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Post-Growth

Can We Prosper Without Growth? 10 Policy Proposals

By Giorgos Kallis

A new Left – new in terms of ideas but also in terms of the young age of its members – is rising in Europe, from Spain and Catalonia, to Greece, Slovenia or Croatia. Will that Left also be green and propose an alternative cooperative model for the economy inspired by the ideas of degrowth? Or will this new Left, like the new Left of Latin America, driven by the demands of global capitalism, reproduce the expansionary logic of capitalism, only substituting multi-national corporations with national ones, distributing somewhat better the crumbs to the populace?

Many people who are sympathetic to the ideas and critique expressed in our book tell us that even though the critique of degrowth sounds reasonable, its proposals are vague and in any case they could never be put into practice. It seems easier to imagine the end of the world, or even the end of capitalism, than to imagine the end of growth.

Even the most radical political parties do not dare to utter the ‘D word’, or at least question the desirability of growth. To break this spell of growth, we at Research & Degrowth in Barcelona decided to codify some of the policy proposals that are coming out of the theory of degrowth, policies that are discussed in more detail in our recent book: “Degrowth: A Vocabulary for a New Era”.

In what follows we present 10 proposals that we wrote in the context of Spain and Catalonia, and which we submitted to progressive political parties such as Podemos, the United Left, the Catalan Republican Left, CUP or Equo. The context to which these proposals refer is specific; but with certain amendments and adaptations they are also applicable elsewhere and relevant for radical Left and Green political parties all over Europe.

1. Citizen debt audit

An economy cannot be forced to grow to resolve accumulated debts that have contributed to fictitious growth in the past. It is essential not only to restructure but also to eliminate part of the debt with a people’s debt audit, part of a new, really democratic culture. Such elimination shouldn’t be realised at the expense of savers and those with modest pensions whether in Spain or elsewhere. The debt of those who have considerable income and assets should not be pardoned. Those who lent for speculation should take the losses. Once the debt is reduced, caps on carbon and resources (see 9) will guarantee that this will not be used as an opportunity for more growth and consumption.

2. Work-sharing

Reduce the working week to at least 32 hours and develop programmes that support firms and organisations that want to facilitate job-sharing.  This should be orchestrated in such a way that the loss of salary from working less only affects the 10% highest income bracket. Complemented by environmental limits and the tax reform proposed below (see 4), it will be more difficult for this liberation of time to be used for material consumption.

Even the most radical political parties do not dare to utter the ‘D word’, or at least question the desirability of growth.

3. Basic and maximum income

Establish a minimum income for all of Spain’s residents of between 400 and 600 Euros per month, paid without any requirement or stipulation. A recent study suggests this is feasible for Spain, without a major overhaul of the tax system. Design this policy in conjunction with other tax and work reforms so that they increase the income of the poorer 50% of the population while decreasing that of the top 10%, to finance the change. The maximum income for any person—from work as well as from capital—shouldn’t be more than 30 times the basic income (12,000—18,000 Euros monthly).

4. Green tax reform

Implement an accounting system to transform, over time, the tax system, from one based principally on work to one based on the use of energy and resources. Taxation on the lowest incomes could be reduced and compensated for with a carbon tax. Establish a 90% tax rate on the highest incomes (such rates were common in the USA in the 1950s). High income and capital taxes will halt positional consumption and eliminate the incentives for excessive earnings, which feed financial speculation. Tackle capital wealth through inheritance tax and high taxes on property that is not meant for use, for example on the second or third houses of individuals or on large estates.

5. Stop subsidising and investing on activities that are highly polluting,

Move the liberated public funds towards clean production. Reduce to zero the public investment and subsidy for private transport infrastructure (such as new roads and airport expansion), military technology, fossil fuels or mining projects. Use the funds saved to invest in the improvement of public rural and urban space—such as squares, traffic free pedestrian streets—and to subsidise public transport and cycle hire schemes. Support the development of small scale decentralised renewable energy under local and democratic control, instead of concentrated and extensive macro-structures under the control of private business.

6. Support the alternative, solidarity society

Support, with subsidies, tax exemptions and legislation, the not-for-profit co-operative economic sector that are flourishing in Spain and include alternative food networks, cooperatives and networks for basic health care, co-operatives covering shared housing, credit, teaching, and artists and other workers. Facilitate the de-commercialisation of spaces and activities of care and creativity, by helping mutual support groups, shared childcare and social centres.

7. Optimise the use of buildings

Stop the construction of new houses, rehabilitating the existing housing stock and facilitating the full occupation of houses. In Spain those objectives could be met through very high taxes on abandoned, empty and second houses, prioritising the social use of SAREB housing (those falling under the post-crash banking restructuring provisions following the Spanish real estate crisis), and if this is insufficient, then proceed with social expropriation of empty housing from private investors.

8. Reduce advertising

Establish very restrictive criteria for allowing advertising in public spaces, following the example of the city of Grenoble. Prioritise the provision of information and reduce greatly any commercial use. Establish committees to control the quantity and quality of advertising permitted in the mass media and tax advertising in accordance with objectives.

We do not expect parties of the Left to make “degrowth” their banner. We understand the difficulties of confronting, suddenly, an entrenched guiding principle.

9. Establish environmental limits

Establish absolute and diminishing caps on the total amount of CO2 that Spain can emit and the total quality of material resources that it uses, including emissions and materials embedded in imported products, often from the global South. These caps would be on CO2, materials, water footprint or the surface area under cultivation. Similar limits could be established for other environmental pressures such as the extraction of water, the total built-up area and the number of licenses for tourist enterprises in saturated zones.

10. Abolish the use of GDP as indicator of economic progress

If GDP is a misleading indicator, we should stop using it and look for other indicators of prosperity. Monetary and fiscal national accounts statistics can be collected and used but economic policy shouldn’t be expressed in terms of GDP objectives. A debate needs to be started about the nature of well-being, focusing on what to measure rather than how to measure it.

These proposals are complementary and have to be implemented in concert. For example, setting environmental limits might reduce growth and create unemployment, but work-sharing with a basic income will decouple the creation of jobs and social security from economic growth.

The reallocation of investments from dirty to clean activities and the reform of the taxation system will make sure that a greener economy will emerge, while stopping to count the economy in GDP terms and using prosperity indicators ensures that this transition will be counted as a success and not as a failure.

Finally, the changes in taxation and the controls in advertising, will relax positional competition and reduce the sense of frustration that comes with lack of growth. Investing on the commons and shared infrastructures will increase prosperity, without growth.

We do not expect parties of the Left to make “degrowth” their banner. We understand the difficulties of confronting, suddenly, an entrenched guiding principle. But we do expect radical left parties to take steps in the right direction, and to pursue good policies, such as the ones we propose, independent of their effect on growth. We do expect genuine Left parties to avoid making the relaunch of economic growth their objective. And we do expect them to be ready, and have ideas in place, on what they will do, if the economy refuses to grow.

Can We Prosper Without Growth? 10 Policy Proposals

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