Towards a New Central Economic Paradigm
At one time, concentration on the fundamental questions of life was thought essential to any reflective social politics. At a time before there was a distinction between economics and political theory, Aristotle put it thus:
"A person who is going to make a fruitful inquiry into the question of the best political arrangement must first set out clearly what the most choiceworthy life is. For if that is unclear, the best political arrangement must also be unclear."
[Politics, 1323a14-17]
The point of economic and political institutions and policies is to make possible the good human life. It is against this criterion that institutions are to be evaluated.
Often enough, the biggest questions we have to answer are never asked. Because of their magnitude, because of their extensive implications, it is often hard to see that there can be major alternatives to the way things are and the way we typically think about the world.
The single biggest social policy question confronting us today remains the same question it was 2300 years ago: What is the purpose of economic activity?
Today this is a question rarely posed, yet while rarely asked, there is an implicit understanding of the good life and its relation to economic activity that underlies modern consumerism. Thus we have:
The Dominant Economic Paradigm
- The good life is to be found in the satisfaction of our desires, in particular desires that can be satisfied through consumption.
- The economy contributes to the good life by providing consumers with the goods and services they desire.
- Work (along with land, capital and information) is an input within the productive process, as well as the central means through which people earn the income which allows them to purchase goods and services produced.
- Successful performance of the economy is best understood as the sustained expansion of goods and services (i.e. economic growth).
- Efficiency is primarily a matter of achieving maximum outputs (goods and services) with any level of resource input.
This vision, if it ever served us well, is today exhausted. It leaves us adrift in a changing world, hoping than "more and faster" adds up to better. What we need is a new outlook, one that in some ways returns to a more ancient vision. The perspective of simple living offers this alternative paradigm for thinking about the purpose of economic life:
The Simple Living Paradigm
- The good life is a form of simple living, it is found primarily in meaningful activity and the simple pleasures of friends and family. It requires an abundance of time to do things right.
- The economy contributes to a good life by providing goods and services to meet core needs, by offering meaningful forms of activity, and by providing economic security. Once core needs have been met, the consumption of goods and services is of secondary importance.
- Work is itself a central arena in which the good life is either found or lost. Work is not a mere means to income or productive output; at its best it is an opportunity for people to engage their highest qualities and creativities in ways that are of value to others. The kinds of work opportunities a society has to offer are its real outputs, the forms of life it makes available.
- Economic performance should be evaluated not in terms of economic growth but by looking at the levels of need satisfaction, levels of leisure, levels of security, and quality of work roles.
- Efficiency is primarily a matter of achieving high levels of need satisfaction at low levels of labor time or at low levels of income.
Put in different terms, a politics of simplicity responds to Aristotle's question by saying that the good life is found as a form of simple living and then turns to both government and the economy and says, "Your purpose is to facilitate the attainment of such lives, to create an environment which is supportive of simple living."
A politics of simplicity recognizes that the real work of creating a meaningful life has to be done by people themselves, with their friends and in communities of common values. At the same time, it looks to the society as a whole, to our national economic and social policies and says that they play a role of tremendous importance in creating the background environment within which such projects will either succeed or fail.
Making this shift to a different lens, to a different way of looking at economic life, to a different set of criteria for evaluating economic performance, is the single biggest element of a politics of simplicity. In many ways it turns conventional thinking on its head. It says that what are normally viewed as inputs or by-products of economic activity, namely the forms of human activity and interaction that are generated by economic activity ("work" and "jobs" and "social roles") are its real outputs, and that what is typically viewed as economic outputs (the goods and services received from the economy) are really inputs into life. They are the means that sustain us physically as we seek to find lives of inherent value and significance.
In making this shift to a different economic paradigm it is important to see that a politics of simplicity is not anti-technology. The primary problem that we as a society face with respect to technological change has to do with the benefits of technological innovation, both in deciding which kinds of benefits to choose and in determining who is to receive them. This is best illustrated with an example.
Today there are many who fear the impact of new technologies, and there is a growing list of writers who have warned that technological changes on the horizon may threaten the jobs of just about anyone. Let us assume that this is the case; let us assume: