, the rule that government debt cannot exceed 60% of GDP implies that, if GDP declined, debt would also need to fall (Stijn, 2021). Fourth, poorer households in (degrowthed) rich countries are likely to revert to deforestation30 and environmental destruction - as they did during the 2021/2022 winters in Europe when faced with rising energy prices following the Ukraine war (Moloney, 2022; Rankin, 2021; Kauppi et al., 2006). A further shortcoming of degrowth is that if one considers degrowth as a method to decreasing carbon emissions, it is a much more expensive method than any currently comparable technological investments as green growth is pushing for. According to calculations by Jakob and Edenhofer (2014) if the world shrinks GDP per capita by 10% (around US$7,000 billion), it will reduce carbon emissions by about 3.3 gigatons, meaning a cost of US$ 2,100 per ton of emissions. In comparison, the social cost of carbon dioxide (SC-CO2) has been estimated at US$ 185 per ton of emissions (Rennert et al., 2022). In additionn to being likely ineffective, to worsen the environmental challenge, and a very expensive way to reduce carbon emissions, degrowth may disproportionately hurt the poorest of the poor - and make global inequality worse. One mechanism through which this could occur is that degrowth in the Global North will severely curtail development in the Global South because of the intertwined nature of the global economy (and there is no time for the Global South to successfully “decouple” if at all that is possible). The COVID-19 crisis emphasized this inter-dependency - poverty rose more sharply in the Global South than the Global North - and indicated how difficult it would be for the Global South to decouple from the Global North. Hence it may be indeed the case that, ”the degrowth people are living a fantasy where they assume that if you bake a smaller cake, then for some reason, the poorest will get a bigger share of it [. . . .] that has never happened in history” (Horowitz, 2022).Ultimately, degrowth will make global inequality worse because it will be the poor will pay the price, and not the rich, who has the means and connections to find shelter31 - and who has arguably the most wasteful consumption. Hence, “Degrowth is, in essence, a form of ecological austerity for working-class people” (Chambers, 2021). Finally, in the words of Stijn (2021) degrowth is not only ineffective, likely to worsen the environment, very expensive and a form of austerity for the working class, but redundant: “Economic degrowth is not necessary, because it targets the wrong enemy. GDP is not the enemy; environmental impact is the enemy. Environmental scientists are able to determine upper bounds on environmental impacts such as pollution. For example, climatologists have determined the carbon budget: how much greenhouse gases can still be emitted that keep the atmospheric temperature increase below 1,5°C. But GDP is measured in dollars, a totally different quantity than kg CO2. Hence, none of the economic degrowthers are able to say what is the upper bound or true limit on affluence. There are no scientific studies that estimate the maximum level of GDP that is still permissible.”