Maybe I went too far by claiming villages would not accept these arrangements. Maybe I have misrepresented Gandhi, and for that I apologize only to the point that it actually matters to the actual argument (which I wonder if it really does). The fact is that I’ve never been too concerned with such assumptions on an overall theory that seemingly has little applicational value. I was trying to make some of his ideas relevant to today’s world on a whole, and if indeed I have failed there, I would be curious to hear further comment in regards to the global situation I have highlighted.

that’s an incorrect reading of gandhi’s prescription. his formula also included ‘gram swaraj’ or autonomy for the villages. this was opposed on the ground that given greater autonomy, the indian village would revert to perpetuation of all the prejudices, ‘localisms’ of the past, as ambedkar put it. doesn’t that mean gandhi wouldn’t have supported the state-led development model that nehru later adopted?

It seems that most people will agree with Daly in regards to the basic economic assumption that the economy can grow forever and ever. The trouble is, if we acknowledge that a boundary exists around the macro-economy, we introduce a new set of philosophical questions that politicians and economists are not prepared to deal with, so we instead dismiss the viewpoint that gives rise to these questions.

For example, since the macro-economy can be described in terms of population multiplied by per capita consumption, if an ecological carrying capacity exists, then we acknowledge that the economy is in fact zero-sum, and thus that over-consumption today forsakes future generations, or that over-consumption in the developed world limits current consumption levels in the developing world. Yet somehow we promote growth to everyone, even though we know that this is NOT ecological sustainable and that we are consuming ecological capital to which future generations have a fundamental right of ownership.

Irrationally, our jiminy-cricket reliance on technology convinces economists, politicians and the general public that the global economy can continue to grow forever. For politicians, it’s obviously easier to espouse growth than discuss the necessary actions of population control and redistribution of income. For economists who have built careers based on these assumptions, the emerging ecological economics paradigm challenges the neo-classical foundations.

Speaking of Gandhi vision of limiting frivolous consumption, this is the ideal framework in which to open a discussion about the aims of our growth-centered economy. Regardless of where politicians, economists, policy-makers, or the average person falls on the issue of limited/limitless growth, perhaps we should step back and question the success of a growth-centered economy in delivering utility to the average person. After all, isn’t economics primarily concerned with utility maximization (e.g. happiness)?

If a growth-centered economy does potentially risk causing irreparable environmental damage, we should at least hope that at a bare minimum the economy delivers increased utility to the average person. Does this hold true for the developed world? No.

Recently, the field of economics has begun asking some pertinent questions related to economics and happiness, producing surprising results. Economists have found a strong positive correlation between income and happiness up to $10,000 (not surprising because this income is spend on services such as food, basic health care, education, etc.). However, beyond this value, the statistical relationship disappears, as expenditures beyond this threshold appear to satisfy positional rather than necessary goods. See:

http://www.economist.com/finance/displaystory.cfm?story_id=8401269
http://www.economist.com/opinion/displaystory.cfm?story_id=8450035
http://www.economist.com/finance/displaystory.cfm?story_id=E1_TJSQTPJ

Finally, let me quote Herman Daly regarding technological optimists:

“Technological optimists counter the above argument by claiming that technology can increase resource productivity without limit, and that therefore all nations can become richer. Even if technology could increase resource productivity without limit, so that the same physical resource flow would yield an ever greater value flow, we would still face the problem of keeping physical flows within ecological limits, and still could not generalize the current U.S. industrial economy to the whole world. We might generalize some new, as yet unknown system that made much more efficient use of resources, but that is more a concession to the impossibility hypothesis than a refutation of it. If the technological optimist really believes in unlimited increase in resource productivity, then limitation on the volume and distribution of the physical resource flow would be seen as desirable, since this would force technological effort in to increasing resource productivity and away from the path of increasing intensity of resource usage.”

Good stuff Rob, keep it coming.