The following is excerpted from “The Eco-Suicidal Economics of Adam Smith,” and published here by kind permission of the author, Richard A. Smith. The full article appears in the June 2007 issue of the journal Capital Nature Socialism.
by Richard A. Smith
If we’re going to stop the capitalist economic locomotive from driving us off the cliff, we are going to have to fundamentally rethink our entire economic life, reassert the visible hand of conscious scientific, rational economic planning, and implement democratic control over our economies and resources. We’re going to have to construct an entirely different kind of economy, one that can live within its ecological means. Such an economy would have to be based around at least the following principles:
An Ecosocialist Economy of Stasis
First, in a world of fast-diminishing resources, a sustainable global economy can only be based on near-zero economic growth on average. That means that to survive, humanity will have to impose drastic fixed limits on development, resource consumption, the freedom to consume, and the freedom to pollute. Given existing global inequities and the fact that the crisis we face is overwhelmingly caused by overconsumption in the industrialized North, equity can only be achieved by imposing massive cutbacks in the advanced countries combined with a program of rational planned growth to develop the Third World, with the aim of stabilizing at zero growth on average. This will require drastically cutting back many lines of production, closing down others entirely, and creating socially and environmentally useful jobs for workers made redundant by this transition. This will also require physical rationing of many critical resources on a per capita basis for every person on the planet.
Human survival will thus require a profound rethinking of our most fundamental ideas –bourgeois ideas — of economic freedom. For too long, many Americans, in particular, have come to identify their notion of ”freedom,” if not their very being and essence, with insatiable consumption — unlimited freedom of ”choice” in what to buy. But 50 styles of blue jeans, 16 models of SUVs and endless choices in ”consumer electronics” will all have dramatically less value when Bloomingdales is under water, Florida disappears beneath the waves, malarial mosquitoes blanket Long Island beaches, and the U.S. is overrun with desperate environmental refugees from the South. Once we as a society finally admit the ”inconvenient truth” that we have no choice but to drastically cut production and severely reduce consumer choice, it will also become apparent that we have to put in place a planned economy that will meet our needs and those of future generations as well as the other species with whom we share the planet.
A Restructured Economy of Production for Social Need and for Use
Second, we need to massively restructure the global economy. Enormous sectors in the global capitalist economy — plastics, packaging, much of the manufactured consumer electronics, petrochemical-based and other synthetic products, many pharmaceuticals, all genetically modified foods, and the vast and ever-growing production of arms — are either completely unnecessary or waste increasingly scarce resources and produce needless pollution. Our parents did without nearly all of this before WWII, and they were not living in caves.
Many lines of production and most retail industries are built around unnecessary replacement and designed-in obsolescence. How much of the American economy from cars and appliances to clothes is purposefully designed to be ”consumed, burned up, worn out, replaced, and discarded at an ever-increasing rate” so the cycle of waste production can begin all over again? How much of the planet’s natural resources are consumed every year in completely unnecessary annual model changes, fashion updates, and ”new and improved” products whose only purpose is simply to sell and sell again? If a global population of 6 to 9 billion people is going to survive this century, what choice do we have but to reorganize the global economy to conserve what shrinking natural resources we have left, reorient production for need rather than profit, design products to last as long as possible, enforce as close to total recycling as possible, and aim for as close to zero pollution as is possible?
A Socialist Economic Democracy
Third: an ecosocialist democracy. Endless growth or stasis? Resource exhaustion or conservation? Automobilization of the planet or enhanced public transport? Deforestation or protection of the wild forests? Agro poisons or organic farming? Hunt the fish to extinction or protect the fisheries? Raze the Amazon forest to grow MacBurgers or promote a more vegetarian diet? Manufacture products designed to be ”used up, burned up, consumed as rapidly as possible” or design them to last, be repaired, recycled and also shared? Enforce private interests at the expense of the commons or subordinate private greed to the common good? In today’s globalized world, decisions about such questions will determine the fate of humanity.
Who can make these critical economic and moral decisions in society’s interest and in the interest of preserving a habitable planet? In Adam Smith’s view, which is still the operable maxim of modern capitalists and neoliberal economists, we should all just ”Look out for Number 1,” and the common good will take care of itself. If Smith were right, the common good would have taken care of itself long ago, and we wouldn’t be facing catastrophe. After centuries of Smithian economics, the common good needs our immediate and concentrated attention. Corporations can’t make such decisions in the best interests of society or the future, because their legal responsibility is to their private owners. The only way such decisions can be scientifically rational and socially responsible is when everyone who is affected participates in decision-making. And time is running out. We don’t have 20 or 30 years to wait for Ford and GM to figure out how they can make a buck on electric cars. We don’t have 60 or 70 years to wait while investors in coal-powered power plants milk the last profits out of those sunk investments before they consider an alternative.
Humanity is at a crossroads. Either we find a way to move toward a global economic democracy in which decisions about production and consumption are directly and democratically decided by all those affected, or the alternative will be the continuing descent into a capitalist war of all-against-all over ever-diminishing resources that can only end in the collapse of what’s left of civilization and the global ecology. To be sure, in an economic democracy, society would sometimes make mistakes in planning. We can’t have perfect foresight, and democracies make mistakes. But at least these would be honest mistakes. The conclusion seems inescapable: Either we democratize the economy, construct the institutions of a practical working socialist democracy, or we face ecological and social collapse.