Economist Ann Pettifor: "GDP isn't the Problem, Capitalism is!"

obviously GDP gross domestic product growth three interconnected Kuznets said please don't measure him there was a gentleman behind Theodore of GDP so please don't measure human progress with GDP but in this era is it we obviously still live in a Democratic era mass public participation one person one both in the UK us number of other countries it makes it very easy to understand when you say 2.5 percent GDP we're growing so well you've got a technocratic class who you get the economists every week and literate in the back almost up the football results you got the GDP scores yeah do you not think that socialists or post capitis whatever you want to call them do you not think that we similarly would need some kind of metric by which by which to judge the success of any potential economic system yes and I I just I do want to take on this progress I heard what George said about GDP GDP is if you think of of of a car and the speedometer on the car the speedometer tells you the rate at which you're traveling the speed at which you're traveling and the speedometer is not the problem the problem is the accelerator the problem is the driver behind the wheel the problem is the car capitalism and the measure of what's happening and the GDP is a measure the GDP is a measure of the total activity as far as we can count it we can't up we can count how many people are aimed in employment we couldn't count how much money is going into green technology these things are countable and the fact that we can count them is okay is in my view is not a problem the question really is the driving force behind GDP what is it you know it is that GDP must rise as you say every week the football score of it rising yeah up up up it must never go down you know and in fact GDP has to go down we have to we have to extract less from the earth we have to exclude fossil fuels from our counting we've just got to block them out didn't he say the finance shouldn't be included in GDP I mean this has been a yeah absolutely I mean the thing is what if that should not be included because that's all very complicated you don't want to get into to buy your book for that one yeah but the point is that you know these are intangibles and these are intangibles but mainly because it's all too complicated but we've turned in tangible things like trust into assets we've commodified absolutely almost everything we could possibly commodify and modify and and monetize as capitalism and and and and that's all crazy we must stop doing that too but we'll never stop counting I hope we don't because for me that is what science does we we have to measure how much oil is coming out of the earth and how much must be must stay behind and someone's going to do that measuring but the question read we really have to dress this do we extract that oil or not those are the big issues is a really interesting paper just being published by Jason Hickel and George's Carlos looking at this whole idea of green growth you know that can we deem materialized growth can we decouple growth economic growth from material resource consumption and it's it's it's a very thorough paper it's a very good one and it shows definitively we cannot that there while there was some religion for this it's new I think it's called a new political economy or something it's it's it's it's a new journal actually I think this is its very first edition jason Hickel and you're just Kalos know something like is green growth possible I think that's the title so anyway it's it's it's a very rigorous look at at this question because yeah its intrinsic to all the models you know if you look at you nap if you look at OECD the World Bank they all say oh it's fine because we're just decoupled we're switching from goods to services so it's gonna happen anyway we'll just deep materialize the economy it's not happening I mean what's so interesting is that during the 20th century there was some relative decoupling in other words material resources was still rising but it was rising more slowly than economic than than GDP right in the 21st century there's been a recovering where material resource use is rising as fast or faster than that than GDP and and we're we're going in exactly the wrong direction if that's what you want to do as for the absolute decoupling in other words a an overall reduction in material resources they demonstrate pretty convincingly that it is physically impossible while an economy is growing you just cannot do it and and they've they've done a very thorough literature survey it's terrifying you know and you basically come to the end of that and say you cannot continue to have economic growth and continue to have life on Earth the two things are in compliance respond quickly and then I'll get your opinions on this so we know for instance in the US UK most of Europe carbon emissions have been falling since about 2000 although GDP although quite slight in this country since 2000 still gone up so there has been something of a sort the argument is that there's basically a hard limit on the amount of co2 emissions a country per capita will emit almost like you know there was declining birth rates increased life expectancy now they're saying that one of the sort hallmarks of capitalist development is it is a cap on carbon emissions do you think that's simply because all the production's being done in the global south or is that there's a couple of things to say here that so while there has been no absolute decoupling of material resources and there can't be with economic growth with carbon production that carbon dioxide production there has been an absolute decoupling even taking into account out sourced emissions elsewhere what the paper shows is that that is nowhere near enough to hit the targets which were signed up to under the Paris agreement let alone what we actually need to do if we're going to produce no more than 1.5 degrees of global heating let alone two degrees of clutter or even two degrees of global heating I mean they're saying you know if economic growth continues you're talking about seven eight maybe eleven twelve percent cuts per year in order to meet those targets and yeah that is three four five times what any economy has managed to achieve so again while you know you might you can look at this and say ah you know we've got the lowest emissions per capita we've had since 1888 or something like that in this country isn't that an amazing achievement and is it actually by comparison to where we need to be it's nothing it's nowhere near we'd already stocked the atmosphere with full of carbon anyway thanks to past activities but you see the thing is that I mean I'm I think I'm going to diverge here from you George on this point because for me a green and a sustainable economy will be a high employment economy for me labour will have to substitute for carbon we're gonna have to grow our own green beans we're not going to be able to import them by plane we're gonna have to walk you know we're going to have to do we don't have to become much more than nationally self-sufficient and that's going to be labor intensive and I have been on platforms with green Emmy peas and so many Varg you that actually know we have to have high levels of unemployment so when I when we talk about growth and I don't want us to talk about that because it's such a neoliberal concept I want us to talk about what level of economic activity would be sustainable and how much of that should we devote towards labor and how much of Labor must be labor for example in activities that don't use material resources you know education the arts creativity care all of those things there's an awful lot to be done in my view that doesn't need to be fueled by carbon and and how much of that you know how are we going to organize a society to make it sustainable and whenever I talk about this I think of Egypt and I think of the millions of our young unemployed people in Egypt and I think of the ecological devastation that is the result of a society living on high levels of unemployment so I don't want to ever talk about growth but I do want to talk about what what kind of economic activity would we require to maintain our solidarity our civilization our ability to live in community and for me we've got to be talking about national self-sufficiency far more we've got to be self-sufficient we've got to you know feed ourselves we've got to be able to make her own clothes we've got to be able to walk around and cycle around these are all things we're gonna have to think about anew and envisage a new world but it's going to have some economic activity in it and we've just got to address Congress wants both of you a bit about GDP growth but you've talked about something important there which is the nation state yeah and the importance of returning sort of nationally oriented economies I agree with you I don't think I don't see how else you're going to be able to do this and often sort of the cliche amongst the left is because Marx made this observation correctly you know over time production becomes ever more socialized ever more globalized well actually when it comes to agriculture we probably need to deglaze quite significant absolutely but but the left would say that's you know oh well that's actually that's almost foreshadowing the possibility of a return of national socialism and you think do you think that's a sort of a bit of a lacuna for the left well they don't really engage with the national question but the national is in an identity Rhian issue but the nation-state is that locus of economic production yeah I mean I I have a problem with it and I think there is a worry there about nationalism and I'm deeply against nationalism having grown up in a nationalist state and what I think is really important is the idea of self-sufficiency of not being having to extract assets from other parts of the world for our own survival purposes but there will be countries and they are in Africa which cannot be self-sufficient on their own because they're too small they will want to have regional alliances and they want to want to work together with their neighbors you know who will have more water or more land or be able to grow things they can't grow or whatever so you know I don't think it's what I think the important concept is self-sufficiency and is this the idea that you cannot live by just exploiting in other parts of the world and by you know importing exporting all this stuff this is not it's not going to be sustaining I say that because Rio Earth Summit in 1992 and since then sort of common sense which is percolated all the way down to your everyday sort of liberal earth activist is we can only have global solutions to this in a sense it's true I mean Britain's only like two percent of world's co2 emissions but at the same time it seems to me and let's see what you think about this George that's almost provided a license force of political inertia and even even worse than not doing anything it's given almost the outward appearance of doing something and being invested and actually transitioning the economy where in fact that was never really on the table when we were running the Jubilee 2000 campaign the World Bank and the big the big charities in the United States wanted us to play a part in growing a global civil society to match global capitalism you know a global civil society was going to hold capitalism to account and I said you know we're not playing that game right because a global civil society is accountable to whom and and you know the idea all you're asking us to do is to reinforce global capitalism No thank you have you said that we want international cooperation and coordination we want to be able to work with our neighbors and you know we want to international alliances but you don't want a sort of globalized state which is what globalization is and one space in my view you

  1. GDP is a measure of the quantum of transactions in financial terms, in fiat currency.

    It is no measure of resource depletion.

    In an economy dominated by the finance sector and speculative transactions, it is a poor measure of the quantum of material flow and labour input.

    It is also not the indicator to track if you want to know if civilization has collapsed, because the record will run out before then.

  2. Interesting discussion, although I do not buy the "there is no green growth" theory yet. Ultimately, in material terms, production has to be linked with energy – but there is a massive energy resource that is severely underused, that is the sun. A huge amount of solar radiation is still unexploited and I think if it does become exploited then it won't lead to great atmospheric warming. In fact it should replace fossil fuels altogether.
    It also seems inevitable that carbon sequestration will become necessary to prevent widespread famines and massive migrations the likes of which we have never seen.

  3. The main problem is waste, there's an extraordinary amount of waste due to global capitalism. Take the car industry for instance, the level of waste from that industry ifreversed alone can take us back to the ice age.

  4. The real problem isn't capitalism it is middle class tosspots who think socialism is bloody wonderful but in reality it has been rejected everywhere it has been tried.

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