Economists’ Growth Insanity

Paul R. Ehrlich | April 29, 2014 | Leave a Comment Download as PDF

Economists growth insanity

 Virtually every economist rejects the concept of limiting growth – by which they normally mean growth in GDP.  As Larry Summers, famous as a major cause of the recent U.S. financial disaster, once stated, “The idea that we should put limits on growth because of some natural limit is a profound error, and one that, were it ever to prove influential, would have staggering social costs.”  More typical of the intellectual contributions of mainstream economics, John Makin of the American Enterprise Institute recently asserted that “There is no magic bullet for stimulating long-term growth, which depends largely on persistent technological change and population growth.”[1]  Long-term growth is, of course, a “ bullet,” but lethal, not “magic,” being fired directly into the heart of civilization.  Even most smart economists, for example Paul Krugman, cannot get over the notion that growth is necessary to solve human problems.  As Krugman said recently, ” Oh, and politics: between the non-disaster of Obamacare…and the prospect of a decent rate of economic growth, the midterm elections may not go the way many on the right currently expect.”  Krugman recently spent time on TV talking about how to get growth without bubbles, opining, among other things, that Japan’s growth had slowed because of its demographic situation (Japan is one of a handful of overdeveloped nations whose populations, blessedly, have begun to shrink).[2]  He is thoroughly hooked on growth, most recently advocating reducing inequality (a good idea) to promote growth[3] (a very bad idea).  And Robert Reich recently stated that income inequality is “the enemy of economic growth,”[4] (since it limits the power of the middle class to buy more junk).  Economists like Reich and Krugman are wisely concerned with the pain people suffer through poverty and joblessness, which even in a nation as rich as the United States can still lead to clinical depression, hunger, illness, and even death.  It is diagnostic of their growthmania that economic growth is inevitably their solution to the problems of maldistribution of resources  – alternative approaches such as a shorter work week (an historic solution to the problem of job shortage), redistribution (except by changes in marginal tax rates), and (in the longer term) steps to limit family size are never considered.

This endemic growthmania creates love of the disease and fear of the cure.  Old-time economist Robert Gordon of Northwestern University projects (and laments) a dramatic decline in growth.  As he wrote, “We began with the tantalizing (and frightening) suggestion… that per-capita real GDP growth could slow down to a rate of a mere 0.2 percent by 2100.”  This horrifying slowing of growth would be, according to Gordon, because of “faltering innovation,” [5] without considering the obvious environmental/resource factors that make it likely growth will be reversed long before 2100.[6]  Of course, if economists could (or would) take into account the ongoing depreciation of the planet’s natural capital,[7] I think it is likely that economic growth has already halted, along with (as economists ironically have demonstrated) the growth of human satisfaction.  Depreciation of natural capital is the main reason that growth of GDP often leads to a decrease in human well-being – of both current and future generations.

Ironically, economists are also helping to generate what Marxists would call a “false consciousness” even in the numerate public about the role of individuals, the distribution of wealth and power, and what is likely to happen to those distributions in the future.  They themselves see the basic system as sound, individuals as “free,” and believe everyone will be richer in the future.  It is ironic because the major constraints on growth in wealth today were largely unknown to Marx, Engels, and others of their time; but their writings lead me to suspect they would know better and be ecological economists if they were alive today.

How does one explain that economists, many of whom have knowledge of mathematics, consider that 3% per annum is a “healthy” or “decent” economic growth rate?[8]  After all, a simple calculation shows that if the U.S. (or any other) economy grew at 3% for about 23 years, it would double in size.  In less than 150 years the economy would be 100 times as big.  Picture the drought situation in California or the air pollution in Beijing with a doubling of economic activity occurring in only 23 years. Then picture a doubling again and again every couple of decades.  Is this the future we want for our children and grandchildren? 

The explanation for economic blindness, I’m afraid, lies primarily in educational systems that pump out graduates, including economists with doctorates,[9] who are usually utterly clueless about how the world (or the economic system) actually works.   It is crystal clear that few understand that the growth-oriented economic system thrives on the heedless rape of natural capital and generates gross inequities (recall that much of western prosperity was built on a foundation of slavery).[10]  They fail to recognize the importance of natural capital, and when they do they are vastly overoptimistic about the chances of technological change offsetting its losses.[11]  They can’t imagine that the present economic system, dependent on continuous growth in population and consumption, is doomed. 

The critical economic questions today are simply: “is there a humane, equitable, and well-being-providing substitute for physical growth and, if so, how can we transition to it?” Indeed, when thinking about the needed total revision of the present economic systems, one must again (shudder) refer to Marx and his concept of alienation.  How is it possible for most people not to view themselves as cogs in a giant production machine, and how can we return a sense of pride and association with the results of one’s labors?

Economics may be the discipline that has the most to contribute to avoiding a collapse of civilization.  It’s a great pity that most economists are growthmaniacs — very much part of the problem rather than the solution.


[2] NYT Jan 4, 2014.  Also

[3] Krugman P. Mar 9, 2014. Liberty, Equality, Efficiency. The New York Times.



[6] Ehrlich PR, Ehrlich AH. 2013. Can a collapse of civilization be avoided? Proceeding of the Royal Society B  .

[7] E.G.,


[9] Colander D, Klamer A. 1987. The making of an economist. Journal of Economic Perspectives 1: 95-111.

[10] Grandin G. 2014. Empire of Necessity: Slavery, Freedom, and Deception in the New World. New York, NY: Metropolitan Books.

[11] Davidson DJ, Andrews J, Pauly D. 2014. The effort factor: Evaluating the increasing marginal impact of resource extraction over time. Global Environmental Change .

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  • John Taves

    This article and all the comments below are a total waste of time. What do you expect someone to do with this information? Should the CEO of Exxon stop trying to satisfy demand for oil? Should the politician not lure the factory to their town? Should I not try to earn more money? Should Nokia not try to make a better phone? Should Ford stop making cars? Seriously, what do you expect people to do with this information?

    Are you concerned that the economists that advocate economic growth can actually change the economy and achieve infinite growth? Maybe you are saying that these economists that call for economic growth are going to cause us to average more children. Since when has economics had any significant influence on how many children we average?

    Malthus suggested such a thing existed by saying that the poor reduce the number of children they create. He and scientists ever since have never managed to add that up in an objective manner and discover that regardless we average too many children and relentlessly attempt to drive our numbers to infinity.

    If you believe there is a mechanism behind the correlations that have produced the demographic transition theory, then you’d want continued economic growth, because lower fertility correlates to higher wealth.

    This rant and all other rants about how economic growth is bad does not hint, suggest, or imply in any way that each of us has a moral responsibility to limit the number of children we create. Why are population experts continually beating around the bush on this topic?

    We all know that cramming too many people into a football stadium will kill. We all know that the planet is just as finite as the football stadium. Population scientists know that averaging more than 2 children does the cramming, yet cannot bring themselves to admit or say that averaging too many children kills.

    Population scientists don’t even know that averaging too many children kills only children (see ). Population scientists have no concept for the situation where the population hits or is at the limit such that more births cause more child mortality. Instead of learning and teaching these fundamental population concepts, we get these ridiculous rants about economics that will have absolutely no effect on how many children adults average.

  • Harry

    I think what is really needed is to convince the ordinary person that their and their children’s lives will be improved by moving to a zpg & zeg system. Show them with articles in the popular press and tv shows that we don’t have to pave over farmland for new subdivisions but can rehabilitate the existing ones, that we don’t need new roads but better ones, that we can work shorter hours in better jobs using automation and robotics to increase efficiencies.
    In the western world today, I believe the majority of working people don’t think immigration is helping their lives, it’s certainly not getting their jobs back.
    The best places to live in the world and with the highest employment seem to be the places with stable populations like Switzerland, Norway, Sweden, Australia, New Zealand, Japan, why are these places not held up as good examples.
    The average middle class American knows they can’t afford more than 2 kids, it should be easy to convince them that the country can’t either.

  • Stephen Morris

    Both zero population growth and also zero economic growth. Is this possible?

    It seems that most politicians are not trained in economics, but more worrying, even if they were, they would still not have an answer to maintaining living standards with zero population and economic growth.

    The real problem is
    the consumer society and the wasteful use of the earth’s natural resources.
    This results in productive resources being put into making products that only
    last a few years and are then discarded. A lot of it is to do with the need for
    fashion that we have been “sold” by manufacturers. We make cars that only last
    a few years when we could make ones that last 50 or 100 years. We make
    furniture that we throw away after 5 years and clothing after one season. We
    have been convinced that we must keep purchasing these goods to satisfy our
    needs when in reality we are satisfying manufacturers needs to make more
    profit. Even today it is not worth getting small appliances repaired when they
    breakdown. It is cheaper to buy new ones.

    The whole world economy seems to be
    reliant on ever growing mass production and replacing people with machines that
    make more and more goods that replace more and more workers. Thus we must
    consume more and more goods to keep expanding the factories that make ever more goods but employ less and less people per factory. As we consume more and more goods we must then throw them away so the next lot of new goods can be consumed and then thrown away.

    It is a vicious cycle and one that must eventually come to an end as we over exploit the world’s resources, not to mention the pollution and degradation of the environment it is causing. It is like a mouse running around and around in a wheel but getting nowhere.

    Even If we can manage to slow population
    growth we need to think of the economic consequences. After careful
    consideration Alpha has decided that in the future we will need to make quality
    products that last for as many years as possible rather than “consumer society
    products,” that look good but only last a short time.

    Many, if not most products made today,
    actually have planned obsolescence built in. With slow to zero population
    growth, not only will producing products that last for many years, stop the
    wasteful use of the earth’s resources, it will be vital, to create employment to
    maintain and repair these products over many years. So rather than build more
    and more factories that employ less and less people per factory, if we make
    products that last a long time, we will create employment that will be needed
    for repairs and maintenance for these long lasting products. This is probably
    the only way we can have sustainable slow to zero population and economic
    growth; producing quality that lasts.

    • Harry

      Or goods whose material gets recycled over and over but whose functionality (eg. Smart phones) improves with each cycle or whose form differs to keep things interesting (eg. clothing). Of course, renewable energy must be used to create the goods.

  • @mikeriddell62

    GDP is increasingly regarded in a negative light and as a measure of ‘unsustainable activities’. It measures activities that exploit the commons rather than contributing to the commons.
    Our current valuation system is top down.
    Our future valuation system will be ground up.
    Software that banks the time one contributes to the common good is being used to develop a global community of communities that uses its own store of value, its own unit of account and its own means of exchange to connect, share and trade with like-minded people.

  • stevenearlsalmony

    Recalling a message uploaded on 11/ 11/ 11 that still seems relevant because so little necessary behavioral change has occurred in the past few years.

  • RobinDatta

    Conversion of resources into products at a constant rate requires the rate of resource repletion to equal (or exceed) the rate of depletion. “Growth” requires an increase in the rate of conversion of resource into product, accelerating resource depletion, and entailing correspondingly larger energy flows, with depletion of the master resource – energy.

    Even prior to resource constraints, it would be obvious that the finitude of growth would be implicit in the finitude of resources. The same continues to obtain once profligacy in resource use ushers in the inevitable constraints in resource availability. A change in paradigms will be effected by the force of resource constraints.

  • Eric Claus

    Although I agree with the general theme, 3% for 150 years is 84.3 times growth not 100 times.

  • Mallory

    Thank you to Dr. Ehrlich for the above article. How do we go about solving this problem with clueless (or deceptive) economists? (Lawrence Summers, by the way, was also President of Harvard University and Chief Economist of the World Bank.)

    (1) Last July, in response to a recent National Academy of Science DBASSE.CPOP
    (Committee on Population) newsletter, we visited their website (link is shown below) and decided to use their “search” tool (upper right of their webpage) to search their site for certain core population-environment vocabulary terms, concepts, and Biospheric Literacy n101 understandings. We typed in the search term “carrying capacity” – Result? Not found, We typed in the term “limiting factors” – Result? – Not found. We typed in the term “climb-and-collapse” – Result? Not found. We typed in the word “overshoot” – Result? Not found. We typed in the word “J-curves” – Result? Not found, etc. Here is the link to their site:

    Therefore, a point number one to be made perhaps, would appear to be this: If
    the National Academy of Science appoints a Committee on Population, one would
    think that the vast majority of the committee’s members should be taken from
    Natural science sectors of academia – and that all of the members of such a
    committee should be conversant with the core terms, data sets, and understandings we queried above (as opposed to social science sectors).

    (2) In 2011, the Royal Society of London hosted a People and the Planet conference. Because of the importance of the topic, we eagerly anticipated,
    encouraged, and awaited the conference presentations and discussions. So the conference (with its various keynote and plenary speakers, etc.) and, when viewers, scientists, policymakers, and young people all around the world tuned in to
    hear a presentation by one of the conference’s first plenary speakers, what they
    heard in that presentation (repeatedly) was that population growth is “slowing down.”

    The individual (a plenary speaker, mind you) was citing, of course, a misleading statistical reference to growth “rates” – (which would have been permissible, perhaps, IF the speaker had ALSO cited humankind’s actual, statistically unmanipulated worldwide population growth) – but the speaker did NOT cite ACTUAL real-world numbers – (such as the following: 1981 – World
    population is roughly 4.5 billion and is growing larger by approximately 80
    million extra persons per year. 2011 – World population reaches 7 billion and
    is growing larger by approximately 83 million extra persons per year).

    (In other words, despite thirty years of conferences, research, peer-reviewed papers, initiatives, and tons of money, humankind’s world population numbers in
    2011 are growing FASTER now than they were back in 1981.) (To a statistician
    that may constitute “slowing down,” but recall that Earth’s poor little biospheric life-support systems have never taken a statistics course, so from their poor little functioning systems perspectives, it would appear to them that humankind’s numbers, wastes, damaging impacts, and eradications are FAR WORSE NOW than they were back in 1981.)

    (3) In the summer of 2011, the journal Science devoted its July 20 issue to
    population. Its topic introductory page (attributed to a senior editor and his
    colleagues) was entitled “Doom or Vroom?” and proceeded to immediately
    reference Malthus before moving on to subtly appear to reference, characterize,
    or categorize today’s ecologists and biospheric systems scientists as
    “neo-Malthusians” and “doomsters” – in seeming contrast to cheerful others (mostly non-scientists one would imagine) that were characterized as “boomsters”. Keep in mind that this is the introductory page for a special issue population issue of the journal that once was known as “Science” (as opposed to “Economics”). The edition also included articles entitled “How to engineer a baby boom” and “Are more people necessarily a problem?”

    In closing, therefore, we return to our opening question: How do we go about solving the problem that Dr. Ehrlich’s article identifies? One possible pathway: Return the U.S. National Academy of Science and other world “scientific”
    academies (and the journal Science and others) to the natural sciences such as
    physics, biology, chemistry, whole-systems ecology, astrophysics, biospheric
    systems, etc.

    As a second possible pathway (educational), envision a brief, two-week
    “Biospheric Literacy and Sustainability 101” unit as: (a) an accreditation requirement and, (b)as a degree requirement for every first-year undergraduate (of EVERY major). These latter initiatives would help ensure that non-science majors around the world who go on to become elected officials, journalists, and economists, etc. have achieved emergency-scale biospheric literacy understandings involving matters of planetary systems, ecosystem services, whole-systems ecology, carrying capacity, limiting factors, J-curves, overshoot, delayed feedbacks, the enormous size of a billion. and classical real-world climb-and-collapse population outcomes, etc.

    Open-courseware PowerPoint and PDF executive summary resources that target
    precisely the core concepts, data sets, principles, and understandings cited above already exist. Six such open-courseware PowerPoints and six such Executive summary PDFs for policymakers and academia already exist and are accessible at

  • Stefan Thiesen

    Dear Paul – as usual I can sign most of what you say. A glimmer of hope that I see, however, is that alternative economics and some of the harshest critique of mainstream economics (or rather, perhaps, mainstream economic politics). System dynamics/synergetics has its roots, independently, in physics, biology and economics, and “Limits to Growth” also was an offspring of economics research – after all E.F. Schumacher’s Book is (according to the Times Literary Supplement) one of the 100 most influential books of the 2nd half of the 20th century. Here in Germany I see many research economists who do not only question growth, but who consider our entire economic system as deeply flawed and ultimately unsustainable. You mentioned Japan as one of the countries with stagnating population – Germany is another, the difference to Japan being that Germany’s economy keeps growing. The only way to achieve that is by means of export surpluses, ultimately on the cost of other nations. When I look at mainstream economics textbooks I also have to say I do not see that much emphasis on growth. The emphasis generally actually is more on equilibrium. The factors that drive forced growth are not overly prominent in textbook economics, often added as a seeming “afterthought” towards the end of the books. Also most better economists make and made it clear that economics is not a settled subject, and many textbooks (i.e. “Microeconomics in Context”, Goodwin et al, 2008) are very cautious not to present economic theories as facts. That alone is an interesting development. The unfortunate ideological belief in “innovation” and “technological development” as the source for unlimited growth on the other hand indeed calls up a “bullet” metaphor: it is akin to someone playing Russian Roulette saying “All will be fine! Nothing happened during the last five rounds!”.

  • stevenearlsalmony

    Many too many scientists and virtually all preternaturally-oriented pseudoscientists (e.g., economists, demographers and politicians) ‘toss around’ the term “population dynamics” as it regards the human species without bothering to examine a single question: “Is the population dynamics of Homo sapiens essentially similar to, or else fundamentally different from, the population dynamics of other species?” Whether inside or outside the communities of science, nowhere can experts be found who are ready, willing and able to respond to this question, based upon the best available scientific evidence. Scientists and non-scientists alike appear to be willfully blind, hysterically deaf and electively mute in the face of what until now appears to be irrefutable scientific research. Adequate scientific knowledge of human population dynamics is vital to gaining a good enough understanding of why, why absolute global human population numbers have been exploding on our watch, during a time period in which scientists and pseudoscientists have consciously, ignored and deliberately denied what common sense and scientific data tell us about the unbridled growth of the human species worldwide. Their ongoing failure to openly acknowledge, objectively examine and honestly report findings of extant research is an unconscionable breach of trust with regard to science and humanity in an apocalyptical historical moment when the current size and anticipated growth of the human species can be seen precipitating the ruin of the Earth as a fit place for habitation by children everywhere and life as we know it.
    Steven Earl Salmony
    AWAREness Campaign on The Human Population
    established 2001
    Chapel Hill, NC

  • jane

    Read this little book : ’10 Billion’ by Professor Stephen Emmott.
    Available from Amazon and a concise and uncompromising account of where growth insanity will lead us.

  • Charles Justice

    It’s easier to understand what is going on if you can visualize the theory of perpetual growth as a type of theology. Just as theologians talk about the nature of heaven and hell, economists talk about economic growth with no physical limits – an impossibility but one that resembles heaven on Earth.

    Modern economies are a lot like ponzi games. They work fine as long as they keep growing, but the moment they stop growing they collapse. That’s because the ponzi game is based on people’s belief that their investment is sound. And as long as people keep putting money into the scheme it appears to be working. But once enough people start making withdrawals the whole thing collapses, because at that point it is impossible to keep up appearances.

    Our modern economic systems tend to collapse if they are not growing because they are based on the accumulation of capital and the growth of debt. When the economy stops growing then holders of debt are less likely to pay their creditors and defaults and bankruptcies increase, leading to decreased trust and decreased confidence. This creates a spiraling contraction that can only be stopped by massive injections of capital into the economy by the government. At some point even that will not work, as trust in the government and the banking system becomes fatally undermined. We haven’t got there yet, but how far are we, really?

    Economic growth is really about growth of the market. As the economy grows, the market gets bigger and the public and private arenas get smaller. If the economy stops growing it will contract. and if it contracts then something must take it’s place. That something is the commons. If we build the commons we are replacing the growth of the market with the growth of cooperation, sharing, and rule-making. We are putting limits on how much people can own and on their ability to destroy the environment, but we are allowing for growth in knowledge, human development, and happiness.

  • jane

    I wrote the article linked above 4 years ago,but it seems that little has changed ,as Prof Ehrlich’s blog shows.

    Unfortunately,the Coop Bank-mentioned in my article-is now in dire straits,and has been partially bought out by a US -based hedge Fund consortium;it faces additional difficulties in the near future.and will struggle to maintain its hitherto mutual ethos.

    The Uk is now showing an increase in GDP-the economists’ cure-all,but inequality is entrenched,being exacerbated by austerity measures and a deregulated and growing labour force: zero hours contracts and cheap foreign labour.

  • JoeWoodhouse

    A great discussion of these excellent points can be found in Wiesman’s new book, “Countdown”…Gretchen Daily and Paul Ehrlich are referenced extensively in the discussion of growth. The chapter on Japan is especially interesting.

    I think the “growth insanity” is part of a larger “disease of awareness” that afflicts mankind and is making it impossible for the human collective to assess its current predicament. I think that it is likely that 2014 will be the beginning of what Paul Gelding has called, “The Great Disruption” and this will be heralded by massive breakdown in the global financial system. This will be the tumultuous end of growth.

  • David Anderson

    Go to and cick on Blog Tab for my letter to Paul Krugman.

    • William Grey

      Here is an apothegm which I propose for T-shirts and bumper-stickers (with apologies to Karl Kraus): “Growth is the disease for which it pretends to be the cure”