On Friday the U.S. Commerce Department reported:
“Consumers pulled back sharply on spending in early 2017…reducing the economy’s quarterly growth to its lowest level in three years.”
That quote is from this New York Times story by Nelson D. Schwartz:
G.D.P. Report Shows U.S. Economy Off to Slow Start in 2017
Wait a minute. Why would the Trump administration celebrate this?
“the 0.7 percent annual growth rate for the period is far below the 2.5 percent pace in President Barack Obama’s final three months in office, let alone Mr. Trump’s 4 percent target.”
You’re right, U.S. policymakers are not celebrating. I created the headline, White House Celebrates Snail’s Pace GDP Growth, to serve as an example of what we should be seeing from the White House and the media when economic growth approaches zero. Why? This comment from a New York Times reader conveys it well:
“Can anyone understand that an ever-growing economy guarantees the destruction of life as we know it? The earth is finite, folks.” – Donald Sauter
All scientific indications are that the scale of the human enterprise has outgrown the Earth’s ability to sustainably meet our needs. The best estimate is we grew beyond a sustainable size 40 years ago. The size of the global population and economy is now damaging the ability of ecosystems to meet future needs. In this situation, economic growth should no longer be our collective societal goal.
Sadly, many economists and most policymakers, voters and journalists are behind the curve on this. Thus New York Times economics reporter Schwartz writes:
“The softness last quarter also provides crucial ammunition for the Trump administration’s arguments that big tax cuts and regulatory rollbacks are necessary for the economy to grow the way it did in the 1980s and 1990s.”
“Through eight years of a fundamentally tepid recovery, the promise of stronger economic growth….”
“Tax cuts, regulatory relief, trade renegotiations and an unfettered energy sector are needed ‘to overcome the dismal economy inherited by the Trump administration,’ said Commerce Secretary Wilbur Ross.”
Language like this reinforces the myth that economic growth will solve problems and improve our lives. Just look at these editorial cartoons featuring snails. The folklore about the universal goodness of robust economic growth is everywhere. It keeps policymakers and voters pursuing and cheering GDP growth, behavior that is clearly against our best interests.
I long for the world in which an annual economic growth rate of 0.7 percent is celebrated as progress toward a sustainable steady state economy. In this world we would be in the midst of a massive global campaign to shop less, consume less, waste less, and leave some planet for our kids and grandkids.