The Economic Crisis Isn't All Bad; It's a Chance for Us and Obama to Reimagine How We Live Our Lives
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As America, recession mired, enters the hope-inspired age of Barack Obama, a silent but fateful struggle for the soul of capitalism is being waged. Can the market system finally be made to serve us? Or will we continue to serve it? George W. Bush argued that the crisis is "not a failure of the free-market system, and the answer is not to try to reinvent that system." But while it is going too far to declare that capitalism is dead, George Soros is right when he says that "there is something fundamentally wrong" with the market theory that stands behind the global economy, a "defect" that is "inherent in the system."
The issue is not the death of capitalism but what kind of capitalism -- standing in which relationship to culture, to democracy and to life? President Obama's Rubinite economic team seems designed to reassure rather than innovate, its members set to fix what they broke. But even if they succeed, will they do more than merely restore capitalism to the status quo ante, resurrecting all the defects that led to the current debacle?
Being economists, even the progressive critics missing from the Obama economic team continue to think inside the economic box. Yes, bankers and politicians agree that there must be more regulatory oversight, a greater government equity stake in bailouts and some considerable warming of the frozen credit pump. A very large stimulus package with a welcome focus on the environment, alternative energy, infrastructure and job creation is in the offing -- a good thing indeed.
But it is hard to discern any movement toward a wholesale rethinking of the dominant role of the market in our society. No one is questioning the impulse to rehabilitate the consumer market as the driver of American commerce. Or to keep commerce as the foundation of American public and private life, even at the cost of rendering other cherished American values -- like pluralism, the life of the spirit and the pursuit of (nonmaterial) happiness -- subordinate to it.
Economists and politicians across the spectrum continue to insist that the challenge lies in revving up inert demand. For in an economy that has become dependent on consumerism to the tune of 70 percent of GDP, shoppers who won't shop and consumers who don't consume spell disaster. Yet it is precisely in confronting the paradox of consumerism that the struggle for capitalism's soul needs to be waged.
The crisis in global capitalism demands a revolution in spirit -- fundamental change in attitudes and behavior. Reform cannot merely rush parents and kids back into the mall; it must encourage them to shop less, to save rather than spend. If there's to be a federal lottery, the Obama administration should use it as an incentive for saving, a free ticket, say, for every ten bucks banked. Penalize carbon use by taxing gas so that it's $4 a gallon regardless of market price, curbing gas guzzlers and promoting efficient public transportation. And how about policies that give producers incentives to target real needs, even where the needy are short of cash, rather than to manufacture faux needs for the wealthy just because they've got the cash?
Or better yet, take in earnest that insincere MasterCard ad, and consider all the things money can't buy (most things!). Change some habits and restore the balance between body and spirit. Refashion the cultural ethos by taking culture seriously. The arts play a large role in fostering the noncommercial aspects of society. It's time, finally, for a cabinet-level arts and humanities post to foster creative thinking within government as well as throughout the country. Time for serious federal arts education money to teach the young the joys and powers of imagination, creativity and culture, as doers and spectators rather than consumers.
Recreation and physical activity are also public goods not dependent on private purchase. They call for parks and biking paths rather than multiplexes and malls. Speaking of the multiplex, why has the new communications technology been left almost entirely to commerce? Its architecture is democratic, and its networking potential is deeply social. Yet for the most part, it has been put to private and commercial rather than educational and cultural uses. Its democratic and artistic possibilities need to be elaborated, even subsidized.
Of course, much of what is required cannot be leveraged by government policy alone, or by a stimulus package and new regulations over the securities and banking markets. A cultural ethos is at stake. For far too long our primary institutions -- from education and advertising to politics and entertainment -- have prized consumerism above everything else, even at the price of infantilizing society. If spirit is to have a chance, they must join the revolution.
The costs of such a transformation will undoubtedly be steep, since they are likely to prolong the recession. Capitalists may be required to take risks they prefer to socialize (i.e., make taxpayers shoulder them). They will be asked to create new markets rather than exploit and abuse old ones; to simultaneously jump-start investments and inventions that create jobs and help generate those new consumers who will buy the useful and necessary things capitalists make once they start addressing real needs (try purifying tainted water in the Third World rather than bottling tap water in the First!).
See more stories tagged with: capitalism, consumerism, economy, spending, recession, saving, gdp, financial crisis
Benjamin R. Barber, a distinguished senior fellow at Demos, is the author of Jihad vs. McWorld and Consumed: How Markets Corrupt Children, Infantilize Adults and Swallow Citizens Whole.
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