money and the crisis of civilization

This article by Charles Eisenstein, at RealitySandwich.com, gives a very simple explanation of money as debt & how money works, the crisis we face explained as ‘we are running out of things to monetise’ & how informal-economy activity will hasten the collapse but also minimise some of the negative impact of that inevitable collapse. A great article explaining how civilisation has, at an ever increasing rate, converted social capital, natural capital, cultural capital, and spiritual capital into resources/money and how the present crisis is simply that we are running out of things to monetise.

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, 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.

In ancient times entertainment was also a free, participatory function. Everyone played an instrument, sang, participated in drama. Even 75 years ago in America, 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 has 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 America 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 stripmining 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 non-monetized 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.

So what do we do? The system is flawed and can only lead to greater environmental devastation and social impoverishment. Rather than try to keep the moentary system afloat we should be looking for alternatives. The author suggests that we should remove ourselves from the monetary system wherever we can, and that everything we do for each other without money is helping to hasten the collapse, which we should view as an opportunity to free ourselves.

Money has dehumanised us, and the quest for money is making our planet uninhabitable. To embrace the collapse, and the opportunities it offers, is also to embrace and consciously work for the informal economy.

In the face of the 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 so 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 themselves, or to build their own house, cook their own food, make their 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.

In previous essays I have described 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 denies this union, for it seeks growth of the separate self and the expense of something external, something other. Probably everyone reading this essay agrees 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 non-separation. 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. So stop resisting the revolution in human beingness. If you want to survive the multiple crises unfolding today, do not seek to survive them. That is the mindset of separation; that is resistance, a clinging to a dying past. Instead, allow your perspective to shift toward reunion, and think in terms of what you can give. What can you contribute to a more beautiful world? That is your only responsibility and your only security. The gifts you need to survive and enjoy will come to you easily, because what you do to the world, you do to yourself.

The author of this excellent article, Charles Eisenstein, is also author of the book The Ascent of Humanity.

The Ascent of Humanity is a radical exploration of the history and future of civilization from a unique perspective: the human sense of self. Eisenstein traces all of the converging crises of our age to a common source, which he calls Separation. It is the ideology of the discrete and separate self that has generated these crises; therefore, he argues, nothing less than a “revolution in human beingness” will be sufficient to transform our relationship to each other and the planet. And this revolution is underway already. In all realms of human endeavor, an Age of Reunion is emerging out of the birth-pangs of a planet in crisis. The range and depth of Eisenstein’s thesis is breath-taking. Encompassing science, religion, spirituality, technology, economics, medicine, education, and more, he details a vast paradigm shift reflecting a more fundamental shift in the human sense of self. Even in this dark hour, he says, a more beautiful world is possible — but not through the extension of millennia-old methods of management and control. The convergence of crises is revealing the final bankruptcy of those methods. Soon, he says, we will abandon the Babelian effort to build a tower to Heaven, as we realize that the sky is all around us already. Then, we will turn our efforts to creating a new kind of civilization, a conscious civilization designed for beauty rather than height.

The book is available free online here, in the desire to distribute the ideas contained within.