Permaculture Activist Magazine, Winter/Spring 2008/9

Assuring Our Future

Review by Peter Bane

Mike Nickerson

Life, Money & Illusion
Living on Earth as if we want to stay on

Seven Generations Publishing/New Society Publishers
448 pp. paper. $22.95 CAN and US

Ottawa resident, cabinet maker, and communitarian Mike Nickerson has integrated a wealth of relevant information on economics, psychology, politics, history, and communication to make a powerful case for the legitimacy of a new paradigm in economics - or "mutual provision" as he so agreeably terms it. A shift in the prevailing 'time-spirit' or zeitgeist regarding how we meet human needs and organize productive activity in society is needed urgently if we are to avoid massive destruction from overshoot of our ecological limits. Time is short and inertia is immense. The dominant players in the world Monopoly game are deeply invested in the present paradigm of dept-created money and perpetual expansion of output. They regularly apply great financial wealth and other forms of persuasion and coercion to maintain the legitimacy of this worldview, even though our best science and the common sense of great numbers of people - perhaps a majority in the developed world - now recognize that continued growth in a "full world" is not only impossible but savagely destructive.

In identifying the metaphysical origins of the world crisis, Nickerson has done much to demystify and expose the real working of a massively successful and powerful way of thinking that has outlived its core assumptions, has become demonstrably false, and yet is poised to drive humanity and most forms of higher life over a cliff of sudden and traumatic ecological collapse. It is no longer the validity of capitalism that compels its continuation, but the enormous power of its winners and the denial and propaganda in which they have wrapped their privilege. That propaganda maintains the illusion of legitimacy by which markets have become the context for all social questions and money profit the only measure of success.

Capitalism, following the radical dicta of Adam Smith, asserts that the public good is best served when men pursue each their own private interests by creating goods and offering services into the marketplace, wherein competition over price rewards the most useful. In the "empty world" of the 18th century, widespread material poverty, a small human population, and vast unexploited territories in the Americas and the southern hemisphere validated these startling assumptions on which capital has built its worldwide dominance. The very notion that humanity might overwhelm the balances of nature would have been laughable if not lunatic in 1780. For 400 years from the end of the Middle Ages to the middle of the last century, abundant natural resources fueled a dynamic expansion of output in the mercantile societies of Europe, North America, and a few other countries in their economic orbit.

No longer. Success has become a trap. There can be no additional doublings of human population or of economic output. The world's minerals and fossil fuels are within decades of exhaustion and the maxima of production have already been passed for many essential industrial feedstocks. Now, argues Nickerson, we (civil society) must, by the power of moral and scientific argument, wrest legitimacy away from the growth economy and vest it in a steady-state paradigm of mutual provision (people providing for each other's needs) in which the use of non-renewable resources is balanced against their sustainable yield, and the distribution of benefit from work is much more equitable than today.

Indeed, the most powerful section of this persuasively written book is its exposition of growth economics as a religion, and the faith of the bottom line as its most fundamentalist sect. The problems we face, in short, are problems of belief. What do people (society at large) accept as legitimate forms of behaviour and social expression? Growth economics presently occupies the central organizing point in our social order. We do not lack evidence of its failures nor of the mounting problems it has created. We do not want for solutions to these problems, either technical or behavioral. Yet society continues in a course of self-destruction, turning preferentially, when confronted with the need for change, to the 'solutions' that will increase output, harness pursuit of profit, and exploit technology (machines) to address problems that are at root ethical. People are troubled - as they were before the abolition of human slavery by law in the 19th century - by the cognitive dissonance between evidence of injustice, cruelty, and destruction (much of it suppressed by mass media and widespread denial based on fear), and the need to conform to long-established, publicly lauded norms of behavior and rectitude. "Of course it's right that society reward the rich. After all they create the wealth on which we all depend." "Of course business is better able to 'get things done' than government." "Of course government has to borrow money from banks and pay interest on it. How else could it be done?'

Well, if the public's mind were not polluted with $650 billion a year in commercial advertising and political propaganda bolstering the established order, there are actually a lot of other, more just, ecological, thrifty, and effective ways to fund and administer public projects, distribute the rewards of work, and repair a dangerously distorted relationship between humans and nature. Nickerson has identified the leverage point for movement toward a sustainable future for humans on the earth. He, like many of us, would like to preserve a great deal of the progress toward a humane society that has been made during the past three centuries: political liberty, freedom from hunger and disease for most people, scientific advancement, broad-based public education. These, not the absolute survival of some limited number of hominids, will be the likely casualties if we fail to dethrone the god of perpetual expansion.

Life, Money & Illusion builds on important work by contemporary economists Richard Douthwaite and Hazel Henderson, a well as E. F. Schumacher, among its many other sources. Their efforts to better understand human well-being and craft economic systems, both of measurement and of production that better serve that end stand out in a field best marked by obsessive abstraction, two-dimensional views of human nature, and ignorance of thermodynamic, geophysical, and biological limits.

Nickerson is well-studied and builds his case methodically from first premises. The front papers lay out an eight-point argument for long-term well-being that can scarcely be denied. The first chapter expands on these points, while the second propounds a vision for the 21st century based in the principles of urgency (time for a change is short), nonviolence (distinguishing behavior from people; making no enemies), cooperation and inclusion, working for the future, and assisting society to mature from an adolescent phase of rapid growth to an adult phase of taking responsibility for maintaining and nurturing life. He also introduces here and develops at length in later sections of the book the logic of Limits. Resource extraction begins with discovery, expands through successful exploitation, and in every case reaches a peak after which output declines. All physical commodities and locations come under this inexorable process when subjected to human use. We can escape peak and decline only by exploiting resources that are themselves renewed by the organic processes of nature in short cycles - sunlight, wind, tidal, geothermal, and biomass energies, and the organic products of land and sea - and respecting the projective limits and absorptive tolerances of the ecosystems that organize them. The logic of limits, demonstrable as it is, has not been accepted by the perpetual growth system, in much the way that a teenager rejects constraints, believing magically that he will always have more energy, can do anything, and will live forever. Most humans survive this temporary delusion and successfully negotiate the transition to adulthood. Our global society must now do so as well.

The book unfolds in an orderly fashion and the author writes in a gentle tone, taking the teaching of Marshall Rosenburg about non-violent communication to heart. This encourages engagement and softens the hard edge that a book about dire threats to life and the dry and obscure subject of economics and money might be expected to carry. Nickerson eschews sensationalism and chooses words that are descriptive but not derogatory. Setting out the nature of our present quandary, he writes, "Great wealth and power continues to accumulate to those in charge, further reinforcing their belief that the system is working. They feel good about their accomplishments, making it very difficult for them to see that our present crisis is a product of that success. They are to be congratulated, then gently urged to acknowledge the new challenges."

Nickerson examines the basis of life and ecology, problems we now face on a full planet, the existing system of perpetual growth that has allowed humanity to fill up the planet, and the problems of scale that have arisen as a consequence. He expands his critique of the market economy by examining where it fails to recognize value, where it overstates value, and how the use of money as a measure distorts social values. The market economy of course, leads inevitably to monopoly (winners find it easier to win again), and unless this is regulated and restrained by society, the power of monopoly corrupts markets, politics, government, and all else.

A wealth of story and vignette present a compelling if capsule history of economic development and cultural evolution, with its focus on the energy-abundant modern age. The author explains the rise of the corporation, the emergence of fractional reserve banking, and the financial cartels that have shaped industrial society. The center of the book is a description of present debt-based, centralized government fiat money systems, how they contrast with other forms of money, why money is important, and how it might be reformed to serve a wider spectrum of values. This is a useful, accessible, and basic discussion that all educated adults would benefit from reading. There is, in my experience as a teacher, no subject more confusing to modern-day people (who use it every day), than money, and none more essential to understanding the operations of our economy and society. Nickerson, however, goes beyond monetary reform to delve into the cultural foundation of society in beliefs about virtue to get at the even deeper issues of how we cooperate and how we acknowledge legitimacy.

In his critique of profit, Nickerson makes an excellent case for an increase in the labor component of mutual provision. This entails redefining 'efficiency.' What profit is there in throwing people out of work when this destroys their sense of self-esteem? Even if provided with full unemployment and welfare benefit (which is rare today), people are profoundly distraught at being marginalized. Our need to contribute to the world around us is nearly as great as our need to eat. The industrial economy of the developed nations had, by 1920, achieved the capacity to provide for all the material needs of every member of society. As gains in productivity continued to mount we could have chosen a shorter work-week, sharing jobs more widely, or could have applied our surplus to assist the development of poorer countries. Instead we accepted unemployment and allowed additional surplus to accumulate in the hands of the wealthy, who, lacking adequate projects for productive investment, expanded speculation, leading in 1929 to the stock market crash and the crisis of confidence that brought on the Great Depression. Why should we assume that "the nastiest of people, pursing the nastiest of purposes" will engender the highest outcomes for society? Wealth and power are quite obviously the focus of addictions no less destructive than alcohol, drugs, or gambling. Why should society not regulate them in order to limit those toxic effects?

Along with his examination of money systems, Nickerson offers a broad array of practical economic solutions to address the problems of our growth-drunk society. These include new indicators to measure well-being such as the Genuine Progress Index (He has been involved in developing legal protocols around these for the government of Canada.), inclusion of unpaid work and natural capital in national accounts, and ecological footprinting. He suggests measures to expand employment and the labor component of production, relocalizing mutual provision, improvements to democratic process such as proportional representation, full-cost accounting to allow markets to eliminate externalities, a guaranteed living income for all citizens, and the shifting of taxes off of incomes and building improvements, and onto carbon combustion, virgin resource extraction, and land. This latter set of innovations he links to the single-tax theories of Henry George, the 19th century's preeminent economic philosopher. To these ample and well-supported proposals he adds ending subsidies to the automobile and to fossil fuels, a tax on currency speculation, cradle-to-cradle concepts for industrial product recycling, and several others.

He ends with the questions of transition: What is our direction and how must we proceed? This section of the book, most eagerly awaited and of course, the most difficult to write is in many ways the least satisfactory. Published in 2006, Life, Money & Illusion appeared just prior to the recent run-up in oil prices which so grounded the argument of limits on which advocates of sustainability have made their case. Few anywhere in the developed world can now ignore that the market system is beginning to show signs of wholesale breakdown as record high prices for petroleum fail to stimulate new supplies. Anticipating history, LMI makes its argument in the softer language of scientific study and analysis rather than the punchy idiom of headlines and gas prices. Nickerson's explanations of the failure of automotive culture - which anchors this end of the book - while true, seem too tepid in view of current events.

Still, this book is about a change of worldview. I appreciated the author's offering of his own low-key attempts to break denial and open a wedge of discussion about the principal issues of social direction and our economic system. He prints his eight-point argument for sustainability on the back of his business cards and silently passes them out whenever that may be appropriate in conferences and at public meetings. Sometimes discussions ensue, always many are newly informed. The importance of this basic work of sparking public awareness cannot be overstated. It goes to the heart of the issue raised by the book: We must challenge the legitimacy of growth, and must at the same time expound a plausible vision of a steady state of mutual provision in which all will be included.

There is much to like about this book. Nickerson is a good writer. His soft-edged style encourages new thinking about old issues, and he's done an impressive job of scholarship on the economics and history of sustainability. Ideas that might from a less thoughtful writer seem Utopian, here make far more sense than the pie-in-the-sky notions of perpetual growth. He weaves lots of tidbits of history into a credible narrative: the rise of the Rothschild banking cartel, the sinking of the Lusitania, the assassination of John F. Kennedy, and the history of money issue in Canada become part of a coherent whole. His critique of market economics and growth is comprehensive, and his discussion of money systems, banking, interest, and local currencies is a worthwhile and ample primer that should become common knowledge. The book would benefit from some sympathetic editing to shorten it a bit. No one section is excessive or unnecessary, yet after 448 pages, one is a bit flagged. Much is interesting and yet by the end there is a strong sense that the author is repeating himself - eloquently and believably enough - but still a bit too much. That said, I've not found yet a single book that so captures the essence of the problem of transition to a steady state. Richard Douthwaite's The Growth Illusion, provides the closet parallel in its powerful critique of the failures and contradictions of the growth economy, but stops short of naming the essential problem of withdrawing legitimacy from growth. People need to stand up for what they feel to be true. The facts are on our side, and as long as we take care to criticize system failures and not make enemies needlessly, we should be able to establish the steady state as the new legitimacy.

Permaculture teachers would benefit from Nickerson's work in framing the issues of sustainability. This is after all, what we do, and he has offered - without referring to permaculture at any point - a comprehensive look at the core curriculum for change.

I would like to conclude by reporting how you could obtain this book, but my sources tell me that it is out of print and that the author is working on a revision. We can hope that this will be available soon and that it will make even tighter and more powerful the argument for the steady state and for a just and sustainable mutual provision for all of humanity. [note: Life, Money & Illusion is, indeed, available from good bookstores everywhere; from New Society Publishers and from the author's website at:

It is being re-published this fall, by New Society Publishers (distributed by Consortium in the US), with edits addressing the current situation, as it has unfolded since mid 2006.]