Transcript for Charles Eisenstein

The following is a transcript for the podcast: Charles Eisenstein: It's Time for A Better Narrative

Chris Martenson: Hello. Welcome to another podcast, I am your host, of course, Chris Martenson. I am really looking forward to today’s podcast. While every generation feels its own time is extraordinary and perhaps each time in history is unique. We, today, are facing a set of predicaments unlike any phase before. Never has humanity been so far out past the edge of the earth’s caring capacity. Never have we faced a globe without appreciable new resource horizons to cross over and exploit. And never has humanity had to envision a better future while moving away from a high density energy fuel source, like oil, and towards a more diffused energy source such as the sun or the wind. All of this is shorthand for the idea that there is something wrong about our current national and even global narrative that is out of alignment with the facts and data that we can easily access today and perhaps even with our own internal compasses that let us know there is much more to being a fully alive and conscious human than our culture typically encourages.

Here to talk with us about where we are with this story and where we are headed and the joys and pitfalls we might expect to find along the way is Charles Eisenstein, lecturer and the author of the books The Ascent of Humanity and Sacred Economics. I am very excited to have Charles as our guest today because he writes beautifully on an area that I find very few have been able to or are willing to explore openly which is the intersection between economics and philosophy.

Today, we are going to explore his thinking on the shortcomings of our current monetary system and why he sees us at an important juncture where, should we want to, we have the opportunity to transition to one more authentic with the laws of nature and the post peak oil future we are likely headed towards. I’m not sure where we will end up in this conversation, but I do predict it is going to be a very interesting ride. Charles, welcome. I am so glad to have you with us today.

Charles Eisenstein: I am really happy to be here.

Chris Martenson: Let’s begin by characterizing the predicament in which we find ourselves. I have said something is wrong with our narrative and there are a lot of pieces to that. A central one, that can prove to be highly disruptive, is when a cultures money system breaks down. I love what you wrote about money as a sacred object and that our high priest and priestesses of money are in danger of being revealed as powerless frauds. Can you please paint for us your picture of how money operates and how it is failing now?

Charles Eisenstein: Yes. I think everybody has a sense that the failure of money is an expression of the failure of something even deeper. So money might not be the deepest thing that is failing, but certainly it is pretty central to everything else that is going on. What I see, we talk a lot about peak resource use or maybe even more relevant, peak environmental degradation, but I think that underneath all of that the failure is of the basic mythology of our culture that money is an expression of. You can even say we are going through peak separation where the kind of money that we have today pushes us into competition whether we want to be there or not because of the way that it is created and circulated as interest baring debt there is always more debt than there is money. Everybody is competing for not enough money and it kind of makes into the truth something that isn’t fundamentally true, which is the kind of Cartesian version of self that we are these kind of bubble psychology competing with each other in an external universe for never enough. And the money system reifies that and drags us into that way of being. And it also necessitates economic growth because if there is always more debt than there is money the only way the debts can be paid what would have to happen is either that lots and lots of people go bankrupt and default and everything falls apart or you have to create even more money to pay the debts that were created from creating the existing money as you and your readers all know, maybe even better than I do, how this all works.

That can only continue as long as there is a basis for creating new money. I feel like I am kind of wandering off a little bit here. But basically, and I can get into that a little bit more. Basically, what is happening is that our money system is deeply implicated in separation and growth and both of these have reached their extreme. Therefore, money isn’t working anymore.

Chris Martenson: And money is certainly breaking down. I love the image you have us before of how our high priest Ben Bernanke is up and he is doing his rain dance, right? And he pours trillions of dollars into the landscape and what is supposed to happen next is an economic revival and it doesn’t happen. So what we take from that is uh oh, it looks like our priest’s magic is gone and indeed it is gone. From my point of reference I think once you have hit where we are in the energy cycle and we are getting less and less high net energy back it is just an absolute guaranteed prediction you are going to get less and less economic activity regardless of what you do with the monetary policy. Whether it is tight or loose or all of that, ultimately, the real driver of economic activity is not money itself, it is real goods and services that people actually need and want and are going to consume going from point A to point B and energy is just sand in the transmission of that as it is rising in price.

So through that framework we can see that it is an enormous structural shift and it goes beyond, it goes so far beyond that, of course. The money system is breaking down. Europe is discovering that right now. We were going to hit a mathematical limit with our debt expansion which is about four decades in the making. That was going to happen anyway. But we were going to have this whole peak oil thing happening at the same time, plus other resources are getting tight. We have global food supplies and aquifers and we are looking at certain minerals. There are just enough warning signs there any prudent person can look at this and say gosh, this is a new landscape. And yet, my perception is that our current cultural and political leadership is just so far away from understanding that the game has changed that my personal assessment is that what they are going to do is continue to perpetuate the status quo as long as possible until it is painfully obvious that we can't do that anymore and by painfully obvious I mean, reality has somehow prevented us from going any further. Our liver gave out, that’s it. We are all done in our time as alcoholics.

So what in your writings and from your perspective, what is going on here? How can people like you and I, thousands and if not millions of other very intelligent, well meaning people look at this data and go "Whoa, something really has to change here."? This is serious and yet we find this gap between what we are seeing in the data and what we are receiving as messages in cultural conditioning messages from everything around us, in essence. What is going on here?

Charles Eisenstein: I think you are right, that the power elite is very much trapped in their obsolete paradigms across the political spectrum. Everyone’s solution is we have got to reignite economic growth. So when housing starts rise that is trumpeted as great news. No one really bothers to mention that we already have like double the housing capacity per capita that we did in the 1950’s. There is something like 19 million vacant units. But as long as we are starting to build new houses then that is going to be employment and everything is going to be "OK". They are trying to squeeze a little bit more growth out of the system. But as you mentioned, it comes at a higher and higher cost.

It is very much like an alcoholic. In the early days you can maintain the addiction quite easily. Maybe you will have to take a second mortgage out on your house, you will have to lie to your boss a little bit but you can kind of hold things together. Eventually, things fall apart. Eventually, it is your liver. And you can only get that next fix at greater and greater cost. Now, to extend the metaphor to our system, we have gotten all of the easy oil. We have depleted all the easy resources and the ones that we can easily escape the consequences of. Up until now, or up until recently if you are creating industrial pollution, radioactive waste, etc., etc. social turmoil. Well, you can move away from it. You can move to a gated community. You can escape it.

Well, today it is becoming impossible. The consequences are invading even the fortresses of the wealthy in various forms. And if we want to keep growth going there is not that much more of nature that we can convert into product and not much more human relationship that we can convert into services. What we can convert comes at a much, much higher cost. You have to excavate the Alberta tar sands and devastate that ecosystem. You have to clear cut the forests the fifth time or sixth time and they aren’t really recovering anymore. Trees are dying everywhere and we just – the planet can’t take much more of that.

Sometimes economists will say is we can grow the economy of services instead and we can actually have economic growth with less energy because of miniaturization and other technological innovations. So energy really isn’t a constraint and I think that to meet that objection you have to kind of extend the peak argument to include community as well and understand that a lot of the growth and services come at the expense of things people once did for each other and that technology — just like in the material realm and the social realm — has extended the reach of monetized services.

For example, people never used to pay for communication, now we pay for almost all of our communication. People never used to pay for entertainment but now we pay for almost all of our entertainment. Even when my father was a child he says that in his suburban neighborhood, his whole neighborhood, every Sunday, would get together with guitars and sing folk songs. To imagine that happening in my neighborhood today is ridiculous because we all buy all of our entertainment.

There is almost nothing that we don’t pay for anymore. What is happening is there is just not that much room for economic growth. We are never going to go back to the normal of the 50s and 60s when like there were years where there was like 7 or 8% GDP growth. No way. Now we are having trouble getting up to 2.5%. And that is just not enough to allow lending. The banks would rather just sit on their money. Why would you lend it to build a widget factory when the market for widgets is flat?

The money is stagnating as excess reserves. No matter how much they create it is, as Keynes said, like loosening your belt in hopes you will get fat.

Chris Martenson: It is interesting to me that during a period of time in which everybody is in a position of leadership today grew up was one of the more extraordinary economic periods of history where somehow in the decoupling of gold from the international exchange system in 1971 through to current roughly, about 2008 when it broke apart, but up to say between 71 and 2008 we were increasing debt much, much faster than GDP and that is even ignoring all the ways GDP as a number is factiously padded and otherwise fuzzified. So we have, even by our own data, such as it is, this idea that we can compound our debts faster than we can compound the underlying economy and perpetuity and that is sort of the environment in which, the culture in which the people who are currently in power grew up. So that is normal to them. This very distorted, grotesque, Daliesque landscape to them looks perfectly reasonable and square and flat and it is not. It is actually a very unusual period in history and that is coming to an end.

There are really only a couple of ways to end it. This is debt we are talking about, so you pay it back or you don’t. If you don’t pay it back you are defaulting on it in some form with inflating or printing it away being a form of soft default that spreads the losses over everybody instead of a few. That is our choice at this point in time and if we go the pay it back route we have to accept a much, much lower standard of living than we have come to expect. That whole born on third base and think you hit a triple thing. Right? We have come to expect that life – this is just how life it is. No, that is just how it is when you are spending beyond your means. Spending beyond your means is really not a very normal place to live forever.

Charles Eisenstein: Third solution would be to grow the economy so much that you can keep paying it back and increase the standards of living. That is one thing I really appreciate about your financial commentary because you are one of the few out there, really, that has integrated the understanding of the limits of growth into this money picture; that is the only way out and it is not a way out anymore.

Chris Martenson: We have enough years under our belt at this point to say it hasn’t been working for at least three or four years and you are right – there is precious little commentary and connection out there that says wait a minute, maybe it is more than the debt overhang. Maybe there are some other factors at play here. How about this $100 oil? Anybody thinking about that right now? We haven’t had a single instance of economic recovery of oil prices at this level. It hasn’t ever happened. So how it will be different this time is a mystery.

Charles Eisenstein: Well, we all know it won’t be. It really is hard to know what is coming. You had asked before about how do we grapple with this as individuals when we see the world falling apart. The understanding that the world is falling apart hasn’t reached everybody yet. It is still possible today to cling to the illusion that things are basically normal or that normal is coming back, but more and more people are realizing that it isn’t coming back. And then, the question is well, what do you do with that?

I was at a conference a while back. For some strange reason I was invited to speak to a group of investors and the guy before me he spoke on how the financial system is going to collapse so you better buy gold, he said. Better be physical gold, like actual bars of gold. That is the only safe investment. So then I give my talk after that and someone in the Q&A asks me well what do you think about gold, Charles, do you agree with that? I said if things fall apart to the extent that the US dollar no longer has any value the worst investment you can have, the worst thing you can have would be a whole lot of gold in your basement because men with guns will come and take your gold. Those men with guns will probably be the government, but could be warlords, thugs, thieves and so forth. Unless your temperament is cut out to be a warlord and hire your own private army to protect your gold in your basement and then deal with the fact that they are probably going to think well, "why don’t we just take his gold?" Unless you are cut out to be a warlord, gold is probably the least safe investment you can have under those kind of conditions. The only thing that you could invest in that can survive such a transition would be to invest in your community, to create a reservoir of gratitude out there to be someone who is valuable to other people who has valuable resources, valuable skills which you share. Basically, the only kind of wealth that can persist through this transition is what you give. Wealth would be how much you have given.

This shift, this different approach also resonates with where we want to go anyway. Even when people achieve a lot of wealth and they have kind of won this war of all-against-all that is dictated by the money system, what do they want to do? They want to give. It is in our nature to want to give and I think on a deep level what we are seeing is resurfacing of a much more ancient kind of economy. All ancient economies were gift economies where indeed, the wealthiest person was the one that gave the most. That is how you became a big man in a potlatch society. Our desire and even on a deeper level it goes down to understanding that we are not these separate beings in an objective Cartesian Newtonian universe. But that something of you is in me and that our beingness is interdependent.

Chris Martenson: This is something that I think in the United States is a particular challenge. So I have the opportunity and the fortune to be able to travel and see other cultures. We in the United States have a particularly isolationist sort of a view and it is heavily reinforced in our practices here whether it is creating false dichotomies in a political divide so that we can get along there or through any other isms or divisions or what not. It really struck me, I was talking with a woman who is a psychiatrist in one of the tonier zip codes in California and she said that it was her experience that her practice was actually booming, she said all these people are hanging on by their economic fingernails but there are still two cars in the driveway, the lawn is perfectly manicured, everything looks great. But the people who are coming to her can’t even talk about their own difficulties with their family members sometimes or certainly they can’t let their neighbors know. There is this extraordinary pressure to just sort of deal with it as their world is collapsing around them and in fact, that is historically speaking a really, really unusual condition to find yourself in. I would suggest it is unnatural.

Charles Eisenstein: Yes. This alienation from everything. First from community and now from even the family. It is truly remarkable that now like a confidant, like wise advice; that is something that has been commoditized. You pay for that today. And you don’t get it from the people who are most intimately involved. This is kind of an extreme, but still. I think it is symptomatic.

Chris Martenson: It is something I have become aware of, a lot recently, is that on some level almost everybody I talk to has got the awareness that something is wrong, maybe desperately wrong. Some of them have the intellectual framework, some of them just have a raw feeling in their gut that something in our narrative that we have agreed to live by is just broken. I am not just referring to the American narrative anymore at this point or the European or Japanese, I mean human, global narrative. I mentioned it before the data suggests that we are past carrying capacity of the globe. What this means to me is that there needs to be – if you say you are past the carrying capacity, the next sentence is "well, I guess there is going to be fewer humans at some point in the future" or "we are going to have to really, enormously change our habits and practices". Yet, the deepest messages we are still giving to ourselves every day in the newspapers and on TV and in the media and whatnot and in our religious text are things like well, "be fruitful and multiply", "our economy needs to grow this year and every year and next year forever", that "resources are there to be consumed".

None of these things are truly sustainable meaning, they can continue at their current trajectories for even another 10 generations. Whether it is this year or 100 years the final consumption of non-renewable natural resources means that’s it, its gone. Aren’t we also wired somehow as humans to really care about our children, I mean really and those who come after us even if we don’t know them? Is not stewardship somehow a human capability?

Charles Eisenstein: I think we are caught in the grips of a myth and a story and you put your finger on it to be fruitful and multiply, I call that myth "ascent". It says basically that we were once very few on earth, basically animals, helpless and ignorant. Then we developed, thanks to our big brains, science and technology and we covered the earth, we transcended natural limitations. We harnessed natural forces. We turned the whole world into ours. We domesticated it. The story says, someday our conquest of nature will be complete. We will have synthetic food, we will upload our consciousness into computers, we will conquer all disease, we will conquer old age, we will move on into space and we won’t need nature anymore. We will have completely transcended it and fulfilled our destiny. That narrative, it is all over the place in very subtle ways. We don’t explicitly talk about conquering nature very much anymore, but the very fact that we refer to nature as "resources" also comes from that mindset. And that is becoming obsolete in so many ways.

The money system is part of that myth, it embodies it and it enforces it — for one thing because it generates, it necessitates, compels economic growth, the conversion of nature into property, into goods and services. So the breakdown of the money system is one symptom that this myth, or this story, has run its course. Other symptoms are the outbreak of all kinds of incurable diseases. In the 50s and 60s it looks like we really would conquer all disease by the year 2000. It looks like we just conquered small pox, cholera, plague and polio and everything and cancer was going to be next. Now we have all of these new diseases, life expectancy is starting to go down.

Look at any institution that is facing a parallel crisis and our trajectory of ascent is slowing down or maybe even beginning to descend. Now will that descent be a crash or will we level off into some kind of steady state, that is an open question. But I think that if you look at the growth trajectory of natural systems, like immature ecosystems or children. You have a period of rapid growth and then it levels off. One way I like to frame it is I like to say okay, maybe what is happening is that humanity is entering its adulthood. We have been children this whole time on earth with a relationship to the planet of mostly receding. Which is the same relationship a child has to the parent.

But when you enter adulthood, then your love relationship takes on a new dimension. You fall in love with somebody who is not your parent and you no longer simply desire to receive but you also desire to give a gift to your sweetie. Then at some point, you desire, to co-create.

I think that humanity is transitioning into that relationship to earth, which means that we are falling in love with earth. I think it started as a mass consciousness movement in civilized society. Envisionist cultures are another matter entirely, but it started maybe in the 60s with the environmental movement. When the astronauts brought back those photographs of earth, the first pictures anyone had ever seen that didn’t have borders drawn on them, the first map that didn’t have borders drawn on them. And people really were struck by those images and they fell in love with earth and the environmental movement was born.

The problem that we have is that all of our institutions are based in an obsolete myth in an era of growth, of conquest, of ascent. But our desires and our intuitions are shifting. We no longer are excited as we were 100 years ago to contribute to the conquest of nature. An idealistic young person 100 years ago, yeah, I mean, I am going to invent a way to cut down trees faster and you would be a hero for doing that. But today, the idealistic young people are going into permaculture.

But the money system is still based in the past. You can still make lots of money if you can discover a way to cut down trees faster, but there is not a lot of money in permaculture. And that means that the money system is obsolete and we need to change it to align it with a steady state or de-growth economy. And that is what I write about. But basically, none of the policies that are on the table as far as legitimate political discussion go, nothing is on the table, yet. It is still way off in left field.

Chris Martenson: I have noticed it at first as I was thinking of it as a cultural but then I realized it is actually a generational breakdown happening. It first became startling to me about four years ago or five years ago when I was lecturing, the audience would be exclusively boomers unless they accidentally dragged somebody young along and then over time it began to shift a little to younger and younger people. The dichotomy that existed was that the boomers were typically asking me a flavor of this question almost invariably, which is "how can we preserve the status quo?". And the questions would be framed in terms of who do we vote for so that we can keep this moving or where do I put my 401k or some version of countless, "I invested my whole life into this thing. Can it please just not fall apart right now? Thanks."

Young people were peering into the same system and saying I see nothing to gain by preserving the status quo. You racked up all of the debts and I am being left with all of the wreckage from it – no. I am not playing along so I am going to go into permaculture or something like that. There is a real generational gap here that idea of separation is alive and well I think across the ages.

I love this idea that humans are at some point of initiation, one of those magic boundaries in life where if you have an intact culture you would have somebody walk you into manhood from boyhood. Or into womanhood from girlhood and here we are at our adolescence and I really, truly believe that it is up to us to decide either to shift our culture on our own terms or nature will shift it for us on her terms.

We face a future shaped by disaster or design, I am a design guy. I think design would be awesome if we could do that here.

The trajectory I see though is that we are really still very, clearly, headed towards a hard landing at this point. Largely because it is so hard to shift a culture. So hard for the status quo to let go of what it knows how to do. The institutional inertia, the personal inertia, all of those things are really much in play. But I know that any of these big changes we are talking about that we need to have. So if we are going to be living as a part of, not apart from, nature that we are going to be living in balance in a way, that we could see credibly what could be sustained for another thousand years. If we are going to maneuver into that landscape that first step for me was required for me to break from the culture and in my own small way, I did this, right? Along with my own small family I left the comforts of the life I lived into. The vice presidency, the big salary, nice, tidy bedroom community. I actively crossed the grain of my culture and I did all of these different things, very bold.

Yet, as anybody who has read Ishmael by Daniel Quinn — and I think everybody should, that is a great book –he says “that mother culture whispers to us so seductively and so comprehensively at all moments that it takes near super human effort to step back and even recognize what the messages are”.

So my big break from culture was really nothing more than a series of very miniscule steps. Yet, we have to take those steps if we are going to close that gap between what we know to be true and what our actions are at this point.

Charles Eisenstein: I am kind of a disaster and design guy. The designs are coming out. Like some of them are in my book, very few of them are original actually. I pull them from various traditions of economic thought and there are tons of solutions out there for every single problem that we face. They aren’t actually that hard to implement theoretically. It is just a matter of our inertia of our perceptions and our habits, our ways of being and how do those change? Personally I don’t usually change anything in my life until there is some kind of crisis or disaster. It is actually not that I made any superhuman efforts to change. It is that I clung on to normal as long as I could until various events made that impossible. I think on a collective level we are going through that. You mentioned initiation, I think that is the other thing that happens when one enters adulthood. You go through an initiation where the world falls apart and even your identity falls apart. And, again, like you were saying primitive tribes they had these initiation ordeals where they would purposely make your world fall apart. Everything that seems so secure and so permanent and so real became revealed as nothing but illusion. I think that is a really good metaphor for what is happening today with the money system. Things that seem so real, nothing was more practical than a blue chip stock or a triple a bond. These things, that is how you did it, you know, you bought your annuities, your insurance, your long-term investments. That was security. That was the very essence of practical, of real. Now we are seeing that these things are just numbers in computers. They are just this swirl of bits. People are almost having a sense of vertigo when they contemplate that all of this could dissolve.

I think it really is a – just the financial aspect of this – it really is an ordeal and you could call it a hard landing. I think it will be frightening for a lot of people. Fundamentally we still live on a very rich planet with incredible abundance and you see it even here in Harrisburg. I live here in Pennsylvania you know and last year the Susquehanna River rose 30 feet. And neighbors who didn’t even know each other’s name were basically flooded out of their houses and they just started helping each other. They were able to achieve things that seemed impossible a few days before. I think that our capacities are kind of dormant right now, but when a crisis hits we will become capable. All the things that are politically impossible today, if we really turn our minds to it we could achieve them very quickly. If we really had our minds set on it we could reduce CO2 emissions by 90% in 10 years. Most of them aren’t going toward anything that serves real human happiness anyways. Wouldn’t be worse off. People in India aren’t less happy than people here even if their ecological footprint is a tenth or a twentieth.

I was doing some research into organic agriculture; usually it is criticized as well. It is kind of this you know, bourgeoisie indulgence, but you couldn’t feed the world on it because the yields are much lower. Turns out that actually, the yields are much higher per unit of land, but not per unit of labor. For units of labor the yiel