Herman Daly had a knack for making things clear. When the economy produces more costs than benefits, he calls it “economic growth.” But you won’t find that conclusion in economics textbooks. Even suggesting that economic growth can outpace inflation can be seen as an economic fallacy.
The ambitious entrepreneur, known as the father of environmental economics and a famous architect of sustainable development, died on October 28, 2022, at the age of 84. He has spent his career questioning an economy disconnected from an environmental and moral compass.
In an era of climate and economic uncertainty, his ideas inspired a movement to live within our means that is increasingly important.
The seeds of an economist
Herman Daly grew up in Beaumont, Texas, ground zero of the early 20th century oil boom. He witnessed the unparalleled growth and success of the “gusher years” against poverty and deprivation that persisted after the Great Depression.
To Daly, as many young men believe at that time and since then, economic growth is the solution to the world’s problems, especially in developing countries. Studying economics in college and selling the northern model to the southern world was seen as a righteous path.
But Daly was a voracious reader, a side effect of childhood polio and missing out on Texas football. Outside the bounds of the prescribed textbooks, he found a history of economic thought filled with rich philosophical debates on the function and purpose of economics.
Unlike the correct market equilibrium written on the classroom blackboard, real-world economics was abstract and political, determined by those in power. who has the power to decide who wins and loses. He believed that entrepreneurs should ask themselves: Growth for whom, for what purpose and for how long?
Daly’s greatest discovery came from reading Rachel Carson’s 1962 book, “Silent Spring,” and seeing her call for “goodness and nature … to prove that we grow up and we are in control, not by nature but by ourselves.” By then, he was working on a Ph.D. in Latin American development at Vanderbilt University and has long been skeptical of the hyperindividualism baked into economic models. In Carson’s writings, the conflict between economic growth and a fragile environment was very clear.
After an intense class with Nicholas Georgescu-Roegen, Daly’s conversion was complete. Georgescu-Roegen, a Romanian-born economist, debunked the free market myth of a pendulum swinging back and forth, trying to find a natural balance. He argued that the economy is like an hourglass, a one-way process that turns valuable resources into useless waste.
Daly believed that the economy should no longer prioritize the efficiency of this one way but to focus on the “best” scale of an economy that the world can sustain. Just shy of his 30th birthday in 1968, while working as a visiting professor in the impoverished region of Ceará in eastern Brazil, Daly published “On Economics as a Life Science.”
His pictures and tables show that the economy is a metabolic process, completely dependent on the biosphere as a source for sustenance and sink for waste, this is the way for a change in the economy.
Economy of a whole world
Daly spent the rest of his career drawing boxes in circles. In what he called the “pre-analytical view,” the economy – the box – was seen as the “all governing body” of the environment, the circle.
When the economy is small relative to the environment in which it exists, focusing on the efficiency of a production process is useful. But Daly argued that in a “total world,” with an economy that exceeds its environmental sustainability, the system is in danger of collapsing.
While a professor at Louisiana State University in the 1970s, at the height of the US environmental movement, Daly brought the box-in-circle installation to its logical conclusion in “Steady-State Economics.” Daly thought that the growth and the use were prioritized in the competitive, pioneering stage of a young organization. But with age comes a new emphasis on consistency and teamwork. His enduring example changed the goal from the blind expansion of wealth to the betterment of the human condition.
The international development community took notice. Following the United Nations’ 1987 publication of “Our Common Future,” which set forth the goals of “sustainable” development, Daly saw a window for policy reform. development. He left the security of working at LSU to join a group of environmental scientists at the World Bank.
For the better part of six years, they have worked to improve the economic order that uses “the world as a business in liquidation.” He often enlisted senior executives, most famously Larry Summers, the bank’s chief economist at the time, who publicly waved the question. a Daly whether the size of a growing economy relative to a sustainable environment matters. The future US Treasury secretary’s response was short and blunt: “That’s not the right way to look at it.”
But by the end of his tenure there, Daly and his colleagues were able to incorporate new standards of environmental impact into all lending and development. And the international sustainability plan they helped to shape, is now included in the UN Sustainable Development Goals of 193 countries, “a plan of action for people, planet and prosperity.”
In 1994, Daly returned to teaching at the University of Maryland, and his life’s work was recognized around the world in later years, including Sweden’s Right Livelihood Award, the Netherlands’ Heineken Prize for Environmental Science, Norway’s Sophie Prize, Italy’s Medal. the Presidency, Japan’s Blue Planet Prize and even Adbuster’s person of the year.
Today, the mark of his work can be found far and wide, including measures of the True Progress Mark of an economy, new Donut Economics installation of public floors in the roofs of the environment, degree programs throughout the world in the economy of the environment and a strong movement that is focused on a transition to a fair economy.
I have known Herman Daly for twenty years as a writer, consultant and teacher. He always makes time for me and my students, who recently wrote the foreword to my upcoming book, “The Progress Illusion: Reclaiming Our Future from the Fairytale of Economics.” I will forever be grateful for his inspiration and courage to, as he said, “ask stupid, honest questions” and then “not rest until I get the answers.”
Jon D. Erickson, Professor of Sustainability Science and Policy, University of Vermont
This article is republished from The Conversation under a Creative Commons license. Read the original article.
