Essentially, for the economy to continue growing and for the (interest-based) money system to remain viable, more and more of nature-and-human relationship must be monetized. For example, thirty years ago most meals were prepared at home; today some two-thirds are prepared outside the home, in restaurants or supermarket delis. A once unpaid function, cooking, has become a service. And we are the richer for it. Right?
Another major engine of economic growth over the last three decades, child care, has also made us richer. We are now relieved of the burden of caring for our own children. We pay experts instead, who can do it much more efficiently. Even if we don’t want to become “richer” in this way, the destruction of social structures like tight-knit neighborhoods and extended families gives most people little alternative. Community has been converted to a paid service.
In ancient times entertainment was also a free, participatory function. Everyone played an instrument, sang, participated in drama. Even seventy-five years ago in the United States, every small town had its own marching band and baseball team. Now we pay for those services. The economy has grown. Hooray.
The crisis we are facing today arises from the fact that there is almost no more social, cultural, natural, and spiritual capital left to convert into money. Centuries—millennia—of near-continuous money creation have left us so destitute that we have nothing left to sell. Our forests are damaged beyond repair, our soil depleted and washed into the sea, our fisheries fished out, the rejuvenating capacity of the earth to recycle our waste saturated. Our cultural treasury of songs and stories, images and icons, has been looted and copyrighted. Any clever phrase you can think of is already a trademarked slogan. Our very human relationships and abilities have been taken away from us and sold back, so that we are now dependent on strangers, and therefore on money, for things few humans ever paid for until recently: food, shelter, clothing, entertainment, child care, cooking. Life itself has become a consumer item. Today we sell away the last vestiges of our divine bequeathment: our health, the biosphere and genome, even our own minds. This is the process that is culminating in our age. It is almost complete, especially in the United States and the “developed” world. In the developing world there still remain people who live substantially in gift cultures, where natural and social wealth is not yet the subject of property. Globalization is the process of stripping away these assets, to feed the money machine’s insatiable, existential need to grow. Yet this strip-mining of other lands is running up against its limits too, both because there is almost nothing left to take, and because of growing pockets of effective resistance.
The result is that the supply of money—and the corresponding volume of debt—has for several decades outstripped the production of goods and services that it promises. It is deeply related to the classic problem of oversupply in capitalist economics. The Marxian crisis of capital can be deferred into the future as long as new, high-profit industries and markets can be developed to compensate for the vicious circle of falling profits, falling wages, depressed consumption, and overproduction in mature industries. The continuation of capitalism as we know it depends on an infinite supply of these new industries, which essentially must convert infinite new realms of social, natural, cultural, and spiritual capital into money. The problem is, these resources are finite, and the closer they come to exhaustion, the more painful their extraction becomes. Therefore, contemporaneous with the financial crisis we have an ecological crisis and a health crisis. They are intimately interlinked. We cannot convert much more of the earth into money, or much more of our health into money, before the basis of life itself is threatened.
Faced with the exhaustion of the nonmonetized commonwealth that it consumes, financial capital has tried to delay the inevitable by cannibalizing itself. The dot-com bubble of the late ’90s showed that the productive economy could not longer keep up with the growth of money. Lots of excess money was running around frantically, searching for a place where the promise of deferred goods and services could be redeemed. So, to postpone the inevitable crash, the Fed slashed interest rates and loosened monetary policy to allow old debts to be repaid with new debts (rather than real goods and services). The new financial goods and services that arose were phony, artifacts of deceptive accounting on a vast, systemic scale.
Various pundits have observed that the Bernard Madoff Ponzi scheme was not so different from the financial industry’s pyramid of mortgaged-based derivatives and other instruments, which themselves formed a bubble that, like Madoff’s, could only sustain itself through an unceasing, indeed exponentially growing, influx of new money. As such, it is a symbol of our times—and even more than people suppose. It is not only the Wall Street casino economy that is an unsustainable pyramid scheme. The larger economic system, based as it is on the eternal conversion of a finite commonwealth into money, is unsustainable as well. It is like a bonfire that must burn higher and higher, to the exhaustion of all available fuel. Just as fire breaks existing chemical bonds and frees heat, so does our economy break the bonds of community, nature, and culture, liberating free energy—called money—in the process. Only a fool would think that a fire can burn ever higher when the supply of fuel is finite. To extend the metaphor, the recent deindustrialization and financialization of the economy amounts to using the heat to create more fuel. It says, “We will use more money, rather than goods and services, to redeem the promise of money.” According to the second law of thermodynamics, the amount created is always less than the amount expended to create it. Obviously, the practice of borrowing new money to pay the principal and interest of old debts cannot last very long, but that is what the economy as a whole has done for ten years now.
Yet even abandoning this folly, we still must face the depletion of fuel (remember, I mean not literal energy sources, but any bond of nature or culture that can be turned into a commodity). Most of the proposals for addressing the present economic crisis amount to finding more fuel. Whether it is drilling more oil wells, paving over more green space, or spurring consumer spending, the goal is to reignite economic growth: that is to expand the realm of goods and services. It means finding new things for which we can pay. Today, unimaginably to our forebears, we pay even for our water and our songs. What else is left to convert into money?
A collapse is coming, unavoidably; indeed, we are in the midst of it. The first government response to the 2008 crisis, the bailout, was an attempt to uphold a tower of money that is far beyond the total value of real goods and services it promises to redeem. Unless economic growth brings us more new goods and services, this measure can only delay the inevitable. That is what economic stimulus, such as Obama’s 2009 package, is designed to do. But it too is doomed to fail—for a different and much deeper reason. It will fail because we are maxed out: maxed out on nature’s capacity to receive our wastes without destroying the ecological basis of civilization; maxed out on society’s ability to withstand any more loss of community and connection; maxed out on our forests’ ability to withstand more clear-cuts; maxed out on the human body’s capacity to stay viable in a depleted, toxic world. That we are also maxed out on our credit only reflects that we have nothing left to convert into money. Do we really need more roads and bridges? Can we sustain more of them, and more of the industrial economy that goes along? Government stimulus programs will at best prolong the current economic system for a few more years, with perhaps a brief period of tepid growth as we complete the pillage of nature, spirit, body, and culture. When these vestiges of the commonwealth are gone, then nothing will be able to stop an economic collapse on a global scale.
The persistent economic crisis of recent years is actually the final stage of what began in the 1930s. Successive solutions to the fundamental problem of keeping pace with money that expands with the rate of interest have been applied, and exhausted. The first effective solution was war, a state that has been permanent since 1940. Unfortunately, or rather fortunately, nuclear weapons and a shift in human consciousness have
limited the solution of endless military escalation. Other solutions—globalization, technology-enabled development of new goods and services to replace human functions never before commoditized, technology-enabled plunder of natural resources once off limits, and finally financial auto-cannibalism—have similarly run their course. Unless there are realms of wealth I have not considered, and new depths of poverty, misery, and alienation to which we might plunge, the inevitable cannot be delayed much longer.
In the face of an impending crisis, people often ask what they can do to protect themselves. “Buy gold? Stockpile canned goods? Build a fortified compound in a remote area? What should I do?” I would like to suggest a different kind of question: “What is the most beautiful thing I can do?” You see, the gathering crisis presents a tremendous opportunity. Deflation, the destruction of money, is only a categorical evil if the creation of money is a categorical good. However, you can see from the examples I have given that the creation of money has in many ways impoverished us all. Conversely, the destruction of money has the potential to enrich us. It offers the opportunity to reclaim parts of the lost commonwealth from the realm of money and property.
We actually see this happening every time there is an economic recession. People can no longer pay for various goods and services, and have to rely on friends and neighbors instead. Where there is no money to facilitate transactions, gift economies reemerge and new kinds of money are created. Ordinarily, though, people and institutions fight tooth and nail to prevent that from happening. The habitual first response to economic crisis is to make and keep more money—to accelerate the conversion of anything you can into money. On a systemic level, the debt surge is generating enormous pressure to extend the commodification of the commonwealth. We can see this happening with the calls to drill for oil in Alaska, commence deep-sea drilling, and so on. The time is here, though, for the reverse process to begin in earnest—to remove things from the realm of goods and services, and return them to the realm of gifts, reciprocity, self-sufficiency, and community sharing. Note well: This is going to happen anyway in the wake of a currency collapse, as people lose their jobs or become too poor to buy things. People will help each other and real communities will reemerge.
In the meantime, anything we do to protect some natural or social resource from conversion into money will both hasten the collapse and mitigate its severity. Any forest you save from development, any road you stop, any cooperative playgroup you establish; anyone you teach to heal himself, or to build her own house, cook his own food, make her own clothes; any wealth you create or add to the public domain; anything you render off-limits to the world-devouring Machine, will help shorten the Machine’s lifespan. Think of it this way: if you already do not depend on money for some portion of life’s necessities and pleasures, then the collapse of money will pose much less of a harsh transition for you. The same applies to the social level. Any network or community or social institution that is not a vehicle for the conversion of life into money will sustain and enrich life after money.
There exist today, in theory and increasingly in practice, alternative money systems, based on mutual credit and demurrage, that do not drive the conversion of all that is good, true, and beautiful into money. These enact a fundamentally different human identity, a fundamentally different sense of self, from what dominates today. No more will it be true that more for me is less for you. On a personal level, the deepest possible revolution we can enact is a revolution in our sense of self, in our identity. The discrete and separate self of Descartes and Adam Smith has run its course and is becoming obsolete. We are realizing our own inseparateness, from each other and from the totality of all life. Interest belies this union, for it seeks growth of the separate self at the expense of something external, something other. Many in the West are now coming to agree with the principles of interconnectedness, whether from a Buddhistic or an ecological perspective. The time has come to live it. It is time to enter the spirit of the gift, which embodies the felt understanding of nonseparation. It is becoming abundantly obvious that less for you (in all its dimensions) is also less for me. The ideology of perpetual gain has brought us to a state of poverty so destitute that we are gasping for air. That ideology, and the civilization built upon it, is what is collapsing today.
Individually and collectively, anything we do to resist or postpone the collapse will only make it worse. Let us stop resisting the revolution in human beingness. If we want to survive the multiple crises unfolding today, let us not seek to survive them. That is the mindset of separation; that is resistance, a clinging to a dying past. Instead, let us shift our perspective toward reunion, and think in terms of what we can give. What can we each contribute to a more beautiful world? That is our only responsibility and our only security.
More concretely, let us engage in conscious, purposeful money destruction in place of the unconscious destruction of money that happens in a collapsing economy. If you still have money to invest, invest it in enterprises that explicitly seek to build community, protect nature, and preserve the cultural commonwealth. Expect a zero or negative financial return on your investment—that is a good sign that you are not unintentionally converting even more of the world to money. Whether or not you have money to invest, you can also reclaim what was sold away by taking steps out of the money economy. Anything you learn to do for yourself or for other people, without paying for it; any utilization of recycled or discarded materials; anything you make instead of buy, give instead of sell; any new skill or new song or new art you teach yourself or another, will reduce the dominion of money and grow a gift economy to sustain us through the coming transition. The world of the gift, echoing primitive gift societies, the web of ecology, and the spiritual teachings of the ages, is nigh upon us. It tugs on our heartstrings and awakens our generosity. Shall we heed its call, before the remainder of earth’s beauty is consumed?
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THE CAPITAL IS PERSONAL
ANYA KAMENETZ
I was talking on the phone to a friend about the plight of unhappily single women in New York. “They just don’t give themselves the right value in the dating market,” I said. “Hey, we were just talking about the banking crisis. Look how these capitalist phrases have taken over our language!” he replied. “You’re right. I shouldn’t use these bankrupt expressions.” We both laughed when we realized I had inadvertently repeated my mistake.
As my friend pointed out, capitalism has colonized our words, our identities, and our minds. The habit of thinking of people, ideas, and relationships as commodities has been pervasive. We are collectively guilty of extreme reification—treating the abstraction of money as if it were the only real thing. We have constructed an idol out of our own adornments—pulling our very teeth to do it—and in the process subjected our innate divinity to the inert form.
And then, in late 2008, American-style free market capitalism, the single dominant human system of the last century or so, underwent a bloodless, swift, and absolute coup. The king was dead. The golden calf had been melted back down into dross. This event would be even harder to believe if the exact same thing hadn’t happened to capitalism’s doppelganger, totalitarian socialism, just a decade before. This time, we didn’t topple any walls or statues, but a set of powerful illusions fell nevertheless. The crisis will take time to fully be absorbed into our culture.
What illusions have sustained capitalism, and what has been the consequence? Our democratically elected leaders, with the collaboration of thousands of business oligarchs and wealthy financiers, have refused to put our country’s vast resources to use to feed the hungry, lift up the destitute, provide care to the sick, or protect the planet from degradation—even now that it’s widely acknowledged that the future of the species is at stake. The argument was always that “the market,” with its unique capacity to produce “economic growth,” was too sacrosanct to be subject to the “distortions” of government intervention, whether in the form of taxes or regulation. No hum
an need or desire was deemed as important as the interests of the market: not the survival of innocent children and not the health of the air we breathe.
But when the market itself was in danger of collapse, Congress acted within days, authorizing taking $700 billion in bad debt off the hands of troubled banks and investment firms. This desperate rescue operation exposed market fundamentalism as just another form of false, extremist religion. When banks, financial institutions, and corporations failed, the power to respond rested with the United States government. Clearly, then, government intervention is not detrimental to the market. Government intervention makes the market possible.
Anarchist anthropologist David Graeber writes about the history of systems of value within different cultures. In Toward an Anthropological Theory of Value, he summarizes the views of Hungarian economist Karl Polanyi thus: “The state and its coercive powers had everything to do with the creation of what we now know as ‘the market’—based as it is on institutions such as private property, national currencies, legal contracts, credit markets.… ‘Market behavior’ would be impossible without police.”
Legal scholar Cass Sunstein makes a related point in his book The Second Bill of Rights: FDR’s Unfinished Revolution and Why We Need It More Than Ever. He points out that our Constitution happens to guarantee the right to the abstraction of private property, but not the right to the necessities of life such as food, clothing, or shelter. That means that the police are empowered to cast out someone who is hiding from the rain, if the roof he or she is huddling under happens to technically “belong” to someone else. The choice to defend one principle over the other is not always in line with our acknowledged moral values, as in the case of the starving man who steals a loaf of bread. (In the time of the New Deal, Sunstein argues, FDR identified “Freedom from Want” as a new American right, and created new social institutions to try to protect it, but failed to enshrine it in the Constitution—thus, an unfinished revolution.)
What Comes After Money Page 3