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Friday, November 25, 2011

Why growth, not consumerism, is good

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U.S. Economy

Tuesday, Aug 17, 2010 4:30 PM Eastern Standard Time

Why growth, not consumerism, is good

It's not about having more "stuff." It's about the U.S. providing everything its citizens need

Retail Sales

Pedestrians walk by the window display at an Old Navy store in Monday, Sept. 21, 2009 in downtown Chicago. (AP Photo/Kiichiro Sato) (Credit: Kiichiro Sato)

Economic growth is slowing in the United States. It’s also slowing in Japan, France, Britain, Italy, Spain and Canada. It’s even slowing in China. And it’s likely to be slowing soon in Germany.

If governments keep hacking away at their budgets while consumers almost everywhere are becoming more cautious about spending, global demand will shrink to the point where a worldwide dip is inevitable.

You might ask yourself: So what? Why do we need more economic growth anyway? Aren’t we ruining the planet with all this growth — destroying forests, polluting oceans and rivers, and spewing carbon into the atmosphere at a rate that’s already causing climate chaos? Let’s just stop filling our homes with so much stuff.

The answer is economic growth isn’t just about more stuff. Growth is different from consumerism. Growth is really about the capacity of a nation to produce everything that’s wanted and needed by its inhabitants. That includes better stewardship of the environment as well as improved public health and better schools. (The Gross Domestic Product is a crude way of gauging this but it’s a guide. Nations with high and growing GDPs have more overall capacity; those with low or slowing GDPs have less.)

Robert Reich, a professor of public policy at the University of California at Berkeley, was secretary of labor during the Clinton administration. He is also a blogger and the author of "Aftershock: The Next Economy and America's Future." More Robert Reich

1 comment:

  1. Isn't growth created nowadays in fact largely by consumerism? How can policy insure that growth isn't just the effect of uneducated buyers demanding products that have negative global and local externatilities, such as ever new models of cell phones produced with child labor which leaves a long trail of waste in its production and eventual destruction without upsetting growth itself?