The Debate over Growth

By Joachim Bischoff/ Christoph Lieber

[This article published in: Freitag 37, 9/16/2005 is translated from the German on the World Wide Web,  http://www.freitag.de/2005/37/05370602.php.]

[Growth or redistribution – opinions are divided on these two main themes. Should more investments and more consumption be encouraged to create jobs and chances of participation? Is growth the indispensable foundation for a more just society? Daniela Dahn answers these questions in the negative and urges a radical reform of working life. Three hours of work per day will be enough (cf. Freitag 30/7/29/2005). Albrecht Mueller regards renunciation on a growth strategy as a great illusion (cf. Freitag 32, 8/12/2005). After two responses from Friedrich Kiss and Klaus Blessing (cf. Freitag 34, 8/26/2005), we continue the debate.]

Combating mass unemployment is a cherished illusion even within the left. Daniela Dahn expresses the unease of many citizens (Freitag 30). There can be no return to a full employment of the old or new type in developed capitalist societies. What the established parties recommend as therapy against joblessness has been unmasked as quackery for 20 years. Only a radical reduction of working hours and a basic income as an individual right can deliver us from the misery. In contrast, Albrecht Mueller (Freitag 32) stresses the priority of economic growth and points to a bizarre political constellation. “Growth critics unintentionally pursue the work of the neoliberals when they claim not enough jobs can be crated in the dominant system.”

Given the enormous advances in productivity, radical reduction of working hours is an overdue demand. However working hours are actually lengthened – usually without adjustment of work income – while millions of long-term unemployed must manage with social transfers below the socio-cultural subsistence level. Power relations are hidden behind these distribution structures. The social elites refuse to renounce on appropriating a large part of the social wealth and the free time. What can be done against this malformation?

Reducing work to a minimum, striving for the most dignified form of work and giving chances for meaningful activity to as many as possible should be the long-term goals. Qualitative or socio-cultural economic growth would be an important step in this direction. In the short-term, an alternative economic policy should not renounce on a stabilization of domestic demand. We need higher work income, an expansion of employment conditions liable to social security and a stabilization of the social treasuries through citizen insurance -, a basic reform of value creation and distribution.

Even under the present financial policy pressures, an immediate program could be launched to improve the situation of over seven million citizens. The amounts of unemployment benefits II must be increased, the distinction between West and East annulled and unique benefits allowed – at least for the emergency. In this way, a clear signal would be set against the fortification of poverty and an urgently necessary economic program initiated. If this program is joined with communal investments and active labor market policy, it can affect the political economy.

As a result, leftist parties and WASG urge a radical change of course away from the failed neoliberal concepts. Taxes should not be lowered even more; social cuts should not be pursued. Instead a dynamic should be set in motion that leads to growth and jobs. The solidarian security systems could be rebuilt and working hours drastically reduced. Thus growth is not an end-n-itself for leftists but a means creating an atmosphere where other ideals could be followed.” (Keynes)

One percent economic growth leads to additional revenues of the public treasuries in an amount of ten billion Euros. When the state spends more money for securing social income and communal investments, it can expect considerable self-financing effects increasing with the length of the time period. In contrast, proclaiming a basic income as an individual right completely disregards social value creation. If one pays 750 Euros to the socially excluded, all citizens in training conditions, all low-wage earners and receivers of low pensions, a three-digit billion sum would be necessary. Financing this sum would only be realistic if all incomes were included in this redistribution.

Reducing working hours and raising all forms of minimum incomes to a satisfactory socio-cultural level is not controversial. However we cannot ignore the question neglected by advocates of a basic income: How can social production be reorganized in the sense of civilized progress? How can a broad reform alliance arise?