I have just finished Sacred Economics by Charles Eisenstein and I am starting to change—at least a little bit—the way I think about money and the economy. And I’m changing my behavior: I’m starting to do much more on a cash basis. I track it just like I did my debit card, but I find I am spending less. I am much more stingy with cash than credit (or debit). I seem to think about it more when I’m paying cash. I’m not sure why that is, but I’ve read studies that say people tend to spend less when they use cash than credit, even when their income stays the same.
Eisenstein has seven policies or strategies that he believes will move us toward an economic system that values nature and people over money and the accumulation of wealth. I will be giving them very short shrift here—after all, he has devoted nearly 500 pages to this analysis, so if any of these approaches interest you at all, I strongly encourage you to pick up the book. You don’t even have to pay for it—in the spirit of the gift economy, Eisenstein is making his book available online at no cost. Here are the seven policies/pillars/strategies, and a comment or two about each:
Negative-interest currency. This is the one I have the hardest time getting my arms around, but apparently it’s not as wacky as it sounds, as the Fed has written at least one paper about it and Sweden has implemented it. The purpose of negative interest is to keep money circulating and to discourage its hoarding. Negative interest rates have been used primarily as a temporary measure to force banks to lend money rather than sit on it. This also makes a steady-state economy acceptable, whereas an interest-based economy needs to keep growing or it will implode (another thing I have a hard time getting my arms around).
Elimination of economic rents, and compensation for depletion of the commons. This shifts the tax burden away from labor and toward property owners. In this way, private interests can only profit by using a property well and improving it, and not by merely owning (or destroying) it. Also, shifting taxes onto property and resources will reduce or eliminate sales and income taxes and create a strong economic incentive for conservation.
Internalization of social and environmental costs. Currently, society pays most of the costs of pollution and environmental damage. These costs are referred to as externalities (external to the company, that is; not external to taxpayers or the environment). Internalizing these costs to the companies themselves will end the opposition between ecology and the economy. “With economic disincentives for cheap, throwaway goods, manufactured items will become more expensive, more durable, and more repairable. We will care about our things more, maintain them and keep them.” Wouldn’t it be great to move away from our throwaway culture?
Economic and monetary localization. Hidden subsidies and decades of policy (NAFTA, anyone?) have pushed many things that can and should be local into the global commodity economy. This puts local regions into competition with each other, resulting in a “race to the bottom” in wages and environmental quality. Not everything will be local in our more localized economies, but we’ll probably stop importing honey and apple juice from China.
The social dividend. This is basically a return to every individual for use of the commons—physical, social, and intellectual. The dividend will come from the pollution taxes and payments for the use of our commons.
The social dividend would ideally provide the bare amount to cover life’s necessities; beyond that, people could still choose to earn their own money. It frees work from the pressure of necessity; people would work because they want to, not because they have to…. The point of economic life…will no longer be to “make a living.” Freed of that pressure, we will turn our gifts toward that which inspires us.
Economic degrowth. It is time to stop growing. It is time for stability, or perhaps even some economic shrinking. With all the labor-saving devices we’ve invented, we have consistently chosen to consume more rather than work less. Now it is time to consume less. Everyone seems to think this is so scary, but I think it provides wonderful opportunity and happiness quotients will soar. “People will spend more and more of their time in noneconomic activities as the money realm shrinks and the realm of gifts, voluntarism, leisure, and the unquantifiable grows…. People will also share more and consume less, borrow more and rent less, give more and sell less—all reflecting and engendering economic degrowth.”
Gift culture and peer-to-peer economics. Shoveling your neighbor’s walk. Giving an extra potato masher to a friend that needs one. Carpooling to the grocery store, sharing a lawnmower, watching the neighbor’s kids. More needs will be met without money. We are seeing a huge growth in peer-to-peer economics already, through the Internet: Craigslist and freecycle come to mind.
I have shortchanged every single one of these ideas. It may seem pie-in-the-sky to you, but some of these practices are already taking root. Look at Wikipedia. Farmers’ markets. Co-ops and credit unions. Community gardens. Car-sharing programs.
Enough, anyway, that it just seems possible.