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Synthesis/Regeneration 37   (Spring 2005)

Economics Reconsidered

A Green Economy Cannot Be a Market Economy

by Don Fitz

Green economics requires two profound changes: a decrease in the overall quantity of goods produced; and an increase in democratic decisions concerning production. Market economics can do neither. A market system is incompatible with Green economics.

The Fundamental Goal of Green economics

The cornerstone of Green ecologism is the idea that humans should survive by having the smallest possible effect on other species. The Fundamental Goal should be for humans to improve the quality of their lives simultaneously with decreasing the total quantity of goods produced. Market economics prevents attainment of this Fundamental Goal.

The Fundamental Goal should be for humans to improve the quality of their lives simultaneously with decreasing the total quantity of goods produced.

The cornerstone of Green social relationships is empowerment. Greens seek a society where everyone develops their abilities to the greatest extent possible so that the largest number of people can participate in determining our future.

A market economy is inherently domineering. It is the epitome of people seeking to dominate other people. Markets intensify social divisions and increasingly disempower people.

A market economy is based on corporations, legal entities that own social wealth and compete with each other for profit. Corporations produce products by purchasing raw material and paying people to work for them. Every corporation has an ultimate goal, a defining characteristic of its existence: to maximize profit. Profit is the one true God of corporations. The market looms over corporations and exterminates any that worship a lesser deity. Its deification of Profit is what renders a market economy inherently anti-ecological and incompatible with empowerment of the oppressed.

Markets vs. nature

Corporations would not be fulfilling their duties to stockholders if they did not maximize profit in every way possible. They may even be liable to lawsuits if they fail to do so.

The first way to increase profits is to increase the quantity of goods produced and sold. The change to a market economy has been characterized by the most massive expansion of production in world history. For several centuries, this seemed to help create the basis necessities of life. But for several decades markets have focused on goods that are useless (Coca Cola, genetically engineered food), of dubious utility (TV, drugs), designed to fall apart (furniture, appliances, clothes), or designed to become obsolete (cars, computers).

Its deification of Profit is what renders a market economy inherently anti-ecological and incompatible with empowerment of the oppressed.

Each corporation is compelled to produce more and more. If it does not, its competitors will produce more and will drive it out of business. Each logging company must rush to clearcut as much as possible. Each fishing company must slaughter ocean life as fast as it can. Each oil company must promote whatever wars it can to exhaust reserves as fast as possible. Markets compel corporations to drain natural resources and destroy entire areas of the earth.

Corporations can also maximize profit by producing as cheaply as possible. This means releasing massive quantities of poisons into the air, on the land, and in water. Poisons such as radiation, lead, mercury, cadmium, chromium, nitrogen oxides, PCBs, furans and dioxins destroy human health and the earth’s ecosystems.

We usually think that industrial processes release poisons because it would be more expensive to remove them. It is cheaper to burn coal without capturing mercury, which then goes into the air. But sometimes industry is compelled to use the more-polluting process because it involves more capital investment and therefore presents more opportunity for profit. Incineration is more expensive and vastly less effective than less destructive disposal techniques; but it is the corporate preference because the required equipment is a source of profit. There may be no more expensive and poisonous way to produce energy than nuclear power; but it is preferred to solar and wind because, like incineration, its vast equipment offers the opportunity to soak the taxpaying public for more profit.

A Green economy would improve the quality of our lives by producing and consuming less. This would be accomplished by:

1. producing fewer objects that are destructive or useless,

2. producing goods that are designed to last a longer time, and,

3. increasing the production of goods and services that are actually necessary.

Green economics would aim to manufacture furniture that would last for centuries. This is key to having a better life with a decrease in production. Simple arithmetic confirms that if clothes were to last 20 years instead of 2 years, you could decrease the quantity of clothes manufactured by 80% and have twice as much clothing available. Multiply this by dozens of categories of goods or thousands of consumer items and total production decreases dramatically.

There is no contradiction between increasing the production of necessary items while decreasing total production. This is accomplished if the decrease in production of useless junk is greater than the increase in the quantity of necessary items. But a shift in the production of necessary items can also decrease production simultaneous with increasing consumption.

…a shift within the production of necessary items can … decrease production simultaneous with increasing consumption.

Visualize food. The market economy wastes enormous social wealth by (a) encouraging people to eat meat, and (b) developing genetically engineered (GE) crops. Much of GE is for the purpose of animal feed. Production of meat requires an 80–90% loss of protein by converting vegetable protein into animal protein before it is consumed by humans. GE actually involves a decrease in crop yield and is done primarily to help agribusiness eliminate small farmers. To the extent that a Green economy was successful in persuading as many people as possible to shift to an organic vegetarian diet, it would:

1. decrease the total quantity of crops produced (largely, but not solely, due to decreasing the need for animal feed);

2. increase the total quantity of healthy food produced;

3. decrease the quantity of road repair and production of machines that do road repair for the purpose of transporting garbage disguised as food;

4. decrease the need for medical care associated with bad food; and,

5. decrease mental health services for people with disorders from working unnecessarily long hours.

The food example shows how production can decrease simultaneous with an increase in necessary production and the quality of life. Add to this transportation (reduction of cars), energy (replacement of oil and nukes), buildings, clothes and appliances and the result is an enormous decrease in consumer items that then results in an even greater decrease in production of machines that produce consumer items.

Imagine a world eliminating nuclear power, reducing oil production, and increasing organic food production. Picture a world with furniture designed to last 200 or more years, appliances without electrical crap that breaks every six months, and roofs made of slate instead of asphalt shingles. If you are seeing this in the context of a market economy, try imagining total economic failure and the most massive unemployment the world has ever seen.

Corporate radio, TV and newspapers constantly indoctrinate us that an increase in consumption is a “bright” economic forecast and the consumption of fewer objects means the economy is having a “downswing.” Market economists debate the best way to have an increase in the quantity of consumption but they never debate whether consumption should go up or down. They share an assumption that producing and consuming more is good because they correctly understand that a large decrease in consumption could cause a market economy to fall apart. While they may want us to believe that a need for an increase in consumption is eternal, it is not. The market system is perhaps the only economic system in history that collapses if there is a large decrease in consumption.

Imagine a world eliminating nuclear power, reducing oil production, and increasing organic food production.

Despite the personal feelings of owners, board members and investors, market competition compels corporations to increase the total quantity of goods and increase the production of poisons. This makes a market economy incompatible with the Fundamental Goal of Green Economics.

Markets vs. democracy

Long before there was widespread concern with corporate destruction of the environment, people realized the extreme dehumanization of their lives brought by corporations. In the 21st century, corporations see environmental destruction as an “externality.” That is, if an industrial facility emits mercury while burning coal, it considers problems with mercury poisoning to be “external” to production and that the cost to humans and other species should be paid for by those affected or by the government. Environmental organizations side with the victims and argue the costs of poisoning should be “internalized” and paid for by the company committing the crime.

This debate is actually several centuries old. The first unions fought not only for higher wages but for corporations to “internalize” costs such as workers being injured and killed during production, for health plans and for pensions. Corporations have always viewed these as “external” to production and wished to lower costs by shoving them onto the backs of workers. One way to think of labor and environmental history is as a continuing struggle to prevent externalization of costs of production.

Though there may be a victory against externalization, it is always temporary. The victory may last 200 years, but it is still temporary—the victory does not affect the structure of market economics but only its current apparition. Unions may have won pension plans, but Profit remains the one true God of the market economy. Every corporation is compelled to worsen the conditions for workers as much as possible in order to lower costs of production and maximize profit. If corporations can lessen wage gains, they will work to eliminate wage gains. If they can stop wages from going up, they will try to make wages go down. If they can make wages go down, they will seek to lengthen the work week, eliminate pensions and make workers pay for their own injuries on the job.

It makes no difference whether individual corporate board members think that this is nice or that it is not nice. If a corporation does not maximize its profits by attacking its workers as viciously as it can, its competitors will and the market will drive it out of existence.

Market economists debate the best way to have an increase in the quantity of consumption but they never debate whether consumption should go up or down.

This unending effort to undermine the livelihood of those who actually produce goods and services is not exactly workplace democracy. It is the antithesis of workplace democracy. And it is required by market economics.

In contrast, Green values require democracy in every aspect of life. Green values require that all people have the right to vote on how to organize their work lives and how to distribute the wealth produced by collective labor. Except for a few rare examples, those who work for corporations leave their democratic rights at the company’s door.

Green values of egalitarianism require an economy that distributes social wealth as evenly as possible. This means between genders, between ethnic groups and across the continents. But market economics forces corporations to do the exact opposite. If nineteenth century male secretaries were relatively well paid, and if the changing of secretarial work to a predominantly female occupation could be accompanied by a sharp fall in pay, markets compel the corporation to do so. If corporations can define some work as Black work or Chicano work and get away with paying less or offering no health plan, this is what the market says they must do.

The most extreme difference in working conditions is between the overdeveloped countries and victims of imperialism. Workers in the US and Europe may earn 10 to 100 times as much as their counterparts in Africa, Asia and Latin America, largely because of the military machine and extreme national bigotry which has always been used to maximize profits. Once again, these evils are not because a few wicked men in corporate boardrooms make unfortunate choices. Sexism, racism and national chauvinism increase because a few wicked men in corporate boardrooms make choices that the market compels them to make.

Just as the Green value of democracy means that people should vote on how work should be organized, a society as a whole should vote on what should be produced. We the people should vote whether we want more cars or more mass transportation systems. We should vote on whether spaceships should be produced and whether food should be genetically contaminated. There is no idea in this essay which is more antithetical to market economics than the idea that all of society, rather than a wealthy few, should democratically decide what goods and services they want. In the Religion of the Market, the Grand Invisible Hand of consumption decides what is produced. And if the pocketbook in some invisible hands is larger than the pocketbook in other hands, so be it.

If a corporation does not maximize its profits by attacking its workers …, its competitors will and the market will drive it out of existence.

By preventing citizens from voting on what is produced, market economics is inherently disempowering. You can support Green economics or you can support market economics. Only a mugwump can claim to support both.

The pet argument

If a market system is so awful, why would any Green ever defend it? Consider the pet argument:

“We’re agreed that we will get a pet, but I don’t want a cat.”
“Then you want to get a dog.”
“No, just because I don’t want a cat does not mean that we have to get a dog.”
“Yes it does. If you don’t want a cat that means that you want a dog.”

Knowing the wide range of animals to choose from, few would take the above “pet argument” seriously. Unfortunately, it represents the logic of many who support a “Green market economy.” The reasoning is that, if we were to say that a market economy was bad, then we would be saying that a state-run Soviet-type economy was good; and, since we know that Stalinism is bad, therefore, some form of capitalism must be at least acceptable.

As far as economic systems go, this makes no more sense than saying that if you claim that feudalism is bad then you must be in favor of a slave system. In reality, there are an unlimited number of economic systems that people can design. Greens will not develop an economics of empowerment if their analyses are based on fear that rejecting something which is evil will get them labeled “socialist.”

Greens have been willing to challenge sexism by requiring equal representation by women, challenge racism with open support of reparations and challenge homophobia by endorsing gay marriage. Just as Greens participate in social struggles which may be unpopular in a white, male chauvinist society, development of a Green economic theory means that we must be willing to oppose dogmas of corporate ideology.

If not a market economy, then what?

Every society believes that it is the ultimate form of human social organization. And every social system ends up being replaced by another which believes it is the ultimate system. Despite the fantasies of Bill Gates and Donald Trump that their ilk will reign eternal, the market system will eventually be replaced.

…there are an unlimited number of economic systems that people can design.

There is a virtually endless list of movements that tried to discover democratic ways to live without markets. A few that jump to mind are the Russian mir (system of communes), the Paris Commune of 1871, the syndicalists of late nineteenth century Europe, nineteenth century communes in the US, the Wobblies, the original Soviets of the 1905 Russian Revolution, ejidos arising from the twentieth century Mexican revolution, communes of revolutionary Spain (1936–39), the 1956 Hungarian Revolution, and Chilean tomas during Allende’s presidency. There must be countless more that I am not familiar with or that never made their way into Western history books. These all shared a yearning for a society without a dichotomy between the powerful and the powerless. They also existed without awareness of the acute ecological crisis facing human survival.

Green economic theories must not ignore these social movements. True Green economics would begin with the long-held desire to abolish man’s domination over humanity and expand it into the goal of abolishing man’s domination over nature.

Some small companies such as family restaurants will stay open for a long time. But this is a far cry from multinational corporations expanding to control every aspect of our lives. A few independent shops are not a market system. A market system means that private corporations are the dominant form of production which determines the direction of the economy.

Many economic formations exist which can be expanded as corporate markets shrink. A few are:

What would increase most rapidly in a Green society could well be economic formations we have not yet imagined but which will be created by those born into a world which strives to eliminate institutionalized domination. While we cannot say what those yet-to-be-conceived Green economic formations will be, we can be clear on what they will not be: they will not require people to serve feudal lords, they will not allow slavery, and they will not be based on market economics.

Don Fitz is an editor of Synthesis/Regeneration, is on the Green National Committee of the Greens/Green Party USA, is Outreach Coordinator for the Missouri Green Party, produces Green Time TV in St. Louis, and edits the Compost-Dispatch for the Green Party of St. Louis.

[22 mar 05]

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