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Does the economy have to keep growing?

What Dr. Dr. Money says
tablet das wirtschaftswachstum zeigt
What happens if the economy stops growing? Is it even possible for it to grow indefinitely?
If the economy stops growing, economists and politicians get worried. Why ist that so? Don’t we have everything we need? In the past, after the war, people had nothing, of course. In those times, economic growth for most meant recovering life’s essentials: a home to live in, food and clothing. When the economy thrived, people prospered too. This still holds true in developing countries and emerging economies. But here, in our country? We already have a super-abundance of wealth. That may not be true for each individual, but overall, Austria is a wealthy nation. Adding more and more to what you already have will not make you happier, as research studies tell us. However, many experts are convinced that economic growth is necessary to maintain our prosperity and social security.
Better Jobs

Capital investment depends on growth

In today’s factories, tasks that used to be done by people are now performed by machines. This has freed workers to move into jobs that require more and better skills. In these jobs, they earn more money and can afford a better life as a result. But responsible company managements only make investments – in modern equipment, for example – if the investment can be expected to pay off. And that is more likely if the economy is growing than in times when it stagnates or even contracts. If you look at it this way, we can only prosper if the economy grows.
Sustaining debt

We need more money because of growing public debt

All nations around the world incur debt because public expenditure tends to be higher than tax revenue. And the level of these “sovereign” debts owed by states continues to grow. To be able to repay them, higher revenues are needed. Governments can either raise taxes, or they can rely on economic growth to help increase revenues. The latter option is certainly more convenient for politicians seeking election or wanting to stay in power. Austria’s public debt in 1980 was equivalent to 27 billion present-day euros, a figure corresponding to 35.3 per cent of the Gross Domestic Product (GDP), that is, the total value of all goods and services produced in that year. By 2014, the debt mountain had grown to 285 billion euros, or 86.6 per cent of GDP. This was clearly much more than in 1980, not only as a percentage, but also in absolute numbers. (Government debt of the Republic of Austria) If the GDP had not grown throughout this period as well, Austria would be buried in excessive debt by now. That is exactly what happened in Greece. So economic growth enables countries to service their public debts. This is called debt sustainability.  
Sustainable growth

Unlimited growth?

But can the economy really keep on endlessly growing, unlike humans, animals and plants?
Critics, among them environmentalists, speak of an “addiction to growth”. According to them, if we keep producing more and more, we’ll use up resources today, and those resources will no longer be available for future generations.

This has led to a movement towards sustainable economic growth based on renewable energy sources and renewable raw materials.
Does the economy have to keep growing?

What Dr. Dr. Money says

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