The Priorities of Capitalism Has Us All Upside Down

We Need to Realize That a Good Life

Is More Important Than Money

 

The political and economic debate in the United States and Europe revolves around public financial deficits and how best to resolve them while ignoring the deficits that most endanger our future. In the United States, as Republican deficit hawks tell the story, “America is broke. We must cut government spending on social programs we cannot afford. And we must lower taxes on Wall Street so more money can grow the economy, create new jobs, increase total tax revenues, and eliminate the deficit.” Democrats respond, “Yes, we’re pretty broke, but the answer is to raise taxes on Wall Street looters to pay for government spending that primes the economic pump by putting people to work building critical infrastructure and performing essential public services. This puts money in people’s pockets to spend on private sector goods and services and is our best hope to grow the economy.” Both sides have it wrong on two key points.

 

 

First, both focus on growing America’s GDP while ignoring the reality that the benefits of GDP growth over the past several decades have gone almost exclusively to the top 1 percent – with dire consequences for the remaining 99% resulting in the worst epidemic of long-term unemployment and homelessness since the Great Depression. Second, both focus on financial deficits, which can be resolved with relative ease if we eliminate rampant waste in government domestically while bringing our troops home from overseas, where they are unwanted and unnecessary. To achieve the ideal of a world that secures health and prosperity for all people for generations to come, we must redefine the public debate about the choices we face as a nation and as a species. We must measure economic performance against the outcomes we really want, give life priority over money, and recognize that money is a means, not an end. The key point, which the deficit debates rarely address, is that one person or entity’s financial debt is another person or entity’s financial asset. We can only borrow money from each other. The idea that we borrow money from the future is an illusion.

 

 

From a societal perspective, total debts and assets are always in balance. Consequently, if we say that one person or entity has excessive financial debt, we in effect say that another has excessive financial assets. Reducing the financial debt of debtors necessarily requires reducing the financial assets of the creditors. In theory, we could instantly wipe away all financial debts through a universal forgiveness, a modern equivalent of the ancient institution of the Jubilee (see the Old Testament, specifically the books of Exodus, Leviticus and Deuteronomy). Simply put, all debts that have been accumulated over a seven year period were universally and unconditionally forgiven. This was the law of the land in the Old Testament, written by Moses and dictated by Almighty God. Every seventh year was regarded as a “Year of Jubilee”, and yet only Jewish people and the Seventh Day Adventists still celebrate this important feast. The ancients recognized the significance of such action to restore the balance essential to the healthy function of the human community. The deficit-hawks recoil in horror at the very mention of this while frantically reassuring us that we can reduce government debt while leaving the financial assets of the rich untouched. It makes perfect sense in the fantasy world of pure finance in which profits and the financial assets of the rich grow perpetually even as growing inequality and wasteful material consumption deplete the social capital of community and the natural capital of Earth’s biosphere. A viable human future, however, must be based on living world realities rather than financial world fantasies.

 

 

Any normally intelligent 12-year-old is fully capable of understanding the distinction between a living forest or fishery and a system of financial accounts that exists only as electronic traces on a computer hard drive. Unfortunately, this simple distinction seems to be beyond the comprehension of the economists, pundits, and politicians who frame the public debate on economic policy. By referring to financial assets as “capital” and treating them as if they had some intrinsic worth beyond their value as a token of exchange, they sustain the deception that Wall Street is creating wealth rather than manipulating the financial system to accumulate accounting claims against wealth it had no part in creating. Real capital assets have productive value in their own right and cannot be created with a computer key stroke. The most essential forms of real capital are social capital (the bonds of trust and caring essential to healthy community function) and biosystem capital (the living systems essential to Earth’s capacity to support life). We are depleting both with reckless abandon. Social capital is the foundation of our human capacity to innovate, produce, engage in cooperative problem solving, manage Earth’s available natural wealth to meet the needs of all, and live together in peace and shared prosperity. Social capital is depleted as individualistic greed becomes the prevailing moral standard and the governing institutions of society deprive all but a privileged minority of access to a secure and dignified means of living. Once it is depleted, social capital can take generations to restore.

 

 

Biosystem capital provides a continuing supply of breathable air, drinkable water, soils to grow our food, forests to produce our timber, oceans teeming with fish, grassland that feed our livestock, sun, wind, and geothermal to provide our energy, climate stability, and much else essential to human survival, health, and happiness. It is depleted when soils are degraded, when oceans are fished to the point where whole species are threatened with extinction, when rivers and lakes are polluted, forests cut down, aquifers contaminated and depleted, and climate stabilization systems disrupted. These natural systems can take thousands, even millions of years to restore. Species extinction is forever. According to the World Wildlife Federation’s 2012 Living Planet Report, at the current rate of consumption, “it is taking 1.5 years for the Earth to fully regenerate the renewable resources that people are using in a single year. Instead of living off the interest, we are eating into our natural capital.” Unlike with financial deficits, simple debt forgiveness is not an option. There are no Jubilee celebrations when we take everything from the earth and put back nothing. When we deplete Earth’s bio-capacity – its capacity to support life in its many varied forms – we are not borrowing from the future; we are stealing from the future. Even though it is the most serious of all human-caused deficits, it rarely receives mention in current political debates.

 

 

When we assess economic performance by growth in GDP and stock price indexes, we in effect manage the economy to make the most money for people who have the most money. This leads us to the fanciful belief that as a society we are getting richer. In fact, we are impoverishing both current and future generations by creating an unconscionable concentration of economic power, depriving billions of people of a secure and dignified means of living, and destroying the social and biosystem capital on which our real well-being depends. With proper care and respect, biosystem capital can provide essential services in perpetuity. The reckless devastation of productive lands and waters for a quick profit, a few temporary jobs, and a one-time energy fix from Earth’s non-renewable fossil energy resources represent truly stupid and morally reprehensible deficit spending. Evident current examples include the internal combustion engines in our cars and trucks and mountaintop removal coal mining. The fact that we thereby deepen human dependence on finite nonrenewable fossil energy reserves and accelerate climate disruption make such actions all the more stupid and immoral. Financial system logic, which rests on the illusion that money is wealth, tells us we are making intelligent choices. Living systems logic tells us our current choices are insane and a crime against future human generations and creation itself.

 

 

The economy of a just and sustainable society needs a proper system of money creation and allocation that supports the health and productive function of social and biosystem capital and allocates the sustainable generative output of both to optimize the long-term health and well-being of all. We have got to figure out a way to reward individuals with a system of financial credits in proportion to their actual productive contribution to living system health and prosperity. The current U.S. money system does exactly the opposite. It celebrates and rewards the destruction of living capital to grow the financial assets of Wall Street looters at the expense of Main Street producers—thus concentrating economic and political power in the hands of those most likely to abuse it for a short-term gain that is motivated by grossly excessive greed.

 

 

Wall Street operates as a criminal syndicate devoted to the theft of that to which it has no rightful claim. It then bribes politicians to shield the looters from taxes on their ill-gotten gains and to eliminate social programs that cushion the blow to those they have deprived of a secure and meaningful means of livelihood. This brings us back to the real source and consequence of excess financial debt. In the big picture, the Wall Street 1 percent has divided society into a looter class that controls access to money and a producer class forced into perpetual debt slavery – an ancient institution that has allowed the few to rule the many for thousands of years. The immense burden imposed on the 99 percent by public debt, consumer debt, mortgage debt, and student loan debt is the outcome of a Wall Street assault on justice and democracy, while maintaining a system of enforced inequality. The resulting desperation and loss of social trust account for the many current symptoms of social disintegration and decline in ethical standards. These include growth in family breakdown, suicide, forced migration, physical violence, crime, drug use, and prison populations.

 

I grew up in America during a time when we took pride in being a middle-class society without extremes of wealth and poverty. In part, we were living an illusion. Large concentrations of private wealth were intact and systemic discrimination excluded large segments of the population —particularly people of color – from participation in the general prosperity. The underlying concept that the good society is an equitable society, however, was and still is valid. And from the 1950s to the 1970s the middle class expanded. But not any more.

 

 

Extreme inequality as exemplified by Capitalism, is both a source and an indicator of serious institutional failure and social pathology. Economic and social inequality is detrimental to human physical and mental health and happiness – even for the very rich. Relatively equal societies are healthier on virtually every indicator of individual and social health and well-being. In highly unequal societies, the very rich are prone to seek affirmation of their personal worth through extravagant displays of excess. They easily lose sight of the true sources of human happiness, sacrifice authentic relationships, and deny their responsibility to the larger society at the expense of their essential humanity. At the other extreme, the desperate are prone to manipulation by political demagogues who offer oversimplified explanations and self-serving solutions that in the end further deepen their misery. Governing institutions lose legitimacy. Democracy becomes a charade. Moral standards decline. Civic responsibility gives way to extreme individualism and disregard for the rights and well-being of others. To achieve true prosperity, we must create economies grounded in a living systems logic that recognizes three fundamental truths:

 

  • The economy’s only valid purpose is to serve life.
  • Equality is foundational to healthy human communities and a healthy human relationship to Earth’s biosphere.
  • Money is a means, not an end.

 

 

Runaway public deficits are but one symptom of a profound system failure. They can easily be resolved by taxing the unearned spoils of the Wall Street looters, eliminating corporate subsidies, and by making offshore tax havens illegal, and cutting military expenditures on pointless wars that enrich only a few at the expense of the multitudes. They want to send your sons, daughters and grandchildren to fight their wars for them because it is allegedly the patriotic thing to do (but God forbid that they should ever send their own kids). Joblessness can easily be eliminated by putting the unemployed and underemployed to work meeting a vast range of unmet human needs from rebuilding and greening our physical infrastructure to providing essential human services, eliminating dependence on fossil fuels, and converting to systems of local organic food production. If the primary constraint is money, the Federal Reserve can be directed to create it and channel it to priority projects through a national infrastructure bank – a move that avoids enriching the bankers and does not create more debt. In addition, we must:

 

  1. Break up concentrations of unaccountable power.
  2. Shift the economic priority from making money to serving life by replacing financial indicators with living wealth indicators as the basis for evaluating economic performance.

  3. Eliminate extremes of wealth and poverty to create a true middle-class society.
  4. Build a culture of mutual trust and caring.
  5. Create a system of economic incentives that reward those who do productive work and penalize predatory financial speculation.

  6. Restructure the global economy into a planetary system of networked bioregional economies that share information and technology and organize to live within their respective environmental means.

 

 

Within a political debate defined by the logic of living systems, such measures are simple common sense. Within a political debate defined by conventional financial logic, however, they are easily dismissed as dangerous and illogical threats to progress and prosperity. So long as money frames the debate, money is the winner and life is the loser. To score a political victory for life, the debate must be re-framed around a narrative based on an understanding of the true sources of human well-being and happiness and a shift from money to life as the defining value. Wall Street interests would have us believe that the best way to save Earth’s biosystems is to put a price on them and sell them to wealthy global investors to manage for a private return. Rather than concede the underlying frame to Wall Street and debate the price and terms of the sale, indigenous leaders, the Occupy and 99% Movements, and environmental groups drew on the ancient wisdom of indigenous peoples to challenge the underlying frame. They declared that as the source of life, Earth’s living systems are sacred and beyond price. They issued a global call to recognize the rights of nature.

 

 

This debate highlights a foundational and inherent conflict between the rights of nature, human rights, property rights, and corporate rights. In current practice, based on the same financial logic that leads us to treat financial deficits as more important than social and environmental deficits, we give corporate rights precedence over the property rights of individuals. We give property rights precedence over the human rights of those without property. And we give human rights precedence over the rights of nature when it should be the other way around. To put it bluntly, America’s leadership and the financial elite who are running our country into the ground have their priorities backwards. Furthermore, we – the 99% – will continue to pay a terrible price so long as we allow the deeply flawed logic of pure finance to define our values and frame the political debate. Therefore it is up to us, the 99%, to get these priorities put back in the correct order. As of this writing, we Americans are still trying to do this peacefully. After all, the only remaining alternative is revolution, and I have been convinced for many years that this will be the ultimate outcome. What is currently happening in Syria, Egypt, Spain, Yemen, Bahrain and Greece will soon be coming to our shores. The Occupy and 99% Movements are but a precursor of things to come here in the US.

 

 

There is no magic bullet quick fix. We must re-frame the debate by bringing life values and living systems logic to the forefront and turning the prevailing rights hierarchy on its head. The rights of nature must come first, because without nature, humans do not exist. As living beings, our rights are derivative of and ultimately subordinate to the rights of Earth’s living systems. Human rights come, in turn, before property rights, because property rights are a human creation. They have no existence without humans and no purpose other than to serve the human and natural interest. Corporations are a form of property and any rights we may choose to grant to them are derivative of individual property rights and therefore properly subordinate to them.

 

 

The step to a prosperous human future and a balanced environment requires that we acknowledge life, not money, as our defining value, accept our responsibilities to and for one another and nature, and bring to the forefront of the debate the social and bio-system deficits that are the true threat to the human future. Replacing cultures and institutions that value money more than life with cultures and institutions that value life more than money is a daunting challenge. Fortunately, it is also an invigorating and hopeful challenge because it reconnects us with our true nature as living beings and offers a win-win alternative to the no-win status quo. The only two alternatives are revolution (when all other means are exhausted, and we are very close to that point now) or human extinction.

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One thought on “The Priorities of Capitalism Has Us All Upside Down

  1. I agree .These wars are a detriment to our country in every way imaginable .We should stay out of other peoples countries and let them fight their battles like we Americans had to do for our country..We are only adding to the turmoil that war is.We only need a good defense system,and if any country dares to bomb the United States, then give them two like Harry Truman had once said,but stay out of the business of war.It does not pay.
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