September 16, 2008

Over consumption is the crunch issue

Filed under: Environment, Politics/News — Tags: , , — 4fooey @ 2:06 pm

Who do we blame for the financial crisis sweeping the globe? Bankers and regulators should certainly shoulder a lot of the blame: bankers for taking on too many risky and dodgy deals, regulators for taking their collective eye of the ball and allowing this all to happen. But individuals should also take some of the blame. For example, taking on a mortgage that you may not be able to pay back is irresponsible (until recently 125% mortgages were available, and banks were offering to extend mortgages to pay for holidays and the like), and consumers should take some blame for taking on too much debt via loans, store cards and on numerous credit cards. Again though, perhaps regulators should not have allowed banks and financial institutions to offer such mortgage deals and cards to ‘unsuspecting’ individuals.

At the heart of the crisis though is the consumerist society which our economy relies on to succeed — the need for people to buy more and more, and to consume more and more. And there is a need for economies to grow continually, year on year, mainly based on people’s ability to buy more, and consume more. And that’s where the problem lies, or that catch 22 in all this: to sustain our economies we must go on spending and borrowing, but this is exactly what has bankrupted our economies. At present we have stopped spending and borrowing so much and the economy has frozen up. Going forward how do we get the economy working properly again, but not based on a never ending spiral of consumption? And how do we get a functioning economy while protecting the environment, securing energy and food supplies, and meeting all the other challenges that require investment.

Looking on the BBC site today, I found this article, containing various people’s reaction to the current crisis: Credit Crunch Future Predictions. In it, Dr Benjamin R. Barber seems to have grasped the causes of the current problems. A longish quote from the BBC site is useful here:

“The current crisis in consumer capitalism – which has precipitated a mortgage crisis, a housing crisis, a spending crisis and a savings crisis in the United States and the West – has many causes. But consumers themselves bear major responsibility for these multiple crises.

Irresponsible spending on goods which consumers do not need and/or can not afford – from houses to iPhones, from gas-guzzling SUVs to bottled water – have created a spendthrift economy that has decimated savings, turned the US into a debtor nation, and allowed capitalism to become dependent on unsustainable consumer spending.
Responding uncritically to the new “ethos of infantilization” that turns adult shoppers into impetuous and grasping teens crying “I want, I want!” and turns children into unaccountable shoppers, consumers are shopping themselves and their societies into bankruptcy.

Where once capitalism produced goods to meet real human needs, today it manufactures needs to sell all the goods it produces. With billions spent on marketing, consumers are easy marks. “Shopaholics” head for the mall with no goal in mind except to buy something, whatever.

Until consumers once again become prudent adults and reflective citizens who make shopping decisions based on what they really need and can afford, capitalist producers will conveniently insist they are only giving people “what they want”, and continue to run the market economy to the ground.”

It’s an interesting thesis from Dr Barber and one I would not wholly agree with (the infantilization of adults is maybe going a bit far), but I largely agree with his analysis, that the consumer society is at the core of the problem. All the current problems lead back to people’s desire to buy stuff and then some, and to consume more and more. If we are to have a sustainable future, and one that does not impact of the environment, it’s a problem we urgently need to fix. But it’s a problem that many have not even identified, or connected with the current problems in the financial system, or if they have are in denial about it.



  1. Can’t disagree with much you have to say. However, it can’t be ignored, human nature does seem covetous. Unless we find a way to rein in that element of human nature the pattern will repeat itself. Either our politicians need to help resolve this (if they can find some time when they are not busy helping themselves) or we leave it to other organisations or the individual. Unfortunately, if the solution is not universally implemented, even those that were prudent will get dragged down by the rest. Is this a case for moral leadership? Is there a leader with probity? If so (s)he would be very unfashionable. We would need to look far from the limelight.

    Comment by conceptualizer — September 18, 2008 @ 10:53 am

RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

Create a free website or blog at WordPress.com.

%d bloggers like this: