SA on the wrong track

An unemployed man offers his services at a traffic intersection in Cape Town. Picture: EPA

An unemployed man offers his services at a traffic intersection in Cape Town. Picture: EPA

Published Jun 24, 2017

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"South Africa is like a teenager who hasn’t had sex and is thinking about it all the time and fantasising about it. But when it comes to action, it’s unable to do it because the secret is to think about something else.”

Johannesburg - Riding the Gautrain this week, Lorenzo Fioramonti was struck by the massive billboards screaming out at every stop between Sandton and Hatfield, each selling promises of economic growth.

One from MTN proclaimed that “courage equals growth” while another from an investment bank, declared: “Ready. Set. Grow.”

For Fioramonti, a professor of political economy at the University of Pretoria, it was more evidence of the country’s unrelenting “obsession” with economic growth.

He had something of an epiphany. “All of a sudden, I realised that everything around us, from all the public debates, the media and advertising, we’re immersed in a growth fetish at all levels.”

But this is as useless as obsessing about sex, muses Fioramonti, who runs the university’s centre for the study of governance innovation.

“The more you obsess about sex, the less good you are at it. South Africa is like a teenager who hasn’t had sex and is thinking about it all the time and fantasising about it. But when it comes to action, it’s unable to do it because the secret is to think about something else.”

For Fioramonti, who is also an extraordinary professor at the centre for complex systems in transition at Stellenbosch University, that “something else” is an alternative economic model: the well-being economy.

In his new book, The Well-Being Economy, Success in a World Without Growth, Fioramonti postulates how the unfolding demise of the growth economy may herald the “dawn of a new society”, which pursues well-being - and not GDP - as the ultimate target of progress.

“Growth is disappearing, whether we like it or not,” he writes.

“Even China, the global locomotive, is running out of steam. Consumption has reached limits in the so-called developed world, with fewer buyers for the commodities and goods exported by ‘developing’ countries. Energy is running out, particularly fossil fuels, while renewables, which are slowly picking up, are by their nature not amenable to long-distance travelling, thus imposing a toll on globalised trade.”

Even if polluting energy sources were endless, as touted by shale gas and fracking enthusiasts, global climate agreements “require us to eliminate them soon if we want to stand even the slimmest chance of avoiding disruptive climate chaos”.

Fioramonti spent years examining the flaws of using GDP as a measure of development. The world, he writes, is in deep crisis, with most of its people drowning in debt, while “exorbitant” amounts of wealth are being amassed by a few.

It’s no better in South Africa. “We’re in a recession and now we know it’s not temporary. We can either cry for the next few decades and flagellate ourselves or be innovative.”

If the country opts for the former, it will “condemn itself to an escalation of inequality and destruction because of the blind pursuit of ever-more fading growth”.

Then, there are the robots. Low growth, he says, is particularly relevant in the “age of robots”, which brings with it the real prospect of massive automation.

Research by Oxford University predicts in the next 20 years, robots could displace half of the jobs in the US and Europe.

“Anecdotal evidence is showing China is shedding 60000 jobs every two months, with most jobs replaced by machines. This will happen in South Africa. The growth economy is all about ‘big is beautiful’ and if your economy is all about producing, then robots can do that much better than you and I.

“The big question is do we want an economy based on mass production where robots will destroy everything, and at some point the system will destroy itself because you and I won’t have any money to buy the things that robots produce?

“Or do we want an economy that is grounded in the local context, with networks of small businesses that are not about mass production but customisation - that are about recycling, reusing, adapting and upgrading, rather than throwing stuff at people who throw it away. If that’s the case we’ll never replace people with robots.”

Instead, Fioramonti explains, technology like 3D printers, will complement local artisanal jobs.

“We need to be equipping people with good, practical skills to be our future carpenters and plumbers, rather than producing more and more McDonald’s jobs, which is what the growth economy is producing now.”

Fioramonti, who praises the sharing economy, says development lies not in the exploitation of natural and human resources but “in improving the quality and effectiveness of human-to-human and human-to-ecosystem interactions, supported by appropriate enabling technologies”.

South Africa is the perfect example of the “madness”of growth at all costs. “We have a broken natural system, and we’re sitting with huge environmental debt.”

The government’s obsession with growth has given extractive industries such as mining a blank cheque but this has “generated huge societal and ecological costs that we pay for.

“At the same time, we have a broken society, where crime is basically the main industry. We have diseases, lack of trust, families that have no relations, households torn apart by a system of exploitation in apartheid that hasn’t changed.

“Our communities are affected by drug abuse and child abuse. These are all consequences of a society that doesn’t have time for itself. It’s becoming more difficult to justify growth at all.”

While Fioramonti and this alternative economy has its detractors - it has been called a “hippy utopia” and “fuzzy economics”, he points out there are thousands of social entrepreneurs, innovators and scientists, who are “actively building the well-being economy”.

In recent years, too, global interest surged from outfits such as the World Economic Forum and leading business think tanks on the importance of well-being.

“Growth is a poor indicator of a better society,” he believes.

“In many countries, growth happens when people get sick or die. Think of the fires in Knysna. It’s good for growth because those houses will need to be rebuilt, and people have to be buried. Every time an insurance pays out a funeral plan, that’s a bonus for growth. It’s perverse.”

In his book, Fioramonti outlines how in the US keeping people healthy has no value. “Making them sick does. An effective and preventative public healthcare approach (as in Europe and South America) is suboptimal for growth: it’s better to have a highly unequal and dysfunctional system like in the US, which accounts for almost 20% of the country’s GDP.”

Similarly, wars, conflicts, crime and corruption are friends of growth as they force societies to build and buy weapons, to install security locks and to push up the prices of what government pays for tenders.

Too much growth, says Fioramonti, is negative growth that thrives on human sickness, death, crime and environmental degradation. “We exist because we consume ... If I sell my kidney for some cash, then the economy grows. If I educate my children, prepare and cook food for my family, improve the health conditions of my people, growth doesn’t happen. If a country cuts and sells all its trees, it gets a boost in GDP. But nothing happens if it nurtures and grows its forests.”

The planet is broken from “climate change, ecological mayhem, natural disasters and biodiversity loss. Every minute, 41hectares of trees are felled, the equivalent of 50 soccer fields. “Water is running out. Food is trashed rather than made available to hungry mouths. In some countries, the air is so dirty people have to wear masks when outdoors.”

Plastiglomerates, fossil-like substances created by plastic, will last for millions of years and potentially turn human pollution into a main factor in geological records.

“Waste is everywhere. In Hong Kong, beaches are so filthy, they look like dumping grounds. We throw away enough stuff to fill a line of trucks - between Cape Town and Nairobi every day.

“That’s why the world’s leading geologists have used the phrase ‘Anthropocene’ to describe the present time: an era in which human activities have become the most determinant factor in shaping how the planet behaves.

“This is the world we have built in our blind pursuit of ‘economic growth’. We have sacrificed all other important aspects of life to gain another notch on the GDP (ladder).”

Across the world, people have been lifted out of poverty, life expectancy has risen and more and more children have been given access to formal education.

But it’s not economic growth that has done this, writes Fioramonti. “The evidence is much more nuanced.

“Countries that succeeded at achieving high levels of human development, from Scandinavia to South Korea, did so because of purposeful restrictions on the unbridled powers of growth.

“They imposed limits on corporate profits, pursued income and wealth redistribution, protected families and communities, guaranteed a good work, life balance and invested heavily in social welfare.”

What makes people lead healthy, fulfilled lives? Fioramonti says decades of research has revealed the simple answer: a healthy relational and natural environment.

“The social and physical climate as well as the quality of nature are more important at predicting well-being than income or GDP per capita.”

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