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On Growth (1974)

On Growth

(1974)–Willem Oltmans–rechtenstatus Auteursrechtelijk beschermd

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33. Erza J. Mishan

Professor Erza Mishan is reader in economics at the London School of Economics.
He was born in 1917 in Manchester, England. His books include Welfare Economics: An Assessment (1969), Welfare Economics, Ten Introductory Essays (1969), Twenty-one Popular Economic Fallacies (1969) and The Cost of Economic Growth, Pelican (New York, 1967).

What is your reaction to the publication of Limits to Growth?

 

One could predict that the report by MIT would not be welcomed by most economists. This is because very few among them have seriously questioned the notion of sustained economic growth as a legitimate aim of social policy. The accent since the war has always been on increasing rates of economic growth. Indeed, generalizing from the response to the Blueprint for Survival in the United States, the sort of denunciation it will invoke can be anticipated.

First of all, ritual scorn will be poured on doomsdayers. Prophets of the world catastrophe reaching back to ancient Egypt will be unearthed. Yet, will Malthus be dismissed as a false prophet? Economists will hasten to remind us that as traditional resources become exhausted, new materials are sure to come into being and new technology should enable us continuously to raise real standards, at least in the West. For the boundaries of science, he will say, widen today more rapidly than in any other period in history. Economists will insist that the model of MIT is far too simple to express reality, and that it makes no provision for the resource and ingenuity of man. Yet, the book is sure to make an impact as did the Blueprint,1 which preceded it by a couple of months.

The model used by Forrester2 and Meadows is relatively complex in structure. The mathematical equations describing the links between the variables cannot of course be laid bare in a popular account. And the general reader has to be content with some simple illustrations, verbal

and diagrammatic, of the nature of the interconnections and, later on in the book, with descriptions and graphs (not as clearly drawn as they might be) of the time paths that emerge from the computer in response to altering initial assumptions and parameters. What the most serious critic will want to examine, however, is not only the information fed into the model but the structure of the equation system. Do changes in the structure of the equation system make significant differences to the results?

For all that, a beginning has been made, a global model has been made explicit and is therefore open to modification and to further experiment and refinement. Certainly it would be salutary for growth men and antigrowth men to have some clear ideas of the magnitude of the technical achievements that are needed over time, if positive growth rates are to be maintained.

 

You have written that technological conditions of production are not chosen with a view to enhancing man's experience of life, social sciences are not involved. ‘They seem to evolve solely in response to requirements of industrial efficiency and profit seeking.3 The process is generated accidentally.’ How to reverse this trend? How to bring in the social factors, the interests of the mass of people?

 

I do not know how to reverse the trend, quite frankly. What I am saying is fairly clear though. Consider, for example, air pollution: There's been a study by Lave and Seskin, which seems to show that for certain age groups such diseases as asthma, bronchitis, and emphysema, double, as we move from low-pollution areas to high-pollution areas. This does create employment among medical men, and of course it provides opportunities for increased research. This seems to me typical of the way science approaches a problem. It first undertakes some innovation which turns out to have unforeseen consequences, good and bad. The bad consequences find a welcome place in the system, because people are employed to do research on it. Thus, when I say that there is no overall benign Being concerned continuously to the pros and cons of each innovation, that is what I mean. The system proceeds more or less blindly in this sort of way, guided only by its immediate commercial prospects.

 

Economic growth renders many things obsolete, one of them is economic theory. How to adjust economic thinking to the fast-changing patterns

on the planet in relation to population, pollution, ecology - is economic theory running behind the facts and realities of our situation?

 

Yes, economic theory always does lag behind. I am sure that goes for other sciences as well. But younger people are becoming interested in ecology today. Their original training was in economics. Now they are starting to tackle a number of other problems, and the problems they can tackle are usually those concerned directly with the environment or ecology. Resources for the Future is a well-known organization in America, which has a number of very competent economists working for it, who are interested not only in producing models, but making quantative estimates. Their concern is with the conservation of natural resources and environment.

They have not tackled the broader social consequences. I suppose the reason is that they are intangible in many ways. It requires quite a lot of speculation on social questions. And the kind of questions even sociologists address themselves to are often very narrow indeed. In the nature of things I don't think they can consider many of the long-run social consequences. For example, people are today discussing this question of pornography, and the possible effects of television violence, often sadistic violence, on young people or even grown-ups. The kind of studies that are done by sociologists are so narrow in scope, merely trying to discover if seeing these things has any immediate effects on these people: if, for example, watching violence leads immediately to more crime, or watching sexual promiscuity leads to more sexual promiscuity. Statistically I don't think the results are very valuable. But even so they don't address themselves to the right questions, such as what are the ultimate effects on people's character. For the kind of life we are after will depend ultimately on people's values, and on how they feel about each other.

The question I ask myself is, if you watch television programs and see people just being abused and subjected to violence by other people with no moral at the end of it - a bad guy just getting away with his violence or getting away with his sexual promiscuity - will not young people come to take these things perhaps as a social norm, as an acceptable part of life, and try to model themselves accordingly? What kind of a future is that going to lead to? These are the sort of questions in my mind, but I cannot see sociologists measuring anything that will enable us to answer them.

In your book you spoke of teenagers between thirteen and seventeen, spending some seven hundred dollars in luxury items on the way to their dolce vita.4 What role could economists - or sociologists and psychologists, if you want - play to change the worsening trends, so that people will shift priorities and behave more realistically?

 

This is really like the game about the hen and the egg. Because in order to change the environment and then be changed by it, people themselves have to take the initiative. The environment does not change by itself. People must first change the environment. And in this country, which is supposed to have some sort of democratic institutions, the environment can only change if the majority of people are in favor of such changes in the first place. So it follows that you've got first to have a change of heart arising from some new insight or some new awareness by many people before this is going to come about. Obviously once you change the environment, then you also change the people. As Winston Churchill once said, we shape the buildings and then the buildings shape us. It's that kind of process.

 

But aren't we controlled now in a so-called free democratic society? Controlled by teachers, professors, civil servants, governments. We are controlled from top to bottom. The control has to change in order to change -

 

I agree with you in a sense. We are subjected already to a number of political and institutional constraints. Madison Avenue5 is very strong indeed. Vested interests are very strong. Vested material and intellectual interests are strong. This we know, and yet the only hope of radical change coming about is the recognition that masses of people will become convinced that the existing sort of life, a by-product of economic growth, is not the life they want. They want a new set of options to choose from, and once they believe that this is indeed feasible, we can start changing the environment in earnest.

 

Professor Mishan, would you think it feasible to run the planet earth as a big corporation?

 

Yes, for some people it is already on the way to being run as a giant corporation.

But if that's so, spending some two hundred billion dollars a year, on military budgets for the world as a whole - no efficient management would allow that kind of waste.

 

No, of course not. If you had a universal government this waste would not exist. But it does not need imagination to understand the fear with which countries, now heavily armed, watch one another. Any small weapons advance in one country has been matched by the other. Indeed, each country seeks to anticipate what weapons the other countries will invent in order to have some weapon to counteract it. In fact, it is the arms race between nations which endows economic growth with a good part of its current rationale. If it were not for the arms race, and the arguments about the spin-off from industrial and technological growth, the political possibility of slowing down growth deliberately in the attempt to reach a stable state would be much easier.

 

Yes, but do you envisage at all a possibility of managing the planet on a global scale?

 

Not in the near future, no. I don't see that. My position is pessimistic. If you ask me how long the civilized world is going to last, I would guess that it may last ten or fifteen years. If it lasts much longer, it will be something of a miracle. Yet at the same time, I believe man has free will, and sometimes miracles happen. So I plug along, hoping for the best, though expecting the worst.

 

Will we ever bridge the gap between the rich and the poor countries? If we aim at a global-scale management, which seems unavoidable in the long run, how to manage it when there are such tremendous gaps between the rich and the poor countries?

 

You're taking it rather out of my depth here. I was concerned very largely with affluent societies, and arguing that further economic growth for them serves no wholesome purpose. It has just become a bad habit or, as you might say, you just cannot stop the machine. Now you're asking me what we do about all these poor countries, and here I hate really to stick my neck out, because I happen to believe that these countries should have followed the path suggested by Gandhi;6 that is to say, they should use small technology, intermediate technology, and aim at a modest but fairly satisfactory material standard. But they haven't

gone that way. A small group in each of these countries have their eyes all the time on the West, and they hope to bring their countries up to that standard. Well, this, in the nature of things, seems to me impossible. Certainly impossible within a few years, because it seems clear that if all these countries could within a few years have material standards comparable with those of the United States, the world would not last more than another ten or twenty years. The rate of consumption of resources and the rate of pollution would be enormous.

 

Every Chinese having two automobiles in his garage -

 

Yes, something like that. If you ask me what is the ideal in some sense, and you don't ask me how it's going to be realized, simply supposing one had an all-powerful dictator ruling the whole world -

 

Toynbee7 spoke in those terms earlier.

 

Well, that's the only way one can talk sensibly sometimes, because one gets continually mixed up with what is feasible or immediately realizable, what can happen in the more remote future when, we imagine, there are fewer constraints.

If there were to be a benevolent dictatorship over the whole world, then the first thing to do, obviously, would be to make every effort to reduce population growth; to stabilize total population and, possibly, to reduce it. And the second thing, of course, would be to distribute the world's wealth a little more evenly, in which case certainly we couldn't maintain standards of living in America as they are now.


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