I am reading India’s most eminent economic thinker, Raghuram Rajan, opining that slowdown in the economy (of India) is ‘very worrisome’.
He is not alone, nor is India alone, as most of these experts of “Macro” economics, not just of India but the world keep waking up every third morning and make us worry about stuff like GDP growth rates or economic slowdown, and in general other doomsday things like deep recession hitting the world leading to job losses and other scary things.
But, with Raghuram Rajan really getting agitated about the slowing of GDP growth rate of India, I am forced to ask a bigger question.
What is the “Macro” that he and others are talking about when they discuss economics in elite forums?
Macro literarily means large-scale or overall. When used in the context of the economy, it is basically the largest context in which an economy is functioning.
So, when modern economists talk about macro-economics, they refer to global contexts like world economy or world market and discuss issues like foreign exchange rates, taxation regimes or market forces driven by public demand, but are they really the macro-forces that matter the most today?
The possible and scary truth is, the failure of going beyond the “visible” part of our “economic” activities by our great macroeconomists of modern age is probably doing to seriously damage the survival prospects of humanity on this planet, as the real context, the real MACRO to our economics is our planet and the biology that runs all life on Earth.
While the global conferences are busy discussing the limited macro-economics of human wealth creation spree and scare us about an economic slowdown, they are failing to see the obvious.
The rapid growth rate of human activities is now completely out of sync with a slow planet that takes millions of years to change even a wee bit.
With the creation of the horror called money that signifies “ownership” on a planet shared by us with billion trillion other beings, humanity has disrupted the original and the only economics, i.e. biology unfolding into ecology at macro-level of the planet.
Armed with “ownership”, we are now creatures that hoard more than what we need because we can and because we no longer trust the planet to give us what we want in a future that we are scared of.
The net outcome is, what macroeconomists like to call growth and want us to worry about it when it slows down, is actually a human delusion that is eating into the web of life that is not designed to grow at such a mad rate.
If we really understand that the planet is the real MACRO of economics that we need to worry about, the world is actually growing at a rate that the planet’s own economy, i.e. ecology will not be able to sustain.
What we need to worry about is that we are growing too fast and the planet is heating up due to our senseless growth that the fear-mongering macroeconomists are spreading to the political decision-makers and the situation is getting worse day-by-day.
My humble request to Raghuram Ranjan Et al. is that the world actually needs saving and that is unlikely to happen if they keep asking the governments to push GDPs. They need to apply their brilliant mind to the real context, the real MACRO that is now visible to all of us and that is ice shelves are breaking, glaciers are vanishing and rain forests are burning across the planet.
The planet needs a massive slowdown, a recession and a lot of downtime to heal.
The real challenge before great economic thinkers of the era is to help us find out how to do it in a manner that will not cause complete economic chaos.
If they won’t do it in time, the greatest and 3.7 billion-year-old economist who runs the planet will do it the harsh way and the cure may include sending us and our economies off the planet.