I have long maintained that part of what ails America is that corporations have become far too stakeholder and profit driven. Who cares how it came about, as long as the bottom line is in the black? This ends up driving an amoral quest for profit--profit at the cost of people. Do we want to love people and use things or love things and use people? Corporations these days, I think, have long lost the desire to pay the price of civilization. An excerpt from The Price of Civilization: Reawakening American Virtue and Prosperity by Jeffrey D. Sachs captures much of this idea.
At the root of America's economic crisis lies a moral crisis: the decline of civic virtue among America's political and economic elite. A society of markets, laws, and elections is not enough if the rich and powerful fail to behave with respect, honesty, and compassion toward the rest of society and towards the world. America has developed the world's most competitive market society but has squandered its civic virtue along the way. Without restoring an ethos of social responsibility, there can be no meaningful and sustained economic recovery.
I find myself deeply surprised and unnerved to have to write this book. During most of my forty years in economics I have assumed that America, with its great wealth, depth of learning, advanced technologies, and democratic institutions, would reliably find its way to social betterment. I decided early on in my career to devote my energies to the economic challenges abroad, where I felt the economic problems were more acute and in need of attention. Now I am worried about my own country. The economic crisis of recent years reflects a deep, threatening, and ongoing deterioration of our national politics and culture of power.
The crisis, I will argue, developed gradually over the course of several decades. We are not facing a short term business cycle downturn, but the working out of long-term social, political, and economic trends. The crisis, in many ways, is the culmination of an era--the baby boomer era--rather than of particular policies or presidents. It is also a bipartisan affair; both Democrats and Republicans have played their part in deepening the crisis. On many days it seems that the only difference between Republicans and Democrats is that Big Oil owns the Republicans while Wall Street owns the Democrats. By understanding the deep roots of the crisis, we can move beyond illusory solutions such as the "stimulus" spending of 2009-2010, the budget cuts of 2011, and the unaffordable tax cuts that are implemented year after year. These are gimmicks that distract us from the deeper reforms needed in our society.
The first two years of the Obama presidency show that our economic and political failings are deeper than that of a particular president. Like many Americans, I looked to Barack Obama as the hope for a breakthrough. Change was on the way, or so we hoped; yet there has been far more continuity than change. Obama has continued down the well trodden path of open-ended war in Afghanistan, massive military budgets, kowtowing to lobbyists, stingy foreign aid, unaffordable tax cuts, unprecedented budget deficits, and a disquieting unwillingness to address the deeper causes of America's problems. The administration is packed with individuals passing through the revolving door that connects Wall Street and the White House. In order to find deep solutions to America's economic crisis, we'll need to understand why the American political system has proven to be so resistant to change.
The American economy increasingly serves only a narrow part of society, and America's national politics has failed to put the country back on track through honest, open, and transparent problem solving. Too many of America's elites--among the super-rich, the CEOs, and many of my colleagues in academia--have abandoned a commitment to social responsibility. They chase wealth and power, the rest of society be damned.
We need to re conceive the idea of a good society in the early twenty-first century and to find a creative path toward it. Most important, we need to be ready to pay the price of civilization through multiple acts of good citizenship: bearing our fair share of taxes, educating ourselves deeply about society's needs, acting as vigilant stewards for future generations, and remembering that compassion is the glue that holds society together. I would suggest that a majority of the public understands this challenge and accepts it. During my research for this book, I became reacquainted with my fellow Americans, not only through countless discussions but also through hundreds of opinion surveys on, and studies of, American values. I was delighted with what I found. Americans are very different from the ways the elites and the media pundits want us to see ourselves. The American people are generally broad-minded, moderate, and generous. These are not the images of Americans we see on television or the adjectives that come to mind when we think of America's rich and powerful elite. But America's political institutions have broken down, so that the broad public no longer holds these elites to account. And alas, the breakdown of politics also implicates the broad public. American society is too deeply distracted by our media-drenched consumerism to maintain the habits of effective citizenship.
"The unexamined life is not worth living," said Socrates. We might equally say that the unexamined economy is not capable of securing our well-being. Our greatest national illusion is that a healthy society can be organized around the single minded pursuit of wealth. The ferocity of the quest for wealth throughout society has left Americans exhausted and deprived of the benefits of social trust, honesty and compassion. Our society has turned harsh, with the elites on Wall Street, in Big Oil, and in Washington among the most irresponsible and selfish all. When we understand this reality, we can begin to refashion our economy.
Two of humanity's greatest sages, Buddha in the Eastern tradition and Aristotle in the Western tradition, counseled us wisely about humanity's innate tendency to chase transient illusions rather than to keep our minds and lives focused on deeper, longer-term sources of well-being. Both urged us to keep to a middle path, to cultivate moderation and virtue in our personal behavior and attitudes despite the allure of extremes. Both urged us to look after our personal needs without forgetting our compassion towards others in society. Both cautioned that the single-minded pursuit of wealth and consumption leads to addictions and compulsions rather than to happiness and the virtues of a life well lived. Throughout the ages, other great sages, from Confucius to Adam Smith to Mahatma Gandhi and the Dali Lama, have joined the call for moderation and compassion as the pillars of a good society.
To resist the excesses of consumerism and the obsessive pursuit of wealth is hard work, a lifetime challenge. To do so in our media age, filled with noise, distraction, and temptation, is a special challenge. We can escape our current economic illusions by creating a mindful society, one that promotes the personal virtues of self-awareness and moderation, and the civic virtues of compassion for others and the ability to cooperate across the divides of class, race, religion, and geography. Through a return to personal and civic virtue, our prosperity can be regained.
It is not perfect; for some reason Mr. Sachs resists Jesus Christ as one of his sages. I think it is because Jesus Christ also asks for internal transformation and commitment. Your treatment of others flows naturally out of the love that God has placed in your heart via his forgiveness, grace and love. We have lost something in our country, however, and to at least acknowledge that loss is an important start.