Don’t grow the economy, transition it.

I am not a big reader. Clear symptoms of dyslexia have always prevented me from efficiently absorbing large texts. Legal contracts are the worst, yet I suffer through them, as many of us do (thank you lawyers). But books with 150+ pages are also a lot of work for me.

Recently, I received a copy of the book “Less is More: How Degrowth Will Save the World ”, written by Jason Hickel. Luckily for me, the author included an excellent intro chapter in which his view on a much-needed transition is summarised in such a convincing way that it became clear I don’t need to read the rest of the book. I already sympathised with his arguments.

The book focuses on the idea of “Degrowth”. A concept which states that we must realise that the current climate breakdown and ecological collapse is caused by our unrestricted drive for economic growth. In other words, capitalism.

By taking less, we can become more.

Hickel argues that capitalism demands constant growth, and that there is only one solution that will lead to meaningful and immediate change to avoid killing our planet: DEGROWTH.

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He says that to solve ecological disaster we need to “change how we see nature and our place in it. Shifting from a philosophy of domination and extraction to one that's rooted in reciprocity and regeneration.”

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Rooted in our belief is that mankind is superior to all other living species. People must fundamentally adjust the way they look at the world and the moral position they have. We need to move beyond capitalism and discover a new system that is fit for the twenty-first century.

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In essence, our focus should not be about economic growth, but about wellbeing. Or as Hickel says: “by taking less, we can become more.”

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The limits of growth

I remember as a young child reflecting on the concept that growth is something that should have limitations. Without limits, growth spirals out of hand.

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Apparently, “wellbeing” has become that limit. In the Western World everything we do is to increase our quality of life. But the benefits have not been evenly distributed across the globe and have come at the expense of our planet’s natural resources.

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Hence, it is past time for us to be critical of the growth model of capitalism. At the core of the transition beyond capitalism is that growth is not needed for ALL sectors of the economy. In fact, some sectors require immediate and radical degrowth (fossil fuels, weapons, jets, SUVs to name a few). While on the other hand, some sectors require radical development (for example clean energy, health care, regenerative agriculture).

The result of this transition might be no growth, little growth or even a small decline in the economy, but a more honest, equal and inclusive economic system will emerge. Bringing sustainability and ecological balance to us all.

A clean energy system ultimately gives us a chance to democratise wellbeing.

Energy is at the core of what we need in any economic system. Evolution accelerated once our ancestors learned how to make fire. But the ecological damage caused by the amount of CO2 we inject in the atmosphere today (Hickel gives a depressing outlook) means we must abandon fossil fuels now and grow a new carbon-free energy system that is environmentally sound, sustainable and equally distributed around the world. A clean energy system ultimately gives us a chance to democratise wellbeing.

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At SET Ventures we call that “making impact”. We’re glad to be investing in the energy transition - one of the few sectors that must and will grow in the years towards 2050. This will come at the expense of other economic sectors, but the economy does not necessarily have to grow, but simply be replaced. In other words, a true transition.

So I say, “we don’t need to grow, but transition”.

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This article was written by René Savelsberg , Co-Founder & Partner at SET Ventures. Thank you to author Jason Hickel for the inspiration.