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On Growth (1974)

On Growth

(1974)–Willem Oltmans–rechtenstatus Auteursrechtelijk beschermd

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59. Alan Coddington

Professor Coddington teaches economics at Queen Mary College of the University of London.
He was born in Yorkshire, England, in 1941. He obtained a degree in physics in 1963 and a Ph.D. in economics in 1966.
Professor Coddington regularly publishes articles in the Manchester Guardian. Among his published works are: Theories of the Bargaining Process (1968) and, with Dr. P.A. Victor, Ecology-Economy: Your Environment (1972).

What do you mean ‘the cheermongers’?1

 

By the ‘cheermongers’ I mean those who have taken it upon themselves to assure us that there is no serious threat posed by the combined effects of pollution, natural resource depletion and population growth. In particular, it would include those who have sought to deride or discredit the views of people like Paul Ehrlich2 and Barry Commoner3 as well as the kind of concerns displayed in a study like Limits of Growth.

The cheermongers have attempted to do this in a variety of ways: partly by the use of protracted sneers (in which the analogy with hellfire-

preaching about the end of the world appears with wearisome regularity); partly by appeals to their own alleged superior sophistication regarding the many technical issues involved; and partly by advancing actual arguments. I would contend, however, that these arguments, under closer scrutiny, turn out to be simply affirmations of spontaneous optimism: a kind of global micawberism. Of course, it is the underlying mood of spontaneous optimism which gives the cheermongers' views their unity.

 

What are these views?

 

Naturally, not all cheermongers share the same views, but there is a cluster of ideas which have emerged quite clearly from the general cheermongering literature. At the most fundamental level, cheermongering involves reaffirming one's faith in the adaptive capabilities of industrial society. I am deliberately using a vague term like ‘adaption’ to include adjustments which are brought about in the political, economic or the technological sphere. Actually, most cheermongers pin their faith on the adaptive capabilities of the global economic system, but their ideas are by no means confined to economic processes. When I say that the cheermongers have faith in the adaptive capabilities of industrial society, I mean that they believe that the processes which they envisage being set in motion will be both sufficiently sensitive and sufficiently powerful to avert any social dislocation that could have arisen from natural-resource depletion, pollution problems or population pressures.

 

You think that the cheermongers' faith is misplaced?

 

I do not know whether their faith is misplaced or not, although I do not happen to share it. My point is that we should recognize their position for what it is - the product of a rather large act of faith - and not accept it in the form it is presented, as the product of dispassionate analysis, superior sophistication, or, most notably, the inescapable conclusions from incontrovertible economic principles. It is certainly true that many economists have taken a cheerful view of these matters, but I think we have to see this as an occupational hazard rather than as a necessary product of economic reasoning. The main claim they make is that natural-resource depletion is not a problem since the spontaneous working of the market system will provide the incentives for the substitution of new materials, the development of new techniques and the introduction of recycling processes as the prices of increasingly scarce materials rise.

But the speed and sensitivity of such adaptive processes in real economics is a matter of such uncertainty that it becomes, inevitably, the object of conjecture, which is an unbridgeable gulf away from the abstract models of economic theory. Just how powerful such adaption will be in a world of cartels, government intervention, high technology, ill-defined property rights and so on, no one knows.

These remarks are relevant to a common reaction to the Limits to Growth study. This reaction is that the world is a great deal more complicated than the model used in the study, especially in that the model abstracts from certain types of adaptive processes; it is then concluded that the model must be hopelessly misleading or even worthless. Now, the interesting thing about the Limits to Growth model is, indeed, the great emphasis it places on self-reinforcing processes, in direct contrast to the adaptive processes which are the focal point of neoclassical economics. Which of the two kinds of process is the more powerful in the long run is an interesting and important question, and one that should not be simply begged. In particular, one cannot establish that the selfreinforcing processes of Limits to Growth are not worthy of study simply by pointing to the existence of adaptive processes. Of course the world is complicated; of course the Limits to Growth model is a drastic abstraction; of course there are adaptive processes complicating the picture. But what follows from all this?

Only skepticism. And skepticism is not an attitude which, in an unprejudiced observer, is supposed to apply only to the conclusions of the Limits to Growth study. As it happens, I am skeptical about the conclusions of the study, as I should imagine Denis Meadows is, too. But I am also skeptical about the conclusions from alternative formalizations addressed to the same issues; and I am particularly skeptical about formalizations which are insinuated rather than stated. On pollution, the cheermongers' faith switches from the economic to the political sphere. In this case they recognize that government intervention is necessary to establish a charging system whereby polluting activities will be brought within the workings of the economic system. It is asserted, however, that all problems of pollution may be solved in this way. Indeed, a well-known British cheermonger, Professor Wilfred Beckerman, recently claimed that ‘...the pollution problem is a simple matter of correcting a minor resource misallocation by means of pollution charges’ and went on to argue that the objections to such a scheme may be disposed of with the aid of second-year economics. What remains unclear is whether this reflects more on the incontrovertible viability of such a scheme, or

on the inadequacy of second-year economics for analyzing the problem.

Even if one regarded the imposition of pollution charges as an acceptable approach, a number of problems immediately arise. First, one needs a method of recording and measuring the pollution of each type caused by each individual and each firm. Second, one needs a system for deciding the charge appropriate to the location and for collecting the resulting revenues. And third, one needs a method of detecting those who are cheating the system, together with legal sanctions to impose on them, this being a matter which may involve international as well as national law. All that economic theory tells us is how, under idealized conditions, to relate the charges to the costs imposed by the polluter. In fact, making such regulative systems workable and responsive to the problem rather than to goals of bureaucratic origin, are problems requiring political will, legislative skill and administrative competence of an order that makes one hesitate to categorize it as a ‘simple matter.’

So we see that in this case the underlying faith of the cheermongers concerns the adaptive capabilities of the political system: a faith in the wisdom and skill of governments in devising a regulative scheme based on pollution charges. Again, I do not share this faith, but I leave it to others to decide whether it is misplaced or not.

 

How does all this relate to economic growth?

 

Our cheermongers are wholeheartedly in favor of economic growth. But since they see resource depletion as unproblematic and pollution as something that can be dealt with in a straightforward way, it is quite natural for them to view increased production with a delight unmixed with concern for the effects other than on the supply of goods and services.

They do, however, in the context of economic growth, introduce some further arguments. For example, they stress that economic growth does not involve the physical growth of some fixed bundle of goods, but the growth of the value of some ever-changing bundle. This may increase in value not just because it contains more materials, but because the materials are transformed in ways which make them more effective in satisfying human needs and wants. This stress on the value aspect rather than the physical aspect of materials and resources generally obviously helps to undermine the idea that there is some definite relation between producing, on one hand, and resource depletion and pollution, on the other. It supports the contention that there is no necessary relation

between the growth of flows of value and the growth of the underlying flows of materials in physical terms.

But again, this line of thought merely complicates the picture and, properly, leads to skepticism rather than to optimism. As the technology of production and consumption changes, so the relations between physical and value flows change. So the question becomes that of whether future technology will be less prodigal of natural resources and less polluting than current technology. Or, assuming that such a technology could be developed, the question becomes: Would it be workable within the framework of our institutions? And, if so, Could it be pushed into operation by suitable government policies? And it is on these questions that the cheermongers have nothing to offer except reassurance.

So it becomes apparent that this issue, like all the others, resolves itself finally into a matter of spontaneous optimism. In this case it is technological optimism: a faith in the prowess of future gadgets to solve the problems associated with the widespread use of present gadgets.

Another argument that the cheermongers have put forward is that environmental concern reinforces rather than undermines the need for economic growth, on the grounds that restoring, protecting and improving the environment absorb resources, which need to be made available. But this view is question-begging, for the environment may be preserved not only by the restoration of damage which has been done, but by the prevention of activities which have caused damage.

It is not only question-begging to suppose that reversing damage is always better than preventing it; this view also presupposes that the undesirable effects of economic growth are indeed reversible. And this is just not so. No amount of extra resources will enable radioactive waste to be transformed back into fissionable isotopes. And one is at a loss to think of reverse processes that could be implemented in the case of fertilizer run-off, soil erosion, and the concentration of pesticide residues in food chains.

Since pollution is essentially a process of things becoming intermingled and scrambled together, its reversal is either hopelessly expensive or quite impossible. That is what entropy is all about. The arguments that economic growth makes available the resources to undo its own undesirable effects and still leave resources to spare is a swindle. For the effects cannot be undone. What is being offered here is, at best, certain cosmetic exercises to mask the effects or push them into the future.

Some critics of the Club of Rome have seen in Aurelio Peccei and his friends a latest version of the Robin Hood Symptom.

 

Yes, they have a very peculiar argument to the effect that environmentalism and antigrowth sentiments have Sinister Class Overtones. This is founded on the fact that the propagators of antigrowth sentiments are all members of the middle class, and, according to the cheermongers, this should make us very suspicious of their capacity to pronounce disinterestedly on this issue. But the force of this objection is puzzling, since the cheermongers themselves all have impeccable middle-class credentials. The cheermongers, however, insist that antigrowth sentiments are the disenchantment of the relatively privileged and well-off (other than themselves) with the result of further spread in wealth, results which undermine the quality of the amenities they enjoy: a quality which generally falls as the amenities are more widely used. But to expound this ‘middle-class conspiracy’ theory, one has to be highly selective in one's examples, confining them, in fact, to congestionlike cases; for it remains totally obscure why the middle class should be uniquely vulnerable to, for example, pesticide residues or radioactive emanations.

 

What then is your own position?

 

In the terms I have been adopting, I am very doubtful about the adaptive capabilities of industrial society in the face of the problems it is generating. I am particularly dubious about the role of technology in these processes: it has not shown itself to be markedly responsive to social needs or even, in notable cases, to economic pressures. The Concorde springs to mind as an important example of technology unfolding according to its own goals and logic.

And I am particularly concerned about the load that will be thrown onto the political system with the need to regulate more and more activities with potentially disruptive environmental effects, bearing in mind that the regulative machinery at the global level is decidedly flimsy. Even at the national level, the success with which governments have pursued orthodox economic objectives does not inspire me with great confidence in their capacity to achieve both these and targets involving natural-resource conservation and pollution abatement. It seems quite likely to me that the relatively autonomous unfolding of high technology together with the unwieldy and uncertain workings of the political system could provide sufficient perverse adaption to more than offset the degree

of benign adaption that the economic system may be capable of. In which case, one is thrown back onto global responsibilities of the individual citizen - an already overworked and markedly ineffectual instrument. None of this makes me particularly cheerful.


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