Over the past ninety years, the American economy has grown dramatically. It is now 19 times larger than it was in 1930. Its growth is exponential; it is doubling at a more or less fixed rate, which means its absolute growth rate is rapidly increasing. In fact, our economy needs to grow to stay alive; without growth, it crashes. (COVID-19 has temporarily halted, and even reversed, economic growth; it remains to be seen if the economy will “recover” in the coming years.)
This need for growth is problematic in a number of different ways. Most fundamentally, we live on a finite planet, and anything that has to grow forever will eventually run into limits of some sort. In this essay, I want to consider a particular question: how does a growing economy affect the development and existence of communities, whether intentional or organic?
To answer this question, we need to answer another one: why does the economy grow? There are a number of causes driving economic growth. For one thing, our population is also growing. There are more people in the United States today than there were in 1930, and so there are more workers and more demand for goods and services. This population growth isn’t a complete explanation for our economic growth, however; while our economy today is 19 times larger than it was in 1930, our population is less than three times larger than it was in that year. Another reason for this growth is that living standards have risen. Some of this rise is beneficial, since it involves people obtaining better access to basic necessities. This rise, however, is also insufficient to explain the growth of the economy. Even before the disruption caused by the COVID-19 pandemic, homelessness was on the rise, and 10% of American households were experiencing food insecurity, and yet the economy was growing rapidly.
Much of the growth in the modern economy is driven by two factors: increased desires, and commodification.
In our society, we’re constantly bombarded by advertising, and we experience social pressure to “keep up” with the increasingly consumptive lifestyle of those around us. This pressure can make us desire all kinds of things beyond what is necessary for a dignified human life.
Houses today are much bigger than they used to be; while 70 years ago the average new home had 983 square feet of floor space, the average new home in 2020 had 2333 square feet. This extra space is a vacuum crying out to be filled with consumer items of all sorts. In fact, many Americans now find that the space available to them is too small, and the personal storage industry, which hardly existed 70 years ago, has ballooned dramatically.
Fashion contributes to this growth of desires, causing perfectly good clothes and other items to be discarded in favor of the latest and greatest. Software is continually updated, cars are traded in, and “dated” appliances and countertops are scrapped.
Disposable items, mostly made of plastic, are ubiquitous in the United States, and promote economic growth by replacing more durable goods. In general, the faster a given item moves from the store shelf to the landfill, the more the economy grows.
“Economy” literally means “the management of the household”. It is how households and societies support themselves. In this sense, vegetables grown in the backyard for personal consumption are part of the economy, as is the work of a child watching younger siblings. Goods and services of this type, however, are not counted toward the GDP of the formal economy. One of the major ways that the formal economy grows is through commodification, by turning social “capital” of this sort into financial wealth. A good example of this is entertainment. In past times, entertainment was a relatively small proportion of the formal economy; people made most of their own entertainment for free. Now, entertainment has become a multi-billion dollar industry, increasing the size of the economy. There are many similar examples in other areas of the economy; in the past, most cooking, mending, and child care was performed by the informal, social economy instead of by the formal financial economy. Even the basic social interaction of conversation is becoming commodified by social media platforms that see us as an audience for advertising. Every time a social interaction is replaced by a financial transaction, the economy grows.
This growth produces constant disruption on many different levels. People move across the country as the economic prospects in a given location change. Factories are torn down for homes. Farms become suburbs, and suburbs, in turn, are bulldozed to make room for expanding city centers. Businesses have become ephemeral. Even large businesses now have an average lifespan of only 18 years, and small businesses are even more transitory. Whole industries and the skill sets they require quickly become obsolete. This churning disruption boosts economic growth even further.
Effects on Community
It should be fairly obvious that this growth damages community, both directly and indirectly. Commodification in particular destroys the opportunity for community building. There is a certain trade-off: home cooked meals build community better than fast food meals eaten on the go, but the latter produce more economic growth. Increasing desires make it harder to stay in one place and put down roots, since our society penalizes those who are unwilling to be both geographically and socially mobile. The indirect effects of growth are also detrimental; no community can develop if everything is in a state of constant flux.
To build community, we need to push back against the drivers of economic growth. It is literally a matter of life and death. The economy needs to grow, or it will die. If we let the growth machine drive us, its hunger will eat up every scrap of social connection in our lives. The process may make us wealthy (if we’re among the lucky ones who end up on top) but it will leave us spiritually and socially dead.
On the societal scale, those with the skills and aptitude to do so should pursue the transition to a steady-state economy not dependent on growth. We’ve come to see exponential growth as normal, but in a wider historical sense it is deeply abnormal. There are other ways to structure an economy.
We don’t need to wait for social transformation, however. We can reign in our desires by embracing the Christian virtue of voluntary poverty. We can resist the pull of hyper-mobility and the restlessness of the modern world in our personal lives. Perhaps most importantly, we can reverse the trend toward commodification. By working together, making music, cultivating conversation, tending gardens, repairing homes, and enjoying meals, we can knit the severed threads of community life back together.
Postscript: At first glance, it seems that economic contraction also destroys communities. I’ve seen this play out firsthand in the Rust Belt. The reason for such destruction, however, is that economic growth had already destroyed older, non-commercialized ways of life. In a sense, the devastation seen when the economy declines is simply a revelation of the preexisting, underlying destruction.
Our current economic growth appears to be unsustainable. It is very likely that many local communities will face economic contraction in the future. This contraction will be destructive, unless communities can band together, reject the narratives of growth, and find non-commercial, community-based ways to meet their needs.
Port image by Fatlouie CC BY-SA 3.0