Summary: Creative Destruction is the slogan of globalization, much as the shrill "There is no alternative" cry of neoliberalism by Margaret Thatcher. We start to unpack Creative Destruction and grasp what it might mean for world sustainability here. Along the way, we trace a lineage of thought in ecological economics.
Creative Destruction is the slogan of globalization, much as the shrill "There is no alternative" cry of neoliberalism by Margaret Thatcher. We here begin to unpack Creative Destruction and grasp what it might mean for world sustainability here. My intention is to reframed the catchphrase so that it facilitates sustainability. The creative will be stressed over the destruction --- but its social class character will be obviated.
Why this theme is important is revealed by a business headline as I write this page: Apple Computer has now replaced ExxonMobil as the most highly capitalized corporation in the world . Ironically, the lead headline on the World Socialist Web Site is also compelling: A Turning Point in the Crisis of World Capitalism, reporting the drama in the stock market over the last month. So, put these two events together: Global capitalism is churning, digits are supplanting atoms, and, I posit, we have no adequate understanding of how this either works or will play out.
A premise in the Ecology, Economics, and Ethics project is that sustainers must grasp the unfolding of history and the evolution of civilization itself to think and act strategically to build a sustainable world.
The term Creative Destruction was invented by the great economist Joseph Schumpeter in his classic Socialism, Capitalism and Democracy. I argue in a related page on Schumpeter that this important book and the phrase Creative Destruction has been largely misunderstood, and certainly has lost its context. My respectful and sympathetic attention to Schumpeter is to recapture his thought in the fullness that it deserves. (I suspect that few have actually read the book, or even the [salient chapter]. One does not read Schumpeter, but excavates his tomes.)
Further, there may be a lost connection of Schumpeter to current thinking in ecological economics. Here is the chain of logic that connect ecological economics to Schumpeter, thus implicitly the doctrine of Creative Destruction:
My intention is to draw a line between Schumpeter through Georgescu-Roegan, then through Daly to Costanza. But the foundational thinker just might be Schumpeter. (My forays into the literature of ecological economics has not found this connection, which admittedly might be meaningless.) The point here is simple:
Calculating environmental services and reckoning the value of the stock of Natural Capital is an important analytical project. This path has the pivotal and essential advantage of incorporating science (and thus scientists such as James Hanson) within ecological economics. Sustainability still necessitates the long-term thinking of an analyst such as Schumpeter. Thus the engine of Creative Destruction must also be unpacked for its strategic lessons. Arguably, the turn to sustainability within business is more significant than the application of the fruits of research on quantifying nature as an economic category. And time draws short; both might fall short.
So, while incorporating Nature, as well as society, into the framework of economic analysis (where it was left out) is necessary and appealing, although as of yet rarely implemented. This is the move from formal economics to substantive economics as practiced by Karl Polanyi and, I would argue, Fernand Braudel. Note that Schumpeter, Polanyi, and Braudel squarely stare into the engine of capitalism, the fount of Creative Destruction.
So, this returns us to the caption here: Apple replaces ExxonMobil as the most highly capitalized corporation precisely at the moment that capitalism faces a crisis. At the very least, sustainers might do well to think this through.