Currently reading David C. Korten’s Agenda for a New Economy, just one of several books I’ve on my shelves that suggests/demands that we radically alter how we measure economic growth and prosperity.

Here’s a little extract where Korten takes Jeffrey Sachs to task (from the chapter ‘More than tinkering at the margins’)

Jeffery Sachs, an economist by training and perspective, is known for his work as an economic adviser to national governments and an array of public institutions. The New York Times once described him as “probably the most important economist in the world”.

Sachs opens his most recent book, Comon Wealth: Economics for a Crowded Planet(2008), with a powerful and unequivical problem statement that raises expectations of a bold break with the economic orthodoxy of those he refers to as “free-market-ideologues.”

The challenges of sustainable development - protecting the environment, stabilizing the world’s population, narrowing the gaps between the rich and poor, and ending extreme poverty - will take center stage. Global cooperation will have to come to the fore. The very idea of competing nation-states that scramble for markets, power and resources will become passè… The presssures of scarce energy resources, growing enivonmental stresses, a rising global population, legal an illegal mass migration, shifting economic power, and vast inequalities of income are too great to be left to naked market forces and untrammeled geopolitical competition among nations.

This statement would have served equally well as an opening statement for [James Gustave] Speth [a leading systems ecologist] who agrees that government must play an essential role, and nations must cooperate, in any effort to effect a meaningful solution. From there, however, we might wonder whether they live in different worlds.

[…]

Fra from calling for a restraint on comsumption, Sachs projects global economic expansion from $60 trillion in 2005 to $420 trillion in 2050. Relying on what he calls a “back of the envelope calculation”, he estimates that the world’s wealthy nations can eliminate extreme poverty and develop and apply the necessary technologies to address environmental needs with an expenditure of a mere 2.4 % of the projeced midcentury economic output. Problem painlessly solved, at least in Sach’s mind.

[…]

In stark contrast to Sachs, Speth concludes in The Bridge at the Edge of the World: Capitalism, the Environment, ad Crossing from Crisis to Sustainability(2008) that “the planet cannot sustain capitalism as we know it.” He recommends that “the operating system of capitalism” be redesigned to support the development of local economies populated with firms that feature worker and community ownership and that corporations be chartered only to serve the public interest.

[…] He notes that despitte a slight decline in the amount of environmental damage per increment of growth, growth in GDP always increases environmental damage. The relationship is inherent in the simple fast that GDP is mostly a measure of growth in consumption, which is the driving cause of environmental decline. Speth is clear that even though choosing “green” products may be a positive step, not buying at all beats buying green almost every time.