I have just completed an eight-week course on Climate Change, which I summarised in the eight previous posts. I thoroughly enjoyed it and it has dominated my time allocated to intellectual activities over the past couple of months but I am now returning to other mind-stretching pursuits. For some time I have been very interested in system thinking and its application to, for example, the world economy. So with the Climate Change course on the back burner (solar-powered of course!) my first port of call was the Modern Monetary Theory - MMT World group on LinkedIn. I have just joined a discussion on MMT and Morality, the starting point of which is Charles Eisenstein's book 'Sacred Economics'. I have dipped into Eisenstein's book and also had a look at some of the plethora of his videos and essays. He talks in a way that appeals to me about how the current monetary system is a main driver of both society's bad behaviour (notably greed) and the current economic mess. I will return to this later but let me first pick up on some of the issues arising from the Climate Change course that, in my opinion, are highly relevant to the monetary discussion.
Obviously a key finding arising from the work of climatologists is the link between the rapid increase in human-induced carbon dioxide emissions, mainly from the combustion of fossil fuels, and global warming. It would appear that over the past 150 years there has been a strong correlation between world population, carbon dioxide in the atmosphere and global temperatures. For centuries up until the Industrial Revolution, these three variables had remained fairly constant but over the past 150 years there have been rapid increases. Now correlation does not always imply causation but in this case there is strong evidence to link the growth in human population with increased carbon dioxide in the atmosphere and global warming.
Now let's return to the economic discussion. My view, which I have held for a long time, is that a scourge of society is the insatiable desire for economic growth. You only have to tune in to any TV business programme to listen to pundits extolling the virtues of company growth in turnover and profit, as well as national and international growth of GDP. But growth means more people, greater industrial output and, therefore, more carbon emissions. Can you see how the dots are connecting?! Moreover, as Eisenstein (and others) are quick to point out, infinite growth on a finite planet is unsustainable. What's more, our monetary system relies upon growth for its survival. Money is created as an interest-bearing debt, which means the amount paid back is greater than the amount created. So more money has to be created, which results in a bigger pay-back........Do you get the picture? It feeds the need for continuous growth. I see more dots being connected and dangerous reinforcing feedback loops. But of course the fools' paradise cannot continue forever and financial crashes, which self-regulate the financial system, albeit painfully, are inevitable. Unfortunately, however, the environmental damage to the planet is already done and because of the inertia in the system, driven by the 'stock' of carbon dioxide in the atmosphere (currently greater than 400 parts per million), global warming would continue for some time even if anthropogenic carbon dioxide emissions into the atmosphere were 'turned off' overnight.
So I see the dogma of economic growth as the real enemy within society. Now Eisenstein is a wonderful thinker and theorist and his proposed 'gift society' where wealth, security and status don't come from hoarding but from generosity, is good stuff. Being generous creates bonds between individuals rather than arms-length monetary transactions that thrive on competition and greed. Now there's obviously work to be done to move from Eisenstein's concept to something that works, but if we do nothing, the dots of planetary destruction are fast connecting and there will be no winners.
So let's take positive action to prevent the apocalypse.
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