NYT Reporter Asks Economists About the Future of Consumer Culture
A few days ago, New York Times reporter and Dot Earth blogger Andrew C. Revkin asked a handful of prominent economists what they thought about evidence showing a substantial and sustained cooling of consumer spending habits. In addition to Nobel laureate, Kenneth J. Arrow, a few others weighed in. Arrow starts off the discussion by claiming "One can't give a simple answer..." then proceeds not to. He examines the question from three perspectives, the recovery (increased savings rates will slow the recovery), the medium term (savings rate increase may last beyond the recovery), and the long run (increased saving ratio needed to provide capital for renewable energy and other sustainable economic activities).
Boston College professor, Juliet Schor, answers by stating that "the key is not just to reduce consumption and increase savings ... but to shift activity into a new, sustainable set of activities." She advocates moving "from a consumer-driven economy to one in which productivity growth is translated into leisure time (and more jobs/less unemployment)." Her upcoming book, entitled Plenitude, will argue that "the optimal strategy for individuals and economies will increasingly be a lower-impact path." Juliet Schor is a founding board member of New Dream and someone who's writing and analysis has long influenced the direction of this organization. The road map presented in this book will no doubt influence future New Dream activity on this subject. Schor's comments in full can be found here.
Another interesting comment came from MIT professor, John Sterman. The real issue, in Sterman's mind, is not what the spending chill will do to the economy in the short term, but rather the "long-run impact of consumption on the ability of the global ecosystem to support our economy." The balance sheet we need to pay the most attention to is that of natural capital: "We have been consuming natural capital far faster than it regenerates, whether it’s fossil fuels, fish, forests, wetlands, or the capacity of the oceans and other sinks to take up greenhouse gases." Sterman argues, as does Schor, for a de-materialization of our consumption as one way out of this mess. But he also warns, like Schor, that increased efficiency alone, without some rethinking of our goals, is not the answer.
Sterman's full comments (found here), touching on the unsatisfying economic edifice we've built (and subsequently watched crumble) versus what we long for, are worth reading. His words serve almost as a nutshell summation of why this organization, the Center for New American Dream, exists.
Sterman closes by saying that the stakes are high and "it will take a lot of work to shift our lives from the self-defeating path we are on to a more satisfying, sustainable path."
Which means we should probably get to work.