July 28, 2008
available from Alternative Radio
You can listen to Juliet Schor speak for herself here.
Juliet Schor is Professor of Sociology at Boston College. Before joining Boston College, she taught at Harvard in the Department of Economics. She is author of many books including The Overworked American, Do Americans Shop Too Much?, and Plenitude: The New Economics of True Wealth.
This evening I will offer a vision that addresses both our economic and ecological predicaments. It lays out the logic of a small-scale, low-impact, time-affluent, high-satisfaction alternative to what I call the business-as-usual economy, or what I’ll refer to as I go on as the BAU economy or the BAU market.
It begins from the premise that standard solutions, such as the attempts to maximize indiscriminate growth, have become problems. And that without a more thorough-going reorganization of our economic lives, we will fail on many fronts, from solving unemployment and poverty to improving the distributions of income and wealth and saving the planetary home. Surveys I have done support the view that the average American understands that our way of life is not sustainable. But the elite discourse has not yet absorbed that point.
Like most of the sustainability visions that have been offered in recent years, mine requires that we adopt cutting-edge green technologies. Most importantly, we must get off fossil fuels as rapidly as we can. That’s key to averting climate catastrophe. It will involve capping carbon use. It will require the pollution sector to be made to pay for the havoc they’ve wreaked, through taxes, fees, and a commitment to leave the dirty fuels in the ground. But that won’t be enough.
Getting off fossil fuels will take some time, and in the meanwhile we also have to address the demand for energy. If we continue with business as usual with respect to demand for energy, we won’t succeed either in achieving a true energy transition, maintaining the climate at the 2-degree-warming increase or less, or with preserving the endangered ecosystems around the world that we depend on.
What the requirement to address energy demand really implies is that we need to do more than just change our technology, the terrain on which the conversation is currently stuck. We must also introduce a different rhythm of work, consumption, and daily life. We don’t just need an alternative energy system; we also need an alternative economy.
That may sound utopian. After all, the economy and the government remain firmly ensconced in the hands of a small number of powerful corporations and individuals who have made it clear they have no interest in curing what ails the U.S. or in averting climate catastrophe. The criminal enterprises that go by the name of energy companies—Exxon, BP, Koch Industries, or the coal companies—the big financial institutions that finance this dirty energy, the industrial agriculture system, and a variety of other powerful blocs and individuals have taken us backwards, reneging on earlier promises. The energy companies especially understand climate change. They see that trillions of their assets are in jeopardy of being made worthless and are spending desperately to stop other people from realizing that.
To rein them in, we need campaign finance reform, we need an awakened populace, and a powerful social movement to take back the government. But that movement hasn’t developed yet. Meanwhile, the climate clocks are ticking. What I’m suggesting is a way forward that allows us to do what we can now, at a scale where change is possible, while we push for something larger. One of the premises of my argument is that individuals, communities, cities, even some states can get started on creating the new economy today. Taking the first steps does not depend on already having achieved total systemic change or undoing the gridlock in Congress. Those are essential. But while we engage in those efforts, households and communities can also begin to take their economic futures into their own hands, and millions are already doing that. There are four principles to my vision.
The first is a new allocation of time. We’ve got to reverse the decade-long move toward longer hours of work, a trend that has propelled what I’ve called the work- and-spend cycle.
Work-and-spend has not only yielded exhausted, indebted households but more employment, as hours are concentrated in fewer and fewer people, and higher carbon emissions. As I will explain shortly, my research shows that carbon use and hours of work are closely linked, a fact that has not yet been recognized. Moving forward by funding hours reductions through productivity growth is at the core of this model.
The second principle is DIY, or do it yourself, or self-provisioning. People can use the new-found free time that they get from following step 1 to reduce what they have to buy on the market and provide for themselves in low-impact ways. Millions are already doing this. Self- provisioning not only gives people more freedom from a destructive and increasingly unreliable market, but it can help propel a more local, human, smaller-scale, greener, and fairer economy.
The third principle is an environmentally aware approach to consumption, which emphasizes the
recirculation and reuse of goods, sharing, and the creation of a new consumer culture.
And finally, we need to build new investments that are held widely and publicly. One casualty of rising inequality and an intense market orientation is that community has gotten thinner and human ties weaker. By recovering hours, individuals are freed up to fortify social networks and build common property.
I use the term plenitude to describe this economy in order to call attention to the inherent bounty of nature that we need to recover. It directs us to the chance to be rich in the things that matter to us most and the wealth that is available in our relations with each other. Plenitude involves very different ways of living than the maxims that have dominated the economic discourse for the last 30 years. It starts from our grim ecological and economic situation, but it is not a paradigm of sacrifice, despair, or desperation. To the contrary, it involves a way of life that will yield more well-being than sticking to business as usual, which has led both the natural and the economic environments into decline. It is hopeful, upbeat, and solutions-oriented. I believe that’s essential to success today.
But before getting into the specifics of the plenitude model, it may be worth revisiting the debates about ecology and economics that have been ongoing for many years. The history of this conversation is actually quite long. It began back in the 19th century with political economists like Thomas Malthus. But I will pick up the story in the 1960s and 1970s, because that debate has now again resurfaced in the 21st century. At that time the problem of the Earth’s so-called carrying capacity was famously put forward by a number of biologists. Paul Erlich wrote The Population Bomb, which argued that humans were risking collapse by overbreeding. Similarly, Garrett Hardin’s classic article “The Tragedy of the Commons” argued that humans couldn’t avoid degrading the biosphere because it is in our nature to overconsume common resources.
As it happens, both of these accounts were deeply flawed. Erlich’s racist alarm was later shown to have been sounded at the peak population growth rate, and rates of population growth have declined dramatically since then. Hardin’s grim biological determinism has been powerfully challenged by the work of Elinor Ostrom, who received the Nobel Prize in economics in 2009 for analyzing the conditions under which humans can manage common resources sustainably.
The third major intervention from this period, however, has been of more lasting value. In the early 1970s, a group of researchers at MIT, led by Donella, or “Dana,” Meadows, Dennis Meadows, and their collaborators, developed a model of a self-contained world system in which they included not only population but industrial production, pollution–they talked about climate change that early–and, very importantly, they included the powerful feedback loops that climate scientists are now looking at as key to what’s happening and going to happen in the climate system. The limits to growth analysis indicated that if we continued along the trajectory we were then following, what’s called now in the climate discourse the business as usual, or BAU, scenario, by the first decade of the 21st century there would be the beginnings of a significant collapse.
Their model was simplistic and you could say wrong in a number of ways, as economists rather arrogantly pointed out, but one has to give them credit for being fairly prescient on the big story. Because by the early 21st century, we did have evidence of rampant ecosystem degradation, particularly climate destabilization, as well as an economic meltdown.
The limits to growth and subsequent collapse narratives were based on two major ideas. One is the exhaustion of what are called nonrenewable resources. Peak oil was the most important, but other minerals were also part of the story. This is where the limits perspective was most vulnerable, because commodities prices, including the price of energy as well as many other commodities, fell in the 1980s, partly as a result of a worldwide downturn, such as the one we’ve experienced recently, as well as incentives for more exploration.
Their second idea has proved more enduring, which is that renewable resources, ecosystems such as forests, oceans, and the climate system itself, were in jeopardy. Their argument began from a simple and an increasingly commonly held trope, that you can’t have infinite growth on a finite planet. Eventually ecosystems would be overwhelmed with pollution and degradation.
As I said, limits to growth was mainly discredited by economists and other conservative forces, who argued that infinite growth is possible, even on a finite planet. Although many scientists signed on to the limits-to-growth perspective, the discourse was dominated by the pro-growth, pro-market, neoliberal forces for the next three decades. These people argued that GDP could “dematerialize”; that is, every dollar of growth could be associated with less and less in the way of materials flows, or carbon in the case of energy. Natural resource productivity would grow, perhaps dramatically. In the design world this perspective was known as Factor 4, then Factor Ten, Cradle to Cradle, Zero Waste, biomimicry—a whole range of perspectives that says we can dematerialize our production, and therefore our total output in value terms can grow indefinitely.
Indeed, this camp argues that capitalism is already in the process of greening itself and that this technological transformation will be sufficient to achieve sustainability. Changing the system itself is not necessary. Indeed, the profit motive, the market, highly concentrated ownership of property and investment decisions, and growth itself are all seen as beneficial for the sustainability transformation. That’s the so-called green growth perspective.
But can this be right? Are there no limits to growth? Do we not need a new economy? So far capitalism’s green potential has proven to be rather limited. Dematerialization has not happened. We can measure this by the growth of carbon use, which is soaring, as well as by total material flows, a new measurement that social scientists have just started to collect on a regular basis. It is true that there has been some of what we call relative decarbonization, or dematerialization, by which I mean that the amount of carbon or material flows per dollar of GDP has declined. Since 1980 it’s gone down by a little bit over 1% annually, 1.1-1.2%, for both of those measures, materials and carbon. But the expansion of the world economy has been much larger than that 1.1% or 1.2%, so that both carbon use and material flows have increased by more than 50% since 1980.
One could argue that dematerialization and decarbonization just haven’t been given a chance, and that without a high price for carbon, there’s not too much that will happen. But, of course, there are powerful forces preventing those punitive prices for carbon and materials. Based on the track record to date, one would have to say that the economists and the ecomodernizationists—that’s what they’re called in sociology—have been far too optimistic. Ecological overshoot continues apace.
Conversely, other approaches have been too pessimistic, including the so-called treadmill of production paradigm, which comes out of Marxism. They argue there are inherent dynamics within a market system which make ecological protection almost impossible. There’s also an emerging school of thought based in behavioral economics and psychology which says that humans are hard-wired to avoid climate risks. This perspective has trouble accounting for nations like Germany, Portugal, and the U.K., which have made serious commitments to reducing their emissions or to getting off fossil fuels.
I think the truth lies closer to a third paradigm, which believes that both the optimists and the pessimists have overstated their cases. The new economy movement believes that the system won’t green itself but that we can build a different one that can. In recent years this view has gained adherents not only for ecological reasons but also because forecasts about the economic road ahead are rocky.
One of the core principles of plenitude is diversifying out of what I call that BAU economy, the business-as-usual economy, and it is predicated on the view that for most people BAU will increasingly offer fewer options, lower returns, and higher costs. It’s a bad deal getting worse. This helps explain why people will increasingly want to work less in the mainstream market. That’s because its ability to yield lucrative returns is on the wane. The days of sky-high market returns are over. We know that many of the pre-2008 gains were illusory, bubbles which popped in that year, for example, the billions in fictitious profits that disappeared from the financial sector and housing markets. The BAU economy itself may be in for a long slide.
This view of long-term stagnation in returns to labor, to finance, and other assets comes in part from looking at historical data. Consider profits, the pool of value from which higher living standards are funded. Profits tend to have long swings in addition to short-term ups and downs. From 1948 until 1982, the long-term trend was down. Profits were so low during the stagflation of the 1970s that business revolted and induced government to undertake a major restructuring, which began in the early 1980s with, originally, Jimmy Carter, and then more in earnest with Ronald Reagan, with Margaret Thatcher in the U.K. As a result of this restructuring, profits began to rise, and continued rising until the 2008 downturn. It’s likely we’re on track for another decade of down, particularly for U.S. operations. That means there will be less income available for individuals and households. We’ve already been in 3 years of what the business press calls “the new normal,” lower growth and reduced earnings.
The dominance of the U.S. is also on the wane. For decades the country has benefited from its special position. Americans could live beyond their means with a whopping trade deficit because others have been willing to accumulate the dollars that flow outside the nation’s borders. But the economic collapse made foreign investors and central bankers nervous about all currencies, including the dollar. American workers have long enjoyed a wage gap relative to those in poorer countries. However, companies have used the downturn to reduce compensation and locate even more jobs offshore.
As we move forward, the fatal flaw of the current growth regime, climate change and other ecological limits, will increasingly rear its ugly head. These problems have already started to affect the bottom line, with weather and other climate-related losses reducing profits and incomes. There are trillions in assets that will ultimately be uneconomic on the books of American and global companies. These are not just toxic financial assets, the ones we’ve heard about, but also an estimated $27 trillion of assets in proven oil, gas, and coal reserves, which cannot be used if we are to keep the planet safe. When we own up to that, there will be another giant write-down on top of the financial balance-sheet losses of 2008 and 2009.
We’re also up against some of the factors that triggered global problems in 2007 and 2008. The prices of food and energy appear to be on a long upward climb, as would be expected in a world reaching ecological limits. Energy and food, which, after all, is eaten by workers, are inputs into virtually everything that is produced. The index of primary commodities, which includes wood, metals, minerals, fuels, food, and other inputs, rose 23% a year between 2003 and 2007. At no time in the last 60 years have commodity prices risen so rapidly. After dipping during the downturn, they have now resumed what looks like an inexorable rise. For the average American, European, or inhabitant of another country, selling one’s labor to an employer or investing in financial assets will yield less, while buying food at a supermarket or traveling on an airplane will become more expensive. The bottom line is that room to maneuver in the BAU economy is narrowing. We’re faced with a choice between stagnation and the softer prices of commodities or growth, with high prices and mounting damages.
The plenitude path transcends this dilemma and offers us a way out. It’s parsimonious in the use of scarce natural resources and a heavy user of what is comparatively in surplus: human creativity, knowledge, technology, and, as we reconstruct it, community.
The first principle of plenitude, then, is a new relationship to this declining market. For decades Americans have devoted an increasing fraction of their time and money to the market—working longer hours, at least until the downturn, filling leisure time with activities that require more income for unit of time, and buying rather than making more and more of what they consume. But we can reverse this trend and diversify out of that BAU market. Relying less on the market spreads risk and creates multiple sources of income and support, as well as new ways of procuring consumption goods. That means a moderation of hours of work in the BAU sector.
There are undoubtedly complexities for managing this shift, such as changing the incentives faced by employers and ensuring career tracks in professional jobs where people are working less. However, work-time reduction is absolutely at the core of an economic policy that will both solve our unemployment problems and reduce carbon emissions.
The importance of work-time reduction becomes clear as we consider our economic history. Between 1870, the peak of the industrial production of the 19th century, and 1970 the U.S. was on a trajectory of declining hours. Annual work time went from about 3,000 hours a year in 1870 to about 1800 hours a year 100 years later. That is almost a halving of the annual working hours. This was made possible through productivity growth. And it was not just the U.S. that was on this path. All of the other industrialized countries did the same thing.
But beginning in 1970, the U.S. diverged from those other nations and from its own historical path. Annual hours began to rise. And before the downturn in 2008, the average American worker was putting in an extra 200 hours per year of paid employment in comparison to where he or she was in 1973. The reasons were partly due to employers’ incentives. Because they were funding ever more expensive health insurance, they prefer longer hours and fewer employees. But there were other reasons, too—weakened trade unions and growing inequality.
By 2001 the average U.S. employee was on the job almost 300 more hours than many Western Europeans. In that year the gap with Germany was 296, with France 264, with the Netherlands 320 hours, with lower differentials for Sweden, about 70, and the U.K, 62. What those differences mean is that a U.S. employer needs to generate anywhere from 4% to 24% more revenue to hire an additional worker than his or her European counterparts. For the countries with the biggest hours gap, the U.S. economy is producing four new jobs for every five created in those short-hour countries, where, by the way, the collapse of 2008 generated almost no unemployment. Whether we look at our own historical experience or to other nations, the anomalous trend of rising hours in the U.S. has hobbled us with respect to both preserving jobs and creating them. High hours unfairly concentrate hours in too few people. This has become a key driver of poverty, because the poor have too little work. High hours also create stress, reduce the quality of life, and undermine community and democracy.
In the 1980s, the Dutch addressed their high unemployment by offering new government employees a four-day work week at 80% pay. It was a savvy policy, which allowed 20% more young people to get jobs than the business-as-usual policy would have. It’s a good way to begin, because youth are bearing the brunt of the unemployment crisis. Today the Dutch have not only the lowest hours in Europe, super high labor productivity, and a successful economy, but they also have a carbon footprint that is 63% of the U.S. footprint. It’s important to note that this 80% solution, as they call it, does not take away income from people that they are already attached to. That’s a bad way to design work-time reduction. Instead, it starts new hires at lower salaries than they would get if they started at 100% time. That’s a psychologically and practically much easier way to manage the transition to shorter hours.
But we can do more than the 80% solution. If we build in the principle of using productivity growth to fund reductions in work time for people who already have jobs rather than using productivity increases for higher profits or wages, people can experience steady incomes with growing leisure time. The U.S. has had a productivity resurgence over the past decade, with especially high rates of productivity growth since 2000. That may be a surprise to you, and that’s because all of it has gone to profits and not to wages. But what if we gave it to people in the form of shorter hours of work? That’s a bounty that can be used to fund a shift out of business as usual. We can get a given level of production with fewer and fewer hours. Why not take that opportunity? There’s good evidence from behavioral economics and from studies of happiness that people are far less attached to income they don’t already have than income they’ve got. In addition, once people are out of poverty, incremental income does less to improve well-being than people imagine and much less than economists typically have assumed.
And there are other ways to reduce hours. According to the surveys I’ve conducted, as well as those of others, many higher-income employees would welcome the opportunity to trade a day’s pay each week in exchange for a 3-day weekend, especially if they’re parents. The desire to trade money for time is strongest when people won’t be punished in terms of their career trajectories or future opportunities. Again, the Netherlands has been a leader in this regard, legislating the right of workers to reduce their hours without career penalties: job sharing, upgrading part-time work, and long vacations are other ways to reduce hours, increase employment, and make people better off.
Work time is also key to cutting carbon emissions. In a study I conducted recently with sociologists Kyle Knight and Eugene Rosa of Washington State University, using data from 29 high-income countries over the years 1970 to 2007, we found that when employees worked fewer hours per year, the carbon footprints and carbon emissions of their nations are lower. The reverse also holds: the high- hours countries have high carbon footprints.
We believe there are two reasons for this relationship. The first pertains to the scale of the economy. High-hours countries are growing closer to their maximums, taking less of their economic dividend in free time. By contrast, countries like Germany, France, the Netherlands, while still extremely rich by international standards, aren’t expanding the size or scale of their economies as rapidly as they would be if their workers spent more time in factories and offices.
The second reason is that having more free time changes what people do in their daily lives. Households that are time-stressed live in more carbon-intensive ways. Travel mode is the most obvious choice here. Getting places faster requires more carbon. Think of the differences between walking, cycling, public transport, driving, and flying. The faster you go, the more fuel you use. But even controlling for their higher incomes, households that work long hours also do other things, like buy more purchased foods, live in bigger houses. It turns out that the impacts of working hours on carbon emissions are quite substantial. For example, if we were to reduce work time by 10%, we would get about a 22% reduction in the nation’s carbon footprint, with about two-thirds of that from the scale effect and one-third from the changes at the household level. Bigger work time reductions yield even bigger impacts.
So it’s a kind of a triple dividend policy: shorter hours of work reduce unemployment, reduce carbon emissions, and improve people’s well-being.
How can we make this transition in such a difficult time, when it seems like the pressure is on to work longer and harder? While we build support for the kinds of labor market changes I’ve suggested—new hires at 80%, income trade-offs, productivity into shorter hours—we can also take advantage of some of the work-time developments that are already happening. There are more than an estimated 8 million people who are on part-time schedules because they can’t find more work. The more we can do to make it economically and socially feasible to live well while only working part-time, the easier it will be to transition more people into shorter-hours schedules.
That’s where the next two principles of plenitude come. They facilitate access to goods and services without having to lay out much money.
Plenitude’s second principle is what has been called high-tech self-provisioning. Self-provisioning means to make, grow, or do things for oneself. If people are working fewer hours in the BAU economy, they can use the time that is freed up to meet their needs through self- provisioning. This allows to them increase their consumption, reduce dependence on cash income, become more self-reliant, build skills, and exercise creativity. Following the philosopher Frithjof Bergmann, I use the term high-tech self-providing for this activity, and I’ll explain why in a minute.
In the U.S. these kinds of activities have become newly popular, especially since the economic collapse, and especially newly popular among more highly educated people. They are typically very green activities, with low carbon and low eco footprints. Examples include growing food, raising poultry, beekeeping, and the whole phenomenon of urban and suburban homesteading. They include small-scale generation of power through solar and wind, eco-friendly home construction, arts and crafts, clothing, and the manufacture of small household items at a household or community scale.
Part of why this is happening is that the downturn has shifted the balance between time and money, giving people more time and reducing their access to cash. That’s the difference between a boom time and a stagnation time. That leads naturally to more DIY and more self-providing. This trend is also related to the growth of what’s called peer production on the Internet, where people have gotten used to doing things for themselves or in groups, whether it’s writing open-source software, making or posting videos, or collaborating on collective projects. Today’s DIY movement is different from those of the past because it incorporates a high-tech dimension. A lot of the activity is Web-enabled and speaks to the need to self-provision in efficient, high-productivity ways. New agricultural knowledge and the invention of affordable smart machines, many of them at small scale, so-called fab lab machines, make it possible to turn small-scale provisioning into a high-productivity and economically viable use of time.
Mainstream economists have typically argued that people should specialize in one activity in the market, earn money from that, and purchase everything that’s they want and need. As I argued earlier, I believe we have reached a point at which further specialization does not make sense, and that a diversification of activities and income streams is a smarter way to go.
One reason is that market returns will be lower in the future. Another is uncertainty and future catastrophic events, stemming from both financial instability and ecological instability. Both climate and economic fragility mean that reliance on the market is more risky. Being able
to meet one’s needs, even in the event of market collapse or climate catastrophes, increasingly becomes a smart strategy. Doing that on the community level is even smarter than as an individual. This is what about initiatives such as the Transition Town movement are directed to, that kind of local self-reliance.
But even aside from this insurance function, as we might call it, there are other good reasons to think that a rebalancing between market and the so-called informal sector or the non-market sector makes sense. One is that the productivity potential of hours outside the market is rising. If self-providing meant going back to the technologies and ways of doing things of the 19th century, the mainstream economists would be right, it’s a net loss. But now there are newly available technologies, knowledges, and Web-based innovations that enhance the productivity of labor at a household and community level. We are all aware of these in the realm of information, software, and culture. There’s a vibrant peer-production model that has developed high-value products like Linux and Wikipedia, Firefox. Self-production in music, video, ads, writing has exploded, and people are sharing and learning new skills, enjoying the opportunity to be creative, and producing real value to be used by others. The self-providing model takes this activity and extends it to the material world, to the offline world—to food, shelter, power, clothing, small manufacture. It’s been dubbed the “open-source hardware movement.” The point is that the model that began in information and culture should not be ghettoized in those sectors. It’s relevant across the board.
What’s key about the new form of self-providing is that it is high productivity, because it is knowledge- intensive. It employs high-tech knowledge in both computers and ecology to raise the productivity of labor. Examples include the use of permaculture principles in food provisioning—and that’s the ecological knowledge applied to agriculture—living wall gardens, small-scale energy generation, and fab labs.
The model of retrieving labor time from the market and putting it to work at the household and community level under different economic principles also makes sense because the economics of scale have changed. What computerization and the development of the Web have done is to make small-scale production much more efficient. After all, think about the change in scale from the first computers, which took up entire rooms like this, to the computing power that is available literally in our laps, or now in our palms. I think this point is of vital importance. The rise of information technology has transformed micro-enterprise from a romantic throwback to a smart 21st century strategy. Indeed, the massive command-and-control institutions that we call corporations no longer possess the advantages they once did. Small companies are where the dynamism and the employment growth is coming.
Extend this insight farther and we see that there are new possibilities at the household and community level for creating a high-productivity local green economy. What becomes possible is a synthesis of the pre-modern household form and modern technology. By the former I refer to peasant households that did not work for others, had diverse skills, activities, and income streams, and actively managed risk through that diversity.
A key aspect of these self-providing activities is that they are low-footprint and therefore a central contributor to solving the climate problem. Furthermore, as people learn how to make things, they develop skills and affinities for particular activities and then turn these into businesses and careers. Self-providing becomes one mechanism for expanding a sector of small green businesses, and those become the basis of a new sustainable economy. High-tech self-providing is a transitional strategy to get out of BAU.
But there’s an even more important reason that the current conversation is failing, and that has to do with what’s happening to the planet. During the same time that the global economy went into free fall and in the years since then, the news on climate has gone from bad to worse to catastrophic. A growing number of scientists have warned that carbon dioxide levels beyond 350 parts per million in the atmosphere are incompatible with preserving a planet “similar to that on which civilization developed.” But we are already at 396 and rising. And the speed of climate change is well beyond anything envisioned by the last round of published models by the IPCC.
I’ll end with briefer discussions of the last two principles. They’re a little more self-evident. The third principle is the building of a new consumer culture that I call true materialism, which respects the materiality of goods and the fact that their production involves the destruction of nature’s bounty and beauty. The key here, in addition to avoiding high-impact lifestyles, is to reduce the purchase of new items and promote economies of reuse and exchange.
A silver lining of the recession is that it has dealt a sharp blow to what I have called the fast fashion model. The average American before the bust was purchasing 67 new pieces of apparel every year, one every 5.3 days. That’s changed since the downturn. Instead, there’s a growing range of new consumer innovations, swapping and selling of a wide range of goods, such as apparel, which is where a lot of the new swapping economy began, but also books, toys, DVDs. People are car- and ride-sharing, they’re couch-surfing, they’re using Airbnb, which is a peer-to-peer bed and breakfast service. There are neighborhoods that are doing tool sharing, there are soup collectives and food-swap organizations, community gardens, CSAs.
Social innovations around concepts of sharing, commons, barter, informal exchange, neighborhood exchange, reuse, resale are changing huge swaths of the consumer economy. Many of these practices have come out of the hacker culture that developed on the Internet and they’re made possible by the Web. The Internet reduces the time requirements for organizing these kinds of schemes, and equally important, helps to solve the issues of trust and reputation which arise when strangers interact directly, such as in couch-surfing or ride-sharing or any other person-to-person or so-called peer-to-peer interchange. The downturn has mainstreamed many of these practices by shifting people toward more cash scarcity and more time abundance. Together they are transforming the way many people, particularly young people, are living and are procuring goods and services. They merge the production and consumption side and they’re much lower footprint.
The final plenitude principle is to built economic interdependence among people or wealth in our relations with each other. These activities overlap with some of those I just mentioned and include not only sharing schemes on the consumer side but also time exchange or time banks, local currencies, skills transmission. These activities flourish when the first two principles of plenitude are followed. That’s because they rely on time, which is a key resource into all production, whether it’s private production or social, and they rely on skills.
But the building of economic interdependence is also occurring in the emergence of a range of new enterprises founded not on traditional private ownership but on various forms of collective holdings. These include models such as the Evergreen worker cooperatives in Cleveland, a set of worker-owned green businesses that are supported by major anchor institutions in the city—the medical complexes, the educational institutions, the foundations.
This model has generated tremendous interest around the country, and versions of it are in the planning stages in a number of cities. But it’s not only worker co-ops that are thriving. We’re also seeing consumer co-ops, land trusts, other kinds of property held in common, co-housing, community development corporations, municipal utilities, and public enterprises. These forms of property are rooted in communities and social networks. As Gar Alperovitz has persuasively argued, they already represent and command large sums of money. If they are channeled to common purposes, such as carbon reduction, employment generation, and wealth distribution, these public forms of wealth holding could be a strong foundation for the emergence of a new pluralistic, small-scale, low-carbon, high-welfare economy.
I will close with an observation. I have described the outlines of a new economy that is rich in time, that is low- impact, and that I argue will yield high satisfaction. But the plenitude idea that I’ve been discussing is not just one scholar’s vision of a good direction to move in. It is already a living, breathing entity that is growing in size, scope, and sophistication every day. It is made up of sustainability activists, conscious consumers, low-income city residents whom the formal economy has abandoned, casualties of the 2008 downturn, young people increasingly committed to a sharing and commons philosophy, and advocates of the peer-production, open- source movement in the tech world. I also include here the degrowth movement, which is gaining momentum across Europe and consists of academics and activists explicitly challenging the growth imperative within western capitalism. The plenitude movement includes groups such as Bioneers, so-called biological pioneers, the Transition Town, BALLE, the Business Alliance for Local Living Economies, much of the alternative food movement, the local currency movement, and the DIY and so-called “maker” movements. What most of these groups share is a commitment to local, small-scale, low-impact production and consumption, expanded motivations for economic activity than just profit, belief in fairness, democracy, and community, and a rejection of the dominant consumer culture.
Only through a social movement that counters the current destructive paradigm can we hope to return to a safe way of life on the planet. I believe this new, emerging economy represents that hope. We’ve got to take it seriously, we’ve got to believe in it, we’ve got to get going on it.But if we do, we have away out of both the economic and the ecological challenges that we face today.
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