Needs of body or needs of mind?

In its roots, the model is based on materialistic/utilitarian approach where it is assumed that ever increasing material possession and consumption are the means to ultimate well-being and happiness. If we examine carefully, however, what we are going to discover is that beyond the immediate survival needs of the physical body, materialism is just a form of entertainment for our mind or psyche.

As far as this mind or psyche is non-material, it does not have a practical way to benefit from material possessions. Beyond the natural physical needs, all material possessions can be enjoyed and bring satisfaction only as an idea and not as something physically useful. You can physically wear only one pair of clothes at a time and can only enjoy the thought about a wardrobe full of clothes that you have at home. Once you have had an abundant dinner, you can only enjoy the idea that there is more food on the table.

In that sense, as far as the mind is concerned the constant craving for ever-growing material abundance is in no way inherent to its nature. It can (and has been) trained to enjoy it as it can be trained to enjoy any other idea. However, the assumption that people are naturally driven towards gaining more and more material possessions is no way a fact supported by hard and undeniable evidence.

Think about marketing industry. If the materialistic inclination was natural, why the need for such industry at all? It is all about manipulating people into believing that they need a product they often do not. Elaborate techniques are used to trick you into buying (for example a smartphone with functionalities you never use) or newer TV set with several million new colors (which the eye of the average human might never distinguish).

Subtleties behind the scenes

In terms of production, while we have more fancy products, it seems that they are less and less durable and it is not by chance. The sophistication of product life cycles and the progress in technological knowledge has opened new possibilities to the insatiable greed of corporations. Nowadays the usability of the product can be to a large degree “pre-programmed”.

Have you ever wondered while your electronic devices often start to malfunction shortly after their warranty is expired? Why the shape of charger cables for mobile devices is regularly revised by the producers? Do you have a TV purchased 7 years ago which has outlived 2 or 3 “state-of-the-art” ones? Much of those (if not all) happen by design, where the manufacturer has as its goal to make you buy the same product repeatedly rather than trying to satisfy your need in a long-lived manner.

We can bring further arguments (and I am sure anyone of us can find evidence from own experience). The point is that in many ways, the materialistic/utilitarian approach is something that we have been taught to adopt and is being carefully maintained. It is not something that is inherent to our nature.

Therefore, the whole economic model that is centred around the idea of insatiable needs of human beings, cannot be in any way asserted as either the only possible nor the best model. In fact, in its initial form the emerging scientific discipline of economics was more focused on trying to understand the underlying logic in economic interactions. Nowadays it seems to be focused on conditioning us into what economic interaction should be like.

(Un)knowingly helping the shift

At first, on an individual level we should re-evaluate what really counts in life for us personally.

Do we really need all the things that we buy? Do we buy because we need or we just follow suit? Do we work more than we actually want to be able to buy things we do not actually need? Are there any things that give us more sense of fulfillment that are not in any way related to buying and possessing things? Can we work less, spend less and have more time to do things that we actually like? When we buy more, do we get closer to being satisfied with what we have or actually find ourselves craving for ever more?

One of the reasons why the economic model is failing nowadays seems to be that more people start to ask such questions to themselves. It might be just a somewhat unconscious hint of doubt but it is there. A hint that there is something fundamentally wrong and unhealthy about materialistic mentality. A hint that constant craving for more is a burden and being satisfied with less is a release.

The more evident this revelation, the more people seem to discover that they do not actually care for their long-held priorities in life. They start getting some intuitive insight that beyond meeting certain natural needs, chasing of material possessions and never-ending consumption is a form of madness. It makes our lives complicated rather than simple.

Such people are less and less supportive to the system in their choices. The inner turbulence and restlessness resulting from the subtle (or sometimes evident) dissatisfaction with materialistic mentality, manifest externally. And while its manifestation is often random and confused, it dismantles the efficiency of the model. People become unpredictable in many ways – in the way they do their jobs, in their non-professional activities, in their relationships. All these tremors translate into the existing social and economic structure putting it under pressure.

Bound to disappear

Eventually, the current economic structure will fall apart … because by its very design it can thrive only upon our acceptance and willingness to support it. The more we break free from the illusion that material wealth can be the ultimate purpose and means towards personal fulfillment, the closer we get to the imminent collapse of the old paradigm.

While we do not know what will come out from the ruins of the old, there will be at the least the possibility for something better. The old economic framework is too deeply rooted and does not allow for alternatives. Only from its ashes such alternatives will come into existence. Alternatives that might be better suited to cater for our real needs rather than artificial desires.

Ultimately you can face the global economic turmoil with a smile – in the end of the day, it is good news.

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Let us take the example of money. Money in its conventional form has no useful value by itself. A banknote or a current account cannot satisfy directly any real need – you cannot eat the numbers in your bank account, you cannot use a banknote as clothes or shelter. In real terms a bank account is a sequence of numbers in a computer and a banknote is a piece of paper with a printed amount. What makes money valuable and useful is our consensual agreement to regard them as means of exchange of the things that directly satisfy our needs.

The previous paragraph is to illustrate that the economic theory and therefore the model for which it serves as a basis, are artificial rather than objective constructs. The theory is on one hand a description of certain forms of interactions between individuals and nations in particular time of human history. At the same time, it has eventually managed to promote those forms of interaction to a level where they came to be accepted as self-existing, self-evident even inherent to the very human nature. People started believing in it as undeniable objective reality and this way have allowed it to shape their mindsets.

Tricked into acceptance

By accepting the framework of contemporary economics as a natural law, we are the ones who actually make it manifest as such law. By believing that economic interactions follow certain logic which is beyond our control and thus we can only abide by it, we effectively decide for ourselves that there is no alternative. As far as we perceive it as being the only possibility, we are bound to behave in a way that can only solidify the model and make it look more like being the natural and inescapable order.

To recap – economic theory has convinced us that it is the only valid alternative and by doing so effectively became such alternative. Now, whether this is coincidence or result of intentional design is another topic. The ultimate fact is that we seem to be only subjects and victims of the model where we actually are the ones who perpetuate it and sustain it. This is the vicious circle we are in – we are the ones who suffer the defects of the model and at the same time the ones who help re-create it constantly. This is the very first thing which people should realize. Only when we understand that, we can consider alternative approaches.

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I do not intend to try to prove above statement because if you turn around and have the courage to acknowledge what you see, the validity of the claim will be self-evident – constant shrink of middle class, bank failures, increase of unemployment, countries in the spiral of ever-growing debts – the signs are all there.

In this article I shall rather try to focus on why the system is failing and why (contrary to our conditioning by the mainstream media and so called “experts”) this might be good news.

The discussion will be a generalization to some degree. I will not talk about the particular situation of this or that country. It would be rather an analysis of the fundamental problems inherent to the contemporary (and nowadays prevalent) economic theory and practice. It is for those inherent errors that the model cannot and shall not survive in its present form.

Economics basics

For those who have no background whatsoever in economics theory below are some of its fundamental and underlying ideas.

While the theory of economics has branched throughout the decades into somewhat different versions, there are few underlying principles and concepts that are considered as fundamental and among them are the following three:

• The availability of economic resources is limited
• The needs and desires which the people would like to satisfy by the use of those resources are unlimited
• The ultimate driving factor of each party involved in any form of economic activity is to realize and maximize profit/benefit from its use of economic resources.

Above assumptions imply:

• In overall terms it is not possible to satisfy the economic needs of everybody
• The use of economic resources for the satisfaction of one’s needs by definition can be fulfilled only at the cost of somebody else’s need that shall not be satisfied

Closely related and arising as a consequence from the aforementioned notion is the idea of competition or in other words constant economic struggle between people, companies and ultimately nations in attempt to get as much resources as possible for themselves and leave as few as possible to the others.

The inherent problems

A direct consequence of the theory is that in order to sustain and increase profits, there should be ever-increasing production of goods and services and ever-increasing consumer demand for them.

When considered on a global scale, the material resources available on the planet are limited and most of them are not renewable (or at least not renewable at the rate they are being depleted). Thus, ever-increasing production of goods is physically not possible. On the other hand, considered globally, the potential number of consumers is also physically finite. Therefore, the increase of consumers can be achieved by producing goods which are short-lived and need to be often replaced.

Also inherent to the model is that to maximize the profit, the economic agents try to reduce their costs and particularly with the advancement of technologies, more and more work is attributed to machines rather than personnel. The less people work, the less income they have and the less possibility for the companies to sell their products.

Above is a vicious circle and while some companies still can extend their markets at the expense of their competitors, considered globally – the mix of production, resources and consumers makes it impossible to sustain an economic model based on the motivation for economic profit (which, as already mentioned, is a cornerstone of the model).

A conclusion of common sense

It is not a matter of personal like or dislike for the model – it is a solid fact that on a finite planet, with finite resources and with finite number of potential consumers, a model based on the premises of ever-growing production and ever-growing consumption cannot last indefinitely. In fact, there is much evidence that we are almost there – at the stage where the rate of resources we use, exceeds the rate of their extraction/renewal.

Above simplified analysis introduces a problem and so far, it seems that no working solution has been found within the theoretical framework of contemporary economics.

In fact, such a solution is not likely to be found. For maybe, just maybe, the solution lies not within the model itself but rather in reconsidering the validity of its underlying ideas. Those ideas around which the whole model has been built (either by chance or by intentional design) seem to be erroneous or at the least incomplete.

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