Economic Growth: The Good, the Bad, and the Ugly

In this current day when congressional Republicans and Democrats don’t agree on much of anything, there is one thing that creates a rare kum bay ya moment of unity for the two groups: economic growth. Don’t get me wrong – healthy economic growth provides jobs, creates necessary goods, and keeps the majority of us fed, clothed, and sheltered. Healthy economic growth is a many-splendored thing! However, for reasons I will explain below, we tend to become fixated with economic growth to the point where we proclaim it our societal salvation: the elixir to ameliorate all social problems from unemployment to social program funding deficits. To the contrary, I propose that the unexamined pursuit of economic growth in a finite world only makes our problems worse and hinders us from seeking and implementing actual solutions.

Let’s cut to the chase. As the Depression eventually gave way to post-World War II, vibrant economic growth in America lifted many out of poverty and pretax incomes between the richest and poorest Americans narrowed. Economic growth (annual GDP) hummed along at 4% and 5% yearly rates.  The US government published the first national poverty rate – 22.4% – in 1959, a significant improvement over the poverty rate estimates of 40-60% during the Depression. One of the main factors contributing to this strong growth was cheap and plentiful oil. As US production of oil was not able to keep up with demand, reliance upon cheap and plentiful foreign oil increased in the 1960s. The OPEC oil embargo of 1973 changed all that. Economic growth decreased to 3% during the 1970s and ’80s, and for the fifteen years of the new century it has hovered around 2%. One of the main factors for the decrease of the growth rate is the increasing price of energy due to the difficult and costly process of extracting energy sources.

Have you ever heard of the term EROEI? It’s an acronym for energy returns on energy invested. Back in the days of Rockefeller and the early American oil boom, EROEI was 100:1, meaning the energy equivalent of one barrel of oil input produced one-hundred barrels output. The area surrounding Titusville, Pennsylvania attracted oil drillers in the 1860s because of the ubiquity of oil springs – little creeks of oil! Those were, as they say, the good old days. Today EROEI for oil is about 15:1. Extracting petroleum from the bottom of the North Atlantic, for example, can be classified as an engineering miracle – albeit an expensive and extremely complex one. As the Keystone XL pipeline continues to be a point of contention in US Congress and American society, check if the sites from which you source information actually report on the EROEI of the Canadian tar sands. I’ve yet to hear a mainstream news organization mention EROEI. Some of the tar sands have a ratio as low as 3:2. Joseph Tainter and Tad Patzek, in their excellent treatise on our current energy dilemma, Drilling Down (Springer, 2012), tell us that to power a complex modern society a net energy ratio of at least 5:1 is required. Yes, the completion and implementation of the pipeline will create jobs – but at what cost? I’ve not even mentioned the accompanying pollution and strains on water supplies that the production of these energy sources entails, and the additional release of carbon into the atmosphere upon their eventual consumption and use . . .

To complicate matters, the Saudis are flooding the market with – just like the good old days – cheap oil. As I write this post in January 2015, gasoline prices in America are hitting long-time lows as the price of oil crashes the $50/barrel barrier for the first time since 2005. And, on cue, economic growth is up. Some are hoping (reports come out at the end of January) for a 5% growth rate – just like the good old days – for the fourth quarter of 2014. Will it last? Has the American economy made its long-awaited comeback to 1950s’ era growth? We’d be foolish to expect a return to what used to be. Cheap, high quality energy – coal powering the industrial era before oil became dominant at the turn of the 20th century – provides strong economic growth and is the essential foundation of the highly advanced society of which we are accustomed. A gallon of gasoline has the energy equivalent of four hundred person hours of work. Giddy up and then some!

So, YES, economic growth is a good thing. BUT, the good and strong growth we’ve experienced has been based principally on a cheap energy source. The fossil fuels coal and petroleum, essentially millions of years of chemically stored sunlight, have made possible a 200-year run of high-phase energy gain. Social commentator Richard Hienberg says we’ve gotten accustomed to a “perpetual growth machine.” For those who think the next high-yield energy source – methane hydrate is currently being touted – will pick up the slack when fossil fuels run their inevitable course of completion, I ask: Is it not narcissistic and irresponsible to think we have to continue on the same trajectory of consumption we’ve been on for the past 200 years? Financial advisor and writer Paul Kedrosky wisely opines: “I want to believe in innovation and its possibilities, but I am more thoroughly convinced of entropy.” In other words, the unlimited growth machine can’t and won’t last forever.

Australian economist Clive Hamilton calls our commitment to unlimited growth above all other things a fetish, “an object worshipped for its magical powers.” Unlimited growth is known by another name: cancer. The defining characteristic of a cancer cell is its inability to self-regulate. Healthy cells follow an established cycle of division, multiplication, and then, inevitably, death. Cancer cells are interested in only one thing: unlimited growth. Similarly, over-commitment to economic growth makes us susceptible to bubbles – the 1990s’ dot.com and the 2000s’ housing bubbles being the most recent examples. Economic bubbles are like cancer cells – they don’t know when to stop and they damage the common good.

What I’d really like to hear from a politician – a president, no less – is talk about a steady state economy. In this day and age, an elected leader – Republican, Democrat, or independent – tempts political death if he or she were to speak common sense and encourage steady state economics. That’s why it’s left up to authors and bloggers like me to do it.

My next blog post will cover steady state economy. Until then –

T. Carlos Anderson

And, in case you’re wondering, the EROEI of wind and solar energies are 20:1 and 13:2, respectively.

 

My book, Just a Little Bit More: The Culture of Excess and the Fate of the Common Good, is available at http://www.blueocotillo.com and wherever books and ebooks are sold, including Amazon.

 

Black Friday Eve – I mean, Thanksgiving

The hallmark shopping day that is called Black Friday threatens to subsume the previous day, still known as Thanksgiving. Perhaps Thanksgiving needs to be put on some type of endangered holiday list. The following excerpt from Just a Little Bit More: The Culture of Excess and the Fate of the Common Good describes the dominant culture in the US since the early 1980s: the confluence of commerce, materialism, and consumerism. It’s like a religion in the sense that it is of “ultimate importance.” It’s been a good religion providing food, clothing, shelter and employment for many, but when it goes too far (as exemplified below), this religion breaks bad and damages societal common good.

 

Thanksgiving Day, November 24, 2011, was the day that a number of big American retailers—Kohl’s, Target, Best Buy, and Walmart—extended the biggest shopping day of the year, Black Friday, with a prelude. Their doors would open at 10 p.m. Thursday night and stay open through Friday.* The big, bloating turkey and trimmings meal that begets tiredness be damned; employees would need to report to work early Thanksgiving evening to prepare for the onslaught of shoppers.

That evening at a Walmart in Los Angeles, a woman doused fellow shoppers with pepper spray in order to get her hands on one of a few discounted Xbox video-game players available. The woman was accused of “competitive shopping,” using the spray to gain preferred access to merchandise in various parts of the store. She left after making her purchases; twenty people were eventually treated for minor injuries from the pepper spray. A Los Angeles police lieutenant described the melee as “customer versus customer shopping rage.” That same evening in six additional states other retailers witnessed similar violence.

Research shows that the same area in the brain is stimulated and rewarded when the following tasks are involved: making money, having sex, getting a good deal, and using cocaine. Dopamine receptors in the primitive brain light up when one “scores”—financially, sexually, or chemically. In one study, laboratory rats, when wired to receive electrical stimuli in the dopamine centers of their brains, opted to continually press a lever facilitating the stimulus—this “hit” eventually became more important than all other activities, including eating and drinking: death by dopamine. We humans are infinitely wiser than rats, but the options that titillate our lizard brain dopamine centers are more expansive as well. Thankfully, Black Friday Eve—rather, Thanksgiving—comes only once a year.

*Malls are following the trend to open their doors on Thanksgiving for shoppers, cooperating with the big retailers to essentially annex the holiday for commercial purposes. Chapter 5 of Just a Little Bit More further explores the role of malls in what I call America’s mythic religion.

 All rights reserved by T. Carlos Anderson and Blue Ocotillo Publishing, 2014.

Click here to purchase Just a Little Bit More: The Culture of Excess and the Fate of the Common Good. Paperback, $14.95. You will be redirected to the Blue Ocotillo Publishing website. JaLBM, admittedly, is not as much fun as an Xbox, but the lessons therein might inspire an Xbox-loving reader to consider ventures beyond the world of virtuality.

Click here if you prefer to purchase paperback from Amazon. Ebook available on Amazon, iBooks, and Nook.

Playing the Game

How much money do you make? Do your possessions measure up to your neighbor’s? What does your car or truck (I live in Texas) say about your social status? The level of importance we lend to the answers of these questions determines the extent to which we are playing the game.

The confluence of commerce, materialism, and consumerism is the game – and in my book, Just a Little Bit More, I call this game the dominant force in American society. It has its good side: playing the game puts food on our tables, clothes on our backs, roofs over our heads, and money in our bank accounts. Not only that, it gives us purposeful activity and work (most of the time) that benefit fellow members of the human family. The playing of the game, however, can go too far. Americans work more hours than we used to, and the heightened pursuit of possessions and goods drives us into greater debt. Instead of the promised joy and fulfillment these possessions seem to promise, we can find ourselves stuck in a cycle of depressing and anxiety-producing consumption. This game will rule those who devote themselves to it.

The Gilded Age (1870 – 1900) was a previous era of societal fixation on material consumption. American economist and sociologist Thorstein Veblen coined the term “conspicuous consumption” in 1899 to describe the spending by the richest Americans to build up their own prestige and image. Whether the Gilded Age or today: Isn’t it interesting that we almost always “compare up”? It can serve as positive motivation to see that your over-achieving neighbor has bettered her standing and that of her family by a combination of hard work and fortuitousness. But, comparing up – evaluating  your status in contrast to your neighbor who has more – can also erode a sense of shared community and eliminate a feeling of gratitude for what one does have.

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Since the 2007-08 economic swoon, to be a part of the richest 1 percent – unless your name is Donald Trump or Tom Perkins – has not been something about which to toot your horn. If you live in a household that has a yearly income of more than $383,000 in the United States, you are a 1 percenter. Most of us (but not all) reading this blog are not 1 percenters. There is nothing inherently wrong with being a 1 percenter. If it gives you a certain sense of relief to not be included in that exclusive grouping, momentarily repossess your unease. US households that take in $140,000 a year are included in top 1 percent of earners globally. Perspective is important; the United States has more 1 percenters than we might think . . .

The United States, because of advanced development and sheer strength of population, has half of the world’s richest 1%. Seventy million people make up 1 percent of overall world population (7 billion), and the United States has some 35 million people (about 11 % of US population) that are part of households that take in more than $140,000 a year. The remainder of the global richest 1 percent primarily come from Britain, Germany, France, and Japan. Conversely, 2.5 billion people (35% of world population) live on less than $2 a day, the majority of these being women and children. An incredible reality – and let’s not bicker about the definition of poverty – that one in every three humans lives with significant material deficiencies.

Thankfully, we don’t have to worry about those who live in poverty. This attitude – screw the poor – is also part of playing the game. All we (who don’t live in poverty) need to do is work and consume and the gate-keeper of the game, the Market, will take care of the rest! We just buy stuff and consume to our hearts’ content and we don’t have to worry about those “below” us. If they want some of what we got, let them get in the game and work for it. True enough for some, but not universally true for all. Adults, whether living on $2 a day or $383,000 a year, are responsible for their own actions and suffer the consequences of bad choices. Yet, it’s a fallacy (and if you identify as religious, it’s idolatrous) to believe that an ever-expanding market system will provide all that we and everyone else will need.

A regular reader of this blog, in agreement with the principles brought forth in Just a Little Bit More, asked me: So, what are we to do? Answer: Inform yourself and stay up to speed on the topic of inequality, be part of the conversation (especially with the younger generation currently being initiated into the lures of materialism), and, take positive action. Perhaps the most important part of taking positive action is to make sure you’re not playing the game. If you’ve got enough to eat, if you own a house that is in good shape, if you are shepherding a vehicle or two (or three) . . .  and you’re still playing the game – then it might be time to reconsider your values and your goals. The game is good up to a point. But beware: the continual striving for more and more, as with an addiction, eventually satisfies less and less. Compare down for a change. You might see a new reality and be inspired to play the game in a different way.

 

Just a Little Bit More: The Culture of Excess and the Fate of the Common Good is available at the Blue Ocotillo Publishing website.

 Thanks to Pastor David Moore of Austin, Texas for the suggestion, via conversation, of this topic. David, in talking on this topic, prefers to use a basis of individual earners as opposed to households. Using individual earners lowers the threshold considerably for top 1 percent earners globally – down to about $50,ooo a year – as non-workers (children, mostly) in households are disregarded. Pastor David’s Moore’s website: http://www.twocities.org.

 

Eras of Excess and Church Attendance

One-hundred years ago when John Rockefeller became the first billionaire in the history of the world, he was asked “How much is enough?” He responded “Just a little bit more.” Though the exchange is most likely legendary, it paints an accurate portrait of the man and the age. Rockefeller’s own Gilded Age (1870-1900) was the first of three eras of excess in recent American history. The Roaring ’20s and the current era, beginning in 1980, share similar characteristics with Rockefeller’s era of excess: untenable inequalities in wealth and income, rising poverty, and increased social instability.

In my book Just a Little Bit More: The Culture of Excess and the Fate of the Common Good, I argue that the dominant religion of American society – using Paul Tillich’s definition of religion as “ultimate concern” – is the confluence of commerce, materialism, and consumerism. It’s been a good religion that has fed, clothed, sheltered, and employed millions in the 250 years since the beginning of the Industrial era, many of these lifted from poverty. This religion can go too far, however, and consequently “break bad.” Americans work more hours than we used to – for the same relative pay; our materialistic pursuits enslave us to increasing debt; and, we believe (we are told as if by incantations) the solution to our travails is more and more economic growth. Just a little bit more, instead of serving as incentive for improvement, becomes a burden that shackles and confines.

Another commonality emerges in the study of the two most recent eras of excess. The Roaring ’20s experienced, as has our current era, decreases in church attendance and participation. Robert Putnam and David Campbell in their 2010 book, American Grace, tell the story of the ups and downs of American church attendance and participation. Undoubtedly a complex subject with many contributing social and cultural factors, declining church attendance in these two eras of excess seems more than coincidental. The 1920s saw the ascendancy of Wall Street; the phrase “playing the market” was popularized and the beneficent stock market was to provide for the young and old, eventually abolishing the need for charity and ending poverty. The promised land was within reach and church attendance and participation were not part of the journey. Church attendance in the United States flagged during the 1920s.*

Post-WW II America, continuing to the early 1960s, experienced exceptional church attendance and participation. It was a much more economically egalitarian era (for majority whites). General mainline church decline, however, has been evident since the 1970s; precipitous drop-offs in attendance and participation beginning in 2001 (to current) are of historic proportions. Again, many factors – busyness, changing modes of belief related to modernity, less reliance on overestimated self-reporting of attendance – contribute to the downward trend. I add another factor: reliance upon and widespread adoration of the religion (ultimate concern) of commerce, materialism, and consumerism. We live in a society that increasingly accepts market values – all things having a price – as the arbiter of what is good and right. Underachieving schools kids in Dallas paid to read books, donors paid to give blood, and people encouraged to think of themselves as brands, are all examples of the intrusion of market values to areas previously unaffected. Two generations ago Americans self-identified as citizens; today we self-identify as consumers.

Let’s do a theological thought experiment with Ephesians 2:19. Does the following slightly transformed text seem out of place? “So then you are no longer strangers and aliens, but you are consumers with the saints and also members of the household of God.” Pretty distasteful, isn’t it? One changed word puts an entirely different spin on the text (and it certainly puts the modern phrase church shopping in perspective). Even though the transformation in identity from citizen to consumer has been gradual, it is seemingly irrevocable.  The values proposed by an ethic of consumerism (wants and desires satiated now) and those of an ethic of the gospel (God’s provision for all) are in many ways opposed. Market values do have their proper place in society (and church), and benefit the common good in many ways. In our day and age, however, market values do not self-regulate. (If you ask your child to clean the table tonight after dinner, remember you’ll have to pay her or him to do so.) They tend to be intrusive, and have the ability to erode shared values (volunteerism, for example) that make our communities livable and enjoyable. Churches need to know where and when to draw the boundary lines, announcing to those who have ears to hear that there are values worth caring about other than market values.

Professional religious leaders have the responsibility of encouraging and maintaining boundary formation in and for their congregations. We are proclaimers of the gospel – do we need to be current with the economic theories and practices of the day? Yes – good stewardship demands it. As long as the society we inhabit religiously promises the nirvana of material pursuits and gains, we must stand up and proclaim it to be idolatrous. Filling up the pews in an era of excess is hard work, but countering the very culture of excess helps build a spiritual house in which the Divine Spirit dwells.

 

* Robert Putnam and David Campbell, American Grace: How Religion Divides and Unites Us, Simon & Schuster (2010), 83-4.

Just a Little Bit More: The Culture of Excess and the Fate of the Common Good is available at the Blue Ocotillo Publishing website.

 

 

 

 

 

Religious Syncretism and “Purity”

I travelled in Latin America as a college student, returning to the States smitten by its history and culture – repeated listens to Neil Young’s Cortez the Killer my panacea of choice. A few years later while in seminary, I consequently made plans to do my internship in Peru. (Since my seminary was in Minnesota, there was a good chance I would have served internship in North Dakota. Enough said?)*

peru 001
Cuzco, Peru, el siglo pasado – last century (1983 to be exact). And, yes – look closely – that is a WXRT “Chicago’s finest rock” t-shirt.

Part of my preparation for a two year internship in Peru included studying aspects of religious syncretism – the fusion of belief and practice systems – in Latin America. The most accessible example for North Americans is La Virgin de Guadalupe, a blending of Catholicism’s Virgin Mary and the mother-god of the Nahautl, Tonantzin. With her combination of features both European and indigenous, La Virgin is the representative first Mexican; her cult is both religious and cultural. There’s a danger, however, in labeling other systems overtly syncretistic: one can easily forgot that one’s own system is also syncretistic. Not all alleged purity is relative, but much of it is.

Syncretism has been a part of Christianity’s development and that of all major religious systems since their very beginnings. These systems could not have achieved worldwide status without being syncretistic. The church’s ability to adapt, thriving or surviving, in situations diverse such as the Roman empire (with emperor Constantine’s approval of the religion in 314) and communist Soviet Union (with its proposed eradication of organized religion), shows its vitality. Not all religious syncretism is bad; it is oftentimes necessary in order that an intended message be contextualized. Too much syncretism, however, can render the original message altered beyond recognition. Danger of another type ensues when religious leaders demand purity in belief and practice from adherents, acting as if their “true understanding” of the system is devoid of syncretism (and its supposed evils).

As the church in 21st century America continues on its downward trend, it has a great opportunity to differentiate itself from the dominant materialist-consumerist societal creed that has infected some of its quarters in the last thirty-five years. Money is a necessity, but Jesus turning over the money changers’ tables in the temple shows money’s supposed primacy as concocted. There’s nothing wrong with a healthy economy, but Jesus’s parable in Luke 12 of the rich fool who, thinking he was entirely “self-made,” considered all his gains for himself and no one else, is a blatant indictment of those who trust in the Market above all other things.

It’s a fine line between material blessings appreciated and properly utilized and those same objects venerated and pursued as life’s ultimate goal. Part of the church’s job in this society is to remind and teach: where you place your treasure, there you will also find your heart. There’s some purity in that understanding that shines like gold for numerous societies and cultures, past and present.

 

*No offense intended against the great state of North Dakota and its inhabitants! Peru was a much better option for internship – for me. And who knows? Maybe it was good for North Dakota that I didn’t make it there for internship . . .

 

Check out my book that covers this and similar themes. Just a Little Bit More: The Culture of Excess and the Fate of the Common Good is available at the Blue Ocotillo Publishing website.