Herman Daly on the case for a steady state economy
Earthsky spoke with Herman Daly, a professor at the University of Maryland and one the founders of a field of academic research called ecological economics – the study of how human economies and natural ecosystems interact.
Herman Daly: We live in a growth economy. But unfortunately, economy is part of a larger system – the Earth ecosystem, which does not grow.
For decades, Daly has advocated a transition to what’s called a steady state economy, in which both human population and physical wealth are relatively stable.
Herman Daly: It’s an economy in which the path of progress is not bigger, not more and more stuff. It’s an economy in which the path of progress is to get better, to design better things.
He said that, over time, it’s not possible to consume more materials, energy, or wealth than one planet can provide.
Herman Daly: The problem is that we’ve reached the point at which the value of what we’re displacing and sacrificing in order to grow is greater than value of the extra stuff we get from growth.
He said measures of economic growth don’t factor in the costs of growth.
Herman Daly: We just count production and consumption. There’s no account that talks about things which are lost from growth. We need to count the costs of growth, and stop growing when the costs of growth become greater than the benefits.
For example, Daly said, fossil fuels power our economic growth. But the emissions from fossil fuels contribute to climate change, and that’s leading to dangerous consequences for ecosystems. Daly described the advantages of a steady state economy as having more time for leisure and personal relationships, which he believes cultivate happiness, not the consumption of things.
Herman Daly: It’s a feedback from the larger system. It’s telling us, wait a minute, slow down. You’re growing too big.
Daly is credited with popularizing the idea of the steady state economy in his 1973 book, Towards a Steady State Economy.
Herman Daly: A steady state economy is an idea that goes back to classical economists. It’s not a new idea. It means constant population, and constant stock of physical goods.
He admitted that this idea goes against the grain of the prevailing global economic policy.
Herman Daly: All of the policies that are currently being talked about are how to get the economy growing again. You know, grow, grow, grow. I would say, we need to adapt to lower levels of consumption.