Trapped by Finance Capital: Business as Usual While Planet Burns Part III: Creative Destruction

Humanity must minimize the chaos of a catastrophic convergence of accelerating climate destabilization, growing poverty and food shortages, armed conflict, and massive migrations around the world. Otherwise, while the old plutocratic order will be destroyed, nothing viable will emerge to replace it. A new form of “creative destruction” must occur for human survival. A new Great Transformation of humanity’s relationship with our earth systems has to happen. It will be very complex and difficult, and “success” is unpredictable.

While it is hard to imagine, a massive social transformation in all industrially developed nations is necessary very soon. Social transformation is no simple matter. How do you turn around the most powerful institutions in the history of humanity? How do you redirect the fundamental thrust of distorted economies? Well, maybe you don’t. It just might be that the only way to stem the tide of anthropogenic economic and climate destabilization is to resist its continued domination. But that resistance must be indirect, since the corporate state has a monopoly on physical power. Resistance must take the form of replacing the very institutions that individuals and groups do not have the power to directly transform. As R. Buckminster Fuller is often quoted:

You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.

While that may not always be true, it certainly is when confronted by the overwhelming power of the corporate state and all the physical force that entails. The New American Revolution will be one of replacement, not of fighting the existing reality in order to overthrow or destroy it. In the intellectual history of economics itself we find a concept that recognized the destructive power of replacement through creativity. Joseph Schumpeter [1] popularized the notion of “creative destruction” in economics as a theory of economic innovation. It refers to a process within economies “that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.”

The concept has since been used by orthodox neo-liberal “free-market” economists and politicians to justify the destructive effects of any innovation produced by technology or the investment of capital. Innovation may destroy environments or peoples’ livelihood or health, but that is deemed okay because it results in “economic growth,” the end-all of finance capital. Ideologically, it has been a defense of the unregulated right of finance capital to plunder the planet.

However, we may take the liberty of re-framing the concept of creative destruction in an entirely new light, given the circumstance we find ourselves in. We must turn away from the destructive economics of finance capital. We must resist its inherently destructive force by withdrawing from participation. We must replace it by creating new ecological forms of economics in local and regional contexts.[2] Economic systems exist only by people participate in them. We must form new human scale economic relationships, thus creating a new economy. If we do that on a sufficient scale, much of the perpetual-growth economy that finance capital sustains will inevitably be destroyed. Its markets will simply contract into oblivion. In Fuller’s terms, we must build “a new model that makes the existing model obsolete.”

The perpetual-growth economy driven by finance capital certainly is obsolete. By executing the innovations needed to create a new ecological economy, we will automatically destroy the old, mostly by ignoring it. It will wither away by disinterest and disuse. Now that would be a far more positive form of creative destruction than imagined by either Marxist or neo-liberal economists. Unlike them, we must realize that there is no inevitable course of history; there is no invisible hand or inevitable stages of development. We must choose.

Progress” may very likely come crashing down upon us – or not. It is our choice. We must create our new ecological economy amidst the ruins of financial capital. The path to human survival will be extremely difficult, if taken. The ‘business as usual’ alternative would be beyond difficult; it would be suicidal. We are at a crossroads between following the old path of ecological destruction by repeating the mistakes of our economic history, and forging a new path of creating a viable ecological economy that we can live with.
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[1] Joseph Schumpeter, Capitalism, Socialism and Democracy (1942). New York: Harper Perennial, 2008.
[2] David C. Korten, Change the Story, Change the Future: A Living Economy for a Living Earth (Oakland, CA: Berrett-Koehler Publishers, 2015) conceptualizes a new way to envision human economies and to create them in harmony with the living earth systems upon which we depend for survival.

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