21 November 2008
"Live within our means"
These days, I hear a lot of people saying that "we need to live within our means," as if doing that now or in the future will get us out of the current crisis. Not that it isn't sound advice on general principles, but people need to understand that it was once people started living more strictly within their means that the bottom dropped out of the economy. Capitalism depends on consumption. Capitalism on the scale we know needs perpetual consumption. If capitalists need us to buy their products, they'll have us all go into debt if necessary. They don't want to bankrupt us. More likely, they imagine that credit-fueled demand will result in more production, more prosperity all around, and everyone paying their bills. For that to work, they need to create a perpetual-motion machine of borrowing and buying, but once people retrench, stop borrowing, and live within their means, the machine stops. Living within your means may be a virtue in a more traditional or a simpler society, but you can't get there from here just by deciding to live within your means or exhorting others to do so. It's going to have to be part of a more thorough transformation of society and culture, and I don't know if people are willing to go all that way.