16 November 2008

How to avoid Harperville

Have a listen to this episode of the NPR radio show This American Life. There's an eye opening segment of Studs Terkel talking to people who lived through the depression in the US. It sounds pretty grim until one of the interviewees talks of being taken to see a huge shanty town where people lived in old cars and fruit crates cobbled together. Then you see just how much worse it could get. But this is not much different than how millions of people currently live in the slums of the cities of the third world.

So why do most of us, who depend on wages or retirement benefits to feed ourselves, feel so immune from this kind of poverty? It may turn out that our jobs, retirement funds and the promises the government has been making to us over the last fifty years about using our money to ensure we don't ever have to live in dire poverty aren't worth much anymore. The federal governments of the world's wealthiest countries have decided to test the laws of thermodynamics by throwing money at big corporations to encourage economic growth in an environment of diminishing energy production. Since we know the economists were not paying attention in high school physics class (that's why they studied economics in university), the rest of us can just watch while they learn this lesson first hand. Of course, they haven't finished learning that the money from nothing trick was a Ponzi scheme, so this physics lesson is going to get quite expensive.

If so, we should all probably start living as though we could face hard times, too. Learning to live with less money and using less energy are two of the biggest things I can think of. Having a well-stocked pantry could allow you to ride out a short term crisis and keep you out of lines at supermarkets. And pay attention to what's going on. Remember that conventional wisdom has a habit of shifting suddenly, and while it used to seem sensible to take on mortgages, student loans and lines of credit to finance a middle class life, these things could seem as imprudent as a payday loan if the deflationary spiral continues much longer.

Really though, even if the economy was roaring ahead and we were all flush with money, if we were thinking about our neighbours in the global south, or our grandkids, we'd still be trying to live smaller, simpler lives. After all, how much economic growth can the planet take?

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