“Connectedness, embeddedness, and natural limits to growth is a consciousness very familiar to all islanders.”
~ Society, You Crazy Breed ~
During our three days at sea, news would trickle in over the radio about the rapidly deteriorating U.S. economy. Persistent unemployment and underemployment was triggering a reduction in consumer demand, which was leading to more unemployment, which caused a further drop in demand resulting in a vicious downward economic cycle. Perhaps this was the unintended consequence of ‘progress’ from automation, off-shoring, deregulated trade, market instability from excessive financial speculation, and a cheap-labor immigration policy. With less tax revenues, public services were dropping and governments were going into greater debt.
As we have been led to believe, in our growth-oriented economy, any reduction in consumer demand is always temporary and demand always picks up again and debts get repaid. But it is sobering to note that Western nations took over half a century to pay off public debts accumulated through WWII; and the UK’s debt overhang from the financial crisis of 2008 could last into the 2030s!
And consumer uncertainty can have negative ramifications for the financial system and for the economy as well—ramifications that are reinforcing rather than self-correcting. For example, once the economy starts to falter, the same positive feedback mechanisms that worked during expansion now work in the opposite direction, pushing the economy further into recession.
Add to the mix a growing and aging population, and the dangers of a downward economic spiral are exacerbated—higher levels of growth are required to maintain the same average income levels and provide sufficient revenues for increased health and social costs.
The news from the mainland also told of riots that were breaking out in some cities to protest police brutality and blatant racism. Fires were raging in several dry, drought-stricken southwestern states.
Economic hardship was replacing a boom-town economy in North Dakota as expensive, debt-heavy, junk-bond-fueled fracking was being squeezed by sustained low oil prices on the world market.
A volatile stock market with too many unexplainable and unpredictable downward spikes was unnerving investors.
Bob, Lua, and I were sipping coffee and tea on deck one morning before any of the passengers were up and about. Hearing all this bad news brought to mind a book I had read several years ago.
In the movie version of that book, Into the Wild, Eddie Vedder of Pearl Jam was on the soundtrack singing, ‘Society, you’re a crazy breed, I hope you’re not lonely, without me.’ It made me think about how comforting it was to be out here right now, away from the stresses and economic turmoil brewing on the mainland.
~ Freedumb on the Mainland ~
“Isn’t it strange how we Americans now consider ourselves consumers first and citizens second?” I asked Lua. “After 9/11, when our ‘freedom’ was threatened, we were told to respond to those evil-doers by—are you ready for this—going shopping. Now I do understand that a strong consumer culture is what helped propel our economy to top ranking in the world, and I get all that stuff about a rising tide lifting all boats. We are a rich country because we’ve been trained to always want more, bigger, better, faster, sooner. Economists argue that growing economies can avoid the political difficulties of redistribution by making everyone better off—a rising tide lifting all boats, and all that jazz. This argument is also used to increase the rate of growth even in countries that are already rich. So there is never a reason to challenge growth. But who has really benefited the most from this excessive consumption? And why are so many people now on food stamps or burdened with crushing debt? The environment is getting more stressed and starting to respond in freakish ways. It really worries me sometimes.”
I knew that climate change was warning of limits being exceeded. Nine out of ten of the hottest years on record all occurred since 2000. This fact, along with other trends, contrasts alarmingly with the preindustrial constancy in which the Earth’s temperature did not vary more than 1 – 2 degrees C in the last 10,000 years.
The scale of today’s fossil-fuel-based human economy, deforestation, and forest fires are the dominant causes of greenhouse gas accumulation. The carbon dioxide released from burning coal, oil, and natural gas is a primary contributor to greenhouse warming. And yet the market price to polluters for using atmospheric sink capacity for carbon dioxide disposal is either zero or minimal, though cap-and-trade schemes are beginning to be implemented in some communities and countries across the globe.
The negative impacts of climate change include migrations of millions of climate refugees from low-lying coastal areas and areas suffering from extreme droughts, heatwaves, and disrupted rainfall patterns, increases to storm intensity and higher frequencies of extreme weather events, damage to agriculture from loss of natural water reservoirs like glaciers, release of trapped Arctic methane from thawing permafrost, ice melt acceleration from positive ice-albedo feedback loops, degradation of forest and marine ecosystems, and loss of biodiversity.
Global warming and associated sea-level rise from thermal expansion and melting of land ice pose threats to the value of all coastally located and climatically dependent capital like agriculture, human-made capital like port and coastal cities, wharves, beach resorts, and natural capital such as estuarine breeding grounds for fish and shrimp.
Clearly, the reckless pursuit of unbridled economic growth is now endangering natural ecosystems on many fronts. The damage we are inflicting on the environment—on which we depend for our long-term survival—is troubling indeed.
“I can understand your worry, Mister Rico,” said Lua. “It seems to me that the purpose of an economy should be to serve life, not money. And an economy that serves life must learn from Nature to live as she lives, organize as she organizes, and learn as she learns. Your economy serves corporations at the expense of the health and well-being of individuals, families, communities, and ecosystems. Why do profit-seeking corporations take center stage in your economy over happiness-seeking households? Doesn’t a corporation strive to hire as few workers as possible and at the lowest wages to maximize its profits, while households want good jobs with high wages? And aren’t those completely opposite goals? That is all very strange to me.”
Lua went on to explain, “On my island we value a healthy local forest as a source of economic resources, sure, but also as a place of beauty, a place to hike and camp, a source of freshwater from its streams, roots that stabilize the soils of a steep hillside and as a filter that cleanses the air of dust and impurities. For a timber company, all that value would be reduced to a simple commodity to be harvested and sold for a one-time profit, then on to the next community and its stock of natural resources. And the timber company would prefer to hire as few workers as possible, for as short a time as possible and at the lowest possible pay. Who benefits the most from all this? On our island, economic power stays local, with households and communities. It would be absurd to hand over our economy to outside corporations that are only interested in maximizing returns to distant shareholders that have no stake in the health and well-being of our people and our communities.”
Hearing Lua’s account of her fellow islanders’ low regard for outside corporations, it occurred to me that today’s product-producing, profit-seeking, power-hungry corporations are the principal actors on the world stage. Yet they are not internally constrained to avoid damaging any public goods nor are they required to produce any public benefits beyond the products they offer. How did we get here?
~ Morphing Corps ~
The story of the gradual morphing of public-benefit chartered companies into today’s free-range, private-benefit, publicly traded, shareholder-beholden, transnational corporations is illuminating.
As traditional chartered companies evolved into today’s modern corporations, they shed themselves of any imposed requirements to provide a public benefit. What had been at one time a license to operate with state-delegated authority for state-designated purposes gradually became an open invitation to pursue private advantage.
Originally, corporations could only act within the narrow set of powers allocated to them by their articles of incorporation. Only shareholders in the corporation had recourse against their corporation for failure by its directors and officers to pursue the purposes that had been agreed upon.
But because corporations could pursue internally established purposes that produced external effects in the world—policed only by the corporation’s own shareholders and the market for shares—corporations naturally became shareholder-centric.
In the process, they also became externality generating—producing large and detrimental spillover side effects onto ‘the commons,’ like pollution and—more socially corrosive—the gradual erosion of local community life.
These negative externalities have grown exponentially as corporations have grown in size and in financial and political influence. And these negative consequences have never been ‘priced in’ to offset the damage to the commons that lingers long after.
~ Psycho, Inc. ~
Historically, acts of corporate social responsibility are, more often than not, about reducing harm rather than about producing net social benefits. Indeed, U.S. corporations pursuing a public purpose at the same time as making a private profit can invite lawsuits over liability for failure to pursue the maximum of shareholder value.
Curiously, given just a brief list of their fundamental traits and the fact that they both enjoy legal personhood status, one could easily confuse a corporation with a psychopath. Consider what they both share: a callous disregard for the feelings of other people, the incapacity to maintain human relationships, reckless disregard for the safety of others, deceitfulness in order to maximize gain, incapacity to experience guilt, and failure to conform to social norms and respect the law.
Such a description begs the question: Could a corporate entity with a social conscience ever really exist? After all, a corporation is a an ‘artificial person’ seeking nothing more than personal gain in the form of profit.
But alas, it has no soul to be damned, no body to be imprisoned, and no sleep to lose after engaging in an immoral act.
And what happens when you combine psychopathic, profit-seeking, transnational corporations with sociopathic, return-seeking, highly mobile transnational capital? You get a global economic system that ravenously, efficiently, and callously converts natural real wealth—mainly from the Global South—to digital virtual wealth—mainly for the Global North.
In fact, global finance capitalism has clearly become dysfunctional and destructive, as revealed by the economic meltdown in 2008. It is a shifty system that is also inherently unstable.
Not only is there an appalling lack of political courage among wealthy nations to confront this growing global pathology, ‘shock therapy’ is frequently used to push through radical pro-corporate measures during times of public disorientation when there is a temporary vacuum between events and our inability to explain them.
The ‘shock doctrine’ of ‘disaster capitalism’ is a brutal tactic from the pro-corporate economic playbook that exploits wars, coups, terrorist attacks, market crashes, or natural disasters to advance the private interests of corporations and authoritarian governments over the public sphere and the public interest.
With increasing regularity, news stories and world events suggest that transnational capital has become so concentrated and pervasive in both national and international institutions—and the tight integration of global finance has created widespread vulnerability—that single nation-states dare not adopt a significantly divergent policy direction from the dominant economies for fear of retaliation and potentially disastrous capital flight.
In Greece, for example, to pay interest to foreign lenders, the structural adjustments imposed on public services and the social wage threw many thousands into poverty. When elected heads of state were embarrassingly replaced by financial technocrats, the too-easy shift toward ‘government by external fiat’ revealed the shallow roots of democratic processes when confronted by the clearly dominant influence and cold, indifferent demands of finance capitalism. Even a well-established and respectable Western democracy like Greece is not immune to this economic humiliation.
Free trade rests on concepts such as comparative advantage, ‘Third World,’ and mandates for growth. But globally mobile financial capital has a nasty tendency to erode any well-intended benefits, and ‘free-trade agreements’ then only serve to facilitate and legitimate the unjust liquidation and appropriation of the high-quality natural resources found in forests, farms, and fossil fuels of ‘lesser’ countries. This has a name: the Resource Curse.
Fortunately, the misdeeds of transnational corporations are also making daily headlines with greater frequency, signaling the end of this form of unbridled ‘extremist’ global corporate capitalism with its insatiable desire for unconstrained freedom and power. This all-out war on the public sphere and the public interest has likely peaked and now entered into a state of terminal decline. The current and growing ecological-climate crisis is but one consequence of the pathetic inability of global capitalism to restrain its greed and destructive ecological practices.
By this point in the conversation, our six passengers had joined us and were listening to what we were saying with great interest. They each had their own viewpoint on what was going on with the U.S. economy and were eager to share their opinions.
Captain Bob had to leave the discussion to go make some adjustments to a frustratingly temperamental auto-pilot. But I had the good fortune of being able to listen in on a fascinating, spirited, and most unexpected debate about a ‘virtual-wealth casino economy’ on the brink of collapse.
~ Phantom Wealth ~
Paul: I am afraid that the vast majority of people do not understand the profound role that cheap, abundant fossil fuels have played in enabling our complex societies, career specialization, mass-consumer lifestyles, and phenomenal economic growth. When that energy is no longer cheap to produce, or abundant, economic growth will end. And when that happens, our growth-mandated financial systems will collapse in short order. We are seeing early signs of that now and are desperately trying to sustain a fundamentally unsustainable system by creating massive quantities of debt, most of which will never be repaid, and encouraging consumption in an environment of rapidly diminishing natural resources.
We are playing whack-a-mole risk games with ever more creative ‘financial products’ and observing the cancerous growth of massive secondary markets for ‘derivatives.’ None of this will alter the fundamental physical reality of obvious limits to growth on a finite planet, though clever Wall Street players can still make lots of money just as easily when markets fall as when they rise.
Sadly, the average American invests in the stock market with very little knowledge and essentially gambles with their life’s savings because they have been conditioned to expect a free lunch from a growing economy that ‘floats all boats.’ Having worked on Wall Street, I can tell you that the U.S. economy has become essentially a casino economy.
Money created through the manipulation of financial markets is phantom wealth as it does not result in anything of real value in the process; it becomes a baseless and fundamentally unjust claim against society’s real wealth. When the markets ‘correct,’ that virtual wealth quickly evaporates.
Did you know that the world’s total financial assets greatly exceed the market value of the world’s real physical assets? There are too many ‘paper claims’ on the world’s wealth and far too few tangible resources backing those claims. And why is that a problem? Because this creates expectations of entitlement by those few who hold these outsized financial assets—expectations that can never be realized. It leads to clueless cable-TV pundits confusing stock and housing price bubbles with ‘wealth creation.’ It is false wealth!
Julie: And here we are being told that we are getting richer as a society when in fact—if one is truly paying attention—every living system essential to our well-being is in distress and decline from abuse and neglect.
Lua: It is a foolish game you are playing. On my island, we feel deeply connected to the Earth—we belong to the Earth; it does not belong to us. Ours is a richer and more natural ‘living-wealth’ informal economy that does not focus on how to best allocate money to maximize financial returns, but on how best to allocate human time and talent to maximize living returns to people and to Nature. Exchange of money is not the rule, but the exception. It has much reduced significance in our ‘lean’ economy. We strive instead to properly manage and balance the many things that we value and find useful—what you call ‘capital’—beyond just ‘financial capital’ or ‘money’—those things include human, natural, social, intellectual, and built ‘capital’—and the sustainable trust we share between members of our community. Money, markets, and corporations are useful servants; but monstrous masters.
Paul: Our current economic system encourages maximizing financial assets and flows of money as GDP, while ignoring the care of the living systems on which the economy depends. There is no short-term profit incentive in sound environmental stewardship.
We also have too many social traps where local or individual incentives that guide behavior are inconsistent with overall long-term goals. Cigarette and drug addiction, overuse of pesticides, economic boom and bust cycles, privatization of information, and overfishing are all good examples of these social traps. They all have this in common: by following short-term feel-good road signs, over the long term resources get exploited or a system is weakened to the point of collapse.
The elimination of social traps require intervention—the modification of the reinforcement system. Ideally, a democratic government assumes this role—while maintaining as much individual freedom as possible—through education, regulation, and legal means.
In our market economy, resources for which access is difficult to restrict—such as frontiers beyond the control of governments, open oceans, Earth’s atmosphere, and wildlife that crosses national boundaries—are frequently overexploited. For example, overfishing is far more likely in an open-access fishery than in a fishery managed as a common resource.
The absence or destruction of institutions that regulate common resources has led to the extinction of diverse species and to the genetic impoverishment of many. To the extent that biodiversity is manifested as different genetic traits, species, and ecosystems that cannot be owned by individuals and incorporated in market systems—commons-management institutions are needed to effectively conserve biodiversity for our descendants.
Jack: The global climate-regulating system is also a great example of a global resource in desperate need of commons-management institutions. For centuries, industrializing nations have dumped carbon dioxide—a by-product of fossil-fuel combustion—and other greenhouse gases into the atmosphere with no regard for the impact on the climate system as a whole. To avoid this tragedy of ‘open-access commons’ requires the existence and enforcement of boundaries.
The role of government needs to be expanded beyond its essential role in regulating and policing the private market economy. It has a significant role to play in expanding the commons sector, which can manage non-marketed natural capital assets and social capital assets. It can also help develop new common-ownership models at various levels of scale that are not driven by short-term growth principles.
Unfortunately, humans are prone to completely ignore the possible future effects of choices made today. This future discounting explains our collective failure to adequately respond to the most likely negative future consequences of the disturbing trends we are observing today from our unbridled pursuit of products, profits, power, and the theology of GDP growth—growthism.
Lua: Isn’t it amusing how you mainlanders try to grow GDP, while we try to shrink it. We view it as the economic cost of producing a given level of well-being, and we try to minimize that cost, not maximize it. Money flowing for treating large populations of chronically sick people from unhealthy lifestyles or for cleaning up after toxic chemical spills would improve your GDP from the associated economic transactions of cleanup, remediation, and legal work and therefore be seen as an economic good. We would prefer to promote healthier lifestyles, cleaner environments, and responsible business practices and drastically lower or even eliminate all those economic transactions associated with reductions in overall societal well-being.
Our institutions only exist to serve a democratically determined public interest. We would never desire unregulated, money-seeking, publicly-traded, limited-liability corporations. Our companies are all human-scale, cooperatively owned, community-rooted enterprises.
Clara: Oh, come on now. We don’t have to redesign any institutions. Americans are innovators—we always come up with some new magical technology that kicks the economy back into overdrive. It’s what we do. We are the indispensable nation thanks to our proud culture of rugged individualism, risk-taking, and innovation. Sky-is-falling doomers like you all always discount human ingenuity and technical innovation.
Paul: Clara, I am afraid that technology, even any ‘magical’ technology you can imagine, and energy are completely different things; one is no substitute for the other. I understand that no one wants to hear that we may be reaching energy, resource, and pollution limits on our planet—and certainly no elected politician could ever mouth such dismal truths—but creating more money by expanding debt will not solve the fundamental energy and resource predicament that we are in. Business-as-usual tweaking with the excuse that some new technology will soon save us means game-over for both the economy and the environment. Things have got to change—in a very big way and very soon!
Jack: I wonder how many people are aware of the fact that a single barrel of oil, costing around fifty dollars today—the price of dinner for two at a restaurant—contains the energy equivalent of over 10 years of human labor; and that close to ninety percent of industrial labor today is fossil-fuel labor, not human labor.
Our precious fossil-fuels—truly magical in their energy density and portability—took hundreds of millions of years to ‘manufacture’ by geologic forces. Yet we mindlessly turn—burn, actually—this amazing one-time energy endowment, along with other natural resources, into dollars, then into temporary feel-good experiences, then into waste. And we are doing this at an ever-accelerating rate. We each now use about fifty times more energy than our hunter-gatherer ancestors. This can’t go on much longer.
Tucker: That is all such left-wing bullshit talk! All this concern over global warming and resource depletion is just a grand socialist wet dream to give more control over to big government. Businesses are the most dynamic and adaptive institutions that have ever existed on this planet. They will solve these problems, including energy and environmental problems, as they emerge. It’s what they do best. We don’t need more wasteful government interventions.
Paul: Never gonna happen, Tucker, and you know it—you are not stupid. For-profit, shareholder-owned corporations like yours have proven themselves time and again to be best suited for one thing only: concentrating economic power for their own internal profit-seeking purposes. They have no conscience. Corporations are generally insulated from accountability for the harms they inflict on individuals, communities, and Nature. They have a fiduciary duty to not give a damn about future generations, environmental health, or sustainable business practices unless shareholders can benefit somehow. And they certainly are not interested in sharing their wealth broadly.
Real wages for average Americans peaked in the early 1970’s, yet overall productivity has gone up dramatically. But only the top five percent are making more than they were a decade ago. It is no surprise that ‘deaths of despair’ from suicide, prescriptions drug overdoses, and alcohol-related illnesses are on the rise among white, middle-aged Americans without college degrees.
Given the existing overpopulation of developing countries, wages in developed countries have been driven down with globalization, thus widening the disparity between labor and capital in high-wage countries. This is justified by claiming that global labor wages will eventually equalize and rise as the rest of the world develops and attains middle class lifestyles—which is an ecological impossibility!
Julie: It may be that we will have to accept the existence of some alternate form of government to manage shared resources now that we are living in a world where humans so clearly dominate and influence the natural world. We are now capable of inflicting tremendous damage on the environment from our collective impact.
Do you know that in the last forty years, we’ve lost half of all the large animal life on the planet? Humans, our livestock, and our domesticated animals now vastly outnumber other wild animals. This is the sad outcome of unregulated free markets and unchecked economic growth.
Corporations are only interested in maximizing short-term profits and have no inherent interest in sustainable, steady-state resource management.
Somehow we have got to get this under control even though there is ‘no money in it.’
~ Money Out of Thin Air ~
Paul: Certainly most people believe that money—a trust-based claim on past or future products or services of human labor—is backed by some real wealth somewhere else. They would be shocked to find out that money is mostly derived out of thin air as loans by private banks—it is literally loaned into existence. This act is totally divorced from any real value being created anywhere on the planet that backs up that new money!
And when the Federal Reserve—a federally sponsored private banking cartel licensed to loan money into existence—writes a check to ‘buy’ a ‘debt instrument’ such as a U.S. treasury bond or a mortgage-backed security, it is literally creating money from nothing.
Contrary to the common belief that governments create money, in today’s system, virtually all money spent in the economy is created by private commercial banks when they extend credit to borrowers. As a consequence, private commercial interests, not public benefit, play a significant role in deciding which investments to support. Thus, investment dollars tend not to flow to projects that support the long-term protection of the assets on which basic economic services depend, such as low-carbon technologies and infrastructures, resource productivity improvements, protection of ecological assets, and the maintenance of public spaces. In other words, short-term private gain gets prioritized over long-term public security.
In today’s economy, money and finance play a major role in influencing decisions on consumption, production, investment, employment, and trade through careful management of interest rates and money supply and the involvement of central banks, commercial banks and other financial institutions.
And money, as a claim on future energy and resources, is increasing exponentially, while at the same time energy and resources—real capital—is decreasing. Money as wealth is an illusion.
Current consumption levels are being temporarily and artificially propped up and supported by central banks creating new money—not by the discovery of any new real wealth. Never has ‘wealth’ been determined for so many by so few.
Jack: Unfortunately, what makes our high levels of consumption so difficult to change is the inconvenient scientific fact that wanting something has a much stronger psychological response than having something; because that feel-good dopamine high in the brain peaks with the anticipation of a reward, not with the reward itself. Simply put: buying trumps having. We have these flow-motivated brains in a world of limited resource stocks.
And you also have the unfortunate social fact that relative wealth is a stronger economic driver than absolute wealth. So even though it is quite clear now that there are rapidly diminishing returns to happiness with excess levels of wealth, people still feel the need to ‘keep up with Joneses,’ though middle-class lifestyles today enable people to live far more comfortably than kings lived just a few generations ago.
~ Consumption as a Way of Life ~
Julie: If we mindlessly accept our place in society as consumers—being valued based on our financial wealth—and we go to extreme measures to display success to others, how does that impact our freedom? Don’t people see that we have gradually become a nation of debt slaves? This allure of consumerism, rooted in some modern myth of personal fulfillment at the cash register, has brought a fierce and determined mass loyalty to high consumption, no-limits lifestyles. Physically, we may be free; psychologically, we enslave ourselves to the shallow and unexamined opinions of our neighbors about our material wealth and status in society—primarily as consumers.
How many of today’s ‘consumers’ are aware of how we got to this place in our culture? In 1955, a marketing guru by the name of Victor LeBow proposed a solution to excess post-war industrial production that would determine how we live our lives today: consumption as a way of life! The goal was to exalt the buying and use of goods into semi-sacred rituals and to seek spiritual and ego satisfaction in consumption.
Material wealth and consumption have become the generic cultural source of value and identity for most people in industrialized countries, and Western consumer culture has spread virally to industrializing high-population countries such as China, India, and Brazil.
With 70 percent of the U.S. economy dependent on the retail sector, collapsing consumption would have severe economic and social consequences. Governments make adjustments to monetary and fiscal policies to bolster consumer confidence and increase retail sales and other discretionary economic activity. But people with a consumer’s sense of relationship and a tourist’s sense of place cannot grasp that human well-being depends on healthy natural and social systems, at the local level, and that we share a responsibility for restoring and preserving them.
The freedom many of us understand as the unimpeded individualistic pursuit of limitless desire is actually negative liberty, because it is blind to our true place in—and relationship to—the natural world. This special brand of liberty is the basis for much of our current political economy, law, and governance, and much of our moral philosophy. In the aftermath of the collapse of communism in 1989, the trend toward anti-regulatory and free-market orthodoxy in economics and public policy accelerated. The genie of unfettered, guilt-free mass consumption was out of the bottle.
And our colleges have become factories for producing compliant, debt-burdened workers destined for indentured service to sociopathic profit-seeking global corporations. We should be moving to more local and regional economies. Perhaps small, local, and distributed makes more sense now than large, distant, and centralized.
And while we’re at it, maybe it’s high time to break out of our petty little consumer cocoons and begin to act more like artist-activists, challenging ourselves as engaged citizens to produce original ideas that have genuine life-serving value, rather than being duped into trying to shop our way to some elusive state of happiness and fulfillment as isolated ‘self-interested’ individuals.
Tucker: Look, we just need to find a new source of cheap energy to keep our economy growing. We have to have growth, because that is the way our financial systems are designed—debt must be paid back—with interest! Our current economic system has no easy route to a non-growth, steady-state economy. Its natural dynamics push it toward one of two states: expansion or collapse. The economy either grows or collapses, period. There is no middle ground. Lowering taxes would put more money in people’s pockets, which would help boost consumption. Growing the middle classes in developing countries is the key to prosperity for all.
Jack: That is both deceitful and impossible. We have already overshot the carrying capacity of the planet with existing levels of consumption. That discredited global wealth-production strategy would only further enrich a few well-connected business folks like you, folks with mobile capital available for investment; but it would be a disaster for the environment and for future generations. To pursue relentless growth means blowing past several environmental planetary boundaries that define a safe ecological operating space for humanity and endangering the global ecosystem on which we—and all other species—depend for long-term survival.
No, what we need is a large and steadily rising carbon tax, a consumption tax, and—dare I say—a tax on babies, not a tax-break for them! These would all send strong ‘price signals’ to modify behaviors for the common good. Income taxes could be reduced or eliminated to compensate. We should tax what we burn, not what we earn—tax social ‘bads,’ not social ‘goods.’
Jan: Jack, what you propose would require bigger government. That is not the solution. We don’t need to become a sissy European high-tax nanny state. We need hard-working people who don’t expect handouts from their government. We don’t want to encourage idleness in America.
Clara: Jan’s right. Whatever happened to the good old Protestant Work Ethic? We need to reduce regulations and get the government out of the way to free up the innovation that we need to solve our problems and get people working hard again.
~ Parable of the Atonqi People ~
Lua said that on her island, they like to tell the story of the Atonqi people. They were a large tribe that lived deep in the interior of a rainforest. Some of the younger members of the tribe were ambitious and wished to expand their world by creating a path to the sea.
There were others in the tribe that were wary of this plan and chose not to participate and instead climbed the tallest trees to enjoy the view, make crafts and converse with one another about tribal matters.
At first, the clearing took much effort and progress was painfully slow and burdensome. Morale was low. But after some time, a few of the more clever workers suggested new cutting strategies and designed better tools that enable the workers to clear the path faster and more efficiently with each passing day. The enthusiasm grew and morale improved.
One day, the tree dwellers observed from their lofty vantage point that the path that the workers were clearing was leading them straight to the edge of a steep cliff, not to their dreamed-about ocean.
When they climbed down to warn them, they were told that the workers were not to be bothered because they were finally making great progress.
~ Homo Economicus ~
Bob had come back in time to catch Lua’s story. After hearing it, he and I just stared at each other in silence. Tucker, Jan, and Clara exchanged gestures of sardonic amusement.
Paul, quite impressed with Lua’s story, added that our actual non-abstracted psychological and social experiences suggest that we are all, in fact, persons of community. Our individual identity and feelings of well-being are very much defined by the quality of our social relations. We are, in fact, related not only by our individual desires to pay for satisfying our wants, but also by relations of trusteeship and compassion for the poor, future generations, and for other species.
To its credit, the free market system does channel individual greed to the common good without coercive social institutions. But the value and contributions of community life that markets ignore are necessary at different geographic scales to define the social good, adapt the social order, and manage environmental systems collectively. Indeed, homo economicus, as the self-contained unit of methodological economic individualism, is a rather cartoonish and absurd abstraction.
The current culture of excessive individualism and conspicuous consumption—existing primarily to impress, to intimidate, and to generate envy—and the consequent decline in community and concern with moral conduct are not the fault of Adam Smith’s invisible-hand economy, but his reasoning certainly played a decisive role in justifying individual greed.
There is an implicit understanding that one must compete by understanding and coming to dominate the natural and social systems one inhabits. Desire to acquire and consume is taken to be psychologically unlimited. Growth in the economic activities of extraction and excretion knows no bounds.
In the neoliberalist market philosophy dominant today, the individual must survive and flourish as an economic self, one must fulfill biological and psychological needs by competing successfully to extract value from the labor of others or to secure access to positions in which one’s own labor can provide the desired income. The assumption is that individual tastes and preferences are fixed and given, and that the economic problem consists of optimally satisfying those preferences once and for all.
But this is not the case at all. Producers create wants, then conveniently create the goods needed to satisfy them. Preferences and desires can and do change quickly at the whim of a powerful and influential billionaire puppet master exclusively devoted to that very purpose—the advertising industry.
When preferences change over time under the influence of education, advertising, and changing cultural assumptions and expectations; a steady state of optimal satisfaction is quite elusive indeed.
~ The Islander Knows ~
Lua continued, “You mainlanders are caught in some strange collective trance in your obsession with money—a false god of value. It distorts your reality, limits your freedom, and will soon likely take you over a cliff. We, on the other hand, are deeply connected to Earth’s ever-evolving community of life. We see life moving, for its own deeply mysterious purpose, towards ever increasing awareness and beauty and complexity. We live every day with joy and wonder in our hearts at its full range of possibilities. We value our distinctiveness. We worship life, not money, and measure our success in the health of our communities and the happiness and well-being of our citizens and families, not on the frequency of monetary exchange or the size of numbers in a bank account. We nurture and protect our culture as the foundation for trust in our informal economy. I do not understand why self-described good and intelligent people would accept such a spiritually-impoverished, joyless economy.”
Lua’s comment made me think of the words of French philosopher Voltaire, ‘It is difficult to free fools from the chains they revere.’ She followed up her last comment with a witty song about an islander. She strummed a few opening chords on her ukulele and sang to us:
There was a time, not long ago
When folks were few, and change was slow
The Earth a-filled, with Nature’s gifts
No reason then, for pause and thrift
But now, it’s true, the world is full
And money games, have made us dull
We burn too much, we move too fast
We grow, we spread, this cannot last
The Islander, is one who knows
That there are bounds, to all that grows
That there can be, a size just right
That Life can thrive, without a fight
The Islander, has this to say
Yes, there can be, a better way
Yes, Man and Earth, can get along
Yes, there’s still time, to right the wrong
The Islander, whose bounds are real
Would surely say, look, here’s the deal
Find the balance, slow the pace
Lose the greed, or doom you face
The Islander, will tell you straight
Your wasteful ways, will seal your fate
Your wants and needs, are not the same
Your “Living Large,” a foolish game
The Islander, is one who knows
That there are bounds, to all that grows
That there can be, a size just right
That Life can thrive, without a fight
The Islander, has this to say
Yes, there can be, a better way
Yes, Man and Earth, can get along
Yes, there’s still time, to right the wrong
We were all quiet for a time after Lua finished her song, trying hard to see the world the way she did. Her way of thinking was so foreign to us. Find the balance. Slow the pace. Lose the greed or doom you face. I suppose, on a full planet, we are all islanders and need to start thinking and acting as islanders do and accept limits to growth—or deal with the grim consequences.
She then broke the thick silence by excusing herself so that she could start preparing lunch for the group. Julie offered to help and got up to follow Lua to the galley.
Before she left us, Julie paused for a moment and added, “I have to say, as a long-time restaurant owner and community activist, I do see many encouraging trends. The old institutions of an ugly extractive money economy are slowly dying and being replaced by emerging institutions of a regenerative living economy that respects the regeneration rate of natural resources. Small family farms and farmers’ markets and locally owned, human-scale businesses are transforming communities and making them more self-reliant, resilient, prosperous, happier, and healthier. Edge projects and networks such as Transition Towns, Shareable, Peer to Peer, Open Source, Degrowth, Slow Food, Seed Freedom, Buen Vivir, and Canada’s Leap Manifesto are gaining real momentum. Bike-friendly streets and walkable urban places, zero-waste local recycling systems, community-controlled wind and solar energy projects, local banks and credit unions—I see many good things happening at the local level, and I think that interesting times are on the horizon. Localization may be our best—and perhaps our only—way forward from here as the overly complex, centralized, energy-and-materials intensive, infrastructure-heavy model of society and the economy on which rely continues to crumble.”
With those parting words, Julie left the group and we disbanded the all-hands-on-deck debate.
For the rest of the day, the passengers spent time alone in their cabins, chatting in small groups about personal matters, taking pictures, helping with trimming the sails and steering Kalea, stretching, exercising or sunbathing on deck, and listening to international news on the shortwave radio.
At one point, Jack asked if he could use the snorkeling equipment and get towed behind Kalea to get a fish-eye view of any marine life and the assortment of odd inanimate, semi-buoyant objects that could be seen suspended in the water column close to the surface.
“Fine by me, so long as you don’t mind being trolled as shark bait,” replied Captain Bob.
Sure enough, intrepid Jack spent the next several hours with mask, fins, and snorkel in the smooth water between Kalea’s twin wakes—no doubt a most enticing live lure for any large ocean predator.
Fortunately for Jack, there were no curious sharks along Kalea’s path that afternoon, though he did get bonked on the head when he wasn’t looking by a semi-submerged orange-ish plastic bucket with the letters ‘… om … epot’ on the side slowly drifting and bobbing its way across the vastness of the Pacific Ocean.
~ Relational Liberty ~
The conversation earlier in the day made me think of how we are emerging from a centuries-long emancipation quest of the mind and spirit that has succeeded in producing the illusion of human mastery over Nature. Ironically, one of the great successes of this newfound intellectual freedom—the Scientific Method—is now starkly revealing how we have overstepped Nature’s boundaries. Nevertheless, our hard-won emancipated agency surges onward.
The growth-seeking capitalist market economy is tied to a liberal justice model that champions the emancipation of individual agency, but conveniently leaves out stewardship of the environment and the economy’s creation of externalities.
Liberty must be redefined in the context of a responsible and just human-Nature relationship—individual agency and responsible self-direction with an ecological awareness.
Self-directing ecological citizens who use their freedom and agency in the service of a sense of ecological trusteeship and responsibility—this is the democratic hope of the future. Privatized selves who concern themselves with who gets what, when and how, need to be reoriented to become deliberative democratic citizens who are attentive to the common good and to obligations of trusteeship for the natural world. Our personal flourishing is inextricably linked to the flourishing of others and to the flourishing of the natural world.
Relational liberty is freedom through interdependence. It internalizes the freedom and well-being of all (both human and non-human) into the freedom and well-being of each. It means living life in one’s own way, but only after embedding that way of life in a tradition—a civic life of shared purpose—and rooting that life in a sense of ecological place and in a sensibility of care for Earth’s life support systems.
Relational liberty rejects the exclusive privileging of individualistic values over communal ones and leads away from the control of the natural world as a source of ‘wealth’ defined as material accumulation, relative social status, and ‘utility maximization.’ It leads toward a notion of artistry, craftsmanship, and appreciation of the beauty of natural forms. It emphasizes participation, engagement, and capacity for creative agency.
The new ethics of relational liberty can justify and motivate the kinds of economic and social change needed nationally and globally in the next generation. It is a recipe for rich lives in a socially and naturally interconnected and interdependent world.
American democracy was founded on the idea of maximizing individual liberty and rights as long as those rights do not interfere with the freedom and well-being of others. But in today’s crowded, full-world reality, more and more of the actions of individuals do interfere with others. And we have certainly expanded our definition of ‘others’ over time from being only privileged white European men to now including women, blacks, and other minorities.
Now we are once again expanding that definition to include future generations and other species on the planet. Our ‘maximum individual liberty’ must not interfere with the freedom and well-being of any of these other categories of ‘others.’
The market system ensures that an individual’s freedom and property are not violated unless there is fair, mutually agreed upon compensation. But many impacts occur outside the market system and are not adequately covered by laws. In a ‘full’ world, these externalities are now pervasive—and leaving these costs out of the market threatens everyone’s liberty and freedom.
For example, it is rather ridiculous to hear individual and corporate polluters argue that they should not have to pay for their externalities because it would ‘infringe on their personal and corporate liberties’.
Our culture is tragically allergic to any self-conscious analysis, and thus we have embraced a self-indulgent materialism that now is undercutting life’s prospects. But what if we were to honestly question anew our understanding of fundamental concepts such as development, poverty and wealth—particularly as they apply to the new reality of interdependent living in a full world?
Is not wealth, after all, simply the ability to create and sustain things of value, such as human beings, trees, hospitals, universities, and other ‘far-from-equilibrium’ systems that would rapidly degrade without continuous energy and material inputs?
Where are these continuous input flows going to come from in an ever more resource-constrained world?
Can we adequately maintain the material wealth we currently have if we are still racing to grow even ‘wealthier’ each year?
~ Society, You’re Killin’ Me ~
Inspired by the day’s debate, I spent my afternoon hours working out a jazzy little number about freedom and a society perched precariously atop one very slippery slope:
Selling me things, that I don’t need
Preaching me things, ‘bout the goodness of greed
Pushing me hard, for more, more, more
Scaring me ‘bout my, credit score
Twisting me ‘round ‘bout them sinful seven
Making me feel like they’s the, pathway to heaven
They ain’t so bad, that’s what you’re telling me
Society, you’re killin’ me
No way of living, no way to be
Society, you’re spinnin’ me
Ya tell me I’m winning, ya tell me I’m free
~ From ego to eco ~
When I debuted my little songlet to Lua that evening, she remarked, “You know, Mister Rico, the key to a happy life, a good life, is a life with sustained, supportive relationships; challenging work; and strong connections to community and to Nature. This will be the foundation of the generative living economy that Julie is seeing emerge—not a reckless economy and culture that celebrates greed, domination of Nature, and extreme individualism and exalts brash one-man megabrand ‘disruptors’ who make their fortunes by flagrantly ignoring laws, regulatory standards, and norms of common decency.”
Captain Bob overheard our conversation and came over to share his experiences building Kalea in Tahiti over a period of four years with the help of some locals. “My life as a general contractor in Florida before the financial crisis of 2008 was financially rewarding, but very isolating. I was going down that path of more and more communication with clients and subcontractors being done via electronic means. I rediscovered the joys of personal connections and shoulder-to-shoulder work when I took on the four-year boat building project. The friendships and relationships I made during that project were far richer and more rewarding than any I had made during the last decade of my life as a contractor. I had forgotten how wonderful it is to be connected into a larger community, a circle of belonging, where there is no shortage of people happy to help in times of need.”
“Unfortunately, we are losing social skills, human interaction skills, how to read a person’s mood, how to read body language,” I replied. “People are having difficulty being patient, waiting for their moment to make a point. I think this is due to obsessive use of electronic gadgetry. It dehumanizes what should be a very, very important part of community life and living together.”
Lua expressed her opinion that on the mainland, we have a generation bloated with trivial information and starving for wisdom. Smartphones offer more access to knowledge, but these same technologies are seducing us away from moments of solitude and the ‘still point’ that reconnects us with our deep intuition—the seat of wisdom.
Fast and furious has been the rise and impact of social media in our lives. And trending quite neatly right along with the latest viral videos and Twitter tantrums is the rise in stress-related diseases and clinical depression rates. We are becoming unconscious slaves to this addictive, soul-deadening experience.
“Of course, these tools can be used—in moderation—to enhance well-being and build meaningful connections with each other,” Lua said. “Connecting is what matters.”
In my own life, I had learned that an important part of fulfilling one’s potential is connecting with other people who genuinely share your interests—bikes, boats, books and music, in my case—and who desire to make the most of their natural aptitudes and passions. Finding this ‘tribe’ of fellow aficionados can be extraordinarily liberating, especially if you’ve been pursuing your passions alone, as I had for many years.
The transformational effects of your tribe on your sense of identity and purpose come from validation—affirmation that you are not alone. A ‘tribe’ is also a source of inspiration and can provide the alchemy of synergy—the amazing results that derive from creative teams of collaborators having diverse, dynamic and distinct talents.
Jack, who had done some math and science tutoring overseas for a time during his extensive training as a scientist, added: “It seems to me that any really mature, grown-up, advanced society would put learning professionals—teachers—at the center of community, as hubs of social connection and nurturers of curiosity. We don’t honor their work enough—teaching is, after all, the noblest profession—and we surely don’t pay them nearly enough for the essential role they play in shaping human society and cultural values and connecting us to larger purposes.”
“And we must acknowledge that ‘community’ extends beyond human societies,” Lua continued. “People tend to abuse land because they regard it as a commodity that belongs to them. When we see land, and the environment in general, as the larger living community to which we belong—when we genuinely connect with it that way—only then will we go back to interacting with it with love, with respect, with reverence, and with restraint. Make no mistake, this connection will matter a great deal in the coming years.”
Like me, Lua was an avid observer of social trends. She told me that she believed social activity and commerce will most likely return soon, by necessity or by deeper wisdom, to local and regional scale as global culture transitions away from growth economies and toward more desirable and sustainable community-centered local economies that are resilient and mostly self-supporting.
Strong local economies composed of many small locally owned businesses are healthier, more prosperous, more committed to place, and more resilient—like natural ecosystems. They also have the advantage of being less dependent on the corrupting (but legal) government ‘attract and retain’ bribes than economies dependent on a few large, shareholder beholden publicly traded global corporations that have weak commitments to local people, places, and community prosperity.
Local economies are also unique expressions of particular places; value diversity, self-reliance, and resiliency; and are more interested in what is practical and feasible rather than some bland, universal Utopian ideal.
Lua claimed there is an emerging ecological mindfulness that is challenging the ‘collective sleepwalking’ resulting from several artificial and destructive divisions: an ecological divide—a disconnect between self and Nature, resulting in overuse of Earth’s finite resources; a social divide—a disconnect between self and other, resulting in two societies: the 1 percent ‘winners’ vs. the 99 percent ‘losers’; and a spiritual divide—a disconnect between self and deeper Self, resulting in suicides in recent years taking more lives than war, murder, and natural disasters combined.
In fact, the root cause of our current economic and civilizational crisis and rising militarism, nationalism, and corporatism may not be Wall Street, as many claim, although the decoupling of the financial and the real economy is a huge problem. It may not be infinite growth either, although overusing Earth’s finite resources is another obvious concern. It may not be Big Business or Big Government, although their disconnect from the real needs in our communities has to be fixed. Leadership, governance, or ownership may not be to blame either.
No, the root cause of our expanding ecological, social, and spiritual emergency may be more fundamental than any of these structural issues or systemic disconnects. The root cause may be our outdated models of economic thought.
~ It’s the Ecology, Stupid! ~
Lua explained that this crisis originates in the disconnect between our dominant model of economic thought today—what could be characterized as ‘ego-nomics’—which revolves around a very limited ego-system awareness where stakeholders maximize benefit only for themselves, and the collaboration imperatives of our global eco-system, in which stakeholders seek to improve the well-being of all, including themselves.
We have an enormous and dangerous divide between narrow ego-system thinking and a wider eco-system reality in which we are embedded and on which we ultimately depend.
Indeed, the broad field of ecology emerged in the mid-twentieth century as a science centered around the ideas of holism and system integration and away from the reductionist Newtonian physics model in order to develop a more accurate worldview that is adapted to deal with actual complex living systems; not abstracted linear, separable, mechanical subsystems that operate independently.
In fact, ecology should really be thought of as the dominant scientific paradigm of our time, as it is an inherently interdisciplinary, ‘systems’ perspective where groups of interacting, interdependent parts are linked together by complex exchanges of energy, matter, and information.
Ecological thinking recognizes that wholes are much more than just the sum of their parts.
The foundation of real living wealth are healthy ecosystems. These are naturally complex adaptive systems because they are evolutionary rather than mechanistic in nature and exhibit a rather limited degree of predictability.
Healthy ecosystems are characterized by their vigor, organization, and resilience. The vigor of a system is a measure of its activity, metabolism or primary productivity. The organization of a system refers to the number and diversity of interactions among the components of the system. The resilience of an ecosystem refers to its ability to maintain its structure and pattern of behavior and recover in the presence of disturbances such as pollution or predation or other stressors.
Biodiversity has two major roles in the self-organization of large-scale ecosystems: it provides the units, energy flow pathways, and nutrient cycling through which energy and materials flow, giving the system its functional properties; and it provides the ecosystem with the resilience to respond to unpredictable surprises. It is not simply the diversity of species that is important, it is how that diversity is organized into a coherent whole system.
Solar energy is the prime driving force of ecosystems, enabling the cyclic use of materials and compounds required for system organization and maintenance. Solar energy is captured through photosynthesis by plants. It is necessary for biogeochemical cycling—the conversion, cycling, and transfer of energy to other systems of materials and critical chemicals that affect growth and production. Energy flow and biogeochemical cycling set an upper limit on the quantity and number or organisms and on the number of trophic levels that can exist in an ecosystem.
In terms of benefits to the human community, a healthy ecosystem—marine, forest, or desert—is useful and necessary in that it provides the ecosystem services supportive of the human community, such as food, fiber, the capacity for assimilating and recycling wastes, potable water, and clean air.
Every ecosystem has its own particular enchantment and sacredness, its delicate balance, its quiet music worthy of care and respect.
The great challenge of our time calls for an evolution of the dominant logic and operating system of human societies from one that is based on narrow ego-system awareness to one that is based on broad eco-system realities. To paraphrase Einstein: the problem with today’s self-interest driven capitalism is that we are trying to solve problems with the same ego-limited level of consciousness that created them.
Shifting the state of awareness from ego to eco consciousness will begin by awakening the intelligence of the heart—by connecting.
I asked Lua, “What do you think it will take to wake up from this ‘collective sleepwalking’ you talk about?”
“Well, Mister Rico, I think it will require applying the power of mindfulness—deep moment-to-moment awareness—both individually and collectively, to how we conduct our daily business, how we practice democracy, and how we structure society. I think we are entering a period of disruption and transition where big systems around us will continue to crumble and collapse. We will need a fundamental shift in the quality of our relationships—a shift of the heart—that will allow us to co-create, test, and grow new forms of collaborative institutions that recognize our embeddedness in Nature and our deep human need for connection to one another and to the natural world that supports and sustains us all. A seismic Copernican-level revolution in our human story and collective consciousness would be helpful to de-center us and place us back into a cosmic evolutionary narrative from which the Enlightenment wrenched us—before we overload the planet’s regenerative capabilities.”
~ At-one-ment ~
Lua felt that a collective sense of atonement was emerging as a result of our lack of ecologically-sound growth and for the elevated risk of whole-system collapse that we have created from global environmental threats such as ocean acidification, disintegration of Antarctic ice sheets, and destabilization of the climate system.
There are many grassroots ‘re-’ initiatives: regreening the planet, restoring damaged ecosystems, recycling wastes, and reducing carbon footprints. Many projects and movements will fail, no doubt, from bad timing or bad information or bad execution. But those who are engaged in regreening and restoration feel a moral duty to pass along a world at least as good as they found it and are striving to ensure all living beings are granted a fair share of Earth’s natural resources.
They believe that endlessly taking, wasting, and depleting the resources that make life possible is a fundamental moral wrong. Wastefully gorging on fossil fuels, as we are doing today, clearly jeopardizes the full flourishing of life’s possibilities on this planet for future generations.
“The new emerging economy requires a new economics,” Lua insisted. “A system which offers a different model than the outdated and oversimplified neoclassical approach founded upon coldly calculating, self-interested individuals striving to ‘maximize personal utility.’ It must transcend market civilization and its corresponding market vocabulary like ‘natural capital,’ ‘cultivated natural capital,’ and ‘ecosystem services.’ ”
“What’s really needed is a shift of consciousness to a culture of caretaking, balance, and renewal based on a deeper understanding of our fundamental embeddedness in Nature and connectedness with other living beings. This is very important, Mister Rico,” Lua said.
“We need to expand our spheres of care and act not just for ourselves and the people we know, but in the interest of the entire ecosystem in which human activity takes place. We are connected to that system. What happens to it, happens to us!” she continued.
“Economists should be educated as specialists within the broader field of ecology before they attempt to measure and guide the health, wealth, and well-being of individuals and communities. They should focus on the long-term sustainability of human, social, and living natural well-being—not just ‘human-made capital,’ ” Lua said.
“You seem to have a remarkably deep understanding of these things,” I noted.
“Well, connectedness, embeddedness, and natural limits to growth is a consciousness very familiar to all islanders, Mister Rico.”
“I suppose it would be,” I murmured back.