But the idea of perpetual economic growth, even if it can be massaged back to life in the short term, has had its day. Even if it were sustainable on its own terms, it would still annihilate us. Just over 160 years ago, John Stuart Mill was musing on the possibility of the \”stationary state\”, warning that the consequence of unlimited growth could only be environmental destruction and a reduced quality of life. \”It is only in the backward countries of the world that increased production is still an important object,\” he wrote. \”In those most advanced, what is economically needed is a better distribution.\”
Marvellous though the old boy was even Homer nodded.
Nordhaus brackets the growth of real wages over the past century as somewhere between a 20-fold and a 100-fold increase. Alan Greenspan … has suggested adjustments of the statistics that lead to an estimate of a 30-fold increase of material wealth over the past century. (DeLong 2001)
That seems a reasonably elegant destruction of the idea that more growth was impossible or undesirable after the old boy\’s death in 1873.
Just as a test, is there anyone at all out there who would be willing (even if we take the lower number there) to live on one twentieth of their current real wages? That is, if you currently earn £50,000, then you have only £2,500 a year, if the median wage of around £20,000, then only £1,000 a year: and yes, prices stay as they are now?
Even if we had that better distribution, a perfect one even, would we be happy with an economy where GDP per capita was around £1,200 pa? A little above Vanuatu, a little below Armenia today?
Anyone who argues against us all living at such standards is of course implicitly (at the very least) acknowledging the value of economic growth.
Even the High Priest of happiness research, Richard Layard, tells us that up to £15,000 makes us happier so yes, economic growth has even made us happier.