What is chindogu, you may well ask. Chindogu is a Japanese word for all the useless things we might be tempted to buy – windscreen wipers for your spectacles, in case you go out in the rain, slippers with mops underneath so that you can polish the floor as you walk around the house. I have all those ties that I’m never going to use – chindogu. We get a lot of it wrapped up in fancy papers every Christmas – and ever more ingenious chindogu catalogues come through my door with each post. On 14 February, St Valentine’s Day, Americans are expected to buy thirty million boxes of heart-shaped chocolates.
Chindogu can get exotic. A friend of mine visiting someone in Brazil, found that he had six fridges in his house, five of them not plugged in. Why? he asked. Well, the Brazilian explained, when inflation was at its height there, money went off very quickly, like milk in the sun, so as soon as he had any cash he went out and spent it. The only things he could find that he fancied were fridges – so, chindogu fridges. Is this what ‘buoyant consumer demand’ really means? Is this what we are all working so hard for?
Technology thrives on chindogu. Washing machines now come with twelve different programmes, but most of them are never used. I can programme the video recorder for a month or more ahead, but I have never felt the need to test it. I bought it because it had more options than any other. I had fallen prey to the chindogu bug and had lumbered myself with a bundle of useless options. My son’s new computer has features that weren’t thought of when I bought my last one, two years ago. The instinct to have what he has is strong, although my reason tells me that the extra features are quite unnecessary for my needs.
I hate to say it, but many books are chindogu items. In 1996, 106,000 new titles were published in Britain alone. Presumably they each sold enough copies to keep the publishers, at least, reasonably happy, but many of them were almost certainly never read, just put on the shelf. Useless bits of processed trees. To cope with the unread books and all the other chindogu, every society has to become a throwaway economy. Otherwise there would literally be no room for it all. Waste collection and recycling become boom industries, thrift shops thrive, while postal services carry ever more catalogues and free offers. The chindogu world is a busy one.
A chindogu society may chalk up good economic numbers but it would not, on the face of it, provide good enough reasons for working or living. If ‘buoyant consumer demand’ means a world full of junk, it is hard to see why we should want to work so hard for it. As Adam Smith also said, ‘No patriot or man of feeling could oppose it [growth], but the nature of this growth . . . is that it is at once undirected and infinitely self-generating in the endless demand for all the useless things in the world.’ He was in favour of ‘cultivation’ as the purpose of society, but, unfortunately, he suggested no way of building that concept into the efficiency formula.
The British economist, the late Fred Hirsch, took the view that economic growth was ultimately self-limiting because that growth would increasingly come from ‘positional goods’, things that set us apart from the neighbours – second homes with open views, membership of exclusive clubs, rare antiques. These goods were, by definition, limited because if everyone had them they would lose their exclusive value. He may have underestimated our capacity to think up new fashions and new haunts, but, again, a society fuelled mainly by envy of your neighbour is not one that seems worth fighting for, or one that many would want to live in, because there would never be any end to invidious comparisons, or to a feeling of perpetual dissatisfaction. Economic growth, fuelled by efficiency, may not, therefore, be limitless, odd though this may seem today. On the other hand, inefficiency is not an option, either, if we want a society that works.
Efficiency, one has to conclude, may be essential for the continued existence of a society, but ultimately it, and the economic model it belongs to, cannot lead to an answer to the greater hunger, the reason for living. We will need, perhaps, to create more activity outside the purely economic sphere, where the motivation will be unconnected with efficiency and more to do with intrinsic satisfaction and worth. In which case, money and the market would be marginal considerations in one’s scheme of things.
At least three of my more mature friends, that is, friends of my age, have taken up the piano, a notoriously difficult instrument to learn, particularly when one’s fingers are stiffening at the joints (and the ability to coordinate the different movements of two hands is known to decline with age). All three speak in glowing terms of the satisfaction they feel when they can make a piece of music sound roughly as it was meant to sound. It would be much more efficient to buy a CD, better results, less time and probably less money – but it would have far less meaning for them. Not effective, in other words.
The same, of course, goes for all the things that so many of the British spend their time on, and which we belittle as hobbies. The 700 people of the country village where we spend much of our time enjoy, between them, over 20 interest groups ranging from the cricket team to the drama group to the silver thread group to the church bellringers. They are ‘organized around their enthusiasms’ as one book on voluntary organizations once put it. The efficiency of some of these groups is often in doubt, but that is hardly the point. Sometimes the members positively glory in the communal chaos.
There is nothing new or surprising here. Many people, perhaps even most people, have always found their meaning and their satisfaction in life from activities that are quite outside the market, and far removed from any concern with efficiency. Sadly, however, what we do in private does not seem to count in public. We need to find ways to make it count, because we could then begin to escape from the myth we have made for ourselves, that only the things with a price are worth having or doing. We know that is not true. We should celebrate the fact.
THE COLLAPSE OF THE WEST
Pierre Thuillier, a French philosopher and science historian, in his book The Great Implosion: a report on the collapse of the West 1999–2002, has conjured up a report in 2081 by a group of historians, humanists and poets (notably excluding scientists and economists) on the conditions that underlay the upheavals of Western Society at the start of the new millennium. They pose the question: why did the elites at that time not see the writing on the wall?
The group is astonished at how the elites seemed to continue merrily on their way:
. . . despite the most grotesque manifestations of the cult of Progress, the excesses of technocratic management, the kind of paranoia which was so evident among the so-called informational/organizational elites, the unbridled imperialism of the economic and financial institutions, the obsessive research into mechanization and automation, the regressive aspects of Western rationalism and the science which was an integral part of it, the incapacity of the governing bodies (in both industry and the State) to conduct the enterprises for which they were responsible in a humane way, the lack of imagination, sensitivity and human warmth that finally characterized the activities of all political parties, the alarming rise of individualism, the lures of the ‘information and communication culture’ so touted by diverse sociologists and media experts, the exacerbation of the North/South imbalances, and the risks of explosion or implosion caused by the increasing numbers of the marginalized.
The fictional group is puzzled by the fact that ordinary citizens were so accepting of what was going on, grumbling when their material interests were affected but seemingly accepting the spiritual poverty so characteristic of modernity. ‘While much time and effort went into the material manipulation of things, people seemed incapable of facing fundamental questions concerning the meaning of human life.’ The group concluded, not surprisingly considering its membership, that the West collapsed because it no longer had any culture and had lost all its sense of poetry, for ‘a society is not really a society unless it is able to invent ideal concepts and myths that mobilize individual energies and bind people’s souls together.’
The book, published in 1996, was ignored by the French press, proving the aut
hor’s point that the elites were unconcerned. The journal Le Monde Diplomatique was the exception, commenting in its editorial on the growing pessimism in France, where 80% no longer believed in the improvement of the economy:
The discontented of last December’s revolt are now being joined massively by the middle classes, who have been struck in full force by rising taxes and who see their children, in turn, being hit by unemployment, while they fear for their pensions . . . The country is losing confidence in the elites, too often guilty of corruption, embezzlement and using their influence for trafficking. There is a strong hostility towards the technostructure – all the more so since it is being held responsible, together with the government, for the social tragedy.
Ironically, the economy in France is improving, but nobody seems to feel better for it, or even to believe the statistics. What is true of France is also true of Britain and of much of the rest of the efficient society. The combination of impending drama and apathetic silence is eerie. For all its benefits, efficiency alone is not the answer.
THREE
THE BABY IN THE BATHWATER
MARKETS AND EFFICIENCY have their flaws, but we must be careful not to lose the baby of capitalism in the messy bathwater of its unintended outcomes. We have, thus far, glossed over the benefits of both markets and efficiency. It is necessary to correct the balance, because if we were to abandon our belief in either we might end up by substituting material poverty for the spiritual poverty that many sense today.
The World of Davos Man
In early February each year one thousand businessmen, financiers, officials and intellectuals gather at the Swiss ski resort of Davos for the annual meeting of the World Economic Forum. It is the biggest business conference of the year, and the most expensive. Forty or so heads of state will also be there, living evidence that business and economics have a large part to play in politics. The businessmen, and the rather fewer businesswomen, do not go there to butter up the politicians; it is the other way round. The heads of state step up to the podium in turn to proclaim the virtues of their countries and to invite investment. Bill Gates attracts more interest in Davos than any Prime Minister or President.
Some people find the gloss and glitter of Davos Man hard to take. As even The Economist admitted, there is something uncultured about all that money-grubbing and managerialism. Profits not poetry are what fascinate these people, at least in their official capacities. Yet, in their enthusiasms for markets, whatever and wherever they may be, these people may do more to promote peace and prosperity than any number of well-intentioned diplomats. As never before, economic activity spills across borders, unconcerned whether the land the other side is Muslim, Buddhist or Western. Any service that can be digitized and transmitted – computer programming, banking services, back office operations – can be produced and sold everywhere. This spreads commercial activity, allowing the growing populations of the developing world to have some hope of participating in the world economy and to find their future in prosperity rather than warfare. Because commerce requires continuity and predictability it promotes order, and because that order brings prosperity there is little popular enthusiasm for disturbing it.
McKinsey, the consulting firm, estimate that the speed of data transmission will increase by a factor of 45 between now and 2005. Whole new industries will spring from the improved communications that result. One possibility is the privacy-management business. We will all be bombarded by so many electronic services that we will pay for ‘gatekeepers’ to sort out some of the stuff for us. That service can be provided, electronically, from anywhere on earth, as can many other services. One shopping mall in Britain reputedly employs a Nigerian company to monitor its security videos, utilizing the fact that Nigeria is in the same time zone as Britain and has much cheaper labour.
By plausible assumptions, the world output of goods and services could easily double by 2020 while the population should increase by one third. Average living standards would then rise by two thirds. Even if a lot of the growth is chindogu it still brings more money to more people. In the process the rich countries do lose some jobs and industries to poorer countries but those countries get richer in their turn, whereupon they import from the rich, more than making up for the incomes they stole. Ultimately the costs of the new economies draw level with the old economies. Nothing stands still. Singaporeans are now proud that their standard of living is equal to Britain’s and even boast that they will soon be more expensive, but, of course, they add, more efficient.
Davos Man would have to accept that there are some snags along the way to this universal peace and prosperity. China’s reinvigorated appetite will take some satisfying in the form of raw materials. All China’s new cars will help to double her demand for oil by 2010, requiring her to import some three billion barrels a day – from somewhere. Then there is all that extra pollution those cars will bring, and the damage to the ozone layer from her new refrigerators. The same is true of the other developing countries, for growth in these lands is not environmentally neutral and raw materials are not elastic. We have been here before, however. In the 1970s ‘limits to growth’ was the standard worry. The rundown of resources which they forecast did not come to pass then, and Davos Man’s hope is that the threat will disappear this time too; that higher prices will bring forth new sources of supply and will cause people to use what they have more efficiently.
The greatest obstacle to the dream of universal prosperity is political. The new commercial opportunities will not fall equally. Can China hold itself together when parts of that country are growing at rates of 20% or more and others are still locked into peasant economies, or will China revert to feudal wars under warlords, in line with her past? There are new signs of economic nationalism as countries and regions are tempted by protectionism when times get difficult. When that happens, who knows whether the new wealth may not be spent on arms to fight our economic enemies? The hope, and in many ways the purpose, of the Davos meetings is that countries will continue to see the sense in cooperation for the sake of mutual prosperity. But it remains a hope, not a guarantee.
The Creativity Factory
In my thirties, I lived for a while in the United States. I was studying at the Sloan School of the Massachusetts Institute of Technology, a place too proud to call itself a University, where technology and business have always been intertwined. Over dinner with some friends one night we got to speculating on the kind of products and services the new technologies would throw up and the ones that we ourselves would back. It was a fun game and I went to bed with a mind still buzzing after a stimulating evening.
The next morning, however, it was back to work. I had put the chat of the previous evening out of my mind when the phone rang. ‘It’s Jack,’ the voice said. ‘You know that idea you were so enthusiastic about last night?’ With some effort I switched my mind back to the dinner and worked out what he was talking about. ‘Well,’ he went on, without waiting for me, ‘I’ve rung my banker and we can get the finance, so what do you say – when shall we start?’
For me, too English by half, I suspect, the evening’s talk had been just that, talk. Yet to my American friend it was the opening up of a market opportunity, one, moreover, that the availability of venture capital turned into a real possibility. We didn’t start a business. My academic work was too important to me to give up. Ironically, however, I learned more from that one incident than from most of my more formal studies. I learnt that markets give wings to ideas.
We all dream dreams, but few of us do anything about them. On the surface it is the thought of profits that is the spur to a practical creativity, but the chance to make our dreams come true is at least as important as the profits we might make from them. It is, however, the possibility of profits that makes finance available and it is available finance that makes the difference between talk and action. In a regulated and controlled world there is little scope and even less incentive to be creative in work because there is no ca
sh around to make it possible for dreams to come true. Better then to do what one has to do at work and keep the creativity for spare time.
The German economic miracle after the Second World War is usually attributed to the then Minister of Economics and later Chancellor, Ludwig Erhard, but, as Neal Ascherson has revealed, it was the two economic officials who then presided over the joint British and American zones of occupation who were really responsible. Their names were Karl Bode, an American, and E.F. Schumacher, later to become famous as the author of Small is Beautiful. Under the Occupation Powers everything initially was tightly controlled, rationed, and nationalized. There was much activity and confusion but not a lot of movement. Then Bode, said Schumacher, ‘came to me one day with the splendid idea that these controls ought to be scrapped, “so let’s take the handle off the controls”.’ They did just that and let Erhard claim the credit for the explosion of energy and creativity that followed.
Silicon Valley in California is the ultimate creativity factory. Unlike bankers elsewhere, those in Silicon Valley bet on future possibilities rather than present assets. If you have a dream, and an idea as to how to make it happen, you will almost certainly be able to find someone to back it if it is halfway practical. Nor are mistakes fatal. Bankruptcy is not failure in the Valley but a sign of maturity. We all make mistakes, they say, but that should never stop one dreaming. Is money the spur to all the creativity and energy? Up to a point, probably. But after that point it has to be something else. ‘I sold the boat and the beach apartment last week,’ one Valley entrepreneur told me. ‘I realized that I had not gone near either of them in the past year – too busy with the business.’ Dreams are more important than the money they bring.
The Hungry Spirit: New Thinking for a New World Page 5
