Where do we go from capitalism? Part One.

What’s the point here I often find myself asking in yet another booming city? That we all capitalize ourselves into the vision of the western dream? Who dreamed up that dream? Do we all think we’re living the dream? It sure doesn’t feel like it. Even the rich are depressed.

Welcome to part one of our series on capitalism. It’s so broad and has so many components we’d like to chat through this all in a non-academic manner. In a way that’s far more rooted in the reality of the situation for the majority of us, rather than a bunch of terms that only make sense to economists. We’re coming at it from a largely environmental angle which overlaps with a number of social issues; of which there are many, many more.

Often it’s not growth, it’s a grab.

Capitalism absolutely destroys our environment. Ironically free-market proponents once claimed (perhaps even recently still did) that it wouldn’t; that a free-market system would self correct to its benefit. Clearly that has not proven fruitful (quite literally). In 1999 even The Economist had to admit that the market system was not designed to share wealth or protect the environment.

On top of destruction in the name of profit, capitalism also exacerbates many of the underlying conditions that create degraded environments too. Poverty isn’t an incident of capitalism, it’s a consequence of it. Capitalism without poverty doesn’t work. Income inequality is an effect of capitalism. And income inequality is also structural racism. It is also a backbone of systemic sexism. All of these issues exacerbate our environmental problems. It’s no coincidence that communities of color, lower-economic countries and womxn face the largest burden of pollution, climate change and environmental destruction.

We’ve been denied the right and the capacity to imagine what the world might be like after capitalism. That’s why most of us can rather imagine the end of the world rather than the end of capitalism.
– Raj Patel

It’s extremely difficult to envision what a world without capitalism, or even with a vastly shifted direction of it, looks like but the best way forward seems to be to have a bold vision. To have ambitious ideas for what our lives can look like. This is actually one of the few topics we can get support on across the political spectrum. People innately understand that capitalism, in general, isn’t working for a large part of the population. Most of us don’t think that billionaires should be flaunting their wealth around the world and that we should feel lucky that a small percentage of them contribute to decent causes. Most of us are looking around us, and however lucky and grateful we may or may not feel, are wondering why we’re all fully grown adults with very little power over our schedules and lives with many of us not even enjoying what we spend the majority of our time on. Many of us are wondering why we can only take a couple of weeks holiday per year – if at all – and spend the rest of the time working to pay the bills.

Bureaucracy is a construction by which a person is conveniently separated from the consequences of his or her actions.
– Nicholas Nassim Taleb

So how did we get here? How did we get to a place where we’re handcuffed by economics and stuck in a system we’re not winning in but need to be a part of for a roof over our heads and food on the table? How did we get a system where we’re conditioned, every hour of every day through government policies, economic incentives, marketing and social norms, to consume more than we ever needed and compare our lives to those that have more than we could ever want for?

It’s a long story of course but in short industrialization is what catapulted us here and then the political structure we created really doomed us. In the 1950’s we were in a post-war recession economy. War makes a huge amount of money. It’s one of the awful impacts of capitalism; war and natural disasters boost out GDP, the only thing we measure the health of the world on. We created TV dinners and made a very serious and relentless stab into fast, convenience food (see also the BBC series, The Men Who Made Us Fat).

The advent of industrial scale farming has often destroyed both our health, and the environment but it’s one of the major pillars of our economy. And our economy is what politicians measure and rely on. At every turn we have been taught that we need to see quarter-on-quarter growth as if it’s the most normal thing in the world to expect this, infinitely. All our policies and industries are entirely directed to increase consumer spend each and every year, well above even our growing population. It’s not good enough to be sustainable; you must grow to see reward.

Our enormously productive economy… demands that we make consumption our way of life, that we convert the buying and use of goods into rituals, that we seek spiritual satisfaction, our ego satisfactions, in consumption. The measure of social status, of social acceptance, of prestige, is now to be found in our consumptive patterns. We need things consumed, burned up, worn out, replaced, and discarded at an ever increasing rate.
– Victor Lebow, Economist (1955)

For me the tipping point came in the 1960s when, for the first time in human history, we consumed more than we could replenish. We’ve steadily gotten much, much worse since then. Overshoot calculation is by no means a perfect figure (it’s actually an underestimate) but sometime in the 60’s we started peering dangerously over the cliff. In 1970 it took us about a month longer to replenish our natural resources for the year. In 2019 we used up all our resources for the year before August started. As the author Jason Hickel points out, a decoupling of rising GDP from global resource use has not happened and is unlikely to. Whilst 50 billion tonnes of resources used per year is roughly the limit the Earth’s systems can tolerate, the world is already consuming 70 billion tonnes.⁣ On our current path, we’re projected to use 180 billion tonnes in 2050.

So was it the boomers? It doesn’t really matter. We can’t change it. I don’t love the generalizations that have come about from lumping people into certain generations (don’t get me started on how odd it is to have a millennial cohort where many of us are pre-internet babies) but it can be useful for demographics and trends. Though it was their generation that accelerated this mess I’m not convinced they did it specifically to make most of the lives of the coming generations worse. There’s also plenty of boomers that aren’t well off and that didn’t get wealthier through the system. And I don’t love “they” and “we”.  That said, when we look at the data of those years and the stats now, it was extremely reckless and the majority of boomers have not acted to correct the situation; in fact they actively vote against doing so. That says a lot. They wanted political control and they were, understandably, determined to make their way up the ranks in the workforce to shape and then dominate our current structures. The generation has ever bigger homes, runaway consumption and in numerous places probably the last government funded pension. It was also all the industries around them that not only enabled it all but encouraged this behavior.

Ultimately though it doesn’t matter if you decide to shun or love the generational divides. The exact years dividing us are arbitrary. The age group of boomers has been in power for a long time now; in our governments, our offices, our technology companies (young people get blamed a lot for tech but Bill Gates, Steve Jobs, Jeff Bezos, Steve Wozniak and Tim Berners-Lee are all boomers), our oil conglomerates, our cultural references and our households. They were both the consumers and the enablers of it. And whomever is in power is in charge of the mess they created. Unfortunately we now all deal with the fall out. 

Capitalism doesn’t see problems wherever it goes, it sees money.

Could we have stopped it?

There were undoubtedly a number of opportunities, some before I was born such as the Club of Rome and subsequent report in 1972, and many chances have existed through reigning in market deregulation. Globally though, 2008 should have been the year we turned this ship around. We failed miserably. During the collapse of Wall Street and the financial depression that swept across the globe we decided that instead of creating a new, more equal system and focussing on a Green New Deal style of arrangement that would benefit our planet and economics, we – us tax payers – bailed Wall Street out. Australia even gave out cash handouts to stimulate spending. The answer to the crash was of course, more consumption.

Reflecting on this is infuriating. We had a world that was angry. We were codified in our frustration of the billionaire corporations and the governments that had decided they were the biggest priorities. It was prime time to step in, be bold and appeal to the public with a new way of doing things. But we had weak leaders who had also fallen prey to the growth trap. Our international system had become so complex. They saw no way out other than to “save” the very thing that had failed so badly. To restart the system without root cause analysis and with barely any repairing mechanisms; just a hope that it would magically do better next time. Imagine if the money had instead been spent on the renewable industry, on new education pursuits, on relieving student debt and mobilizing the younger generation into ethical work, on circularizing our economy, on a universal basic income and on supporting farmers in regenerative agriculture. Imagine if the UK had led the way on their renewable energy earlier. Imagine if America and Australia had public transport that matched that of many Asian and European countries. We’d now be eleven years ahead and would likely be looking at a very different – and hopefully more optimistic – world.

But we didn’t. So where do we go from here?

We don’t have a capitalist economy—business wouldn’t accept that, and they have enough power to prevent it—so, therefore, the public comes in to pour literally trillions of dollars into the hands of failing corporations and maintain them.
– Noam Chomsky

We need to spend a lot more time and discussion on what we’d like our collective future to look like. The economy is this big abstract thing which most of us don’t really understand. We’re currently operating as if neoliberal capitalism is the only way we can live. It’s not. I find it helpful to remember that this phase we’re in, it’s modern. The world was not like this for most of human history. That means we can change it.

I also find it heartening to look at countries that are the biggest preachers of capitalism and see the large scale changes they have made in other areas. Australia for example is wedded to hypercapitalism in all the worst ways; its two biggest exports are coal and beef, the country tends to gleefully destruct the environment, they have the largest houses in the world alongside America, and the nation is consumed with stuffing them full of cheap, unethical goods. But Australia took huge action on gun laws after a devastating shooting in the 90s and effectively eliminated mass scale shootings. The government mobilized immediately and quickly and it remains largely supported. The kicker? It was a very conservative government that did so. The country also took a very bold step against cigarette company labelling despite significant bullying and lawsuits, implemented insanely high tax codes on the products and reduced the smoking population of adults to approximately ten percent in just a couple of decades. That’s impressive.

It is possible to make sweeping changes to things that seemed normal only yesterday.

The best way we’re going to do this is through a combination of education, tax incentives & disincentives, and effective, innovative policy design that address a whole swag of issues from manufacturing, to inequality, our markets, corruption, lobbying and consumption.

There is no ethical consumption under late stage capitalism. Capitalism is designed so a few people make money and everyone else pays for it.

We’re overly optimistic about inventing new technology that is going to save us from ourselves yet we have little to no optimism about changing our economic system. It doesn’t have to be like this.

Are there already alternatives? There are. Some are a radical move away from capitalism. Others are tweaking some of the core tenants. The Yang campaign in the US is running on the idea of “human-centred” capitalism which focusses on changing the way we measure the economy away from GDP and potentially valuing care work, and bringing in new measurements like childhood success rates and mental health. Other countries are still surviving within the system but also running another alongside. New Zealand recently implemented a national Wellbeing Budget; an innovative new policy building on the idea that financial wealth for a country is not a sufficient way to measure quality of life. Bhutan has long shunned traditional Gross Domestic Product with the Gross National Happiness Index instead. Beyond that we get into actual models such al Doughnut Economics popularized by Kate Raworth based on our planetary boundaries. There’s professor David Schweickart’s Economic Democracy which shifts the means of production, resources, factories and capital into the hands of the people. And there’s also a big push for relocalizing – the think small method – creating co-ops, growing locally, using local resources and moving into self-governance.

What we don’t have is an exact, public vision of the economic system, with plans from the top, that we could start implementing. Many of us are wanting a return to a normalcy that won’t be found again. It’s up to us to instead forge a new path and what the world likely needs is a bold plan. Whether that’s courageously changing major components of capitalism or bravely creating a new model, our current system is incompatible both with our environment and the wellbeing of most of us in the public. Currently our economics “privatizes profits and socializes risks” (professor David Harvey). The new system needs to share both of these equally.

We’re going to explore some of the alternatives as we go through this series and continue to provide resources along the way. Next up in the series is conscious capitalism.

In other words, businesses really aren’t getting it.

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