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This content was posted on  10 Nov 21  by   ReThinkX  on  Blog
The Next Economy: Why the growth and degrowth debate misses the point

During COP 26, as he was on route to the G20 summit, British Prime Minister Boris Johnson had an extraordinary message. Civilization could collapse “like the Roman empire”, he warned, “unless we get this right in tackling climate change.”  

“Humanity, civilization and society can go backwards as well as forwards and when they start to go wrong, they can go wrong at extraordinary speed,” he said.  

The UK Prime Minister’s recognition that civilizations can experience a life cycle of growth and collapse is a milestone. But understanding what’s really driving the risk of going “backwards” is crucial to navigating our way forwards. 

Civilizations have grown and collapsed throughout history. Today, the relentless expansion of modern industrial civilization is breaching critical planetary boundaries which scientists believe is endangering what they call the ‘safe operating space’ for humanity, raising the specter of collapse on a global scale. At worst, many scientists have warned that climate change could lead to a largely uninhabitable planet within our lifetimes.  

Polarization and paralysis 

There have been two polarized responses to this crisis. One has been to argue that as the driving force of this crisis has been a form of endless economic growth – and as endless growth on a finite planet is clearly impossible – we have no choice but to put an end to this form of growth. As exponentially increasing carbon emissions have been driven by exponentially increasing material consumption and production, it’s only by putting an end to the latter that we can solve the former. Therefore, we have to bring the economy back in line with natural limits, and this requires a form of ‘degrowth’ – a planned contraction of the economy so that it operates safely within planetary boundaries. That, in turn, will require vastly revised notions of prosperity and human flourishing. 

The other has been the ‘ecomodernist’ approach, arguing that technological innovation will allow us to ‘decouple’ economic growth from an endlessly expanding material footprint – including in particular from continually increasing carbon emissions. Economic growth will, therefore, be able to continue while reducing environmental degradation. The key to doing so is by using technology to accelerate the efficiency of resource use, which will allow us to reduce the ecological and material impacts of human consumption and production. Therefore, the solution is to continue economic growth and intensify technological innovation. Doing so will largely permit industrial civilization to continue expanding on its current trajectory while reducing material intensity and solving ecological problems. 

Both these perspectives offer some useful insights into the challenges ahead, and how we might overcome them. But both are also severely limited. 

One emphasizes the need for radically changing our mindsets, values and how we organize our social and economic structures.  

One emphasizes the need to apply scientific innovation to produce better technologies that can solve our problems more effectively and efficiently.  

Each of these perspectives offers some valuable truths – yet they are both deeply flawed. In short, both degrowth and ecomodernism frame their sustainability solutions within the existing system. Whereas degrowth suggests we can solve our problems and be sustainable by doing less of what we do now, ecomodernism says we can solve our problems and be sustainable by doing more of what we do now. Both these approaches are wrong, because they do not recognize that business-as-usual can’t continue, and that fundamental change of what we do now is coming. 

The biggest problem is that, in different ways, they fail to understand the true nature of the current moment facing human civilization, which ultimately requires us to recognize how the life cycle of civilizational growth and collapse relates to the complex system dynamics of technology disruptions and societal change.  

RethinkX’s research framework and findings suggest a completely different perspective that transcends both these polarities of ‘endless growth’ and ‘degrowth’. 

The life cycle of civilizations 

In Rethinking Humanity, RethinkX co-founders James Arbib and Tony Seba establish a powerful framework to understand why and how societies have grown and collapsed through history. 

This framework fully acknowledges that civilizations faced limits in the past, and that a complex convergence of factors led them to collapse. Technology disruptions were, however, a key driver of the ability of past civilizations to transcend the limits of previous civilizations. This doesn’t mean there are no fundamental biophysical or planetary boundaries – but that our relationship with those boundaries is not fixed, depending on how we use technologies to produce the things we need.  

In the Rethinking Humanity framework, we can view civilizations in two ways: its production system (encompassing energy, transport, food, information and materials) and its organizing system (its governing system, economics, culture, worldview, values and beyond).  

The crucial insight is that civilizations didn’t only collapse due to encountering unsurpassable natural limits – but because they could not adapt through transforming their production and organizing systems. Civilizations from Catalhoyuk and Sumer to Babylonia and Rome collapsed because they reached the limits of their ability to organize society and solve the problems created by their production systems. By attempting to patch-up those production systems, and doubling-down on their incumbent organizing systems, they collapsed. 

Like past civilizations, industrial civilization is pursuing a parasitical growth trajectory which is reaching its limits. If this current form of growth continues in this way, then like our ancestors we will face collapse. This form of growth is intimately connected to our exploitation of fossil fuels, which has played a central role in defining the possibilities and dynamics of our global economic system. In this system, exponential economic growth over the last centuries has been inseparable from an exponential growth in civilization’s material footprint on the planet.  


There can be no doubt, then, that we need to dramatically reduce our ecological footprint in order to stop pushing up against planetary boundaries, to end the biodiversity crisis, and to stop climate change. What’s also clear is that we cannot do so within the extractive structures of the current industrial system. There are now numerous studies which show that there is little serious evidence that we have been able to ‘decouple’ economic growth from increasing material production and consumption within this system.  

But here’s where both these grand narratives fall short: this predicament is organizationally-specific to the current extractive structure of industrial civilization: its five foundational systems of production across energy, transport, food, information and materials, and its organizing systems. The limits and dynamics of what is possible with these systems are specific to these systems.  

Our understanding of economic value and prosperity is constrained within the confines of this paradigm, where almost every increase in economic value registers in some way as an increase in material production or consumption.  

But what if we were able to create a form of economic prosperity that was not inherently tied to a dangerous expansion of our ecological footprint on the planet? What would this look like?  

A form of economic prosperity that increased while contracting our ecological footprint, would in one sense appear to represent a fundamental break with ‘economic growth’ as traditionally understood within the current paradigm. This is important because theoretically, it’s entirely conceivable for economic value to be calculated in different terms not tied to material throughput. So we can still apply the idea of growth in economic value, while recognizing that this would be fundamentally distinct from what has gone before. 

But perhaps the biggest limitation of degrowth is that it doesn’t offer a complete solution to climate change. This has been forcefully put forward by my colleague Adam Dorr, who points out that even if we dramatically shrink our economies within the current paradigm to bring carbon emissions down to zero, we still need to deal with the vast quantities of carbon already accumulated in the atmosphere. Scientists warn that at current levels – even if we manage to restrain emissions to the point that global temperatures stay within the 1.5C upper ‘safe limit’, this will not actually eliminate dangerous climate change. Vast areas of the Middle and North Africa, for instance, would still become uninhabitable. And the risk of triggering key tipping points that could at some unknown and unknowable point cascade into self-reinforcing amplifying feedback loops driving a worst-case ‘hot house earth’ scenario would still exist. 

It’s therefore worth noting that according to climate scientist Tim Garrett, the scale of decarbonization required is so great that we would need to “collapse” the energy consumption of industrial civilization to avoid climate catastrophe – a process that in effect entails an extreme form of ‘degrowth’ in the form of economic collapse. But this is hardly a viable solution. 

Yet, importantly, within the degrowth narrative, we find that there is recognition of the crucial significance of technological progress. The problem is that there is little serious consideration about what this technological innovation actually means in systems terms 

For instance, one important study found that if global energy consumption were to shrink down to 40% of its current levels, with a fundamental reorganization of our economies it would be feasible to provide an even larger population of 10 billion people decent living standards in terms of clean water, hygiene, housing, food, energy, health and education.  

Now this scenario still offers no complete solution to climate change because reducing energy consumption down to 40% isn’t a sufficiently complete collapse as Garrett has argued would be needed to avoid climate risks: nor will it remove carbon from the atmosphere. 

But what’s notable is that this scenario is impossible without tremendous technological progress. The study acknowledges that in addition to what it calls “demand-side changes” to reduce material consumption, “such a world requires a massive rollout of advanced technologies across all sectors.” 

In other words, even within the most optimistic degrowth scenario, there is no point degrowing without technological innovation. That’s because it’s only key technological innovations that can allow us to, in effect, do more with less: to give decent living standards to more people using less than we use today.  

Yet exactly how and what this advanced technological rollout should look like is the big question – and what is completely missing from most conventional degrowth narratives is that the relevant technology disruptions will entail fundamental system transformations to the production relations of civilization that will create new dynamics. 


 This fundamental recognition that we cannot escape the need for technological progress at first glance appears to vindicate the ecomodernist camp. A pure reliance on ‘sufficiency’ economics simply cannot work to provide decent living standards for all people without a “massive” deployment of advanced technologies. This supports the idea that technological innovation is a real driver of social progress, and that future progress is indispensable without it.  

That’s because, as Dorr has also pointed out, improvements in technology represent improvements in our practical knowledge of how to interact with nature in a way that we can solve problems by changing the conditions around us. Prosperity properly understood, then, does not simply equate to ‘money’- but rather to our ability to solve our problems by changing the conditions around us. And technology, while certainly not the be-all and end-all of that, is a core part of it. 

But the biggest problem with the ecomodernists is that, like many in the degrowth camp, they do not understand the real implications of this. Ecomodernists largely view economic and technological progress as having gradually improved over time in a linear fashion. They see this progress continuing incrementally, and therefore posit that since technological progress is a key driver of economic prosperity, we can simply solve all our problems by encouraging more technological progress and economic growth in a business-as-usual fashion that will create new resources for us to solve our problems. The problem is that this translates into simply doing more of what industrial civilization in its current form already does. This leads, at worst, to the Bill Gates model of climate intervention: focusing on how we can keep intensifying the systems that already exist. 

Thus, for instance, the Ecomodernist Manifesto states 

“Intensifying many human activities — particularly farming, energy extraction, forestry, and settlement — so that they use less land and interfere less with the natural world is the key to decoupling human development from environmental impacts.”  

The Manifesto goes on to say that this is “because technologies have made humans less reliant upon the many ecosystems that once provided their only sustenance.” 

Yet the Manifesto ignores the fact that these very activities linked to today’s industrial civilization have accelerated and intensified forms of material extraction to unprecedented degrees that now threaten millions of species with extinction: including, potentially, the human species. 

The problem here is that the ecomodernists offer an extremely simplistic theory of civilizational progress in which ‘technology’ is homogeneously projected as universally good, while its negative impacts are simply denied. As a result, they completely fail to grasp that the incumbent technologies of industrial civilization in energy, farming and infrastructure cannot be improved any further and have, indeed, reached their limits. Attempting to ‘intensify’ them more will only worsen this predicament (think carbon capture and storage applied to fossil fuels, for instance, or tinkering with nuclear, or appending hydrogen to existing gas infrastructure, or improving industrial agriculture with better fertiliser, or spraying calcium carbonate dust into the atmosphere to offset global warming effects). 

By attempting to double-down on industrial age extraction mode business-as-usual, ecomodernism fails to recognize that continued linear progression within this existing system is impossible. As a result, they fail to understand the warning signals of collapse, and lock us into a cycle of applying more and more complex and expensive – but ineffective – ‘band aids’ to keep the existing system rolling along. 

Speaking past each other 

These two narratives have ended up locked into a futile ideological debate that fails to see the bigger picture – at their extremes, one narrative recognizes the risks of collapse but then, in a sense, capitulates to it; the other simply pretends no such risk exists at all.  

One demands a complete end to ‘business-as-usual’ by seeking its exact opposite – instead of perpetual growth, we must revert to degrowth. 

The other demands an intensification of ‘business-as-usual’ – this is how we solved our problem in the past, so we must keep doing that.  

But ironically, both simply look to the recent past for answers, overlooking the unique system dynamics of the present. As such, they represent binary polarized extremes that are both irretrievably trapped within the old, incumbent paradigm.  

Ultimately, a form of perpetual material growth that breaks through planetary boundaries, while often seen as the principal cause of our environmental problems – is in itself a symptom of a deeper cause: the way our economic and material systems are organized. We cannot retain those systems in place, while attempting to stop such predatory forms of growth. We have to understand what it is about our systems that is driving this form of exponentially increasing ecological footprint, and transform those systems.  

And the answer to doing that is neither just about economic transformation, nor is it just about technological disruption: it’s about both, together, simultaneously.  

When we truly recognize this, we can begin to see that an entirely new systemic possibility space is opening up that transcends the economic dynamics we are familiar with, and which cannot be easily categorized or defined within the framework of conventional economic metrics.  

Disruptions and systems 

When we examine the role of technology disruptions in the growth spurts of civilization (both past and present), what we see is that disruptions are not simply one-for-one substitutions where one technology just displaces another.  

They entail complete phase changes in how that part of the production system operates. And sometimes that can end up cascading across into other sectors. In fact, sometimes production-sector technology disruptions are so pivotal that they entail total transformations of the structure of economic activity. 

For instance, as Arbib and Seba show in Rethinking Humanity, the fifteenth century invention of the printing press – an information disruption – was not just an incrementally better way of manually writing on manuscripts made from animal skins. The ability to rapidly and automatically print large volumes of text on paper at costs 10x cheaper not only led manuscript industries to collapse, but opened the way for a fundamental transformation in the ownership, production and distribution of information that broke the Church’s cultural dominance in Europe and, combined with other social and political transformations, paved the way for the ideas of the Enlightenment and Scientific Revolution. 

This disruption in the information sector therefore had transformative implications for wider economic structures: It overturned medieval monopolies in which information was owned and controlled by the Church, and distributed the production of information across an emerging merchant class – undermining and challenging traditional feudal forms of property ownership.  

Similarly, the car was not just a faster horse: it was a phase change in the transport system that led to fundamental transformations in everything – the design of cities, how we produced and distributed food and clothes, how we fought wars. And of course, it also created negative consequences in the form of carbon pollution. 

Technology disruptions at the production sector level, in other words, change the rules that define an entire system of production at the sector level. And depending how they play out, they can lead to and drive changes across other sectors, and whole societies.  

Most importantly, these are not slow, incremental changes. Disruptions happen rapidly, driven by exponential performance improvements and cost reductions that make the new technologies economically superior, out-competing incumbents.  

Disruptions today 

Today, our research at RethinkX shows that the incumbent industries that define our civilization are being upended by a series of overlapping and interconnected technology disruptions happening in every one of the five foundational sectors of civilization. Neither the degrowth nor ecomodernist narratives grasp this reality. 

In information, the dawn of the internet and the smartphone are not only disrupting traditional centralized models of the mass media, but are cascading across into other sectors. The creation of new information business models has disrupted catering and restaurants and led to the rise of ride-hailing, disrupting taxis; while the ubiquitous spread of lithium-ion batteries has driven down battery costs for electric vehicles (EVs), further disrupting transport, and in turn further disrupting demand for conventional energy. 

The information disruption thus helped trigger and accelerate the disruption in the transport sector. As costs of EVs plummet, they are on track to make ride-hailing even cheaper than private ownership of internal combustion engine (ICE) vehicles. Improvements in information are simultaneously creating massive opportunities for autonomous technology, which will soon make self-driving cars a reality. The combination will disrupt private ownership of ICE cars altogether, as transport-as-a-service becomes 10x cheaper. 

As battery costs are dropping, this is having a huge impact also on the energy sector, which is experiencing disruption from the combination of solar, wind and batteries. These technologies are not just becoming better and better at converting sunlight and wind into electricity, and then storing it, they are doing so at declining costs making them the cheapest forms of electricity in most regions of the world: they are also on track to become 10x cheaper within the next decade. 

The impact of the information disruption on materials has driven the rise in 3D printing, nanotechnology and precision biology. That in turn is now impacting the food sector, where information advancements are now enabling us to manipulate matter at ever-smaller scales, and in particular to brew and program proteins anyway we want to. The costs of these technologies, namely precision fermentation (PF) and cellular agriculture (CA) – which will allow us to create real animal meat products without killing animals – are dropping dramatically, to the point where PF is on track to become 10x cheaper than the livestock industry within about 10-15 years. 

The history of technology disruptions reveals that when they become 10x cheaper than incumbents, the incumbents simply cannot compete and are wiped out. Adoption of the new technologies, which at first starts slowly, accelerates exponentially along an ‘S curve’, slowing down as it reaches mass adoption. This doesn’t happen in a prolonged, linear incremental fashion – but rapidly, often in as little as 10-15 years. 

Here’s what we therefore learn from studying the dynamics of disruption, and the nature of current disruptions: They do not entail a continuation of business-as-usual within the current industrial paradigm. In fact, they entail the opposite: they are disrupting that paradigm, and impacting every defining foundational sector of industrial civilization.  

As a result of these technology disruptions, we can already see how conventional industrial carbon-intensive energy, food and transport industries – which happen to be responsible for 90% of carbon emissions – are going to be outcompeted within the next two decades driven by these economic factors.  

Together, as these disruptions encompass every foundational production sector of civilization, they entail that the entire production system of civilization is on the cusp of transformation 

Trying to intensify incumbent industrial activities to solve our problems, as the ecomodernists call for, cannot work – as these doomed industries are already locked into vicious cycles of diminishing returns. Doubling down on them will only lock more of society into their collapse trajectories.  

Yet trying to degrow our material footprint within the framework of incumbent industrial technologies and associated production systems also cannot work as it’s those systems that create the path to unsustainable perpetual material growth: we have to transform those extractive production systems, and the most efficient path to do so is by accelerating the existing technology disruptions unfolding right now with the most transformative implications. 

BAU is over. It’s time for something new 

Therefore, the immediate future of technological progress does not entail a linear continuation of the existing industrial-age economy as we know it. Yet the latter’s inevitable collapse does not entail a negation of progress. It entails that we will be able to transcend this economy as we begin to move into a completely new production system. 

We find ourselves, then, caught between two simultaneous processes: the degrowth of the old, industrial carbon-intensive system, and the growth of a new post-carbon system driven by energy, transport, food, information and materials disruptions.  

We need to rapidly degrow and eliminate the incumbent fossil fuel system, with its economic dynamics involving an exponentially expanding ecological footprint – and we need to accelerate the growth of the new post-carbon system, designing it to operate within planetary boundaries. Simultaneously, we need to protect people throughout this transformation to move them from the old, dying systems, into the new emerging system. And most crucially, we can leverage the degrowth of the incumbency directly to sustain the growth of the new, redirecting materials, resources and capital locked into the conventional energy, transport and food industries into the new deployment of the disruptive energy, transport and food technologies: a pathway that makes eminent economic sense because the assets tied up with the incumbent industries are already stranded. 

Exactly what happens at this point is not set-in-stone, but will depend on societal choices. But this is not a linear extension of the past, it’s a new life-cycle for a new civilization – with fundamentally different dynamics to that of the industrial system. And therefore, we need to recognize the possibility of a form of economic prosperity that we will not be immediately familiar with – and which will likely defy existing classifications of growth and degrowth, as it will involve the emergence of a different economic system altogether. 

Most importantly, our research suggests that two possibilities are going to open up.  

Firstly, the cascading dynamics of these simultaneous disruptions will immediately involve a huge retraction in the material footprint of industrial civilization. The collapse of carbon-intensive industries in energy, transport and food will end the huge demand for global logistics and transport, free up billions of hectares of land, allow oceans to regenerate, and eliminate air pollution. With the right choices, the new energy, transport and food systems enabled by these technology disruptions will initially lead to a net reduction in the materials intensity of human civilization. 

But this is just the beginning.  

Because secondly, while the initial roll-out of the new energy, transport and food system will require mobilizing the materials and capital resources of the dying industrial economic system, once it’s established the new system will not suffer from the same supply shocks and price dynamics of the old centralized energy system. Instead, compelling data shows with an optimal deployment, it will be able to generate at least three times as much energy as the fossil fuel system, but at near-zero marginal costs for most of the year – with potential to generate ten times as much.  

That in turn will enable the electrification of a vast array of services – from mining to manufacturing, from circular economy recycling to wastewater treatment – meaning that we will thereafter be able to cleanly sustain, maintain and operate the system by harnessing the power of the sun and the wind.  

Once all the materials flows to maintain the existing stock of a global solar, wind and battery system are switched over so that they are sustained by the new clean energy system, an unprecedented possibility space appears: we will be able to maintain and even expand the clean energy system without breaching planetary boundaries, and further increases in materials throughput will no longer be dependent on fossil fuel extraction limits. Instead, they would continue to be sustained within the new clean energy system without destabilizing planetary boundaries – again, not automatically, but with the right choices concerning how those materials flows are organized. That means materials intensity would theoretically be able to increase dramatically, sustained by the clean energy system, as long as it was designed in a way to avoid damaging ecosystems. This suggests that decoupling will be possible – but only in the new system. 

With vast areas of land freed up due to the disruptions, and with 10x advancements in clean energy and autonomous machine labour, carbon withdrawal methods that were unfeasible in the fossil fuel system, both natural and technological, will also become cheap and viable: opening up unprecedented opportunities for rewilding and ecological regeneration of our land, air and water. Once again, those technologies are not feasible within the economics of the current paradigm – they will only become feasible as a result of the transformation of production systems in the context of the current five major technology disruptions, and they will only be actionable on the basis of societal choices. 

So these possibilities won’t happen automatically, of course. We will need to choose this pathway, by deciding – based on a new value-system in which we place real value on protecting the earth – that we want to responsibly mine and recycle materials, while investing in the restoration of the earth in a way that will improve conditions for all species. But if we choose this path, it could enable a new form of vibrant economic and ecological prosperity.  

Of course, doing so is simultaneously a matter of survival. Because if we refuse to embrace this transformation, if we delay the disruptions by trying to prolong the life of incumbent industries and systems or decrease our material footprint within these systems, then those industries and systems – and the civilization associated with them – could end up collapsing before we breakthrough to the new system. 

With the right choices, then, there will be tremendous new ways of creating economic value within a new post-carbon system without hurting the earth. In fact, leveraging these existing technologies, we can now envisage the possibility of increasing economic prosperity so that it embraces all people, providing them advanced means of power, food, mobility, education and infrastructure at a tenth of the costs of the incumbent system.  

But to enable and optimize these possibilities will require us to fundamentally transform the organizing system of civilization: for instance, we will need to break-up existing centralized energy utility monopolies, creating new individual property rights to own and trade electricity. Intellectual property rights will also need to be opened up to facilitate open source systems to permit global design and local implementation. These are just a few examples. Such transformations will result in a shift from centralized to decentralized structures of ownership in which people themselves are enabled to become producers of energy and food. This implies a transformation in the very structures of ownership of economic production involving a complete shift in the relationship between labour and capital that cannot be simplistically reduced to pre-existing economic ideologies.  

The next economy, then, cannot be easily understood through the lens of existing economic concepts. It will involve individual entrepreneurship, collective design processes, shared distribution protocols across participatory interconnected networks rather than top-down hierarchies. It will involve a form of increased economic prosperity – including increasing material prosperity in the sense of an expanded capability and efficiency in meeting our key material needs – accompanied by a decreased ecological footprint. It will entail the deployment and then maintenance of a stock of material inputs and outputs for the system to continue existence, which will then for the first time be able to grow within planetary boundaries thanks to the larger and then increasing ability to harness clean energy.  

Within our sights, in short, is the possibility of a technologically advanced and economically prosperous ecological civilization. Armed with this understanding of what’s possible, we can recognize the need to completely rethink the conventional industrial economic paradigm in a way that embraces a new possibility space that cannot be defined, constrained or understood using the old tools, ideas, beliefs and values.  

Although the path ahead will not be simple or easy, in order to step into this future we must first wake up to its possibility: that over the next decades, we have the opportunity to walk into a completely new economic paradigm unlike what we’ve seen before, one that can enrich all our lives and regenerate the earth. 

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