“Americans are substituting growth and consumption for dealing with the real issues—for doing the things that would make us, and the country, better off.”
Economic growth may be the world’s secular religion, but for much of the world it is a god that is failing—underperforming for most of the world’s people and, for those in affluent societies, now creating more problems than it is solving. The never-ending drive to grow the overall U.S. economy undermines families and communities; it is leading us to environmental calamity; it fuels a ruthless international search for energy and other resources; it fails at generating the needed jobs; and it rests on a manufactured consumerism that is not meeting our deepest human needs.
Americans are substituting growth and consumption for dealing with the real issues—for doing the things that would make us, and the country, better off. Psychologists have pointed out, for example, that while economic output per person in the United States has risen sharply in recent decades, there has been no increase in life satisfaction, and levels of distrust and depression have increased substantially. We have entered the realm of what ecological economist Herman Daly calls “uneconomic growth.” Environmentally, we see a world in which growth has brought us to a situation where more of the same will quite literally ruin the planet. Politically, the growth imperative is a big part of how we the people are controlled: the necessity for growth gives the real power to those who have the finance and technology to deliver it.
It is up to us as citizens to inject values of justice, fairness, and sustainability into this system, and government is the primary vehicle we have for accomplishing this. Typically, we attempt to do so by working within the system to promote needed reforms. We work the media and other channels to raise public awareness of our issue, and try to shift public understanding and discourse in our favor. We lobby Congress, the current administration, and government agencies with well-crafted and sensible proposals. When necessary, we go to court. With modest resources, we devote what we can to the electoral process and to candidates for public office. And we hope somehow that lightning will strike and events will move in our favor.
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But it is now abundantly clear that these reformist approaches are not succeeding. The titanic forces unleashed by the American brand of capitalism are too powerful. The ceaseless drive for profits, growth, and power and other system imperatives keep the problem spigot fully open. Reform rarely deals with the root causes—the underlying drivers. The forces that gave rise to these problems in the first place continue to war against progress. And our enfeebled political life, more and more in the hands of powerful corporations and individuals of great wealth, is no match for these forces.
Pursuing reform within the system can help, but what is now desperately needed is transformative change in the system itself. To deal successfully with all the challenges America now faces, we must therefore complement reform with at least equal efforts aimed at transformative change to create a new operating system that routinely delivers good results for people and planet.
At the core of this new operating system must be a sustaining economy based on new economic thinking and driven forward by a new politics. The purpose and goal of a sustaining economy is to provide broadly shared prosperity that meets human needs while preserving the earth’s ecological integrity and resilience—in short, a flourishing people and a flourishing nature. That is the paradigm shift we must now seek.
I believe this paradigm shift in the nature and operation of America’s political economy can be best approached through a series of interacting, mutually reinforcing transformations—transformations that attack and undermine the key motivational structures of the current system, transformations that replace these old structures with new arrangements needed for a sustaining economy and a successful democracy.
The following transformations hold the key to moving to a new political economy. Consider each as a transition from today to tomorrow. Economic growth: from growth fetish to post-growth society, from mere GDP growth to growth in human welfare and democratically determined priorities.
The market: from near laissez-faire to powerful market governance in the public interest.
The corporation: from shareholder primacy to stakeholder primacy, from one ownership and motivation model to new business models and the democratization of capital.
Money and finance: from Wall Street to Main Street, from money created through bank debt to money created by government.
Social conditions: from economic insecurity to security, from vast inequities to fundamental fairness. Indicators: from GDP (“grossly distorted picture”) to accurate measures of social and environmental health and quality of life.
Consumerism: from consumerism and affluenza to sufficiency and mindful consumption, from more to enough.
Communities: from runaway enterprise and throwaway communities to vital local economies, from social rootlessness to rootedness and solidarity.
Dominant cultural values: from having to being, from getting to giving, from richer to better, from separate to connected, from apart from nature to part of nature, from transcendent to interdependent, from today to tomorrow.
Politics: from weak democracy to strong, from creeping corporatocracy and plutocracy to true popular sovereignty.
Foreign policy and the military: from American exceptionalism to America as a normal nation, from hard power to soft, from military prowess to real security.
We know that systemic, transformative change along these dimensions will require a great struggle, and it will not come quickly. The new values, priorities, policies, and institutions that would constitute a new political economy capable of regularly delivering good results are not at hand and won’t be for many years. The truth is we are still in the design stage of building a new operating system. That system won’t be yesterday’s socialism, by the way, but it won’t be today’s American capitalism either.It follows that effectively addressing the many serious challenges America faces will take a lot more time than we would like.
Meanwhile, America’s decline will persist—“decline” here not referring to losing world power relative to China and other countries, but to decline in human and natural conditions. That is a very depressing conclusion, but we must face it. More importantly, we must use it as a framework for understanding what we must now do. Indeed, there can be a very bright light at the end of this gloomy tunnel. There is the great gift of plausible hope that we can find our way forward.
In this period of decline, the imperatives we face as citizens are threefold: to slow and then halt the descent, minimizing human suffering and planetary damage along the way and preventing a collapse, the emergence of a fortress world, or any of the other dark scenarios plotted for us in science fiction and increasingly in serious analysis; to minimize the time at the bottom and start the climb upward toward a new operating system; and to complete, inhabit, and flourish in the diversity of alternative social arrangements, each far superior to ones we will have left behind.
But if we are failing at modest, incremental reform, how can we hope to achieve deeper, transformative change? The decline now occurring will progressively delegitimize the current order. Who wants an operating system that is capable of generating and perpetuating such suffering and destruction? One good thing about the decline of today’s political economy is that it opens the door to something much better.
People will eventually rise up, raise a loud shout, and demand major changes. This is already happening with some people in some places. It will grow to become a national and global movement for transformation, demanding a better world.
As the old system enters its death throes, we are already seeing the proliferation of innovative models of “local living” economies, sustainable communities, and transition towns, as well as innovative business models, including social enterprises and for-benefit and worker-owned businesses that prioritize community and environment over profit and growth. Initiatives that may seem small or local can be starter wedges that lead to larger changes. These initiatives provide inspirational models for how things might work in a new political economy devoted to sustaining human and natural communities. Such initiatives are growing rapidly in America.
While the struggle to build a new system goes forward, we must do everything we can to make the old system perform. For example, if we do not act now on climate change, both nationally and internationally, the consequences will become so severe that the dark visions of those predicting calamity will become all too real. The situation we face in regard to climate disruption is already very grave. Should we fail to act now on the climate front, the world will likely become so nasty and brutish that the possibility of rebirth, of achieving something new and beautiful, will simply vanish, and we will be left with nothing but the burden of climate chaos and societies’ endless responses to it. Coping with the wreckage of a planetary civilization run amok would be a full-time job. On this issue and others, then, reform and transform are not alternatives but complementary and mutually reinforcing strategies.
Important here is a “theory of change.” The theory adopts the view that people act out of both fear and love—to avoid disaster and to realize a dream or positive vision. The theory affirms the centrality of hope and hope’s victory over despair. It locates the plausibility of hope in knowledge—knowing that many people will eventually rise up and fight for the things that they love; knowing that history’s constant is change, including deep, systemic change; and knowing that we understand enough to begin the journey, to strike out in the right directions, even if the journey’s end is a place we have never been.
The theory embraces the seminal role of crises in waking us from the slumber of routine and in shining the spotlight on the failings of the current order of things. It puts great stock in transformative leadership that can point beyond the crisis to something better. The theory adopts the view that systemic change must be both bottom-up and top-down—driven by communities, businesses, and citizens deciding on their own to build the future locally as well as to develop the political muscle to adopt system-changing policies at the national and international levels. And it sees a powerful citizens’ movement as a necessary spur to action at all levels.
So imagine: As conditions in our country continue to decline across a wide front, or at best fester as they are, ever-larger numbers of Americans lose faith in the current system and its ability to deliver on the values it proclaims. The system steadily loses support, leading to a crisis of legitimacy. Meanwhile, traditional crises, both in the economy and in the environment, grow more numerous and fearsome. In response, progressives of all stripes coalesce, find their voice and their strength, and pioneer the development of a powerful set of new ideas and policy proposals confirming that the path to a better world does indeed exist. Demonstrations and protests multiply, and a powerful movement for prodemocracy reform and transformative change is born.
At the local level, people and groups plant the seeds of change through a host of innovative initiatives that provide inspirational models of how things might work in a new political economy devoted to sustaining human and natural communities. Sensing the direction in which things are moving, our wiser and more responsible leaders, political and otherwise, rise to the occasion, support the growing movement for change, and frame a compelling story or narrative that makes sense of it all and provides a positive vision of a better America. It is a moment of democratic possibility.
In the end it all comes down to the American people and the strong possibility that we still have it in us to use our freedom and our democracy in powerful ways to create something fine, a reborn America, for our children and grandchildren. We can realize a new American Dream if enough of us join together in the fight for it. This new dream envisions an America where the pursuit of happiness is sought not in more getting and spending, but in the growth of human solidarity, real democracy, and devotion to the public good; where the average American is empowered to achieve his or her human potential; where the benefits of economic activity are widely and equitably shared; where the environment is sustained for current and future generations; and where the virtues of simple living, community self-reliance, good fellowship, and respect for nature predominate.
These American traditions may not prevail today, but they are not dead. They await us, and indeed they are today being awakened across this great land. New ways of living and working, sharing and caring are emerging across America. They beckon us with a new American Dream, one rebuilt from the best of the old, drawing on the best of who we were and are and can be.
ABOUT GUS SPETH James Gustave Speth teaches at Vermont Law School. He is the author of The Bridge at the Edge of the World. This article from the March/April 2012 issue of Orion, the first of a two-part series, is based on his forthcoming book from Yale University Press, America the Possible: Roadmap to a New Economy.