Tuesday, February 8, 2011

Changing the game?

I'm getting really fed up with all of these "free market liberals" and proponents of infinite economic growth. No one likes waking up to the fact that the way we current live is fundamentally flawed, but the fact that it sucks is not a valid argument against changing our way of life.

The belief in the free market is flawed on two critical points. The way I understand it, the idea of the free market is justified partly because it supposedly guarantees a fair distribution of resources. This hinges on the idea of the rational agent, on the idea that people can (and do) make rational choices. If that was really the case, then how come advertising is such big business? The point of advertising is to influence supposedly rational agents into acting, not according to their own rational wishes, but rather according to whoever employs the advertising agencies. Making rational choices would entail being fully informed, something which advertising is meant to counter. But even worse, according to recent findings within cognitive science the idea of the "rational agent" seems to be little more than a myth.

Worse than that though, is the fact that the supply and demand mechanics of a free market is based on the fact that what we trade is actual resources. Resources which we currently have. Yet todays free market doesn't deal in this kind of resources - it deals in potential, expected resources. It is not a market of commodity, it is a market of credit. Now, if we lived in a world of infinite resources - and if we could ensure that we all came into the world on equal terms - perhaps that wouldn't be so much of a problem (I'm not even sure of that though). The problem, of course, is that we don't. Our resources are, for all practical purposes, finite and we're already deeply overdrawn. There can be no real balance of supply and demand under these circumstances.

These two facts seem very difficult for a lot of people to grasp. And frankly I don't blame them. It's not a pretty picture, but that doesn't make it any less real.

I keep hearing (and reading) arguments along the lines of: "Well, sure, the oil dependency is bad and we need to get out of it. However, currently we can't afford to." Essentially, what these people are saying is that they understand we can't keep doing what we're doing, but they won't change the way they live because it would be inconvenient. The question is made out to be one of choice - either we change the way we live, or we change the way the world works. News for ya' - only one of those is subject to change.

We desperately need to change the rules of the game here, yet it seems to me we're going in the opposite direction. Looking at Sweden as an example, the current government is contemplating selling our carbon credits (which would effectively nullify all the progress we've made with regards to emissions); seem to be favourable towards prospecting for oil on the North Pole (since, as we've already established - we "can't afford" to move away from fossil fuels and oil dependency); and stick to an obsolete overall financial and labour market policy, which is based around the idea of "consuming our way out of the crisis".

Not saying we need to abandon the idea of the market - but we do need to adjust for a couple of things. If we want to see a fair distribution of resources (and I do, partly because it's the "right thing" and partly because I believe it's necessary for an ecologically, economically and socially sustainable society) we need to revise our market rules, taking into account the fact that humans aren't the rational agents we're made out to be. And if we want to have a planet left to live on, we also need to revise our market rules so that we don't trade in credits anymore.

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