Posted by: jackslife | March 11, 2009

The Virtue of Avarice (The Vice of Thrift)

Another great post from FPR.  Mark T. Mitchell sums up true conservative thought about the growth economy.  Here’s some of it –

Economic growth requires increased production. The economy cannot grow unless production grows. But production cannot increase unless consumption increases. Someone must purchase the goods that are produced. If this does not occur, economic growth is impossible. In the fourth quarter of 2008, Americans, feeling the economic squeeze, chose to hold on to their money. They purchased less goods, and the economy contracted. This restraint, if economic growth is the benchmark for economic health, was bad.

Consumption, then, must increase if the economy is to grow, and a healthy economy is a growing economy. Thus, a healthy economy requires a steady increase in consumption. One way to facilitate this expansion is to tap into foreign markets and thereby find new consumers of the goods we produce. This, of course, is ultimately limited by the size of the world and the capacities of foreign markets to absorb our products. Furthermore, expanding into foreign markets is made difficult when the economic downturn is global in scale. Everyone’s wallet is tighter.

A second way to expand consumption is to increase per capita consumption at home. The economy needs Americans to buy more products. When stated in this way, it becomes the patriotic duty of every American to consume. But if growth is to be perpetual, our consumption must not only continue but steadily increase. Forever. The long term prospects of such a program are dubious when we consider the finite natural resources at our disposal. When we factor in the contracting birthrates throughout the developed world, the idea of perpetual growth seems obviously ill-fated.

and

If the health of our economy is predicated on the denial of certain virtues, something is seriously amiss. If the ideal of perpetual economic growth requires a perpetually frenzied consumerism, it is time to consider a different indicator of economic health. President Obama’s stimulus package is clearly based on this false ideal of perpetual economic growth. This ideal is embraced by the leaders of both political parties, even as the Republicans reject the specific means to that end. As the slurry of dollars begins to wash over us, many Americans are looking for a new direction. A return to the virtues of self-control and thrift would signal something really radical. So would a return to the idea of sustainability, a return to the belief that conserving for future generations is our first duty, and a recognition that putting aside idols is the first step to wisdom.

Wendell Berry had a lot to say about the health of the system, whether it be a family, a farm, or a society.  Health is more than just rapid growth in your livestock.  It is balanced and requires all of the proper nutrients.  In the same way, the health of a society, or even the economy, is not based exclusively on the rapid growth of the GDP or the stock market.  In fact, it seems to me that unchecked growth is probably a sign of a sickness.  Bubbles will inevitably burst, and when they do that sickness will show itself.

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