Most Popular Choices
Share on Facebook 21 Printer Friendly Page More Sharing
OpEdNews Op Eds   

Why Growth Is Good

By       (Page 1 of 1 pages)   1 comment
Follow Me on Twitter     Message Robert Reich
Become a Fan
  (130 fans)

Economic growth is slowing in the United States. It's also slowing in Japan, France, Britain, Italy, Spain, and Canada. It's even slowing in China. And it's likely to be slowing soon in Germany.

If governments keep hacking away at their budgets while consumers almost everywhere are becoming more cautious about spending, global demand will shrink to the point where a worldwide dip is inevitable.

You might ask yourself: So what? Why do we need more economic growth anyway? Aren't we ruining the planet with all this growth - destroying forests, polluting oceans and rivers, and spewing carbon into the atmosphere at a rate that's already causing climate chaos? Let's just stop filling our homes with so much stuff.

The answer is economic growth isn't just about more stuff. Growth is different from consumerism. Growth is really about the capacity of a nation to produce everything that's wanted and needed by its inhabitants. That includes better stewardship of the environment as well as improved public health and better schools. (The Gross Domestic Product is a crude way of gauging this but it's a guide. Nations with high and growing GDPs have more overall capacity; those with low or slowing GDPs have less.)

Poorer countries tend to be more polluted than richer ones because they don't have the capacity both to keep their people fed and clothed and also to keep their land, air and water clean. Infant mortality is higher and life spans shorter because they don't have enough to immunize against diseases, prevent them from spreading, and cure the sick.

In their quest for resources rich nations (and corporations) have too often devastated poor ones -- destroying their forests, eroding their land, and fouling their water. This is intolerable, but it isn't an indictment of growth itself. Growth doesn't depend on plunder. Rich nations have the capacity to extract resources responsibly. That they don't is a measure of their irresponsibility and the weakness of international law.

How a nation chooses to use its productive capacity -- how it defines its needs and wants -- is a different matter. As China becomes a richer nation it can devote more of its capacity to its environment and to its own consumers, for example.

The United States has the largest capacity in the world. But relative to other rich nations it chooses to devote a larger proportion of that capacity to consumer goods, health care, and the military. And it uses comparatively less to support people who are unemployed or destitute, pay for non-carbon fuels, keep people healthy, and provide aid to the rest of the world. Slower growth will mean even more competition among these goals.

Faster growth greases the way toward more equal opportunity and a wider distribution of gains. The wealthy more easily accept a smaller share of the gains because they can still come out ahead of where they were before. Simultaneously, the middle class more willingly pays taxes to support public improvements like a cleaner environment and stronger safety nets. It's a virtuous cycle. We had one during the Great Prosperity the lasted from 1947 to the early 1970s.

Slower growth has the reverse effect. Because economic gains are small, the wealthy fight harder to maintain their share. The middle class, already burdened by high unemployment and flat or dropping wages, fights ever more furiously against any additional burdens, including tax increases to support public improvements. The poor are left worse off than before. It's a vicious cycle. We've been in one most of the last thirty years.

No one should celebrate slow growth. If we're entering into a period of even slower growth, the consequences could be worse.

Must Read 1   Well Said 1   Interesting 1  
Rate It | View Ratings

Robert Reich Social Media Pages: Facebook page url on login Profile not filled in       Twitter page url on login Profile not filled in       Linkedin page url on login Profile not filled in       Instagram page url on login Profile not filled in

Robert Reich, former U.S. Secretary of Labor and Professor of Public Policy at the University of California at Berkeley, has a new film, "Inequality for All," to be released September 27. He blogs at www.robertreich.org.

Go To Commenting
The views expressed herein are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.
Writers Guidelines

 
Contact AuthorContact Author Contact EditorContact Editor Author PageView Authors' Articles
Support OpEdNews

OpEdNews depends upon can't survive without your help.

If you value this article and the work of OpEdNews, please either Donate or Purchase a premium membership.

STAY IN THE KNOW
If you've enjoyed this, sign up for our daily or weekly newsletter to get lots of great progressive content.
Daily Weekly     OpEd News Newsletter
Name
Email
   (Opens new browser window)
 

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Trump Cornered

The Republican's Big Lies About Jobs (And Why Obama Must Repudiate Them)

Paul Ryan Still Doesn't Get It

What Mitt Romney Really Represents

What to Do About Disloyal Corporations

The Gas Wars

To View Comments or Join the Conversation:

Tell A Friend