No system can grow forever — neither human nor economic. Yet the pursuit of continuous growth has been the bedrock economic model of our time. Outdated and unsustainable, it is still advocated, recklessly and relentlessly, by federal, provincial and nearly all municipal governments.
To some extent, this is no surprise. Since its inception, B.C., like Canada as a whole, has enjoyed remarkable and sustained growth, and as a geologist and resource entrepreneur, it’s easy for me to see the role that our wealth in mineral, hydrocarbon, forestry, fisheries and hydro resources played in that success story.
But we should also credit some other factors: B.C.’s natural beauty, as well as the education and immigration policies that have created a well-trained, hard-working and steadily increasing population. The challenge today is to maintain our prosperity — amid a declining resource base — while preserving the things we most value: a diversified industrial economy, magnificent scenery, a healthy environment and livable cities.
But we don’t live in a fishbowl. B.C.’s economy is closely linked to the country and the world. And global economic forces are changing profoundly — it is harder and harder to sustain growth, even though governments the world over keep spending and borrowing more in pursuit of that goal.
For example, Canadian GDP grew nearly fourfold from 1950-2008 but has struggled at an average 1.4 per cent a year since 2008, in spite of a 32 per cent increase in our national debt (to over $600 billion), and an increase in provincial debt by a like amount.
British Columbians need to understand why global growth has slowed. Some reasons are environmental. We are exceeding the carrying capacity of the Earth to support world populations living at the standard British Columbians now enjoy.
Natural limits to growth are everywhere: depleted groundwater, soil degradation, ocean contamination and acidification, deforestation, loss of biodiversity and climate change. These all increase costs, limit wealth creation and reduce prosperity.
At the same time, we have exhausted the world’s land base for frontier agricultural development, and we are depleting global deposits of oil and minerals, forcing us to seek out high-cost alternatives such as oilsands and lower-grade, less-accessible mineral deposits. There are also structural and social changes. In wealthy countries, populations are aging, and fertility rates and personal consumption are on the decline, cutting demand for the goods and services that have been the backbone of consumer economies.
Is slow growth bad? Look at Japan. Despite a massive increase in government debt, it has grown by barely one per cent a year for the past 20 years, and many experts dismiss it as an economic disaster. Yet the country remains one of the richest, safest, cleanest and most socially cohesive on Earth, its people among the healthiest and longest-lived. Not bad for an economic basket case.
I think we need to aim at a steady-state economy. This will require us to moderate expectations, reduce borrowing, and stimulate the myriad business and social innovations that contribute to a healthier and more sustainable society. That doesn’t mean sacrificing employment or social justice — quite the contrary. But it will surely require extraordinary political vision — and a focus on economic policy that goes well beyond one election term.
As an entrepreneur, it is clear to me that our market-based economy remains the most efficient way to drive the change. Along with political vision, we need a free and innovative market to invest in energy efficiency and conservation, in renewable energy, better urban design, improved transportation systems, waste reduction, better water infrastructure and more sustainable agriculture. We need more durable and satisfying consumer goods, and health care and social organizations that sustain a healthier population. We need to manage our forests and farms on real sustainability principles, and we must preserve for agricultural purposes the tiny amount of productive farmland in the province.
We will still need new mines and oilfields, but the more successful we are at reducing demand, the more these non-renewable resources will be available to benefit future generations. Projects like the Northern Gateway pipeline, which clearly have greater long-term risks than long-term rewards, simply should not proceed. Finally, we need realistic expectations about our potential LNG industry — slower, more-thoughtful development and broader provincial benefit for generations.
British Columbians live in a blessed corner of the Earth. And Vancouver is already a world leader in implementing the kinds of policies and directions that will succeed over a much longer term. Our provincial, federal and other municipal governments need to do this, too — giving up on the growth model is one big-picture solution. The result will be a healthier and wealthier population — wealthier in all ways, not just financial.
Ross Beaty is a geologist and resource entrepreneur. He is chairman of Alterra Power Corp., a clean-energy company, and chairman of Pan American Silver Corp., one of the world’s largest silver mining companies. Both companies are headquartered in Vancouver.
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I thought this was a very important article that was printed in the Sun last week. It was very well written, thoughtful and alarming. What made it stand out for me is that it was written by an energy company CEO. This is a group that does not normally make overtures about zero growth policies or ring the bell about environmental destruction. I don't really give a shit where Mr. Beaty derives his opinion from, it is a welcome one from his camp. I think we will see more of this kind of thing in the future and I applaud the (normally shite) Vancouver Sun for printing his opinion.