The Hypocrisy of Environmentalists and the Need for Economic Growth

Environmentalists are hypocrites, right? They condemn all sorts of behaviours like driving cars or taking plane flights in which they themselves indulge, and they want to deny poor people the right to the same luxuries by saying that the economic growth which promises to widen access to such luxuries is unsustainable.

These, frankly, are pretty dumbass criticisms, but environmentalism probably isn’t going to get far until it can somehow transcend them, and they get aired every day – not only by ignorant pub bores, but often by extremely smart people. I didn’t plan to write this post, but in the last week I’ve come across these familiar criticisms by two such smarties – the late Professor Hans Rosling, in this entertaining TED talk from 2010, and global inequality expert Professor Branko Milanovic in his brilliant, but somewhat flawed, recent book Global Inequality¹, which I’ve just finished reading. Perhaps we could also throw in the Angry Chef from my previous post, who writes along similar lines that “The irony of people questioning what science has done for us whilst typing on a computer, connected to the internet via a fibre optic cable, should not be lost”. I want to address these criticisms partly because they fit neatly into the present narrative arc of this blog. But also because, rather than just trying to absolve myself as a guilty environmentalist, I want to try to turn that familiar critique on its head and go somewhere more useful with it.

The first part of the critique – the hypocrisy of personal complicity with environmental ‘bads’ – is the easiest to combat. Taking the Angry Chef’s example of computers, back in the 1980s I completed an entire university degree without once looking at a computer, whereas today I’d struggle to get through a single day without doing so. That’s not because I’ve changed, but because the world has. Of course, I could choose to take a stand and not use a computer, or a car, or aeroplanes. There’ve been times in my life when I’ve done exactly that. I passed my driving test in 1983, but didn’t actually own a car until 2007 (ironically, when I started running my ‘sustainable’ farming business). At various times and for varying durations I’ve similarly taken stands on flying, meat-eating, TV ownership etc. What difference has it made to the future of the world? Virtually none. Here we have the exact opposite of the free rider problem – let’s call it the oppressed pedestrian problem. In a ubiquitously motorised society, weigh up the personal costs of not driving against the benefits it delivers to the world at large, throw in the question of how much personal complicity affects the truth that motor vehicles are environmentally problematic, and go figure. The problem is structural, not individual. Nowadays I try to respect people who choose to avoid environmentally-negative behaviours, refrain from criticising people who don’t, and focus as best I can on what seems to me more important – the larger social structures that enable or constrain these choices.

Perhaps it’s harder to combat the second part of the critique, as articulated by Hans Rosling in his talk about the lack of access to washing machines among the majority of the world’s people – and more specifically, the majority of the world’s women. Surely, Rosling suggests, environmentalists who have access to one can’t without hypocrisy wish to deny the same access to all the world’s people? Actually it’s not so hard to combat this accusation. Do I use a washing machine? Yes. Do I wish to deny use of a washing machine to the 5 billion people in the world who don’t have access to one? No.

See, that was pretty easy. I do entertain a few caveats about Rosling’s position – the element of technological determinism involved in supposing that gender inequality is overcome by machines, the impact of the collective contexts in which people do or don’t have access to any particular technology, and the over-simplified connections he makes between labour-saving machinery, education and improved income. But, no, I think it would be great if everyone had access to a washing machine. I also think it would be great if nobody was threatened by climate change. There’s certainly a trade-off there, and I’m not persuaded by Rosling’s fond hopes for a decarbonised energy supply that can fund rich-country levels of energy use globally. But that’s another issue. For me, the main problem is that I doubt many of those billions actually will have access to a washing machine any time soon, if ever. So if it’s right to advocate for a better life for the world’s poor – and I think it is – then we need to start thinking afresh about how to do so. I want to broach that in the remainder of this post, perhaps in a rather roundabout way, by reviewing aspects of Branko Milanovic’s book.

If I had to nominate one single graph to make sense of the present human world, I think it would be the plot of relative gain in real per capita income by global income level over the last thirty years presented by Milanovic on page 11 of his book – the so-called ‘reclining S’ or ‘elephant’ graph, on account of its resemblance to said beast (you can see a version of it here). Essentially, the graph highlights four categories of people who could be termed the paired ‘winners’ and ‘losers’ from the neoliberal globalisation of the economy in recent history². These are, first, the very richest people in the world, who’ve increased their income by nearly 70% over this period (Milanovic shows that, within this group, there’s a sub-set of super-rich ‘global plutocrats’ who’ve done even better). The second category of winners, who’ve done even better in relative terms, is what Milanovic calls the “emerging global middle class” – essentially the increasingly well-off middle-to-high earners in middle income countries experiencing fast economic growth. In practice, virtually all of these people live in China or a handful of other Asian countries. The losers are, first, the very poorest people in the world, who’ve increased their income by less than 20% (arguably it might not have increased much in the absence of globalisation, though I strongly suspect fiscal deregulation hasn’t helped their cause). And second, the poorer people in the high income countries, who while still earning more than the ‘emerging global middle class’ haven’t increased their income at all over the last 30 years, and so have fallen very much further behind the richer people in their home countries. It’s worth bearing in mind that these are relative rather than absolute figures, so they underemphasise the degree of wealth concentration that’s occurred over the period: someone on $1 a day who doubles their income has $1 a day more, while someone on $1,000 a day who doubles their income has $1,000 a day more. Indeed, 44% of the absolute income gain over the last 30 years has gone to the richest 5% of people³.

The elephant graph suggests that the world may be a slightly less unequal place than it was 30 years ago (the global Gini coefficient was 72.2 in 1988 and 70.5 in 2008) – although since inequality was at an all-time high in 1988, another way of saying this, Milanovic cautions, is that “global inequality today is at almost the highest point ever in history”⁴. This small reduction is almost entirely due to the rise of a hitherto ‘missing’ middle class in a handful of Asian countries such as China – which of course means that inequality within these countries has grown.

Here we have the well-known ‘Kuznets curve’, proposed by the economist Simon Kuznets in the 1950s. A country typified by ‘subsistence’ peasant agriculture will have a relatively egalitarian income distribution, but most people will be poor. As a country ‘develops’ by switching to industry, average income increases, but so does inequality. Eventually, however, inequality starts declining through worker organisation, trade unionism, state welfarism and the like. The Kuznets curve seemed to describe pretty well what happened in early-industrialising regions like Western Europe and North America until the 1980s, but the rising inequality indicated in the ‘elephant’ graph since then confounds it. Milanovic talks – not entirely convincingly, to my mind – of Kuznets ‘waves’, whereby countries like China are now going through their first Kuznets curve, while countries like the UK and the USA have started riding a second Kuznets curve. Milanovic discusses various reasons why inequality is now rising and may decline again in the future in these ‘second curve’ countries, though he doesn’t persuade me that this will necessarily happen, and I’m not sure he even persuades himself. It may be better to ditch the Kuznets hypothesis and all the talk of ‘curves’ and ‘waves’ altogether, and instead contemplate the possibility of chronic future inequality.

But let me try to apply the rather abstract results of the elephant graph to some questions of recent history and social policy. Going back to our old friends from 2016, the Brexit and Trump votes, it’s easy to see from the graph why there might have been a level of disillusionment among working-class voters in the UK and the USA about the consequences of globalisation that propelled them towards those particular ‘anti-global’ choices. Lectures about the damage those choices might wreak upon national prosperity probably didn’t wear too well with people who haven’t seen much of the prosperity come their way (obviously voting choices were a lot more complex than that, but I think that assertion is defensible – at least it puts me in the crowded company of many other wise-after-the-event commentators⁵).

However, the graph also suggests that looming over the shoulders of the relatively poor people in the rich countries are the relatively rich people in the poor countries (who are still poorer in absolute terms than the former, though they’re catching up). The notion that a Trump administration or Britain’s merry band of Brexiteers have either the will or the capacity to reverse the ebb of economic power away from the declining middle and working classes of the west and towards the rising middle classes of Asia seems, for numerous reasons, fanciful.

One thing that emerges strongly from Milanovic’s analysis, though he doesn’t place much emphasis on it, is how geopolitically concentrated the rise of the ‘global middle class’ is, being restricted to a handful of (admittedly very populous) Asian countries. In other words, it looks like the core-periphery structure of the global economy as described historically by world systems theorists like Immanuel Wallerstein is being replicated. What we’re seeing is less the rise of a ‘global’ middle class as the handing on of an economic leadership baton from the west to southern/eastern Asia, with other regions such as Africa and Latin America remaining more or less peripheral. Milanovic shows that prior to around 1820 what mattered most to a person’s economic life chances was their class, regardless of their nationality: it paid to be ‘well-born’, wherever you were actually born. But since then, location has mattered more than class. So for example almost anyone born in Britain is likely to have better economic life chances than almost anyone born in Zambia. There is, as Milanovic puts it, a ‘citizenship premium’ which advantages or disadvantages you largely on the basis of what passport you’re entitled to hold.

Going back to the Trump and Brexit results, one issue that loomed large in those campaigns was immigration – in the Brexit campaign, for example, around the issue of migrants from poorer East European countries undercutting the economic chances of the struggling British working class. “It’s not racist to talk about immigration” was the mantra du jour.

Well, no it’s not. But one of the things I admire most about Milanovic’s book is the clear-eyed way in which he does talk about it, and the way that in so doing he confronts the great unmentionable of economics – that is, the hypocrisy of supporting the free flow of capital around the world without supporting the free flow of labour.

Now, I got a certain amount of stick on this site around this issue a while back, for example being accused of ‘xenophobia’ for, among other things, my lack of enthusiasm for rigorous immigration control. No, me neither. But anyway, I’m completely with Milanovic on this one. Poorer people in richer countries can make a sound ethical argument for a fairer national distribution of income. Poorer people in poorer countries can make a sound ethical argument for a fairer international distribution of income – but if that’s not going to happen, which seems likely, then they can make a sound ethical argument in favour of migrating somewhere they can earn more. If people in richer countries think migration of that sort is unacceptable, then how can it be acceptable for the (relative) ‘have nots’ in a given rich country to expect redistribution from the ‘haves’?

I can’t see an ethical answer to that question. And indeed the only affirmative answers I’ve seen to it are pretty avowedly non-ethical and implicitly nationalist: it’s OK for poor people in rich countries to expect a better deal from their richer co-nationals, but not OK for poor people in poor countries to expect a better deal from richer foreigners. Situations of ubiquitous economic growth tend to keep such questions at bay, because things don’t seem so bad if everyone is getting richer, even if some are a lot richer than others. But in a likely future of chronically low and maldistributed growth, these distributional conflicts are only going to sharpen. Arguments against global migration from poor to rich countries are ultimately winner takes all or might is right arguments. Such arguments have an obvious appeal to the currently mighty (in which category, globally, almost everyone in a country like the UK fits), but they tend to lose their lustre if the mighty should fall (in which category, looking at Milanovic’s analysis, the UK might well fit in the future). Be careful what you wish for (Milanovic has some ‘compromise’ suggestions for dealing with global migration which strike me as quite sensible – perhaps I’ll look at these in more detail another time).

No doubt the ethical notion that people should cede current riches to the less well-off seems ludicrously idealistic, although it’s a commonplace nowadays to consider other ethical systems, such as those of foraging nomads, where the idea that you should take the lion’s share for yourself and let others go hungry simply because you can is absolute anathema – a sensible strategy, the anthropologists tell us, in uncertain times when you never know who’ll next be sated and who’ll be hungry. Perhaps that’s worth pondering as we confront an uncertain collective global future. As ever, ‘idealism’ is contextual – to me, the ‘obvious’ strategy proposed by my critics of clamping down on new or recent migrants is only obvious in the context of a certain modern mindset that’s best transcended.

Still, that mindset is deeply grounded in our politics, which has rarely been about ethics, except perhaps occasionally in recent times with the thinnest veneer of liberal internationalism. Generally, it’s been about power. I can’t see the rich world willingly giving up its advantages – so I suspect it will yield them slowly and unwillingly. I foresee a future of intense distributional conflict and quite probably war. If that happens, I hope those who’ve justified the current turn of western politics on distributional grounds (like John Michael Greer…) will keep quiet rather than trying to find non-distributional arguments to justify the status quo ante.

Are there any alternatives to this grim scenario? Well, possibly – but Milanovic isn’t much help in locating them. Despite his economic heterodoxy, he returns to the mainstream fold on the question of economic growth, ridiculing the idea of degrowth as a hypocritical fancy of rich westerners and arguing – albeit with the historical evidence in his favour – that economic growth is much the most powerful tool yet found for improving the lives of ordinary people in poor countries. He adds,

““Deglobalization” with a return to the “local” is impossible because it would do away with the division of labor, a key factor of economic growth. Surely, those who argue for localism do not wish to propose a major drop in living standards or a Khmer Rouge solution to inequality”⁶

Well, speaking personally I’d say certainly not the latter but possibly the former – especially if the drop in living standards falls mainly on the current rich, as Milanovic himself prescribes. One of the problems with his analysis is the rather crude way he contrasts industrial societies with pre-industrial ones as ‘subsistence’ societies, and uses fiscal income interchangeably with ‘living standards’. I don’t want to succumb to too starry-eyed a version of pre-industrial society, but the pre-industrial Britain of the 18^th century, for example, was not a ‘subsistence society’ and there are some things that money can’t buy – indeed, there are some things that the pervasive marketization prompted by rising national incomes may jeopardise. This was true in early 17^th century northeast England, for example, which experienced the last clearly documented famine in the country – one that afflicted not ‘subsistence’ peasants, but commercial livestock farmers suffering a market crash that made them too poor to afford grain⁷. Similar pressures afflict poor cash-crop farmers today⁸. I’m not altogether against the idea of the rural poor quitting peasant farming for something that pays better, but it’s a risky business. Despite the blandishments of ecomodernists and well-paid university professors, the fact is that many of the rural poor keep a foot in subsistence production as a risk-insurance strategy. I don’t think you have to side with the Khmer Rouge to argue that it sometimes ‘pays’ not to seek higher incomes above all else.

Milanovic nicely points out how bad social scientists, including economists, have been at predicting the future, serially succumbing to the fateful temptation to project short-run current trends as long-term structures. But let me put my cards on the table – I think it would be a good idea if people in the rich countries had lower living standards, and people in the poor countries had higher ones. I can’t exactly see how this will happen on the basis of current economic realities, but I’ll conjure with a scenario where those current realities are breaking down.

This involves chronic economic stagnation and debt in western countries of the kind analysed by political economists like Wolfgang Streeck⁹, the continuing leakage of economic power to Asia and the curveball (or perhaps googly, to use a more Anglocentric metaphor) of climate change and energy crisis renting the fabric of the global economy. In those circumstances, I think a lot of rural peasant cultivators globally will suffer, but so will a lot of urban merchant bankers in the west, and the balance may tip away from the latter and towards the former a little – perhaps to the extent that being a rural peasant cultivator in a country like England starts to seem less crazy than it presently does.

Let me run with that scenario a little further. Suppose that a post-Brexit Britain manages to control its borders, experiences the huge economic slump that obviously awaits it and, in a moment of clarity, sees that its problems aren’t fundamentally the fault of immigrants, the EU, or the Chinese, and that the solutions aren’t to be found in humbling itself before an uncaring global economy. Milanovic writes,

“An interesting question to ask is what might happen if the growth rate decelerated and fell to zero, and the economy became stagnant, but at a much higher level of income than in stagnant preindustrial economies. It is not inconceivable that Kuznets cycles would continue to take place against the background of an unchanging mean income, producing a picture similar to the one we have for pre-industrial economies”¹⁰

…which is one of wildly gyrating inequality in response to exogenous shocks. But a conceivable alternative might be what’s termed a ‘high level equilibrium trap’ which I’ll be looking at in future posts – a stable, efficient, dynamic but stagnant economy in which the primary asset is human labour. Managed well, I think this could be the best kind of economy for steering our way equitably, sustainably and resiliently through the future shocks awaiting us. ‘Managing it well’ would involve an attentiveness to resilience rather than to economic growth, an opposition to extremes of wealth accumulation, and a focus on sustainable, labour-intensive local industries. Like peasant farming, for example. I’m not sure it’s an especially likely future outcome. But it’s a possible one, and it’s better than most of the alternatives, which seem to me to cluster around the two possibilities of ecomodernist fantasy-land or internecine nationalist-mercantilist conflict.

But let me round off by returning to Professor Rosling and his washing machines. As I’ve said, the good professor was right that nobody who has access to a washing machine really ought to lecture those who don’t about what consumer items they can or can’t have. But I doubt for all that that what Rosling calls ‘the washing line’ – the level of income at which people can afford a washing machine – is going to encompass a great many more of the world’s people than it presently does, or that the global energy supply will be able to decarbonise at anything like the levels which would be required to greatly lower the washing line while avoiding runaway climate change. I also doubt that the benefits of the washing machine he outlines that accrued to the lucky earlier generations of technology-adopters such as his mother in Sweden – an education instead of hard domestic work, bringing rising income within reach – is going to work the same way for would-be washing machine owners of the future. There are just too many well-educated people chasing too few jobs in an increasingly dysfunctional and stagnant economy. As Milanovic puts it, the difference in skills and abilities between high and low earners in the future is likely to be increasingly small – the main difference being chance and family background¹¹, not washing machines and education.

Another way of putting all this is that economic growth, education and technological development as means of improving the human lot are old stories that are probably going to work less well in the future. Like the ‘science’ discussed in my last post, they’re not bad things in themselves, but if people pin inordinate hopes on them as vehicles for future human betterment I think, increasingly, they’ll be disappointed. Environmentalists have been saying these things for years. However many washing machines or plane flights they personally enjoy, that doesn’t make them wrong. It’s time we started thinking structurally, and stopped shooting the messenger.

Notes

1. Branko Milanovic. 2016. Global Inequality: A New Approach for the Age of Globalization. Harvard University Press.

2. Though there are some difficulties of interpretation here, highlighted in this critique by Caroline Freund which I only came across as I prepared to publish this post. I’ll have to think about this some more – there are aspects of her argument I don’t find convincing, but some of her points are quite telling.

3. Milanovic, p.24.

4. Milanovic, p.253.

5. Though, once again, the Freund critique puts a different spin on the figures, reverting us to another familiar response to the Brexit and Trump results – an inexplicable desire for economic self-harm, which in some ways is quite encouraging for my general thesis here.

6. Milanovic, p.192.

7. Mark Overton. 1996. Agricultural Revolution in England. Cambridge University Press, p.141.

8. Peter Robbins. 2003. Stolen Fruit: The Tropical Commodities Disaster. Zed.

9. Wolfgang Streeck. 2016. How Will Capitalism End? Verso.

10. Milanovic, p.58.

11. Milanovic, p.215.