Why growth does not ensure human happiness
Small is beautiful but big is necessary.
Many of us believe and have this conviction. Today’s globalized world also stands for everything of a bigger scale. Large conglomerates are ruling the world. Many global corporations have gained unprecedented volume. Companies like Amazon, Google, Facebook, Reliance, Alibaba, etc, have become too big and apparently control much of humanity.
In 1973 EF Schumacher published Small is Beautiful and pointed out the perils of “gigantism.” He claimed, a wave towards mass production of goods and services was facilitated by opening up mass media and mass culture. As bigger markets were created by globalization, the larger scales of production led to the dehumanizing of people and the economic system that govern our lives. In the contemporary world, gigantism has triumphed. But what has been the result? The world is divided, some gain while the rest suffers.
The darkness underneath and within
Today, Schumacher’s proposition about gigantism is ever more relevant. We are experiencing a loss of humanity against corporatism. Contemporary globalized economy has shifted our attention from the human needs towards economic growth. For instance, our food production ability has increased, but we still have hungry people in the world. WFP estimated that globally, as many as 2 billion people did not have regular access to safe, nutritious, and sufficient food in 2019.
A “capitalistic” society above all emphasizes economic production and efficiency, and does not really consider our basic needs and abilities. This argument resonates with the criticism of capitalist society that it monopolizes wealth to a certain segment, depriving the rest. Even Covid-19 revealed the embedded problematic of gigantism. According to recent estimates by Oxfam, while 100 million people are on the verge of being in extreme poverty, the collective wealth of world’s billionaires rose by $3.9 trillion between March and December 2020.
There are other dark sides that do not get attention due to the focus on growing GDP, per capita income, or foreign currency reserve -- so to speak. In 2019, the GDP of the world was $88,081.13 billion but the top 20 economies received almost 79% of it. Specifically, while Bangladesh achieved unprecedented averaged GDP growth of more than 6% over the last decade, we tend to forget the continuous rise of inequality over the last 50 years. The measure of income inequality shows, nationally Gini has risen from 0.36 in 1963 to 0.482 in 2016.
In the book The Growth Delusion: Wealth, Poverty and the Well-Being of Nations, David Pilling has argued statistics of growth do not consider an equitable distribution. The obsession with growth or justification for economies of scale hides the inequitable accessibility of health, education, security, opportunity, goods,
and so on.
Human sacrifice and gigantism
To keep the economies of scale, we sacrifice human lives. People become only tools for achieving growth. For instance, during the Covid-19 pandemic, worker welfare has been jeopardized. Despite the threats of coronavirus, many factories reopened while the country was still under lockdown. Thousands of workers returned to Dhaka barefoot under threats of dismissal and loss of due wages.
The rush for keeping the market share of apparel products, led to the workers’ treatment as “disposable bodies.” Here we found an extraordinary similarity with the infamous Rana Plaza calamity. Back in 2013, many factory managers forced workers to continue production in an unsafe building under threats of sacking and withholding salary. This feature is not unique to Bangladesh. One more example: On 16 August 2012, South African police opened fire on protesting workers of platinum mine at Marikana and killed 34 of them.
An op-ed by Garrett Brown in 2018 argued that at present, Africa offers many competitive advantages with much lower minimum wage and near-zero mandatory compliance regulations to follow. Therefore, as in the early 1980s, global retailers chose Bangladesh as a production base; at present, East Africa has appeared as the “new promised land” for garment production.
The “mad” search for profit directs the clothing brands from one country to another and fierce competitions between factories ensue a race to the bottom. David Harvey has termed this process as “capitalistic imperialism.” Global economic order relocates production centres to the countries with an “industrial reserve army.” This creates inequality amid exceptional economic growth.
A big appears while many smalls disappear
In the RMG sector of Bangladesh, the larger factories are getting bigger, while many smaller factories cease to exist, as BGMEA reports suggest. In October 2020, one of the larger RMG companies expressed interest to buy factories through advertisements in national dailies. The company wanted to increase their production capacity and the pandemic offered them a suitable opportunity.
Due to the pandemic, while the smaller factories are in dire need of cash, big conglomerates have gotten an opportunity to further monopolize their existence. This tendency is also reflected by the fact: In 2019-2020 of the $1.932 billion export income, 63% was contributed by 26.31% of the RMG companies. While the rest could contribute only 37%.
Economies of scale at factories are achieved by a capitalist work process that has led the technological advancement and minute division of labour which lets capitalists hire and fire workers without much concern. BGMEA estimated, due to the pandemic, 300 factories were closed and around 70,000 workers lost jobs. Although in October 2020, industries started to re-recruit workers but reportedly offered lower wages than before.
As many workers are desperately looking for work, factories could offer low compensation packages. Industrialists always claim, workers are free to decide and work; nobody forces them to work for a low salary. But these workers, not having alternative opportunities, must work even if they are offered lower salaries. Industrialists’ power generates from the fact that poor labourers hardly have any alternative income opportunities as reflected by the high youth unemployment rate that doubled in 2020 from 11.9% in 2019.
Growth does not ensure equity or human happiness. Small is still beautiful, and we should go back to the human scale.
Mohmmad Tareq Hasan is an anthropologist and teaches at the University of Dhaka.