Shrink Responsibly: A Practical Guide to Degrowth

How do we actually degrow the economy?

Today is Global Degrowth Day: another of those holidays made up by activists as an excuse to yap about our cause of choice, and boy, do I intend to take advantage of it today.

Degrowth, for anyone unfamiliar, is the movement to intentionally downsize the global economy, and rebuild economic life around fostering wellbeing within ecological limits. Degrowth Institute defines degrowth as “a just transition to a smaller global economy,” which I think gets the point across admirably.

I’ve been an organizer in the degrowth movement for almost a decade now, I work in degrowth advocacy professionally, and I’ve seen the movement evolve substantially over the years. From the fringes of European ecological economics, degrowth has spread around the world and become a regularly-debated topic in post-capitalist and environmentalist circles all over the Global North. The U.S. is now home to more than a dozen different degrowth groups, and degrowth critiques are finding their way into mainstream economics, environmental and policy conversations.

Degrowth is still a very controversial topic (even in the world of radical social change) and it tends to require quite a lot of explaining, debunking and arguing before you can even get to a shared understanding of what you’re talking about. That has hindered much of the degrowth movement from making tangible progress on discussing how to do degrowth, since we frequently have to spend so much time arguing about what degrowth even is and why we believe it’s necessary.

As a result, one of the biggest, recurring critiques of the degrowth movement is, essentially, “You guys never talk about how to do it!”

That’s why I made this guide. It’s not a definitive guide by any means; it’s going to take thousands of us across disciplines and areas of expertise collaborating on the question to come up with a truly comprehensive how-to. This is one educated attempt to point us vaguely in the direction of that answer. There are others with their own answers, too.

That said, before we can get to that point, because I’m writing this for a general audience, I probably do need to bring new people up to speed on the basics of what degrowth is all about. If you are already familiar with degrowth, you can skip ahead to the next section.

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Why shrink responsibly?

The global economy has already surpassed 7 out of 9 critical planetary boundaries (such as climate change, biogeochemical imbalance, freshwater use, land system change, and biodiversity loss), putting us well outside what the Stockholm Resilience Center calls “the safe operating space for humanity.”

Bringing global economic activity back inside a safe operating space for humanity requires reducing overall impact on the environment — not only climate change.

Economic size itself has dire ecological consequences beyond a certain point.

Changing technologies is not enough; as we’ve seen with renewable energy, addition does not mean transition. The renewables sector is growing fast, but so is the fossil fuel sector. Not to mention, lithium mining for battery storage is still extremely ecologically damaging. We cannot disentangle environmental gains in one place, like Californians and their solar panels, from ecological costs in many others.

But what about greater efficiency? Well, this has been, as my friend John Mulrow says, the “promise of sustainability” for decades. He spent years in the sustainability world, only to realize all their efficiency and new technology-based interventions were having no consequential impact on the climate or environment. He became obsessed with the question of why, and he found a key answer: reductions in materials or energy use in one place or sector just shifted to greater production somewhere else.

When reading went digital and we were printing less on paper as a result, shopping also went digital, and we were shipping more in cardboard as a result. Paper production, and deforestation, kept growing. More efficient lightbulbs lowered residential energy use, while data centers increased commercial energy use, and energy consumption, and carbon emissions, kept growing. The list goes on, and on, and on.

Economic output can never be fully decoupled from ecological input. Building housing, building computers (and data centers), taking your corporate clients out for lunch, walking to work, eating, breathing: all these require ecological inputs, from building materials to energy sources to food. Try as we might to escape reality, we are still animals in an ecosystem. Our economy is ecology.

If we want to reduce overall environmental impact, then, we have to reduce economic output. We have to produce and consume less. We have to shrink the global economy.

Doing this is extremely difficult, though, because at just about every level and across every industry, our current economic system is built on an expectation of endless growth. This means that even stagnation can have severe cascading effects, not only across one country, but across a whole planet of economic interconnection. Downscaling would cause even more disruption, especially if it isn’t done responsibly.

The goal of degrowth, then, is to shrink the global economy responsibly: to reduce overall economic throughput in a way that not only protects vulnerable humans from poverty, precarity, and social unrest, but that addresses some of the ongoing social ills caused by the economy’s commitment to growth at all costs.

For example, we often hear that the U.S. is facing a severe housing shortage of between 4–7 million homes. Meanwhile, the U.S. currently has approximately 15 million vacant homes, and about 6.5 million second homes. While these certainly aren’t evenly distributed by location, even in places where units of housing are scarcer, much of the problem is really an overabundance of expensive homes and a scarcity of affordable ones.

From an ecological (and economic justice) perspective, the solution here is fairly obvious. Continuously building new housing means continuous encroachment on green spaces, deforestation for lumber, and transformation of healthy forests into unhealthy monoculture timber plantations that are prone to wildfire. From a degrowth perspective, the redistribution of existing homes needs to be part of the equation.

But, serious policy action to enforce that sort of redistribution would mean disrupting families that rely on housing for generational wealth accumulation or retirement planning, not to mention, major disruptions to (and pushback from) the multi-trillion-dollar US real estate development industry.

That industry serves as one of the driving economic engines for not only the American economy, but the global economy. So, a seemingly straightforward change, like a national policy to decommodify real estate and shift to a social housing library system, could crash the global economy.

This is why we can’t have nice things.

Every level of our economic system, in the way it currently functions, depends on continued growth. This creates a self-reinforcing feedback loop often called the growth imperative.

It’s a major undertaking to shift the fundamental paradigm of the global economy through tangible actions, each of which is necessarily happening at scales much smaller than the global scale at which the economy is organized.

But, if we don’t want to drive our own species extinct, we probably need to spend more time figuring out how to do it. Given that talking about this question this is literally my job, I thought I’d give answering it a shot. That said, I am writing this as myself, not as a representative of my organization, and I am certainly not some supreme authority on how to fix the global economy. I am one person, with a limited scope of actual expertise and a very cursory understanding of some other disciplines. Any methods I come up with are preliminary at best.

If we want to actually do degrowth, I think we need to spend more time collaborating on how to do it, not arguing about if it’s possible. I truly believe it’s both possible and necessary.

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Degrowth goals

Just about every level of our economic system, in the way it currently functions, depends on continued growth. Reducing overall economic quantity requires qualitatively changing institutions, incentives and goals, and ensuring people’s basic needs are met throughout the process.

So, the way I see it, degrowth involves three parallel goals:

1. Reducing total economic size…

2. in a way that still allows for (or even improves) collective wellbeing…

3. while breaking the self-reinforcing feedback loops in the economy that keep driving us back to endless growth.

Now, how might we achieve these goals?

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Degrowth strategies

Understanding how to do degrowth requires understanding what degrowth is. Let’s return to Degrowth Institute’s definition:

“Degrowth is a just transition to a smaller global economy.”

We can use that definition to break the concept down into more operational chunks:

1. “Just”

→ Economic transition must be socially and economically just in its impacts and implementation, and must include protections for those most vulnerable in society. Practically, this requires some redistribution of wealth and power to ensure society maintains an economic “floor” that allows all people to maintain a decent quality of life.

2. “Transition”

→ Degrowth is not just about reduction and redistribution, but about the qualitative transformation of the economy, from one that requires endless growth to function, to one that can meet human needs and ensure human wellbeing without violating ecological limits. That qualitative change requires developing alternatives to existing systems, processes and institutions, organized around different goals and incentives.

3. “Smaller”

→ Degrowth is explicit that reduction in overall economic throughput is required to create lasting ecological sustainability. Degrowth therefore requires limits, on extraction, material throughput within industries, and overall economic activity.

4. “Global”

→ Last, but not least, degrowth interventions must keep the global scale in mind. Ultimately, the global scale is what matters most to ensure our economies are operating within planetary boundaries, and many local interventions fail to account for the externalization of costs or impacts to other locations or sectors. Effective degrowth campaigns must therefore “close the loop,” looking across many scales and sectors to ensure that sustainability savings or social benefits in one area don’t incur costs or lead to redeployment for further growth in another.

So, we can operationalize how to do degrowth as four integrated strategies:

1. Redistribution: Reducing social and economic inequality through transferring wealth, assets and power from top to bottom

2. Developing alternatives: Creating qualitatively different systems, institutions and processes for meeting our needs that organize around different goals

3. Limits: Imposing hard limits on extraction, economic size and material throughput

4. Closing the loop: Accounting for external impacts, and ensuring limits and savings don’t turn into growth and costs in other areas or sectors

Many well-intentioned sustainability or social justice campaigns fall into traps when they don’t account for all four strategies. Environmental campaigns sometimes fail to consider the economic and social needs of certain communities, and thus social injustice or economic scarcity. Some social campaigns fail to consider environmental impacts, and ultimately expand ecological footprint. Innovative “eco-friendly” alternatives may not actually lead to the expected reduction in harmful industries. And, some interventions improve ecological or social wellbeing in one location, while shifting costs and harms somewhere else.

Using all four strategies can help counteract these potential failure points:

• → When people suffer real lack or precarity from having less, we can use redistribution to ensure everyone’s needs keep being met.

• → When institutions rely on growth for their functioning, we can develop alternatives.

• → If the economy starts growing again in one sector or extraction increases in a location, we can apply limits.

• → And, when a limit in one area drives growth to another area, we can assess how the limits are functioning and close the loop to reduce externalities.

However, the reality is that one campaign or intervention is unlikely to use all four strategies. The point is not to try to shoehorn in every strategy into every campaign, but to keep all four in mind to guide an overall suite of campaigns and interventions.

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What those interventions are will vary widely according to where they happen. Degrowth looks different in different places.

To create a global economy that meets human needs within ecological limits, some places and some industries will likely see increases in overall economic size. To borrow from Jason Hickel, sometimes, an overall less will look like more: more ways for people to meet their basic needs and maintain stability without depending on endlessly-growing industries like debt-based finance or asset accumulation, more basic services available free for everyone, more leisure time, more community.

At the same time, for economies like those of the US, Europe, Australia, and some parts of Asia and Latin America, and especially, for some classes of people within these countries, less will be less. Less wealth hoarding, less extraction, less speed, less size, less consumption, less production.

Ultimately, degrowth is a global paradigm shift. Making a paradigm shift this major at this scale will require decades of reforms, experiments, failures, successes, upheavals, ruptures, progress, backsliding, and then finally, some sort of “new normal.” Even then, nothing in this world ever stays stagnant.

Changes will likely be small, incremental and local at first, serving as models to proliferate, proofs of concept to repeat, experiments to try and fail and rework and try again somewhere else. But over time, we’ll collaborate towards a greater shared understanding of what works, what’s needed and what we can accomplish. The more successes there are, the more successes there will be.

Ultimately, degrowth requires a global-scale paradigm shift, but every action we take has ripple effects. Grassroots actions with smaller scales of influence can become models for other activists around the country and around the world, can inspire sweeping shifts in consciousness, and can “trickle up” into policy changes that impact millions of people.

Not to mention, there are already dozens of different groups and social movements that have been working on these kinds of solutions for decades already, and success in some areas has already started to take root. The environmental justice, solidarity economy, wellbeing economy, Rights of Nature, demilitarization, rewilding, ecosocialism, climate justice, buen vivir and community wealth-building movements (to name only a few) are all already working on many of these types of interventions, even if they don’t use the word “degrowth.”

If you’re new to degrowth (and somehow still reading) this may seem overwhelming. I can tell you, if you’ve been living and breathing the degrowth world for years, it’s still overwhelming.

It may be difficult and complicated, but like I said, if you’ve bought into degrowth, you understand: we have to do something like this in some form, or we’re going to render our planet uninhabitable for human life. If we do pull this off, we can create a whole new vision for the economy, a way of structuring society that doesn’t plunge so many millions into poverty and precarity and extract from the rest of the environment as though it’s nothing but stuff.

We can, and will, re-learn how to live on this planet without trashing the place.

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