by: Tara Ruttenberg
De-linking Growth and Material Accumulation from Economic Development and Social Wellbeing
Capitalism, Consumer Culture
and Social Wellbeing: (Frowny Face)
Thanks to the mop-top legends of twentieth century pop music, we already know ‘Money Can’t Buy me Love’. But now we’re starting to learn that money can’t buy me happiness, either. And it certainly can’t buy me things like fulfillment, peace of mind, spiritual connection, or soul-tingling interpersonal relationships. We’re even discovering that beyond a sufficient threshold of income and purchasing power, having more money and material possessions is actually making us more unhappy[1] [2], lending economic credibility to Thoreau’s timeless words: “Most of the luxuries and many of the so-called comforts of life are not only indispensable, but positive hindrances to the elevation of mankind”.
Income’s diminishing returns to happiness[3] extend beyond the individual or household to the national level, where rich countries getting richer has not meant that people living in these countries are any happier[4]. Although Gross Domestic Product (GDP), the measure of economic growth and understood as the total dollar value of all goods and services produced within a country, has risen significantly over the past half-century in the countries of the Global North, citizens today do not report feeling happier than their counterparts in the mid-twentieth century; in many instances, people are less happy today than they were in the past despite significant rises in per capita income. For example, Matthieu Ricard, author of Happiness: A Guide to Life’s Most Important Skill, notes that between 1949 and today, while real income in the United States has increased more than double, the number of people declaring themselves as “very happy” has decreased[5]. Similarly, Mark Anielski comments in his book The Economics of Happiness, “many life conditions for the average US citizen have grown worse despite increasing levels of GDP and booming financial markets”[6] To understand this concept in a tangible sense, a recent poll conducted by Marist College pegged $50,000 as the household income threshold for a family of four in the United States, beyond which additional income does not contribute to higher wellbeing.[7] So if a family of four can maximize happiness on a combined income of $50,000 in a country like the US with its relatively high cost of living, why the continued obsession with wealth accumulation and consumption beyond the happiness sufficiency threshold and beyond the natural limits of the Earth?
In our current (final) stage of modern capitalism, understood by Daly and Cobb as “the hedonistic accumulation of riches without any moral or ethical limiters on sufficiency or a sense of what constitutes a virtuous life”[8], even the most wealthy nations and their citizens are beginning to sense a disconnect between modern life and what we know in our hearts to constitute a good life[9]. As described in the metaphorical anecdote in the previous post, the North’s obsession with economic growth and material accumulation has come to define its increasingly homogenous culture, whereby the ‘pursuit of happiness’ has become synonymous with society’s competitive drive for making money and spending it on consumer goods. As inherent to the structure of the capitalist system, this process propels the continuous hamster-wheel-like cycle of the codependent relationships between production and consumption; between money, debt and economic growth.
As industrialization allowed modern society to produce en masse, well beyond the intrinsic needs or wants of people, promoting consumption became the solution to absorbing all the excess production[10], because in a market-driven system supply and demand must meet to reach equilibrium. Enter: the birth of the advertising industry, helping potential consumers everywhere awaken to their unexpressed desires to buy, buy, buy; in economic terms, stimulating demand. As advertising and pop culture continue to promote over-consumption by purposely making us feel like we need to own things we otherwise wouldn’t want or care about, we keep the system alive: obedient hamsters on the wheel of debt-and-economic growth, chasing the American dream. In the words of Dave Ramsey, the consumer lifestyle is pathetically simple: “we spend money we don’t have on things we don’t need to impress people we don’t like”.[11] As a result, our identity and pleasures in life have come to be defined by what we can buy – which restaurants we eat at, where we shop, the cars we drive, the clothes we wear and the houses we live in. In a market democracy, we call this “freedom of choice”, exercising our constitutional rights in the pursuit of happiness by shopping where we want to shop and eating where we want to eat.
When we pause for a second, however, we recognize that none of it is really ‘our choice’ at all; we wouldn’t buy the majority of what we buy if it weren’t for advertisers convincing us that we need the next best product we can’t live without (we’ve lived without it for this long, why do we need it now?). We begin to acknowledge that our extreme consumption and material accumulation has not made us any happier, but has instead left us with thunder thighs and no closet space and gaping holes in our souls. Still, we yearn to consume to keep up with the glamorous lifestyles we see on TV, which are increasingly impossible for the majority to attain: “More and more wealth is concentrated in the hands of a few, whose lifestyles are glorified by the media, which means that the expectations of the majority have become increasingly beyond their means”[12]. As a result, we are not more fulfilled now but rather more empty because we’ve attempted to find happiness by filling our homes and closets with an endless number of material things instead of focusing on those intangible things that actually, it turns out, contribute more to our personal and community wellbeing; things like deep social bonds, connection with nature, being active, exploring our inner passions, developing our talents and skills, and sharing our lives with those we love.
Alan Thein Durning explains this perpetual sense of lack in modern society as follows: “many in the consumer society have a sense that their world of plenty is somehow hollow – that, hoodwinked by a consumerist culture, they have been fruitlessly attempting to satisfy with material things what are essentially social, psychological and spiritual needs….By the consumerist definition, satisfaction is a state that can never be attained”[13]. This perpetual inability to feel satisfied fits nicely in the capitalist framework whereby we will continue consuming and therefore feeding the growth machine, which is itself vital to the service of usury (interest charged of loans), as explained in detail in the anecdote. The service of usury is so entrenched in the system that money owed is always greater than the money existing, forcing us to continue “innovating” -- creating new goods and services to sell on the market in order to keep the wheels of the machine turning. This has resulted in the commodification of things that were once free: “the relentless conversion of life, spirit and world into money”[14], deepening our inability to find meaning in anything when the intrinsic use-value of it has been disregarded in favor of those things determined to possess exchange value, which, in the capitalist consumer society, means anything that can be priced and sold on the market. This process of commodification of things that were previously free – like nature and its resources, spiritual practices, leisure activities, etc. – and the prioritization of exchange value over use value has misguided our entire values system such that we only know how to value that which has a price tag. Meanwhile, the “free” things in life, the things that have no value on the market (e.g. meaningful relationships, exploring our passions, social participation), are what actually contribute most to our experience of happiness. Quite the perplexing disconnect in our modern consumer culture, and at the heart of our discontent.
As the first step in the process of awakening, this realization phase is most uncomfortable, and in our entrenched consumer society there is not much space for imagining a different existence, often leading us into depression as we see no way out of this dark tunnel, or fueling addiction as we keep trying to fill ourselves up by consuming or numbing the pain of our materially rich but spiritually and socially empty lives. And instead of being rightly seen and treated as the social symptoms of our diseased capitalist system and the consumer culture on which it thrives, we face increasing stigmatization and social alienation, deepening the pain and emptiness inside us and making it no surprise that two percent of all deaths in the world are suicides, above both murder and war[15].
Growth for Development:
Exporting Frowny Faces
and Killing the Planet
While the situation is spiritually and psychologically sad for those in the North coming to terms with their meaningless, repetitive lives as consumers on capitalism’s hamster wheel, the fact that economic development policy imposed on Southern nations continues to promote economic growth as a primary development solution should be cause for even greater concern. Wrongly founded on an assumption of infinite growth in a world of finite resources, Southern economies are encouraged to industrialize, stimulate consumer demand and create their societies in the image of the North as their hope for lifting billions of people out of poverty and into the system. An often ignored reality in this scenario is that the North’s incentive for promoting growth as a development strategy in the South is not born of a benevolent desire to improve quality of life for the world’s citizens, but rather grounded in the fact that the North itself relies on the expansion of Southern economies for its own survival in the form of continued economic growth and the accumulation of wealth. This is evidenced in the persistent need for cheap resources, labor and primary exports from the South to fuel production in the North, the subsequent reliance on consumers in the South as an extended market for those goods produced in the North, as well as the structural adjustment loans characteristic of the final decades of the twentieth century in order to keep the money pumping through the banking system, funding bad policies and unfruitful projects invented in the North and imposed on the South[16]. As discussed previously, in the global capitalist system growth cannot end, because if it did, no one would be able to repay debts and both banks and people would go bankrupt. On the world stage, this has led to international development policy oriented not toward helping improve the lives of people living in poverty and despair, but rather toward stimulating economic growth to ensure debt repayments in order to keep the global money system, and thus the global economy, alive.
But as the impossible hamster[17] and its message of finite planetary limits demonstrate, there are real and obvious limitations to growth – and therefore to the growth-for-development model --, making the collapse of the system inevitable, along with the development strategies it employs. However, in our ongoing round of economic musical chairs, “as long as the music’s playing, there’s no loser”, and the entrenched interests of the powers that be have a vital stake in ensuring that we as a global humanity become aware of this reality as late in the game as humanly possible.
As the monitoring mechanism of the growth-for-development model, the measurement of per capita GDP has been traditionally used as the principal indicator for determining the social wellbeing of a country’s people, evaluating development success or failure on the measure of income alone. GDP-based wellbeing indicators reflect a purely quantitative concept of development and overlook the more significant qualitative aspects of living a meaningful life[18]. With economic growth and per capita income treated as ends in themselves rather than as the means to a brighter future for a nation’s citizens, development strategies have grown increasingly dehumanized and focused on numbers instead of human wellbeing, yet another perverse manifestation of modern capitalism’s prioritization of profit and economic growth over people and their quality of life. In recent years, new indicators have been created to take additional social and environmental aspects into account when evaluating the success of development strategies, including ecological footprint, health and education, as well as subjective measures of social wellbeing . Some of these new indicators will be explored further in the third installment of this series.
As a fallout from the economic development process described here, indigenous ways of life and local values are lost to the consumerist monoculture, which has become the “globally dominant cultural orientation”[19] of modernity, its overwhelming power and dominance undermining the cultures of non-consumers and crowding out those who attempt to live a virtuous life[20]; expressing itself in even greater distortion in exported form so at odds with native traditions in the Global South. Facing these stark realities, we are now coming to recognize that if the goal of economic development is to contribute to the wellbeing of people and communities around the world, exporting an unsustainable growth-based system that has made people more unhappy and the planet less livable is no longer, nor has it ever been, a viable development strategy. In other words, “socioeconomics based on the growth paradigm can never be sustainable”[21] and “attempts to bring people out of poverty by bringing them into the money [system] as it is defined today, are doomed”[22]. As new development approaches emerge, economic growth will play a much less significant role in policies designed to support social wellbeing, poverty alleviation and the promotion of flourishing communities. As this process unfolds, the economic growth-for-development and material accumulation-for-social wellbeing mantras of the global capitalist paradigm are constantly being called into question and increasingly discredited on a grand scale.
Similarly, the environmental struggle has erupted as the people of the Earth rally against select elite interests whose entrenched power and influence stymie widespread progressive action to limit growth within the confines of the planet’s finite natural systems. Currently, “a world without growth is politically unthinkable”[23], because of those whose powerful short-term interests neglect the needs of the Earth and the vast majority of her people. Evelyn Linder makes mention of our dominant global economic reality as “a certain geohistorical cultural context that enables a ‘raiding’ culture to flourish and to hijack institutions with innovate tools and interventions [leading] to domination and exploitation, and if this happens at a global scale, it means the destruction of the entire socio- and ecosphere”[24]. However, as this scenario grows increasingly unsustainable, lurching toward its own demise, it presents yet another tipping-point opportunity where the tables are beginning to turn against the wealthy and powerful, in favor of the environment and the people fighting hard to save it. The concepts of de-growth and the steady-state economy[25] have emerged within this new framework seeking to transform the conversation on growth toward an understanding of sufficiency within planetary limits. This will no doubt require a revolution of the money system away from its cyclical reliance on economic growth.
Wellbeing Economics: Turning that Frown Upside Down
With the ‘wellbeing revolution’ upon us, a new economics is piecing itself together, abandoning classical market-oriented principles and seeking solutions outside the current system. The new economics is founded on the de-linking of economic growth and material accumulation[26] from practices of development and conceptualizations of social-wellbeing as discussed above, and is instead centered on the principles of collectivity, cooperation and solidarity toward a socioeconomically and environmentally sustainable world. Wellbeing economics is diverse in its foundations and does not present blue-print models for society, respecting that wellbeing is a subjective experience to be defined differently among individuals, communities and nations. Based on the understanding that true wellbeing is determined by the satisfaction of subjective needs and living in line with personal values for a meaningful life, wellbeing economics is revolutionizing the ways we approach community development and design new systems to replace the old.
We will return to the discussion of wellbeing economics in the final section, but let us first take a closer look at the innovative socioeconomic approaches of the new paradigm now in its incipient design phase. Stay tuned for the third installment of this five-part series.
[1] Joe Dominguez and Vicki Robin, Your Money or Your Life: Transforming Your Relationship with Money and Achieving Financial Independence (Penguin, 1999).
[2] Daly, Herman E. (2007). Ecological Economics and Sustainable Development: Selected Essays of Herman Daly. UK: Edward Elgar Publishing.
[3] Bruno S. Frey, Happiness: A Revolution in Economics. CES (Cambridge: The MIT Press, 2010): 28-29.
[4] Easterlin et al. The happiness-income paradox revisited. PNAS, December 28, 2010, vol. 107, no. 52.
[5] Ricard, Matthieu (2003). Happiness: A Guide to Developing Life´s Most Important Skill. Paris: NiL Editions. Ch. 15: A Sociology of Happiness, pp. 173.
[6] Anielski, Mark. (2007). The Economics of Happiness. Canada: New Society Publishers. p.39.
[7] Marist College Institute for Public Opinion. Generation to Generation: Money Matters. April 13, 2012. http://maristpoll.marist.edu/wp-content/misc/Home%20instead/Money%20Matters_April%202012_FINAL.pdf
[8] As cited in Anielski, Mark. (2007). The Economics of Happiness. Canada: New Society Publishers, p.24
[9] Anielski, Mark. (2007). The Economics of Happiness. Canada: New Society Publishers.
[10] Eisenstein, Charles (2011). Sacred Economics: Money, Gift and Society in the Age of Transition. Berkeley, California: Evolver Editions.
[11] Dave Ramsey (2009), The Total Money Makeover: A Proven Plan for Financial Fitness. Nashville: Thomas Nelson.
[12] Robert H. Frank (2007), as cited in Raj Patel, The Value of Nothing: How to Reshape Market Society and Redefine Democracy (New York: Picador, 2009): 36.
[13] Alan Thein Durning, “Are We Happy Yet?” Ecopsychology (San Francisco: Sierra Club Books, 1995): 69-70.
[14] Eisenstein, Charles (2011). Sacred Economics: Money, Gift and Society in the Age of Transition. Berkeley, California: Evolver Editions. Ch. 6: The Economics of Usury, pp. 93-124.
[15] Ricard, Matthieu (2003). Happiness: A Guide to Developing Life´s Most Important Skill. Paris: NiL Editions. Ch. 15: A Sociology of Happiness, pp. 170-185.
[16] Daly, H. Growth, Debt, and the World Bank. August 14, 2011. Center for the Advancement of the Steady State Economy. Retrieved 12/16/2011Bank
[17] New Economics Foundation. The Impossible Hamster. January 24, 2010. Available at: http://www.youtube.com/watch?v=Sqwd_u6HkMo
[18] For example, see: Schumacher, E. F. (1993). Small is beautiful, A study of Economics as if People Mattered. London: Vintage Books; Smith, P. B. and Max-Neef, M. (2011). Economics Unmasked, From power and greed to compassion and the common good. UK: Green Books; Raj Patel, The Value of Nothing: How to Reshape Market Society and Redefine Democracy (New York: Picador, 2009).
[19] Jonathan Dawson, “Eco-villages and the Transformation of Values”. State of the World 2012: From Consumerism to Sustainability. World Watch Institute.
[20] As cited in Anielski, Mark. (2007). The Economics of Happiness. Canada: New Society Publishers, p.25
[21] Smith, P. B. and Max-Neef, M. (2011). Economics Unmasked, From power and greed to compassion and the common good. UK: Green Books.
[22] Richards, Howard (2011), as cited in Lindner, Evelin (2012). A Dignity Economy: Creating an Economy that Serves Human Dignity and Preserves our Planet. USA: Dignity Press. Ch. 2: Let us work together and dig up the facts, pp. 15-29.
[23] Daly, Herman E. (2007). Ecological Economics and Sustainable Development: Selected Essays of Herman Daly. UK: Edward Elgar Publishing.
[24] Lindner. A Dignity Economy: Creating an Economy that Serves Human Dignity and Preserves Our Planet, 26
[25] Daly, H. Growth, Debt, and the World Bank. August 14, 2011. Center for the Advancement of the Steady State Economy. Retrieved 12/16/2011
[26] Jonathan Dawson, “Eco-villages and the Transformation of Values”. State of the World 2012: From Consumerism to Sustainability. World Watch Institute.