The Environmental Paradox of Thrift

piggy bank

Holy moly, I had a bombshell of a thought this morning. I think this one has been bouncing around in my subconscious for about a week, and finally took coherent form. Here’s the thought—the human presence on the planet, from nature’s point of view, is something akin to cancer—exponentially growing. As part of the solution, we all need to consume less, particularly in the rich parts of the world. Thus, the impulse as a concerned citizen to cut back, and the idea behind my post yesterday about Minimalism. BUT, it occurred to me—consuming less, if you work the same amount, means that you save more, by definition. (Income that doesn’t get spent gets saved). And your savings flow into the economy in the form of loanable funds, in virtually all undirected forms of saving or investing. These funds help grow the economy. And, the overall direction of the economy is negative from the point of view of the environment, so, on average, your funds are helping to ruin the planet. Due to this, your efforts to lower consumption might have little net effect.

That’s why the “holy moly” part— normal economic activity is part of the business as usual that is wrecking the planet, so our normal life activities are part of the problem. If we aren’t careful with our personal decisions, we stay part of that system—even without intending to. You could cut back on consumption, and not make a difference, because the money you saved by not spending is still feeding the system.

So, stepping back a bit—

You could become a hippie and check out of the system and live in the woods and eat dandelion greens. But the system is negative and has a tendency to grow—so the planet still gets ruined. You slowed the system by not participating as much, but didn’t alter its course.

Or, you could keep your job but dramatically cut back on your consumption. Your unspent income flows into the system in the form of loanable funds, the system is negative (on average/in the aggregate), so on average your funds help grow the system—the planet still gets ruined. Again, you slowed the system (less consumption is a good thing) but didn’t alter its course.

Or, we could consume less and work less. Same result—slows system but doesn’t alter it, per se. Another form of “checking out”. Admirable but not a solution in itself.

Our actions must alter the course of the system, in addition to slowing it. We do this by staying part of the system (which even the really crazy hippies tend to do in actuality—no one is truly self-sufficient), by shifting our demand to sustainable/fairer economic activity, reducing consumption overall, but then making sure that the money we make but don’t spend isn’t undercutting our efforts. Many thoughts here, will continue in a future post.

(Note- I’ve refined my views on some of this just a bit in the time since I wrote this—see later post “The Role of Self-Sufficiency“.)

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