A New Economic Path

by Michael Smith

It is time, methinks, that we looked as our economic system again in a new light. Capitalism, as we know it, has broken down, yet again, and yes, I am well aware that the communist system, as it was used, and I stress “as it was used”, does not work either.

However, the way things have failed, yet again, with the capitalist system, due to the greed of bankers, and G-d knows the greed of other businesses too, that system too cannot be seen as one that benefits the people. In fact, as we can see, it benefits only a select few. And when those screw up they get rewarded for it, basically, by being bailed out by the taxpayer, whether it be banks or the automotive industry.

In addition to that the entire system of government as we know it, whether in Britain or the USA, must be overhauled too. Democracy is not a government of the people by the people and neither is the constitutional republic thing of the USA one that is one.

Also, the way Britain, for instance, is going, as well as the USA to some degree, and some EU member states, we are heading headlong into a police state. In Britain this has arrived already with all the CCTV cameras, the searches for knives and such at so many places, the proposed scatter radar scanners for weapons to be embedded in street furniture and all that. It is a shame though that the British people are so very happy to let this all happen. Or they are just so apathetic that they do not care. Then again, it could be that they feel powerless to do anything about it and, in fact, I think we are basically powerless and it does not matter who we elect into office.

But, let us look at the economy first, for I am beginning to digress:

As far as I can see we must find new ways of doing business and we might not go too wrong if, to some extent, we would go back to the ways of old, including barter.

Banking and credit definitely seems to be the biggest problem of us all and while industry and commerce may have to have a means of obtaining credit in one way or another the ordinary mortals like you and me should looks back to the old ways.

What are those old ways? Well, they are cash and savings. In other words, if you have not got the money to buy what you may want to buy then you cannot buy it and you don't. You save up to get the money to buy this item.

We also must come to the understanding that we have affluenza – many of us – and that we misinterpret and -understand what our needs are and our wants.

Someone with a car that is say 2 years old and working fine does not need a new car while he may want a new one and that is the same for someone whose computer is working perfectly well and is doing all that he needs to do when he thinks he needs a new PC. That is when wants gets misinterpreted as needs.

In truth our needs are not complicated and also not expensive. But people mistake, as I have said, wants with needs. When they, and obviously their offspring, say that they “need” this or that in most cases this is a “want” and not a “need”.

Aside from that we must look at economics in a different way. Maybe, somehow, along the lines of what Fritz Schumacher used to write about, that is to say “economics as if people mattered”.

The state of economics that we have presently but which appears to be breaking apart is no0t one where people seem top matter., The only thing that appears to matter to those that own the businesses and the banks is profit and yet more profit for themselves, their directors and their shareholders. The workers and the people in general do not matter to most of those in the least. There are a few exceptions, or there used to be, for many of them have gone into ownership of multinationals, such as Rowntree and Cadburys, who once had great social systems in place for their workforce.

I believe that we must look at the system of economics and trade completely afresh and find new ways of doing business on a more people-orientated scale. I am sure that this can be done for it used to be done in years gone by.

In some places we are already seeing, for some years and decades even, a different local system of trade and even currency, and even though in some countries this is being frowned upon by the powers that be as, in some countries it is against the law – theoretically – to print own money and to mint coins, it is a system that should be encouraged rather than discouraged. The problem I see here though is that the powers that be do not like such local currencies and barter trade systems because they cannot get any taxes from such sales and transactions. The problem is the states, the governments, as they are. They cannot abide the idea that people could trade without the state getting its share, however unfair this share may be. If no currency of the realm changes hands but just a barter currency or barter trade in general the state has noway of getting the revenue it so desires and that is why any economic activity other that “proper” sales are discouraged and even deemed illegal.

If we want to be able to survive as people and nations in this downturn and especially afterwards and live lives that are more fulfilling then we must first of all change the system of economics under which we work and trade. This must then be followed by the system of government; a system where the people really run the show and not just an elite that has been, supposedly, representatively elected by the people.

Economics must be brought back down to scale and go local again and banking must be changed as well and especially.
We can no longer – not that we really ever could – have banks that lend far above their deposit base. This is unsustainable and not just in the long run.

As far as the economy and economics are concerned in general we must get away from the global market issue and look back to locally produced goods, products and services. On such a scale the exploitation that is happening in the present system of the economy will then be greatly reduced, and I mean here there exploitation of workers in the same way as the exploitation of resources.

As I have said in a previous article about plastics recycling I cannot understand how it can be sustainable for the recyclables to be shipped to China for processing in to plastics base again, then to have goods made from the material there and then have the stuff shipped back to us in Europe, America or Australia. This just does not compute. And it especially does not compute when one knows that there are plastics recycling companies in the UK, for instance, who reprocess the recyclables here, and then make that plastic resultant from the recyclables into new goods that sell at not much more or in fact no more than the goods that come from China. So, someone make the calculations. Once again the reason for carting the stuff to China and then the reprocessed goods back to us is greed for the profit margins are so much better when this all happens in China, obviously.

Greed – corporate greed – is what got us into this problem in the first place and it is not the first time either and still we allow it to go on and on that way.

To some degree one can but hope that economic downturn and the looming depression might be a wake up call for all of us and we may, hopefully, learn that there is and must be another way to do things; a way that is sustainable. This way will have and must have a “repair” mentality again rather than a “chuck it” mentality. However, obsolescence is built into most things that we buy nowadays. Nothing is made too last and most things simply cannot be repaired. It is either too expensive to do so and it is cheaper to actually buy new or one simply, even a technician, cannot get at the insides of the product to carry out a repair.

Mind you, the mentality of people must change first as well for we know of bicycles and other things being thrown out into the trash simply because of a puncture in care of the bikes or a broken plug in case of some electrical goods. Though this might just change in the current climate and especially if this is not over by the end of 2009, say, as predicted by the chief of the Federal Reserve.

Most eminent economists are beginning to talk the “d” rather then the “r” word, that is to say they are coming round to understanding and stating that we are in a recession heading for a depression or that we are indeed already in the latter. Therefore, this could last for quite some time and people might just then come ro0und to understand that we cannot carry on the way we have been doing, and repairing things and the demand for things to be repairable might then happen.

But, we then will have a problem also for, where are the cobblers, the radio and TV repair men and women, the chair menders, the bicycle mechanics, and all those other skilled people that can fix all those things. In most cases they are no longer around. Their businesses folded years ago when we used to buy new each and every time instead of having a pair of shoes resoled, a bike mended, or what-have-you.

Many things, however, can be fixed by someone with a little handyman or -woman experience and a few tools. A bicycle does not have to go to the tip because of a puncture or a chain that has come off but we have see just this happening in this country not so long ago at the municipal garbage dumps. A Hi-Fi system that has a plug ripped off only needs a new plug fitted at the end of the lead but, alas, many people just throw such an item and buy new rather than put a new plug on or have one fitted by someone if they do not have the skills to do it themselves. Getting an electrician to fit a plug may cost a few bucks – if one cannot do it oneself – but it is a lot less than buying a new appliance.

While, with the current economic problems and the looming depression we have the mother of an opportunity for change here I doubt that it will happen unless we all, as people, can get the powers that be to understand from where we are coming and what we want.

The situation that we are in economically and financially could also be of benefit to the environment and to the creation of “green” jobs by the ton. But will this happen and will this opportunity be used for the benefit of us all? Or is it going to be “business as usual”? Much as regards to the outcome, I think, is down too us, to each and every one of us. Let's use this opportunity wisely and not waste it.

© M Smith (Veshengro), March 2009