Beyond Consumerism to Sustainability

The economic meltdown that began on Wall Street has spread to the rest of the nation and most of the world. Economic decline shapes the mindset of many American consumers as they start to hold their cash in the bank or hide it under their mattresses. On November 11, New York Times reporter David Leonhardt wrote an incisive piece on this issue:

“For decades – from the 1950s through the 1980s – Americans spent about 91 percent of their income, on average, and put away the rest. In the last few years, they have spent close to 99 percent and saved only about 1 percent. This simply cannot continue. For one thing, people need to pay down their debts and replenish their retirement accounts. For another, the psychology of spending and saving may well be changing.”

The motor of the world economy has been American consumption. Our culture and politics are centered on it, and ever increasing levels of consumption has built the US economy. Take as an example my apartment, which was built during the first part of the twentieth century. By modern American standards the closets are quite small, but the upper middle class folks that lived there when it was new owned many fewer articles of clothing than we own today. In a similar vein, look at the sidewalk outside a New York City apartment building on garbage pick-up day. You will see a small mountain of green plastic bags. We use a lot more stuff than we used to, and we throw out more garbage too. When my kids were growing up, each of them had more toys than my friends and I could even imagine back when we were growing up in the 1950’s and ‘60s. More evidence: look at all those suburban families that park their cars in their driveways because their garages are filled with junk.

President-elect Barack Obama had many advantages in his competition against John McCain, but nothing factored into the debate more than fears over the declining economy. Why does the economy play such a central role in our politics and culture? At least four things are going on:

  • First, of course, we are addicted to accumulating new toys: iPods, computers, flat-screen TVs, clothes, new kinds of food-whatever strikes our imagination.
  • Second, is the very image of poverty. The picture planted in our brain is a black-and-white photo from the 1930’s of people in gray tattered clothes waiting for soup, bread, a job or anything that might make their lives less miserable. We desperately want to avoid becoming part of that picture.
  • The third factor is ingrained in the American dream, the idea that our children’s lives should be better than our own. As a parent I feel responsible for the well being of my children, and so in this economy I worry about my ability to provide them with the things they need to get a good start in life.
  • Fourth, is the fear of an old age of dependence and poverty. Social Security and Medicare are popular in all segments of our society. Liberals, moderates and conservatives all support government provision of these benefits. Many of us worry about a time when we might be too old or too weak to care for ourselves.

It is clear from Leonhardt’s report, that Americans consume almost everything they make. Our economy over the past several decades has been built on this very high level of consumption. Automobile sales dropped by a third in the past several months, but that does not mean everyone needs to start walking. It means people are keeping their cars longer, and maybe some suburban teenagers will not be getting their own cars this year.

When we think about our quality of life, replacing material consumption with reflection, thought, conversation, exercise, exploration, social engagement or even public service might not be the end of the world. Fewer trips to the mall may be bad for the economy, but might not be so bad for us. The problem is when economies slow down, it’s always the poorest among us that suffer the most. Mass economic life is difficult to understand and the psychology of a slowdown is unpredictable and frightening.

This is where government and public policy comes in. We have learned that the free market is the best way to create wealth, but it needs to be tempered by public investment in goods and services that the market either can’t produce or can’t make available to enough people. It may be that we need to prop up the finance industry and the automobile industry to get past the current crisis of confidence, but it is time to invest in the infrastructure and services needed to make our nation and planet more sustainable.

We need to invest in education, communication, mass transportation, parks, water, sewage treatment, waste disposal and recyling, science, R & D, health care and all of the collective goods that the market won’t create. This will mean higher taxes and less individual consumption. But we will become the kind of society that has learned to defer gratification to build a better future. Without these investments, we will become a second-rate economy less able to compete in the global market place. At one time we knew how to invest in the future. We built roads, water systems, universities, airports, bridges and hospitals. We need to learn how to build for the future again. 

The reason we mistrust public investment is that we don’t trust the government to be efficient and effective in putting our money to work. While I advocate government investment, I don’t favor the construction of 1930’s-style government bureaucracies to do this work. We need a partnership between the public and private sectors. Government contracting with and investment in the private sector can achieve the results we need.

If you’d like to learn more about what I mean (plug, plug) you might want to take a look at a new book Bill Eimicke and I have written called The Responsible Contract Manager. We believe that public-private partnerships can work. By combining the expertise and efficiency of market-driven firms with public purposes, we can get the most out of our public investments. The single-minded worship of private enterprise and higher levels of consumption may be coming to an end. This does not mean that quality of life needs to decline. If we manage the transition correctly, we could build a better country than the one we have now.

Beyond Consumerism to Sustainability