Degrowth - CReality

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Economic Order

Qualitative growth instead of quantitative growth - and degrowth where necessary

[deutscher Text hier...]

Theses on the current problems
1. As a result of climate change and the corona pandemic, world poverty has increased again.
2. Social inequality has increased in a number of countries.
3. The world economy does not function according to ecological or social criteria.
4. The economy is also polarizing: global digital companies are expanding, while local traditional businesses are struggling to survive.
5. Sustainable production is still a long time coming in many parts of the economy.
6. Many products produced by the economy are neither sustainable, nor necessary, or increase the consumption of raw materials and energy.

Ideas for possible solutions
- Focusing production and allocation of goods and services on the concrete benefit for all or on the use value instead of on the exchange value or profit maximization.
- Considering human and dignified work, especially care work, as the "source of all prosperity" - and paying for it appropriately.
- Relativization of private ownership of companies and specification of clear social and ecological framework conditions for production - and abolition of patent protection on vital products.
- Involvement and participation in the sense of "community organizing" in local companies, and especially in transnational corporations.
- Creation of local or regional economic cycles, including with forms of work such as crowdworking or teleworking.

The fundamental question is whether a capitalist economic system can function at all without quantitative growth.
Ulrike Herrmann (in Le Monde Diplomatique, April 2015:3) is skeptical in this regard: "If growth were prevented, capitalism would be ended, but the result would not be the ecological circular economy that environmentalists hope for. It would be an economy in free fall, creating panic. People are deeply shaken when they lose their jobs and their income. All major economic crises have been immensely dangerous - even to democracy."
Basically, the following question arises: How could it come to this point that our economic activity increasingly endangers our ecosystems, which are at the same time the prerequisite and basis of our life and thus also of our economic system? A central explanation lies in the fact that consumption and production incur costs that are not borne by the polluters. When lousily maintained oil tankers sink and pollute millions of liters of water, or when CO 2 emissions change the global climate, the resulting damage is paid neither by the polluters on the production side nor by the consumers who consume the corresponding products. These costs are passed on to outsiders - for example, the residents of polluted coasts or areas affected by drought or flooding as a result of climate change. In economic terms, this is referred to as external costs. External costs are not only the consequences of accidents, but they can also arise as a normal consequence of economic activities, e.g. from the exhaust fumes of normally operating passenger planes in the air. When external costs occur, the market mechanism fails: "Too much of these goods is produced and consumed because they are produced and sold too 'cheaply' in terms of total costs (business and external costs)" (Eisenhut 2006:130). Market participants waste the valuable environment because it consists largely of free goods and partly of public goods and is available to everyone. Therefore, the environment is used and overused by everyone.
Hans Wielens (2004:51) has rightly pointed out that the real scarcity factors are neither labor, capital nor raw materials, but prudence, prudence and wisdom. Economic changes should be thought through and approached with calm and composure. And perhaps one would have to add: Modesty.
All over the world, only products - and services! - should be produced,
a) which serve the sustainable satisfaction of basic needs (e.g. healthy food, renewable energy, education, environmentally compatible information use and communication);
b) which are produced from renewable and environmentally friendly raw materials (e.g. wood; renewable energy);
c) whose production, use or consumption, as well as their disposal, do not cause environmental damage (such as noise, water pollution, air pollution, non-degradable solid waste).
Basically, there are the following methods to enforce sustainable production:
- Bids and bans, e.g. in the form of limit values, specifications for production processes, etc. The disadvantage of bans and prohibitions is the large control effort.
- Self-regulation: Industry associations or companies impose standards, targets and controls on themselves. Here, the focus is on the source and there are fewer time-consuming controls. The disadvantage is that these self-regulations sometimes do not go far enough and are not always adhered to by all - either by companies that evade these agreements or because there are too few controls and hardly any possibilities for sanctions.
- Internalization of external costs: All costs - including environmental and social costs borne by the general public - are imposed on those who cause them. This can be done by means of appropriate prices, but also by means of tradability of property rights, rights of use and rights of action, taxation according to the polluter-pays principle, incentive taxes or environmental certificates, etc. (cf. Eisenhut 2006:131-133).


Cited Literature
Eisenhut, Peter
2006: Aktuelle Volkswirtschaftslehre. Zürich / Chur: Verlag Rüegger.
- Herrmann, Ulrike
2015: Über das Ende des Kapitalismus. In: Le Monde Diplomatique (deutsche Ausgabe Schweiz) vom April 2015. 3.
- Wielens, Hans

2004: Im Brennpunkt: Geld & Spiritualität. Ist die Krise der materiellen Welt überwindbar? Petersberg: Verlag Via Nova.

Book notes
[German books see here...]

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