The Problem

Here we outline some challenges that affect society’s ability to operate sustainability. They are growth, crisis, fixes and ideas of progress. You can watch the animation below, and read more about the issues on this page.

For us to have an understanding of how sustainability can work, and what the limits to sustainability are under current economic conditions, it is important to understand our economic system a little like a set of agreements that states have agreed to, rather like a game. The ‘game’ itself is the economic system upon which most of the world has agreed to play – capitalism. This set of agreements has rules. Any state actor who wants to be involved in the economic conditions of capitalism needs to understand and abide by these rules. Its first rule that is important to consider, is that the economic system is one based on growth of capital.

For the economy to work, more capital value needs to be constantly created on an ongoing basis. This is a basic rule of the system.

Harvey (2014) saliently outlines how this works. Fundamental to societies that are built on this type of economy is profit-making, which ‘requires the existence of more value at the end of the day than there was at the beginning’ that in turn requires ‘an expansion of the total output of social labour’ (Harvey 2014: 232). Without this continuous expansion of value, no capital can be derived from economic processes. We generally consider a 3% year on year growth rate of a capitalist economy to be the healthy minimum for it to operate successfully.

Over time this rule or agreement becomes significant. While we may not think of 3% year on year as that much, this is compound and cumulative growth. Therefore, over time we can materially see the effects of growth. Findings from research into the impacts of growth (Steffen et al. 2014) show not only an increase in the economy but a compounding of the increase. Over time the growth increases exponentially, including the growth of resource use and waste. Ultimately in these growth curves, an inflexion point is reached. This can be considered as a significant turning point that can have profound effects, where, because of the fundamental rule of growth, the trend continues upwards at an accelerating rate until the growth rate over time is, literally, off the charts (figure 1). This is the reality of the long-term expansion of the global system of capital, which has hit an inflexion point in compound growth (Harvey 2014: 253). Therefore, while we may not notice growth in a particular year, over time we see the material and spatial effects of growth. This will become important for environmental matters over time.

The requirement of compounding growth is a continuous problem for economies built on capitalism. We have seen that growth is the rule upon which we all agree to do business, conduct exchanges and take part in the market. However, the rule of growth is set in stone, whereby ‘a zero-growth capitalist economy is a logical and exclusionary contradiction. It simply cannot exist’ (Harvey 2014: 232). Therefore, the rule that applies for societies is an important one: if zero-growth, or even low growth occurs in a capitalist economy, such an economy is in crisis (ibid.).

When the last such crisis occurred, starting in 2007, we got a glimpse of the effects of low and negative growth, and the steps taken under neoliberalism to restore growth. Such was the need to restore growth, that agreements to rescue the economy were made between sovereign states and the financial institutions who had brought about the crisis. Agencies such as the IMF supervised and oversaw this arrangement, making it seem like a legitimate and indeed the only way of keeping capital flowing (Harvey 2010: 49). Money was taken from the public and society in what critics call ‘accumulation by dispossession’ (Glassman 2006). State assets previously considered ‘common property resources’ (Harvey 2010: 49) were privatised. Indeed, part of the IMF ‘recovery’ strategy for countries in crisis generally stipulates the privatisation of natural resources such as water, forestry and gas. In line with the general rules of neoliberal capital, resources considered part of the ‘commons’ which traditionally included health and education, but also environmental entities, have increasingly been handed over to private interests for their administration and profit-making, if not outright ownership.

Therefore, projects that were developed under public and social ownership are removed from public ownership, dispossessing the citizenry while allowing private interests who had no hand in their development to profit from them. We have seen the growth in so-called vulture capitalism practiced by private equity groups, whose role is to take over public assets, ‘rationalise’ the workforce, asset strip the company and then return the company back to the public domain once it is profitable to do so (Harvey 2010: 50). Ultimately these are ways of trying to get the economy back to growth, often at the expense of societal wellbeing and cohesion, and protection of the environment. They can be seen as ‘fixes’, a concept that we explore in the next section.

Critics of the ‘business as usual’ economic position point to the problem of the crisis tendencies of capitalism. Some also bring into the discussion the ecological limits of the planet, arguing that it is necessary to practice ‘degrowth’ or at least encourage a transition to a ‘steady state’ type of economy (Jackson 2009, Ryan 2009, Kubiszewski et al. 2013). One logical solution to this is to dampen the production of goods and its associated waste. This however, is an impossibility under current economic ‘rules of the game’, in that ‘in a growth-based economy, growth is functional for stability. The capitalist model has no easy route to a steady-state position. Its natural dynamics push it towards one of two states: expansion or collapse’ (Jackson 2009: 64). Capitalist economies are therefore fundamentally unsuited to a steady state, let alone a downsizing of the impacts of crisis. We can therefore quickly see that it is usually a priority for governments that growth is encouraged, as growth prevents or mitigates economic crises. This is even in the face of environmental crisis, where usually, growth takes priority over care of the environment.

This brings us to the idea of ‘fixes’. The concept of a ‘fix’ pertains to a way of resolving economic crises. Fixes can take different forms, but the most well-known one is the spatial fix. This concept of the spatial fix ‘is a general term that refers to many different forms of spatial reorganization and geographical expansion that serve to manage, at least for some time, crisis-tendencies inherent in accumulation’ (Castree et al 2006: 146).

A fix does not provide a long-term solution to crisis. Rather it is a way of deferring, deflecting or ‘fire-fighting’ crisis tendencies so that they are no longer immediate and urgent, but resolved to a state of temporary equilibrium. A fix is therefore a suspension, or postponement for another future crisis.

Indeed, the spatial fix only ultimately intensifies crisis tendencies in the long run, as the core causes of crisis are never resolved, merely moved around and spread in space. The spatial fix is viewed as a necessary part of capitalist economies, in that the in-built tendencies towards crisis are temporarily deferred by spatial expansion and transformation. However, this spatial dimension is the environment in which the economy has to unfold. Therefore, if space is reorganised in the service of the economy, this points to a fundamental tension between the economy and the environment.

However, as successive iterations of crisis unfold, the spatial fix, and indeed ‘cascading spatial fixes’ (Harvey 2010: 50) encourage the expansion of the crisis-prone system, thereby spreading and intensifying the inherent crisis tendencies as it expands (extra href=”#references” title=”Reference:” info=”popover” info_place=”top” info_trigger=”hover” info_content=”Harvey, D., 2010. The Enigma of Capital, Oxford: Oxford University Press.” ]ibid.: 149[/extra]). Related to the spatial fix is the temporal fix, whereby capital finds temporary solutions to crisis through finance and credit. The operation of finance and credit help to defer potential lack of return on investment by providing dividends, stocks and future value guarantees before the maturity or viability of the capital investment is assured.

There is little doubt that growth has had its benefits. It has, however unevenly, provided wealth, stability and prosperity for some parts of the world. It supports dynamism and innovation. However, having looked at growth, crisis and fixes, our ideas of growth and what qualifies as ‘recovery’ of the economic system become more problematic. A further critique of compounding economic growth is also in its erroneous association with happiness and wellbeing (Hamilton 2003; Jackson 2009; Sandel 2013; Skidelsky & Skidelsky 2013). This has implications for our collective understandings of progress in society, in that growth is purported to promise a future better life, indeed the idyllic ‘good life’ that includes ecological benefits to society (Skidelsky & Skidelsky 2013). From this ideological perspective, growth is equivalent to progress, and to critique the benefits of growth is deemed at best, regressive. Indeed, any questioning of the unilateral benefits of growth is ‘deemed to be the act of lunatics, idealists, and revolutionaries’ (Jackson 2009: 14). Therefore, it can be seductive to assume that growth is not only beneficial for society, but a necessary precondition for societal progress and wellbeing.

However, despite the raising of living standards that have been associated with growth, indicators of social progress, happiness and human flourishing have, at best remained level, if not decreased over the time that neoliberal policies have been to the fore.Social Progress Imperative: 2015

. Rather than bringing social progress, economic growth without care to social conditions merely ‘fosters empty consumerism, degrades the natural environment, weakens social cohesion and corrodes character’ (Hamilton 2003: x). The neoliberal era has allowed markets to grow relatively free from regulation. At the same time, social protections have been forcibly weakened through undermining of job security and social security, along with the financialisation and privatisation of health, education, and elder care. Statistics show that wellbeing peaked before the introduction of neoliberal policies, and has been declining since the 1970s (Hamilton 2003, Skidelsky & Skidelsky 2013). The wellbeing promised by growth has therefore been replaced by a pale imitation, driven by consumerism and advertising. Indeed, this consumerism is driven largely by faith that it will bring about the utopia of a good life: ‘the compulsion to participate in the consumer society is not prompted by material need or by political coercion: it is prompted by the belief of the great mass of ordinary people that to find happiness they must be richer, regardless of how wealthy they already are’ (Hamilton 2003: xvi).