Growth doesn't just mean using more resources. It also means using less

If you can do something for one ten-thousandth the cost it used to be, you'll feel pretty rich.

The Atlantic's Noah Smith has written on whether capitalism actually does require growth to continue. He argues:

Looking at history, we see that the biggest challenges to capitalism actually came during times of rapid growth. The early 20th Century was the heyday of communism, anarchism, and socialism. But this was a time of immense growth, technological progress, and increased material standards of living. It seems possible that those alternatives to capitalism gained popularity precisely because rapid growth disrupted the stable social systems that had been in place before the Industrial Revolution.

Clearly there's something problematic in that analysis; the "stable social systems" in place before the Industrial Revolution had very little in common with capitalism as we know it today. It may well be the case that the age the joint-stock company didn't require growth in the same way that modern financial capitalism does.

Smith does, however, argue that finance doesn't require growth either, because interest comes not just from an expectation of growth but also the value of consumption smoothing. That is, people will put up with having less money in the future in order to have income now, and interest is a reflection of that.

But the whole argument is rather a moot point, either way, because it's so frequently brought up in the context of a second claim: that growth requires exploitation of resources, and that if we desire an economy which doesn't carry on tearing up the planet, we need to accept that that economy will be "steady state".

There is clearly a grain of truth here. Famously, the history of America can be described, in economic terms, as a country continually dealing with financial issues by physically growing; first expanding south, then west, and then eventually overseas in the form of the pseudo-protectorates the US now runs. And an end to resource extraction would definitely hit growth rates enormously, if for no other reason than that it would require the world's economy to be completely retooled around renewable energy and recycling usable material from waste, which wouldn't happen painlessly.

But it's simply not true to say that growth can only come from increased abuse of the environment. My favourite illustration of the falsehood comes from a two-year-old piece by Alexis Madrigal:

Imagine you've got a shiny computer that is identical to a Macbook Air, except that it has the energy efficiency of a machine from 20 years ago. That computer would use so much power that you'd get a mere 2.5 seconds of battery life out of the Air's 50 watt-hour battery instead of the seven hours that the Air actually gets. That is to say, you'd need 10,000 Air batteries to run our hypothetical machine for seven hours. There's no way you'd fit a beast like that into a slim mailing envelope.

That, right there, is growth. For the energy cost of running one laptop twenty years ago, you can now run 10,000. That's an annual growth rate of just under 60 per cent.

Clearly, energy efficiency in portable computers over the last 20 years is one of the most rapid measurable increases in technology ever, but nonetheless, it puts paid to the idea that all growth can be is increasingly extractive.

We should be planning for an economy which takes only memories and leaves only footprints — but that's not the same as planning for an economy with no growth. Though George Osborne might wish to convince you otherwise, that would be an unnecessary disaster for all concerned.

Some MacBook Airs, engaged in naughtiness. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

New Statesman
Show Hide image

Quiz: Can you identify fake news?

The furore around "fake" news shows no sign of abating. Can you spot what's real and what's not?

Hillary Clinton has spoken out today to warn about the fake news epidemic sweeping the world. Clinton went as far as to say that "lives are at risk" from fake news, the day after Pope Francis compared reading fake news to eating poop. (Side note: with real news like that, who needs the fake stuff?)

The sweeping distrust in fake news has caused some confusion, however, as many are unsure about how to actually tell the reals and the fakes apart. Short from seeing whether the logo will scratch off and asking the man from the market where he got it from, how can you really identify fake news? Take our test to see whether you have all the answers.

 

 

In all seriousness, many claim that identifying fake news is a simple matter of checking the source and disbelieving anything "too good to be true". Unfortunately, however, fake news outlets post real stories too, and real news outlets often slip up and publish the fakes. Use fact-checking websites like Snopes to really get to the bottom of a story, and always do a quick Google before you share anything. 

Amelia Tait is a technology and digital culture writer at the New Statesman.