Beyond the Consumer Machine
A narrative for the new economy
In the latter, Robert and Edward Skidelsky say this about the current system:
‘It has given us wealth beyond measure, but has taken away the chief benefit of wealth: the consciousness of having enough.’
There is now growing evidence that we are on a trajectory of rapidly diminishing returns on quality of life, as a result of over-cooking industrialisation.
Yet in the midst of unprecedented wealth, and unprecedented threats, staring us in the face is the opportunity to move on to bigger things - to move beyond the consumer machine, and gear the new economy towards what we’re really after in life.
Without this explicit quality of life narrative for the new economy, our innovations, collaborations, efficiencies and cleaner energy sources, risk being limited to improving or propping up a system that is fundamentally rudderless, confusing as it does, the means for the ends.
The notion of quality & optimal levels of ingredients
The notion of quality, in any realm, infers optimal amounts of desired ‘ingredients’. It’s logical in that sense that creating a system to achieve quality of life infers optimal amounts of money, material, energy and so on. So what are these?
What is our optimal level of income, and of Gross Domestic Product (GDP) as a country? What about energy use per capita? We scarcely even ask the question. We thrash out how to decouple material impact from growth, replace fossil fuels, create green jobs, make a knowledge economy, a collaborative economy, a circular economy, a clean economy. This is all worthy stuff, they’re worthy ingredients, but what’s it all for? What are we baking here?
Albert Einstein reportedly said in conversation with Werner Heisenberg:
‘In the West we’ve built a beautiful ship, and … it has all the comforts. But … the one thing it doesn’t have is a compass … that’s why it doesn’t know where it’s going.’
So what is our optimal level of energy use?
A decade ago, the UN noted that beyond a certain point, increasing energy use does not lead to increases in the Human Development Index (or the HDI). Indeed, Vaclav Smil had shown that the highest HDI rates were found to occur with a minimum annual energy use of 110 giga-joules (GJ) per capita (roughly Italy’s rate at the time, the lowest amongst industrialised nations, and around a third of the US). He noted no additional gains past that point, with diminishing returns past the threshold of only 40-70GJ per capita.
Developing energy-intensive technology past the point of beneficial utility is akin to using a chainsaw to carve butter. As Smil put, ‘higher energy use by itself does not guarantee anything except greater environmental burdens.’
What about optimal income levels?
In his book ‘Prosperity Without Growth’, Tim Jackson found similarly, that past a certain threshold of GDP per capita, of only around $15,000 per annum, life satisfaction measures barely responded, ‘even to quite large increases in GDP’. He notes many countries such as Sweden, Denmark and New Zealand recorded higher levels of life satisfaction than the USA, for example, with significantly lower income levels.
Jackson’s key message is this: there is no case to abandon growth universally, for there are countries that have not reached that optimal threshold of income per capita. But there is a strong case for industrialised nations ‘to make room for growth in poorer countries.’ (Certain segments of society within industrialised countries are also important to consider in this light.) He goes on to say, ‘It is in these poorer countries that growth really does make a difference…. In the language of economics, marginal utility (measured here as subjective wellbeing) diminishes rapidly at higher income levels.’
On a related note, in the context of self-reported perceptions of subjective wellbeing in Australia, Melissa Weinberg of the Australian Centre for Quality of Life at Deakin University found that once incomes rise above $100,000 per annum, there is no discernable gain in subjective wellbeing.
What’s our end game?
Wherever that threshold lies, it is clearly much lower than commonly thought, and begs the question, what’s our end-game? We pay so much attention to the poverty line, what about the optimal line? Or as philanthropic executive Genevieve Timmons puts it, the ‘economics of enough’. Once optimal material gains are achieved, what are we really after in life?
Of course, I’m not here to tell you what that is. There is no inherent or fixed answer to the question. Indeed, fundamental to the construction of this new narrative is for us to decide together what is most important to us at any given time and place. And to continue to evolve that in changing circumstances.
It is critical, in that sense, that this is a participatory exercise. And as it happens, experiences of this, including in Australia at the local level to date, have proved to be powerful means for communities to better understand each other, their realities, and their aspirations - and to take more responsibility for them. That local work, incidentally, now underpins the proposed Australian National Development Index (or ANDI). Its ambition is to become our primary set of national accounts by 2020.
Measuring quality of life
Indeed, there are growing efforts around the world to develop better measures of quality of life. It has long been recognised that GDP is not only a poor proxy for measuring a society’s wellbeing, but that its creators never intended it to be used in this way. In fact, they explicitly warned us not to do that.
For over 20 years, the Human Development Index has tried to address this, with a broader measure of progress embracing aspects of health and education, for example. Though I remember doing some research on the HDI while I was living in Guatemala, to find that country’s HDI went up during civil war!
Other initiatives aiming to measure quality of life at a national level are underway in countries including Canada, France, the UK and of course Bhutan with its Gross National Happiness. There are also broader projects such as those undertaken by the OECD, New Economics Foundation and the Genuine Progress Indicator. No measure is ever absolute, but they each tell a range of stories, which have the potential to be harnessed into an evolving narrative for the new economy.
Indicators don’t change the world in themselves. But they do play a significant role in legitimising or de-legitimising power structures, expectations and aspirations, assumptions of progress, and constituencies for change, particularly when they are developed and engaged with broad participation.
Other vital signs of life beyond the machine
There are other vital signs that we are readying to redefine progress and craft a new narrative for human societies. The Pope’s Encyclical, for example, made a big splash last year towards this end. He wrote:
‘It is not enough to balance, in the medium term, the protection of nature with financial gain, or the preservation of the environment with progress. Halfway measures simply delay the inevitable disaster. Put simply, it is a matter of redefining our notion of progress. A technological and economic development which does not leave in its wake a better world and an integrally higher quality of life cannot be considered progress.’
Its impact was telling. We had John Fullerton, founder of the Capital Institute and a former MD of JP Morgan, calling the Pope modernity’s Galileo. And here in Australia, we had Professor Robert Manne, twice voted Australia’s leading public intellectual, understanding this to reach beyond calls for more equitable and clean means of production.
As is becoming more apparent to more of us, including growing numbers of people in influential positions, what is at stake transcends the old left versus right political narrative. Deeper questions are being raised about our place in the world, and the meaning we derive from living in it together.
At its heart is a call to revise the flawed narrative of the dominant western model of development, which tells a story of humans as masters of a mechanised universe. What is ultimately at stake, what keeps driving the consumer narrative, is this view of the world that makes sense of materialistic culture - or that obscures it beyond conscious view. For from the vantage point of absolute human mastery, there is no need for circumspection, moderation or reflection. And there is no motivation for empathy, or to examine how we relate with ourselves, each other and the rest of nature.
Just dial up the next technology, all the more these days if it’s cleaner, faster or more affordable. Continue to engineer a mechanised universe to (assumed) human ends.
The tragedy of the persistence of that view of the world is at least two-fold. For one, it is a narrative that flies in the face of the growing affirmation of our limits to material growth. The original Limits to Growth report concluded back in 1972:
‘If the present growth trends in world population, industrialisation, pollution, food production, and resource depletion continue unchanged, the limits to growth on this planet will be reached sometime within the next one hundred years. The most probable result will be a rather sudden and uncontrollable decline in both population and industrial capacity.’
Graham Turner is just one of a number of researchers who has checked how this prediction is tracking, finding that, ‘So far, there’s little to indicate they got that wrong.’
And secondly, it contradicts our growing understanding that nature is the very source of our wellbeing, belonging, and creation of meaning. Our quality of life is derived from the quality of the whole life ‘system’. Indeed, we are learning to see ourselves again as expressions of that whole of life. To paraphrase EF Schumacher, we have been talking of a battle with nature, forgetting that if we won the battle, we would find ourselves on the losing side.
The ‘machine age’, the era of this mechanised view of nature, dehumanises as much as it destroys the nature ‘out there’. Restoring a fuller sense of what it means to be human, and resolving our literally endless, and increasingly disastrous, material quest, are two sides of the same coin.
So how can we move beyond the consumer machine?
The consumer growth economy is coming to an end, one way or another. And not before time, given the trouble it's now causing us. But limits to growth need not be the threat they are often taken to be, as material growth is not our purpose. At least, it shouldn’t be. Paradoxically, in railing against or ignoring the reality of material limits to growth, we limit a broader, richer growth in human possibility and meaning.
Hugh Mackay’s recent spate of books, the culmination of his life’s work, includes ‘The Good Life’. It won’t surprise anyone here that the key ingredient was not money or material, but the quality of our relationships.
So if a quality human life, past certain optimal thresholds of income, energy use and so on, inherently looks beyond consumption to cultivating healthy and meaningful relationships, that sounds like a recipe for a better world. But in scaling back consumption, the good life may also bean inherently recessionary pressure. And that scares us.
But what if we can redefine progress to reflect our aspirations for quality living, and track that against other more appropriate measures, personally and as a society? What if we were even to enter what we’ve defined historically as a recession, based on the inadequate measure of GDP, but we see other indicators reflecting our broader aspirations tracking well? Might we develop the confidence to entertain shifting dynamics of income, work, energy use and so on, to make the transition to the new economy? It’s a big ask, to be sure. But the alternative is to remain adrift in a sea of means without ends, that is only becoming rougher.
We need a narrative for the new economy that, as Schumacher put it, seeks to optimise consumption to maximise wellbeing, as opposed to optimising production to maximise consumption. In addition, it would convey the potential for higher quality of life, while releasing the fallacy of absolute human mastery over a mechanised world. In fact, these points would come to be recognised as one and the same.
Given evidence of diminishing wellbeing in many parts of the industrialised world, and a growing call in powerful places for such a narrative, there is a great opportunity for demonstrating how we may navigate our way to life beyond the over-cooked industrialisation of the consumer machine.
There's more to being human, and more than ever it's time to organise ourselves to that end.
If I was a football coach devising a system to win a premiership, would my priority be for my team to simply get as many touches of the ball as possible?
If I'm seeking to communicate better, would my priority be to use as many words as possible? Or if I was baking a cake, would it make sense to use as many ingredients as possible?
Why, then, when it comes to trying to live a high quality life, or create a high quality economic system, would my priority be to seek as much money and material as possible?
Yet this is the narrative of modern society, and therefore the economic system we employ to make it happen. That may have been all well and good, while the correlation between quality of life and material ‘standards’ of living appeared strong. But this correlation is weakening. A growing spate of titles such as ‘Affluenza’, ‘Stuffocation’ and ‘How Much is Enough?’ speak to the phenomenon.
Presented by Anthony James, Executive Director of The Rescope Project
At the Building the New Economy conference
16 - 17 August 2016 – Glebe Town Hall, Sydney