I’m going to lay out a possibility that might seem shocking to some of you. It’s not surprising to me that despite the many promises to, “make America affordable again,” the new regime’s chaos, recklessness and arrogance is doing exactly the opposite. The stock market is way down, the value of people’s investments and retirement accounts are eroding, inflation is still high, and the unemployment rate is up. Mainstream economists are cautioning that a recession could be brewing. A whole lot of us regular people are feeling the pain of higher prices. Businesses are reeling from the uncertainty, unable to plan inventories, next moves, etc. Nearly all pundits view these developments as negative.
But, what if they aren’t?
The regime, beginning to worry about the growing frustration and anger even from their base, is now framing this economic upheaval as a “healthy correction”. Their spin is that the mess is just a temporary shift from having too many government employees to adding more growth in the private sector. I think that’s BS and certainly not the potential upside I am considering.
We live in a culture ruled by the religion of economic growth, driven by ever-increasing rates of consumer spending and consumption. We measure the health of the economy through the Gross Domestic Product (GDP). If GDP is going up all is well; if it’s falling, not so good. But here is the problem, GDP measures the money flowing through an economy but not whether that money is actually making society better off. Under GDP the money spent to keep a child in juvenile jail counts as exactly as positive as the same amount of money spent to educate a child. Spending a fortune to clean up toxic dump sites, oil spills, etc. boosts the GDP. The war machine and prison industry are massive inputs to GDP.
In a brave and visionary speech at the University of Kansas in 1968 Robert (Bobby) Kennedy said the following:
But even if we act to erase material poverty, there is another greater task, it is to confront the poverty of satisfaction – purpose and dignity – that afflicts us all. Too much and for too long, we seemed to have surrendered personal excellence and community values in the mere accumulation of material things. Our Gross National Product, now, is over $800 billion dollars a year, but that Gross National Product – if we judge the United States of America by that – that Gross National Product counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl. It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. It counts Whitman’s rifle and Speck’s knife, and the television programs which glorify violence in order to sell toys to our children. Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile. And it can tell us everything about America except why we are proud that we are Americans.
The situation Kennedy was addressing is still with us today. I had this animation created for a college course I was developing. It shows the correlation between GDP growth, plastic pollution, climate change, etc. It is very short but the animation is a bit slow so give it just a sec.
In business they say we manage what we measure. In our current system we measure economic growth but not the damages associated with it. In the early 1970s we hit “planetary overshoot”, meaning each year humans consume and degrade more than the earth can repair and reproduce. As of now we’d need 1.7 Earth’s to meet the demands of the global economy.
In addition to environmental destruction our current consumption-based version of Capitalism is also brutal to large swaths of our society. Nearly all of the people born into, or who fall into, poverty in the U.S are unable to climb back out. Most of us live paycheck to paycheck and the leading cause of bankruptcy is a medical crisis that we can’t afford.
On the other end of the spectrum, for the first time in the history of humanity, we now have a billionaire class and these elite few have tremendous power over the rest of us – from blowing up hobby rocket ships over neighborhoods and nature preserves and backing up air travel in the process, to controlling the media, to buying elections, to polluting at off-the-chart rates. America is now genuinely a caste system as well as an oligarchy.
This rapacious economic system is cracking on a number of fronts – ecological collapse, escalating climate-related weather catastrophes, financial market volatility, and resource wars. And now, under the current U.S. regime, inflation is rising, stock market is tanking, and even the sacred cow GDP is falling.
Some of the developments arising in response could prove very beneficial for both people and planet in the long-term:
Relocalization
Europe and Canada are making moves to reduce reliance on U.S. products and build out their own, more localized supply chains and defense systems. Making stuff locally reduces massive amounts of energy due to the decreased miles products must be shipped or trucked. Imported products contain “imbedded energy” that contributes to global pollution but is not factored into the cost of the product. In addition, every year, thousands of containers of stuff from plastic widgets to toxic chemicals to live animals are dumped into oceans when container ships hit rough weather.
When I was serving as First Lady of Oregon, I went on a trade mission with the Governor and key staff to Asia. The point of such trips is to increase trade opportunities and collaboration between parties. At one point, a bunch of old-timers in the administration were crowing about their great success in starting up grass seed exports from Oregon to China. I chimed in, “Does it really make sense in a carbon-constrained world to ship inedible grass seed all the way across the globe? If grass is really needed wouldn’t it be better just to show them how to create the seed themselves?” Nobody said much more about grass seed after that.
I’m not at all recommending a cessation of global cooperation, but perhaps we’d all be better served if the emphasis was less on stuff and more on sharing knowledge, and cultural uniqueness, art, and beauty, and experiences.
Relocalization would reduce pollution and increase the resiliency of communities and countries due to more complete and robust supply chains and production processes. I’m reminded of the observation from well-known American writer James Kunstler who said, “The twentieth century was about getting around. The twenty-first century will be about staying in a place worth staying in.”
Beyond GDP
I’ve spent a few decades working on the beyond GDP movement and there is a lot of progress being made. Genuine Progress Indicator, Gross National Happiness Index, Wellbeing Economy are just a few.
The United Nations is currently in the process of discussing a framework to go beyond GDP. UN Secretary-General Antonio Guterres, recently declared,
“Now is the time to correct a glaring blind spot in how we measure economic prosperity and progress. When profits come at the expense of people and our planet, we are left with an incomplete picture of the true cost of economic growth.”
Even Trump recently called for removing federal spending from the GDP, no doubt in an attempt to conceal the depth of economic damage being done by the slash and burn approach to federal agencies and employees. This illuminates how arbitrary and ineffective the GDP is a measure of the success and progress of society.
Reduced Consumption/ Recession
Some are suggesting we are heading toward recession and I know that creates hardship for many, with job losses, increased prices, etc. I am not wishing pain upon people. And yet, recession is almost inevitable given the fundamental unsustainability of the current system and trends. It is worth noting that the only time the pace of environmental destruction slows is when recession hits major economies. I highly recommend watching the amazing documentary, The Year Earth Changed. It captures the extraordinary ways Earth began to heal when COVID pushed pause on the global economy. We didn’t learn much, or change trajectory then, but maybe we can this time around.
We definitely need a correction, but not just shifting seats on the Titanic. Rather we need to fundamentally redesign economic systems. Daunting? Yes. Impossible? No. The economy is not a force of Nature or an act of God. It is a set of human-made systems that we tweak and change all the time. Humans invented the economy, which means we could re-invent it.
Teaser photo credit: A “farm-to-table” dinner at Kendall-Jackson used produce from the winery’s on-site garden. This is an example of relocalization. By Sarah Stierch – Own work, CC BY 4.0, https://commons.wikimedia.org/w/index.php?curid=59118295.