Do your possessions define you?

In Prosperity Without Growth, Tim Jackson confronts the conflict between our modern economic systems, which are designed to operate through exponential growth and high materiel throughput, and the limits of a finite planet.   Of all the factors that influence that exponential growth, one constantly feeds the engine of growth and drives people towards continued consumerism.  The social logic of consumerism exists in what Jackson calls a symbolic language “in which we communicate continually with each other, not just about the raw stuff, but about what really matters to us: family, friendship, sense of belonging, community, identity, social status, meaning, and purpose in life” (Jackson 51).

In fact, that logic goes beyond positional competition, where we try to appear more prosperous than our neighbors and peers by having more stuff, to what Russell Belk calls cathexis, or the extension of our self-identity onto the objects that we own or associate with:

“It seems an inescapable fact of modern life that we learn, define, and remind ourselves of who we are by our possessions… we seek to express ourselves through possessions and use material possessions to seek happiness, remind ourselves of experiences, accomplishments, and other people in our lives, and even create a sense of immortality after death. Our accumulation of possessions provides a sense of past and tells us who we are, where we have come from, and perhaps where we are going.” (Belk 160)

However, new research indicates that in fact, our possessions may not provide us the happiness that we seek.  Elizabeth W. Dunn, Assistant Professor of Psychology at the University of British Columbia, has found that wealth itself can reduce our ability to savor positive experiences (Quoidbach 10), and that spending our money on experiences, like hiking the White Mountains, as opposed to objects, like a new couch, produces longer lasting satisfaction (Rosenbloom).

It seems, then, that we humans are like a dog chasing our own tail; we work longer hours in order to make more money, and we use that money to buy commodities that we understand will bring us happiness.  However, when we find that we are not happy, we buy more commodities in search of that elusive happiness.  It is the symbolic language, which corporations twist and turn so well in advertising, which pushes us onward in our search.

Amartya Sen, one of the grandfathers of developmental economics, and a Professor at Harvard University, sought to find a way beyond that social logic in his essay, “The Living Standard.”  Sen advises us to consider commodities “in terms of [their] contributions to capabilities and freedom” rather than simply in terms of opulence or object utility (Sen 293).  Jerome Segal goes a step further by insisting that the standard of living cannot be tied directly to increased consumption, as misleading measures such as Gross Domestic Product do.  In fact, Segal identifies our standard of living is an “art form. It is very much a matter of knowing how to live and may involve a broad range of knowledeges and psychological capabilities” (Segal 357).  That complexity goes beyond concrete functionings like shelter, transportation, and health, and to subjective conceptions like beauty and self-esteem.

Considering the rat race of social competition that we find ourselves in, and the importance that we place upon the objects and commodities that we possess, how can we transform our society and recreate the dominant notion of standard of living, which revolves around opulence?  Environmental advocates often urge consumers to make “green” consumption decisions – to choose the option of consumption with a lower environmental impact.  For instance, instead of buying an object that will be thrown away, buy one that will last longer and have a lower resource intensity.

However, that “Green” consumption logic misses the larger point.  As Dunn and Belk identify, the reason that we choose to buy many objects in the first place is problematic – whether it is to appear successful, or to satisfy some perceived need.  However, as the recent Economic crisis, where many Americans overleveraged themselves on cheap debt, shows, the sacrifice to attain those objects can exact a greater loss than the value of what it is we think we are buying.  In fact, the experiences that will make us happier, which Dunn identifies in her research, may become less available because of increased work hours.

It seems, then, that we are lost in the noise of our own consumption.  The messages are non-stop and pervasive.  Just try spending an hour in which you are not exposed to commercial advertisement; unless you live in the wilderness, that silence is nearly impossible.  To overcome this, we need to create space in our lives in which we look beyond the commercial marketplace, and to our own true happiness.  In fact, as labor, we may need to demand a 30-hour workweek, like European societies like France obtained long ago.  The extra free time would allow people to reprioritize the experience that can truly make them happy.  Additionally, a 30-hour workweek would allow the labor market to expand, providing more opportunity for work.

However, reduced work would not solve the dilemma of social competition on its own.  The symbolic power of a measure like GDP would have to be replaced.  In fact one organization, called the State of the USA, is starting a new index, which will attempt to provide a “common ground” and a “shared set of facts” from which we can better analyze our standard of living (Hoening).  This is an improvement, but ultimately, until we can come to a consensus about what a sustainable future is, and transform our economy to meet those needs, we will not find the happiness that we seek.

Works Cited

Belk, Russell W.  “Possessions and the Extended Self.”  The Journal of Consumer Research, Vol. 15 No. 2, September 1988.  Pg 139-168, PDF.

Giridharadas, Anand.  “Getting In (and Out of) Line.”  The New York Times, 8 August 2010.  Pg. WK 5.  Print.

Hoening, Christopher.  “Working Towards a Key National Indicator System.”  StateoftheUSA.org, 22April2010. Web, 09August2010.

Jackson, Tim.  Prosperity Without Growth: Economics For a Finite Planet.  Earthscan: London, 2009. Print.

Nussbaum, Martha.  “The Good as Discipline, The Good as Freedom.”  Ethics of Consumption: The Good Life, Ethics, and Global Stewardship.  David A. Crocker and Toby Linden, Eds.  Landham, MD/Oxford, UK: Rowman and Littlefield, 1998.  Pg 313-341, Print.

Rosenbloom, Stephanie.  “But Will It Make You Happy?” The New York Times, 8 August 2010.  Pg. BU 1.  Print.

Segal, Jerome M. “Living at a High Economic Standard: A Functioning Analysis.” Ethics of Consumption: The Good Life, Ethics, and Global Stewardship. David A. Crocker and Toby Linden, Eds.  Landham, MD/Oxford, UK: Rowman and Littlefield, 1998. Pg 342-365, Print.

Sen, Aramrtya.  “The Living Standard.” Ethics of Consumption: The Good Life, Ethics, and Global Stewardship.  David A. Crocker and Toby Linden, Eds.  Landham, MD/Oxford, UK: Rowman and Littlefield, 1998. Pg 287-311, Print.

Quoidbach, J., Dunn, E.W., Petrides, K. V., & Mikolajczak, M. “Money giveth, money taketh away: The dual effect of wealth on happiness.” Psychological Science. Unknown.  Print, via EW Dunn website @ UBC.


Reid to climate: drop dead. Can we afford inaction?

Ross Douthat admits Global Warming is a problem, but argues for inaction.

Today, in the New York Times, Paul Krugman and Conservative wunderkind Ross Douthat present competing theories on why climate change legislation is dead this year.  Douthat, surprisingly, admits that Global Warming is a genuine problem:

“…Conservatives who treat global warming as just another scare story are almost certainly mistaken.  Rising temperatures won’t “destroy” the planet, as fear mongers and celebrities like to say. But the evidence that carbon emissions are altering the planet’s ecology is too convincing to ignore. Conservatives who dismiss climate change as a hoax are making a spectacle of their ignorance.”

Douthat blames the demise of legislation on conservatives; in his words there is “seemingly an unbridgeable gulf between the conservative movement and the environmentalist cause.”  Of course, that framing of Global Warming is purposeful.  In Douthat’s mind, Global Warming is a problem for bird watchers to worry about.  In fact, Douthat provides the argument for inaction by making a dangerous assumption:

“…The assumption that a warmer world will also be a richer world — and that economic development is likely to do more for the wretched of the earth than a growth-slowing regulatory regime. But it’s also grounded in skepticism that such a regime is possible. Any attempt to legislate our way to a cooler earth, the argument goes, will inevitably resemble the package of cap-and-trade emission restrictions that passed the House last year: a Rube Goldberg contraption whose buy-offs and giveaways swamped its original purpose… Not every danger has a regulatory solution, and sometimes it makes sense to wait, get richer, and then try to muddle through.”

Douthat does not discuss the concept of externalities, and this is key.  An externality is the result of a transaction that is borne by neither the buyer nor seller directly, but rather by a third party.  In the case of our fossil fuel supplies, the externalities are only growing.  In addition to greenhouse gasses, you have pollution from coal plants that has measurable health impacts on communities surrounding them, and you have the ghastly side effects of hydraulic fracturing of shale for natural gas.  Of course, don’t forget about the oil spill in the Gulf of Mexico.  The scary thing?  We subsidize these fossil fuels.  Douthat, however, just wants to rely on unending growth to solve all of our problems.  Unfortunately, the Earth will not support unending growth.  Douthat would be wise to read Tim Jackson’s Prosperity Without Growth.

Paul Krugman, on the other hand, points the blame for the demise of climate legislation in a more

Krugman advises us to follow the money.

believable and useful direction.  In Krugman’s mind, we need to just follow the money:

“The economy as a whole wouldn’t be significantly hurt if we put a price on carbon, but certain industries — above all, the coal and oil industries — would. And those industries have mounted a huge disinformation campaign to protect their bottom lines.  Look at the scientists who question the consensus on climate change; look at the organizations pushing fake scandals; look at the think tanks claiming that any effort to limit emissions would cripple the economy. Again and again, you’ll find that they’re on the receiving end of a pipeline of funding that starts with big energy companies, like Exxon Mobil, which has spent tens of millions of dollars promoting climate-change denial, or Koch Industries, which has been sponsoring anti-environmental organizations for two decades.  Or look at the politicians who have been most vociferously opposed to climate action. Where do they get much of their campaign money? You already know the answer.”

That is the key of course.  Producers of fossil fuels do not want to have to account for externalities of their products.  They would rather society at large bear those costs.  We are slaves to growth and slaves to consumption, unable to see the forest for the trees.  As Krugman points out, 2010 is the hottest year on record.  Inevitably we will need to place a cap on carbon emissions; the longer we wait, the more difficult it will be.

Ross Douthat should read this book.

How do we solve these problems?  Herman Daly, an ecological economist, offers some viable prescriptions.  I will highlight one of the most important ones, which you will not see any politician advocate: ecological tax reform.  Right now labor and capital (the value added) is taxed; ecological tax reform would end value added taxes and instead tax that to which value is added: the throughput of resources extracted from nature (depletion) and returned to nature (pollution).  Ecological tax reform would reward entrepreneurs who are able to add value and innovation efficiently.  We want to encourage value added, and discourage depletion and pollution.  It sounds simple, but it goes against the neo-classical devotion to unending growth.  As such, Douthat and his fellow conservative denizens continue to believe in Business as Usual.


How can we change our economy from a jet to a helicopter?

Ecological Economist Herman Daly

Herman Daly, an Ecological Economist from the university of Maryland, argues that we humans will, sooner rather than later, have to transtion from a growth-based economy to what he calls a Steady State Economy (SSE).  In Daly’s conception, the economy has grown immensely over the last few hundred years compared to the static, steady state of the Earth; the more it continues to grow, the more it will have to conform to the Earth:

“That behavior mode is a steady state—a system that permits qualitative development but not aggregate quantitative growth. Growth is more of the same stuff; development is the same amount of better stuff (or at least different stuff). The remaining natural world no longer is able to provide the sources and sinks for the metabolic throughput necessary to sustain the existing oversized economy—much less a growing one. Economists have focused too much on the economy’s circulatory system and have neglected to study its digestive tract. Throughput growth means pushing more of the same food through an ever larger digestive tract; development means eating better food and digesting it more thoroughly. Clearly the economy must conform to the rules of a steady state—seek qualitative development, but stop aggregate quantitative growth.”

To further identify what a SSE would look like, Daly compares a growth based economy to an airplane, designed for forward motion, unable to hover in place.  Unlike the airplane, a SSE would be more like a helicopter, which is designed to hover.  In other words, the SSE would have a relatively constant population and stock of capitol, and maintain a reasonable rate of materiel throughput “within the regenerative and assimilative capacities of the ecosystem.”  To create the SSE, Daly recommends upstream resource taxes (instead of income taxes), redistribution of wealth, ecological protectionism, and an emphasis on durable, long lasting consumer goods.

To achieve these goals, decoupling will be necessary.  Absolute decoupling in when resource impacts decline in total, across the economy.  In his book Prosperity Without Growth, Tim Jackson points out that despite greater efficiencies and technological innovations, no absolute decoupling has occurred since the Kyoto climate summit:

“Despite declining energy and carbon intensities, carbon dioxide emissions from fossil fuels have increased 80% since 1970.  Emissions are almost 40% higher than they were in 1990 – the Kyoto base year – and since the year 2000 they have been growing at over 3% per year…. [and] what’s true for fossil resources and carbon emissions is true for material throughputs more generally.”

So, decoupling will require hard work and sacrifices in our standards of living.  However, energy and mineral resources get more and more expensive by the day, as the Energy Returned on Energy Invested continues to drop across the board, from oil to copper.  Additionally resources that we humans have long taken for granted are becoming scarce.  Today the New York Times described new investments by Australian in desalination plants to meet the country’s water needs:

‘In one of the country’s biggest infrastructure projects in its history, Australia’s five largest cities are spending $13.2 billion on desalination plants capable of sucking millions of gallons of seawater from the surrounding oceans every day, removing the salt and yielding potable water. In two years, when the last plant is scheduled to be up and running, Australia’s major cities will draw up to 30 percent of their water from the sea. The country is still recovering from its worst drought ever, a decade-long parching that the government says was deepened by climate change. With water shortages looming, other countries, including the United States and China, are also looking to the sea. “We consider ourselves the canary in the coal mine for climate change-induced changes to water supply systems,” said Ross Young, executive director of the Water Services Association of Australia, an umbrella group of the country’s urban water utilities. He described the $13.2 billion as “the cost of adapting to climate change.”’

What this means is that the economy is already bumping up against the limits of the Earth.  However, the decoupling that Daly advocates will require careful coordination on development, between nations, not the type of ad hoc development planning that is evident in Australia.  Unfortunately, as Jackson shows in his book, the developing economies, especially in India and China, will require more and more resources in coming years.  The schism that was evident at the Climate summit in Copenhagen between Europe and the United States, and the developing economies belies that the careful coordination required to achieve decoupling is a long way off.  Unfortunately, I think it will take some much more vivid evidence of the economy bumping up against the limits of the Earth to inspire the necessary action and coordination.  The growth based economy, represented by the worship of Gross National Product, is in our DNA.  It will take a shock to our system to create the conditions for the necessary change.


Prosperity without growth?

Ronald Reagan once said, “There are no great limits to growth, because there are no limits of human intelligence, imagination, or wonder.”  In the United States, growth is mostly unquestioned as a source of prosperity and happiness.  In fact Reagan, under the influence of economist Milton Friedman, believed that the U.S. could prosper, as long as the economy was freed from government influence.  Neo-classical assumptions rule U.S. economic development, to the point where politicians of the right and the left wings both fervently believe it in. Barack Obama, during a campaign speech in Berlin, said:

“This is the moment when we must build on the wealth that open markets have created, and share its benefits more equitably. Trade has been a cornerstone of our growth and global development. But we will not be able to sustain this growth if it favors the few, and not the many. Together, we must forge trade that truly rewards the work that creates wealth, with meaningful protections for our people and our planet. This is the moment for trade that is free and fair for all.”

Obama, like Reagan, believed that growth was essential, but he felt that we should take some of the surplus and provide it to the poorest Americans.  He also understood the importance of “meaningful protections for… our planet.”  Based on the policies his White House has proposed during the first 18 months of his administration, Obama clearly believes that we can protect the planet – preventing runaway anthropogenic climate change – by relative decoupling, a reduction in the ecological intensity per unit of economic output.  Like Reagan, he has faith that Americans will continue to discover technology that will make unending growth possible, with greater efficiency and greater performance.

However, that faith in human innovation is running directly into the ecological limits that Earth provides.  With a growing population, with increasing standards of living, unending growth is in doubt.  In Prosperity Without Growth, Tim Jackson examines the dilemma of growth, and how prosperity and flourishing relate to it.  He writes that: “the truth is that there is as yet no credible, socially just, ecologically sustainable scenario of continually growing incomes for a world of 9 billion people (the United Nations projected 2050 global population).”

If we assume that continuing growth is not sustainable, then what norms can guide economic activity?  Jackson identifies an important factor that helps to inspire our need for growth, our “tendency to imbue material things with social and psychological meanings:”

“Consumer goods provide a symbolic language in which we communicate continually with each other, not just about raw stuff, but about what really matters to us: family, friendship, sense of belonging, community, identity, social status, meaning, and purpose in life.”

With the limits of growth, on an Earth with an expanding human population, finding ways to circumvent that opulence, to find a way to short-circuit the positional race.  In the United States, that race was known under the mantra ‘Keeping up with the Joneses.‘  The task, it seems is to decouple those important qualities, which Martha Nussbaum identified in her essay “The Good As Discipline, The Good as Freedom,” from material opulence.    In contemporary societies, the institutions that can best influence and nurture that decoupling would be religious and community groups.  Institutions that would be most affected by that kind of shift would be groups like the Chamber of Commerce, that favor growth at all costs.

Additionally, another norm that can help to guide the transformation of the economy, and society, would be an emphasis on quality in everything that we produce.  Right now, the goal of growth encourages the production of cheap, disposable objects that consumers will need to replace.  These cheap goods are often produced on the other side of the Earth from where they are consumed, in Third World economies.  An emphasis on quality, and the nurturing of artisan producers, would help develop local economies to sustainably, and collectively, prosper.  The nurturing of local production would also reduce transportation, and environmental costs.

Our companies are designed to maximize efficiency at the cost of people and the planet.  To trace one example, by making meat production local, the meat becomes more expensive; however, that meat better bears its cost to the environment and to our continued prosperity.  This emphasis on quality and local production would impact the global business world, namely the companies which have grown on such a scale as to become more powerful than many States.   For example, ConAgra is a dominant player in food production.  They are already being affected by the locavore movement, and have bought numerous brands in order to find a niche in that economy.  The question of course, is whether we, as consumers, will nurture the artisans instead of the ConAgras of the world.