The Debt Society and Sustainable Growth
October 17, 2008
To return to the Northwestern Political Union’s discussion of the bailout: I left the issues of “best economic interests” and “a sustainable economy” hanging out there.
Taking on extra (and burdensome) debt to buy a house that may have been out of one’s price range was, we were told, in the best economic interest of the actor because in 5-10 years, they would turn a profit after home values continued to increase.
This assumes that the end goal of a person’s economic life is increasing wealth; treating this as the end goal of a person’s economic life is one of the factors that got us into this mess. This also treats a home as something less than such — it is looked at entirely as a means for profit, rather than a place to live. (I refer you to Wendell Berry’s statement that, “A house is not a home,” and all it implies that we have lost.)
Why does this fail? Again, we have an economic standard divorced from an ethical or moral standard; which is to say, we have divorced a (the?) major sphere of human activity from the rules which govern human activity. (Or, as a friend put it, “The instant you start treating economics like it’s solely about numbers, and not at all about people, you don’t know what you’re talking about.”) Rather than an economy viewed as one means (of many) of pursuing a virtuous life, we see an economy viewed solely as a means to profit. In which case, we witness people behaving, if not immorally, then amorally.
This is precisely what happened with our economic and regulatory policies in recent years. Rod Dreher explains: “The point is that both parties had become captive to a turbocapitalist ideology in which Wall Street could do no wrong.”
I like his use of the prefix “turbo-“. I don’t want to be perceived as attacking capitalism (which, when established properly, requires all of us to assume responsibility for our actions and their consequences), or profit, which I think can be utilized as a means to a virtuous life, but should not be mistaken for an end in itself.
From here, it’s a short step to a sustainable economy rather than one predicated upon rapid, or even merely near-term dividends. Let me indulge in an astronomical metaphor for a moment: those stars which burn brightest burn fastest; massive near-term growth at the expense of sustainable long-term growth (for ourselves in several decades, and for future generations) or fiscal sanity (leading us into the debt society in which we now live) is bad.
What got us where we are today, in large part, was that we forgot that we need to live in homes, not houses, and homes are not defined by profit margins — they’re defined by the lives which exist in and around them.