But the only long-term solution is that Europe needs to phase out fossil fuels and increase renewable energy production. And to do this fast enough to meet existing climate commitments it is necessary to reduce excess energy demand. Achieving this in a just and equitable way requires two things: first, reducing the purchasing power of the rich (who use extremely high levels of energy), and second, ensuring that everyone has guaranteed access to the essential goods and services they need to live a good life.
This forces us to confront a paradox at the heart of our economic system. Wealthy economies have high levels of production, with resource and energy use vastly exceeding sustainable boundaries, but they still fail to meet many basic human needs. This occurs because, under capitalism, the goal of production is not to improve well-being or achieve social progress, but to maximise and accumulate corporate profit. So we get plenty of SUVs, fast fashion and planned obsolescence, but chronic shortages of essential goods and services like public transit, affordable housing and universal healthcare.
Ecological economists argue that one of the best ways to deal with this problem is to establish universal public services. Public services mobilise production around human needs and well-being, and can deliver strong social outcomes with lower levels of resource and energy use. It also enables a more rapid, coordinated shift to more sustainable systems. By decommodifying and democratising key sectors such as food, mobility and housing, we can solve the cost-of-living crisis – by directly reducing prices – and help solve the climate crisis at the same time. This requires reversing the current tendency of neoliberal governments to defund and dismantle public services, which has led to the extraordinary crisis that is presently engulfing the NHS and the railways in the UK.
Universal Basic Services (UBS)
Degrowth lacks a theory of how the state can finance ambitious social-ecological policies and public provisioning systems while maintaining macroeconomic stability during a reduction of economic activity. Addressing this question, we present a synthesis of degrowth scholarship and Modern Monetary Theory (MMT) rooted in their shared understanding of money as a public good and their common opposition to artificial scarcity. We present two arguments. First, we draw on MMT to argue that states with sufficient monetary sovereignty face no obstacle to funding the policies necessary for a just and sustainable degrowth transition. Increased public spending neither requires nor implies GDP growth. Second, we draw on degrowth research to bring MMT in line with ecological reality. MMT posits that fiscal spending is limited only by inflation, and thus the productive capacity of the economy. We argue that efforts to deal with this constraint must also pay attention to social and ecological limits. Based on this synthesis we propose a set of monetary and fiscal policies suitable for a stable degrowth transition, including a stronger regulation of private finance, tax reforms, price controls, public provisioning systems and an emancipatory job guarantee. This approach can support broad democratic mobilization for a degrowth transition.
At the Institute for Global Prosperity (IGP), we are committed to three things: public debate around new ideas; sustainable investment in social infrastructures; and public policy aimed at improving the quality of people’s lives. We have been inspired by experiments in universal basic income (UBI) around the world, and by a series of discussions about how to rethink economies, both local and global. In this report, we lay out some ideas about how to deliver quality of life for the UK, improve public services in ways that are affordable, and link radical policy initiatves to improved social integration and cohesion. These are ideas for debate across the broadest spectrum in the UK, including local communities. We call this set of ideas Universal Basic Services.
In May, the Los Angeles Department of Transportation and LA Metro launched the biggest Universal Basic Mobility experiment ever attempted in the U.S., giving 1,000 South Los Angeles residents a “mobility wallet” — a debit card with $150 per month to spend on transportation.
The catch? Funds can be used to take the bus, ride the train, rent a shared e-scooter, take micro-transit, rent a car-share, take an Uber or Lyft, or even purchase an e-bike — but they can’t be spent on the cost of owning or operating a car.
The year-long pilot, ending in April, has the dual goals of increasing mobility for low-income residents and reducing greenhouse gas emissions.
It’s a radical experiment based on a simple idea: People know what they need. Give them the money to go where they want to go, and they will improve the quality of their lives.
It’s the biggest experiment in Universal Basic Mobility in the U.S., but it is not the first.
Capitalism relies on maintaining an artificial scarcity of essential goods and services (like housing, healthcare, transport, etc), through processes of enclosure and commodification. We know that enclosure enables monopolists to raise prices and maximize their profits (consider the rental market, the US healthcare system, or the British rail system). But it also has another effect. When essential goods are privatized and expensive, people need more income than they would otherwise require to access them. To get it they are compelled to increase their labour in capitalist markets, working to produce new things that may not be needed (with increased energy use, resource use, and ecological pressure) simply to access things that clearly are needed, and which are quite often already there.
Take housing, for example. If your rent goes up, you suddenly have to work more just to keep the same roof over your head. At an economy-wide level, this dynamic means we need more aggregate production — more growth — in order to meet basic needs. From the perspective of capital, this ensures a steady flow of labour for private firms, and maintains downward pressure on wages to facilitate capital accumulation. For the rest of us it means needless exploitation, insecurity, and ecological damage. Artificial scarcity also creates growth dependencies: because survival is mediated by prices and wages, when productivity improvements and recessions lead to unemployment people suffer loss of access to essential goods — even when the output of those goods is not affected — and growth is needed to create new jobs and resolve the social crisis.
There is a way out of this trap: by decommodifying essential goods and services, we can eliminate artificial scarcity and ensure public abundance, de-link human well-being from growth, and reduce growthist pressures.