9 Ways The Economy Harms Us All

1: Enemy

Let’s talk about the economy.

You agree: “A logical next step.”

Would you mind if I’m blunt?

“Fire away.”

It’s shit.

“The economy?”

Yes.

“Well, that is blunt.”

You ponder for a moment, then ask, “Is this another of your enemies?”

The economy?

“Yes.”

An enemy to humanity and the biological world?

“Yes.”

I hope, by the time this conversation is complete, you’ll tell me.

2: Taking the good with the bad

We’re talking about the supply-and-demand, producer/consumer, deregulated or lightly-touched, invisibly-handed, limited-resource-distributing, market-based economy that currently prevails across much of the world.

Even in countries which claim to be doing something else, the underlying economic model is primarily this.

“And it’s all entirely shit?”

Well, perhaps I need to qualify that.

3: Rubbish

This economy of ours has its good sides, at least in its immature phase – when the gaps between rich and poor, between investment and profit, are less pronounced.

You could almost say that in its early form the economy ‘pays its way’. The benefits outweigh the costs.

But for the purposes of the 21st Century, for the purposes of the preservation of humanity and the biological world, well, this economy of ours?

I’ll stick to my guns.

It’s rubbish.

4: The balloon and other dangers

Let’s consider a few negatives.

– Growth

The economy, in its current, near-universal form, is built for growth. Growth attracts investment. It offers economies of scale. Executives get rewarded for growth, and owners and shareholders profit from growth.

Governments, seeing economic growth as a measure of re-electability, fund and facilitate growth.

But here’s a simple truth (which most of us already know): the environment in which the economy is located is finite. There’s only so much of it.

Our world – the environment – is like a balloon which the economy keeps puffing.

The skin of the balloon gets thinner and thinner… and thinner… until there’s no avoiding the outcome.

Keep puffing and the balloon will burst.

So it would be better to stop puffing.

It would be better if the balloon didn’t burst.

 – Infection

But that’s easy to say, isn’t it?

It’s harder to accomplish when our economy behaves like a virus.

With its profoundly simple RNA, the producer/consumer virus replicates itself throughout the social and physical world and turns every aspect of our lives into products.

Our relationships, our personal data, our homes, our health… even this article and the communication it signifies is commodified. My creativity and my thinking have become content in an economic entity which exists primarily for profit.

The rewards for the creation of new markets, new opportunities, new services, new products or new ‘needs’ are dramatic. Replicate the owner/worker/producer/consumer RNA and profit is assured. That’s one reason the virus is so powerful: it feels like common sense.

As a result our viral economy produces and consumes ever more, and the outcomes are predictable:

– resource depletion

– habitat destruction

– animal extinction

– the gargantuan production of waste

Our world is in desperate need of a vaccine.

If we don’t find one soon, this virus will harm us all.

– Irrelevance

Another problem with our economy is what it sees as ‘externalities’ – the things it imagines are irrelevant to economic functioning and growth. Human fulfilment, community well-being and the environment (other than those aspects of the environment which can be exploited for profit) are seen in this way.

Meanwhile jobs, dividends, profits, share prices, exploitable resources, end products, industrial processes, corporate and economic growth and the mechanisms for sustaining these, are valued.

Forests destroyed? Communities shattered? Countless lives lost to slavery, whether waged or unwaged?

The economy doesn’t give a f***.

So is our economy an enemy to humanity?

The issues of growth, infection and irrelevance alone suggest as much.

But there are other negatives.

I’ll keep going.

– Inequality

Our economy is an Inequality Machine, which manufactures ever-growing disparities of wealth. It’s fuel is self-replenishing: a reinforcing cycle called the ‘Wealth-To-The-Wealthy’ feedback loop.

It works like this.

If you already have wealth, you can:

• Do nothing while your assets increase in value through inflation or scarcity

• Do nothing while gaining rent through your assets

• Lend your wealth and accrue effort-free interest

• Invest in schemes or businesses where the efforts of others increases your wealth

• Buy up enterprises which generate wealth: factories, mines, farms, businesses of any kind

• Benefit from government grants or subsidies supporting the industries or agricultures in which you invest

• Pay expensive accountants to help you evade paying tax on your increasing wealth, while treating even the cost of your accountants as tax deductible

Feed your wealth into complex financial mechanisms and, without quite understanding what is happening, watch it grow

And so your wealth increases.

And what can you do with this increase in wealth earned primarily not through merit or labour but through your initial possession of wealth?

Well, why not push it through the Wealth-To-The-Wealthy feedback cycle all over again?

“So what?” you challenge. “So the rich get richer? Why shouldn’t they?”

Because horded, stockpiled, centralised wealth is unproductive.

Because, morally, no one should be rich when their neighbours are poor.

“But aren’t the poor always with us?  The rich, too?”

That’s the wealthy apologists’ excuse for wealth – a fatalism sponsored by the rich… and it’s not true.

With our science and technology, our genius and creativity, no one in the 21st Century needs to be poor. And the wealth of the world’s billionaires alone could eliminate world poverty four times over.

More than that, inequality is harmful for society. It undermines cohesion. It tears a great gaping hole in the side of our culture – and out of that hole pours frustration, hatred and rage.

We’ve seen that, haven’t we – in the last few years?

– The Cognitive Dissonance Disaster

Here are three important truths:

1. It’s immoral to be rich when there are those around you who are poor

1. Humans have a natural sense of fairness

Wealth doesn’t make you happy

Despite these truths, our economic system makes small numbers of people extremely rich while leaving millions miserably poor.

This immediately creates a problem for the rich.

Due to truths a, b and c cognitive dissonance kicks in.

To escape the resulting psychological stress, the rich – if they choose to remain rich – have to deny truths a through c. Compulsively they throw themselves into:

–  immorality denial

–  unfairness denial

–  unhappiness denial

A denialism which reveals itself in:

Mythologies of wealth

The rich devise mythologies to justify their unfair and immoral wealth. Myths like ‘Hard work got me where I am today’, ‘No one helped me/I did this by myself’, ‘The just rewards for entrepreneurs’, ‘What price incredible talent?’ or ‘There’s a deserving clan or group or cast who are fully entitled to be wealthy simply because of who they are.’

But all of this is just mythology. Disproportionate wealth IS immoral and unfair. Mythologise all you like. That’s a truth that doesn’t go away.

 Rejection of self

To avoid the pain of cognitive dissonance the rich make themselves blind to the suffering of others. They reject their own instincts for fairness and empathy, for generosity or kindness, They’re compelled to. Anything else hurts. But even this fostered blindness creates its own psychological strain – so they reject harder, and make their hearts colder. It’s another vicious circle. They become the sort of people most people would not want to be.

Hatred of the poor

It gets worse.

Driven by denial, the rich stoke up within themselves a hatred and disdain for the poor and encourage this hatred and disdain in others. If the poor are worthless and undeserving, then fairness and morality don’t apply. The ‘plebs’ deserve the hand they’re dealt, don’t they?

 Evangelism

But hatred and dismissal is not enough. The ache of dissonance persists. So it becomes a mission for the wealthy to force the beauty of wealth, the happiness of wealth and the appropriateness of utterly unequal rewards down society’s throat… because, if everybody believes it, if even the poor believe it, then how can it be wrong?

Why is this a disaster for our society? It’s a disaster because the rich exert themselves tirelessly in rewriting reality for the poor. They purchase or manipulate our media, saturating it with the dissonance-eclipsing idolisation of wealth. They become aggressive purveyors of alternatives to truth. So is it any surprise that a constantly manipulated public become easy victims to populism, conspiracy theory and political deceit?

“I’m feeling a little nauseous.”

You don’t surprise me. Jean-Paul Sartre wrote about that feeling. It’s almost as if humanity is walking on the edge of a cliff and the small toe of one foot is struggling to cast us down to the rocks.

There’s more.

– The Value Inversion Effect

Our economy and its self-justifying mythologies have put a torch to our morality.

“What morality?” you ask.

Irony, I hope?

But it’s true.

It’s difficult and controversial to state what our morality should be in a world of 8 billion opinions and 10,000 religions.

All the same, let’s take that challenge on the chin. Let’s strip down our moral aims to the simplest form they can possibly take if our civilisation is to survive through the 21st Century and beyond.

How about this?

• Nurture those around you

• Nurture all humanity

Nurture and protect the biological world

Is that so hard?

But our economy and its evangelists have given us this:

• Selfishness is king

• Greed is queen

• Profit is our God

• The economy is our religion

• Ownership is our temple
•  
  Always want more
  Acquisition is commendable
  Ruthlessness is admirable
  Wealth is our sacrament

Winner takes all

What a success story!

We now have a value system that’s the very opposite of what any sustainable civilisation needs!

I told you. Our economy is shit.

Do you agree with me yet?

You smile – perhaps a little grimly. “What am I expected to say?”

Only that you agree with me.

“Let me think on it.”

Then let me think with you.

The Inequality Machine, the reinforcing feedback loops of wealth, the growth problem and the Cognitive Dissonance Disaster all contribute to the economic lensing of wealth: the focussing of profit on a smaller and smaller community of individuals and corporations to the detriment of us all. In parallel with this, the Value Inversion Effect tells us it’s not a problem. Nothing to see here. All is well.

But all isn’t well.

Let’s talk about democracy

– The Democracy Distortion Effect

In a properly functioning democracy the electorate should be the main influence on those to whom they’ve delegated power – their elected representatives.

The creation of alternative power centres, through the channelling of extreme wealth to small numbers of corporations and individuals, challenges this in two ways:

The elected representatives come under the influence of these alternative power centres through funding, lobbying, miscellaneous direct and indirect bribes or rewards, promises of investment and jobs, and pressure from an oligarch-owned media

The voters themselves come under the influence of these alternative power centres via the oligarch-owned media and its relentless and all-pervasive messaging, which is echoed by state broadcasters if such exist

This pincer movement against democracy – the control of the politicians and the manipulation of the electorate – leaves nations rushing headlong, without effective voter restraint, towards the economic chaos and environmental jeopardy implicit in the failings of our economic model.

This is not a good path to be taking.

An economy which undermines democracy is more an enemy than a friend.

– Alienation & Atomisation

And it’s not just democratic power that’s undermined. It’s individual power, too.

The market economy sees humans as reluctant workers and greedy consumers – as selfish economic units whose interactions are solely concerned with personal gain. Our oligarch-owned media propagandises this perception. Surrounded by the evangelical messaging of the apologists for wealth, and immersed in a mechanistic economic system, we internalise this vision of ourselves. We lose connection with one another except as competitors for products or jobs.

Empathy? Community? Kindness?

What are these things?

A sense of unity with other creatures and the biological world?

All of this means nothing to the market economy. It’s an irrelevance.

Our economic system divides us from one another and from our world.

We are alienated, atomised. We are anxious and unhappy. We cease to have value, even to ourselves, except as human capital.

And if we have no capital?

Perhaps we’re not even human.

5: Failure

You look restless. “Is this still ‘a short conversation’?”

I venture a shrug. Have you browsed Das Kapital? Have you read Thomas Pikketty’s Capital In The 21st Century?

By those standards this conversation is barely more than a syllable.

You’re right, though.

It’s a long ‘short conversation’.

But we’re getting there. We’re almost done.

– Failure on its own terms

So, lastly, it’s worth observing that our economy is failing by its own measures:

• It’s not self-regulating

• It’s not self-investing

• It’s not a ‘free’ market

• It suppresses competition

• It’s demands state aid

• It’s wealth doesn’t trickle down

• Its celebrated top end,

‘high finance’, in fact produces next to nothing.

• 
  
  Its monopolistic instincts suppress entrepreneurship and start-ups and destroy small businesses
  It’s not efficient (on the assumption that ‘efficiency’ precludes self-destruction)

• As ‘a mechanism for distributing limited resources’ it’s not very good at distribution…. Instead, it allows resources to be horded away in the amassed assets or tax havens of oligarchs.
• Tangibly productive or socially beneficial work receives poverty-level incomes while ethically valueless work (corporate lawyers, accountants, financiers) takes the lion’s share.
• When markets are saturated, corporations cannibalise themselves: cheapening their product or service (hadn’t you noticed?); reducing support or after-care; attacking employee pay and working conditions… all of which harm the society in which the corporations operate

• Huge volumes of income are effectively ‘unearned’, utterly disconnected from real effort, labour or merit (i.e. much of the wealth circulating through the financial sector).

It doesn’t work for the common good

Is that damning enough for you?

6: Stupid

It’s interesting that we speak about the economy as if it were magic. ‘Economic miracles’, ‘economic alchemy’, the ‘Magic Square of Economic Policy’, the market’s ‘invisible hand’…

It is as if the economy is something we should submit to or even worship.

But the economy is just an artefact of human manufacture – humans run it, humans organise it, humans made it.

The economy is a kind of machine, a machine which should serve us, not us it.

President Bill Clinton once said, “It’s the economy, stupid.”

He got that profoundly wrong.

It’s not, ‘It’s the economy stupid,’ but ‘The economy’s stupid.’

Our economy creates unfairness. It undermines democracy. It destabilises social cohesion… and it jeopardises the survival of our species.

That seems pretty stupid to me.

The economy’s stupid – and it won’t become clever unless we engineer cleverness into it.

 7: The fix

“So how do we do that?” you ask, pragmatic as ever.

It’s a good question, and it has an answer – but not one as difficult as our market evangelists would like to suggest.

How do you engineer intelligence into our economy?

You leaven the market economy with cooperativism, with state and community ownership, with ‘Common Good’, ‘Negative Growth’, ‘Green New Deal’ and ‘Donut’ economics.

Then, whatever’s left, you regulate.

You regulate morality into the market economy.

You regulate the stupidity out of the market economy.

You regulate ‘putting people before profit’ into the economy.

And then you’re done.

That’s what economic regulation is for.

Unless we take these measures we’ll never have an economy suited to our 21st Century Age of Intelligence. All we’ll have is a stupid economy. An economy likely to bring this century to a calamitous end.

 

Luke Andreski is co-founder of the @EthicalRenewal and EthicalIntelligence.Org cooperatives.

He is author of Short Conversations: During the Plague (2020), Intelligent Ethics (2019), Ethical Intelligence (2019), the novel To The Bridge (2018) and How To Be Happy (2017).

He is a campaigner for social justice and the environment, and a writer, poet and philosopher with a keen interest in politics and moral philosophy.

His current project is a second volume of Short Conversations: The Perfect Storm; where he addresses the jeopardy in which we are placing ourselves, and whether there’s a way to safely emerge from our self-made ‘perfect storm’.

You can connect with Luke on LinkedIn, https://uk.linkedin.com/in/luke-andreski-ethics, or via @EthicalRenewal on Twitter.

For a slightly longer version of this article, please see Luke’s blog: https://lukeandreski.wordpress.com/

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