The situation we are in is that a lot of people believe there is a need for a change to a more sustainable way of life but very few have any idea about what it would be like - about what they could aim for. This of course means that they tend to wander aimlessly around putting nearly all of their effort into criticising particular inadequacies of the present system.


There is a major alternative, a very different economy, which goes under the name of 'the Steady State Economy'. Although the 'steady state economy' gets an occasional mention in the media that is usually about as far as it gets. It is of course the main holistic alternative to our present endless economic growth system one which involves an increased throughput of materials in the system, without end.

The Situation

Most Governments seek such an increase and do everything in their power to make it come about. To them growth is good and the bigger the better. Governments have two objectives - 1) to foster economic growth, and 2) to manage its consequences. This includes having policies to: increase population and hence overall consumption (encouraged by massive spending on advertising); developing energy resources to provide for the extraction of other resources, for manufacturing and for the provision of services at an ever increasing scale; and maintaining an unequal society because of the fact that getting rich and having higher standards of living than others is seen as an providing an incentive for economic growth and competition and an appropriate reward for effort. It also involves the use of the military to provide security and ensure access to resources. Our economy and the endless economic growth at the heart of it is of course based on the utilisation of stock resources - energy in the form of finite fossil fuels such as coal, created in the physical environment over millions of years. We live as though there were an endless supply of these resources.

The Example of Australia

Australia is a very good example of the present system at work. For instance there is almost zero concern at government level about the environmental impact of Australia's coal exports that are the largest in the world. In fact the only concern is that demand for them might slow. The current situation is that we take no responsibility for our coal once it has left our shores. This is in spite of the fact that the emissions from this coal is one and a half times all our domestic emissions and with likely expansion is set to create 5 times all our domestic emissions. We have 120 coalmines and another 91 are proposed. It is a similar situation with population growth. Melbourne is set to double its population to 8 million by 2050. It is not surprising that we have had three different long term plans for the city in only 12 years.

Meanwhile the world population is growing at the rate of an extra 85 million every year. We do not see any major challenge by the community anywhere to the current economic system because while most people are well aware that while there are some who benefit disproportionately and others live on the streets most feel they are reasonably well off and the poor have little say It is indeed likely that the overall standard of living has benefitted from economic growth but you are probably aware of the statistic that the richest 85 people own as much wealth as half  the world's population (ie three and a half billion). Both government's and the environment movement view their main task of limiting the damage from this growth ('managing it' is how governments usually put it). If it ever mentions reform it is related to the concept of increasing the opportunity 'to climb the ladder of success'. Barrack Obama has recently complained that there is insufficient "upward mobility" in the US. Australian federal Treasurer Joe Hockey last week said "equality of opportunity" should be the goal not "equality of output".

It is clear that the environment movement regards climate change as a bigger problem than the Government does and to many in the movement, it is 'the problem'. What is overlooked is that the constant increase in the demand for energy is a product of our economic growth system and that if we were able to overnight move to 100% renewable energy all the other demands we are making on the earth would continue. This means that we must be very careful about what we ask for.
The Steady State Economy

In complete contrast to this endless economic growth system we define the steady state economy as one with " a relatively stable, mildly fluctuating product of population and per capita consumption". Equality and justice are closely related objectives. It is important to recognise that the concept means having a stable situation, with room for mild fluctuation.

Steady State economist Herman Daly's short definition for the steady state  economy is "one that develops qualitatively (by improvement in science, technology and ethics) without growing  quantitatively in the physical dimensions".

The principles that underpin the steady state economy alternative then are concerned with both the relationship of people and the environment and the relationship between people. 

The FIRST PRINCIPLE  concerns the rate and scale of resource use. Instead of endlessly increasing the use of stock resources to provide for and stimulate more consumption we will use resources at a sustainable rate - at a rate related to the natural processes of renewal, and the capacity of the environment to deal with waste. In other words in the steady state economy there will be a stable level of material throughput at a level and scale which can be maintained indefinitely. This of course includes complete reliance on renewable resources including energy.

The SECOND PRINCIPLE concerns the goal of social equality. It is the opposite of our present system that is inequitable as well as being materialistic, competitive, individualistic and hierarchical. In the steady state, in complete contrast to our present system, there will be complete equality everywhere and co-operation will replace competition as the main goal and form of social interaction.


It is I believe very important to have a scenario of a different world. So, what will life be like in a steady state economy?

To begin with in the steady state economy, to achieve sustainability, people will live within the earth's means, relating their use of its resources to its environmental capacity through their close relationship to it. Reconnected they will have direct control of the environment where they live and full respect for it. They will be as concerned for the long term welfare of the environment as they are for its welfare during their lifetimes. This will be achieved partly by people living in small communities, accessing their own water and energy supplies and producing most of their own food and other materials. Where we live will be where we produce our food not just where we consume it. In this way they will have not only have a close knowledge of their environment but an absolute stake in its future. This of course will involve a vast amount of retrofitting.

At the same time the new relationship with people will involve true equality - equal treatment in every respect, including equal access to food, housing, and other services. There will be no poor. It will be a non-hierarchical society. Fulfilment in life, not the accumulation of wealth, status and privilege, will be the accepted goals of all. No one will be superior to another. There will be respect for all. In the steady state people will gain satisfaction from developing and exercising their skills and from contributing to the well being of the community. It is important with regard to this step that, as I have said, it is understood that inequality is one of the major facilitators of the Economic Growth system and that unless it is dismantled it will impede the move to a Steady State Economy.

As far as governance is concerned all major decisions will be made by direct participation and will largely be at the local community level, by community assemblies. Positions such as chair of meetings will be rotated. There will also be inter-community cooperation. People will have a real say through participatory democracy. I envisage that there will be some measure of representative democracy to assist with inter community and regional and international coordination and communication but even at this level any major decisions to do with resources will involve everyone having a say and delegate positions will also be rotated.

Perhaps I can make this vision clearer by referring to what are likely to be some of its other major features.

First population. The present situation is that we are consuming resources at the rate of over one and a half earths and 2.7 billion people are living in poverty. Australia's population of 23 million is forecast to grow to 28 million by 2050. Achieving true equality will be greatly assisted by having smaller populations and reducing overall consumption.

With regard to trade, in the steady state I envisage that there would be some inter regional trade within nations but no international trade in goods. The long supply chains of today would become a thing of the past. It is of course much more than a trade but recreational and educational tourism will continue because of both the personal enjoyment involved and the better understanding of the world which it brings about.

Needless to say there will be no profit making in the steady state economy. This is an unnecessary cost whose main purpose today is to enable some to become wealthier than others. In the present system money is made out of trading in money and through the manipulation of debt unrelated to physical resources and the facilitation of the exchange of goods and services, or as Herman Daly puts it, "creating money out of nothing and lending it at interest". 

The dominant settlement form would be small local self- sufficient communities. They might have boundaries related to catchments. Some congregation of people around communications and inter regional coordination hubs might be expected but there would be no place for the huge cities of today built on a foundation of international trade and manufacturing and drawing their food, energy and water from huge tributary areas relying on the massive use of transport to move goods and people.