Some Definitions and Precepts

Last year an article appearing in the New York Times, a shortened version of which also appeared in our Herald Leader, caught my attention. The headline read, “Russia makes return to the barter system,” and was followed by the rather ominous subheading “Critic says it's a step backward.” The article noted that Russia's local iteration of the global downturn had resulted in a minor uptick in bartering for goods—up to 3 or 4% of all sales, as reported by the Russian Economic Barometer. I say minor because in the 1990s, when Russia embraced capitalist reforms and sent its economy (and people) into a tailspin as the government transferred its wealth to well-heeled capitalists who unsurprisingly grew richer at public expense, the paper reported that “barter transactions...accounted for an astonishing 50 percent of sales for midsize enterprises and 75 percent for large ones.”

The critic of bartering was Vladimir Popov, who teaches at the New Economic School in Moscow; I am sure that he had good reasons for critiquing the barter system, which seems to have arisen as a way to cope with massive inflation, but they did not appear in the article. Instead, the paper reported that Popov called Russians “arrogant,” and claimed that the minor uptick in barter meant they were “hiding [their] head in the sand.” What the Russians needed to do, the article implied, was to cut costs and reduce inefficiency, normally euphemisms for firing workers and mechanizing production.

The article stood out to me because at the time I had just finished reading an online essay by Charles Eisenstein entitled “Economics of Fermentation.” In his much more developed article, which originally appeared in Wise Traditions Magazine, Eisenstein essentially makes the opposite argument of Popov. Rather than increasing our reliance on exchanging dollars for services and everything else, Eisenstein calls for a return to a much older form of economy, what he calls an “economy of reciprocation and social exchange,” based in human contact and the establishment of social connections. For Eisenstein, what bartering does for us socially is something that gets left out of our money transactions.

Money is, he notes, “an anonymous form of energy.” Anyone can go into Wal Mart and buy a TV or food with it, and we need not know how it arrived there or who made it. In barter and social exchange, however, the emphasis is more intimate, on things we make for and with each other. One household makes cheese, another beer, another clothes from wool. Needs and transaction prices are determined primarily by a community rather than anonymous people from afar who cannot or do not conceive of us.

I'll not go any further into Eisenstein's ideas here, as I'm sure a discussion of them will play into future pieces, but needless to say that such ideas are at the center of how I would define a basil economy. The following bulleted points make a stab at an opening definition and guiding principals.

A basil economy will:

--take non-monetary transactions seriously. This is not an argument for the abolishment of money; rather, it is a realization that money as a form of economic exchange has usurped other useful modes and overcrowd our thinking. In short, a basil economy seeks to put the exchange of money in its place as one among a number of possibilities. Though your financial analyst may tell you that you can “grow” your money, such growth is entirely unnatural and mostly unearned: unlike basil, tomatoes, wool, wood, or a host of other things we need, money does not grow from the sun, the soil, or our water supply. We should figure out how to use better these living trinkets of exchange that we ourselves might produce from our own labor.

--be based first and foremost in small, community-based transactions centered on need: food, clothing, water, shelter, pleasure, health, transportation, education. This is not an argument against the flow of needed outside goods or people into the community; rather, it is a re-commitment to ourselves as able producers. This should help restrict the accumulation of too many things while at the same time to allow for a natural diversification of such needs into localized art, shelter styles, etc.—things all communities used to have and do.

This means that a basil economy will

--flourish to the degree that we produce things. We must begin to think of ourselves as producers once again, makers of things, rather than consumers. For the most part, what we make need not be “perfect,” only “good” and “committed.” (Perfect tends to marginalize interested parties and also to increase value for products that many cannot afford.) Currently, 70% of our GDP is based in consumption, which means that our current solutions to our economic moment lie in us purchasing more. This is a false answer and it makes us poorer socially and economically in hock for the one thing we cannot produce: money. When credit becomes our lifeblood, the answer is not to feed that beast by generating more money to buy things, but to have us scale down to need less money.

In other words, a basil economy will

--assume a scaling down of economic activity to something approaching a subsistence economy. As Americans, we have been perched at the top of the economic world order. As we emerge out of our current economic moment, this will no longer be the case. We should recognize that and pare down our outsized and destructive expectations.

It will mean a renewed focus on

--seasonal and cyclical growth and death rather than on the unnatural capitalist model of permanent accumulation and permanent growth. Cancers grow exponentially; economies, like our earth, should experience periods of growth and decay, of work and rest, of relative abundance and scarcity. By focusing on these sort of growths, by desiring them over continual 3, 4, 6, 8 percent returns, we will better prepare ourselves to be resilient and communally self-sufficient.

What I'm describing requires a lot more work from us, from you, from me. It will mean that we necessarily spend much less time watching television and playing on the computer. These contraptions let us off the hook, make us fat and lazy, and waste a lot of our time that could be better spent doing and making things, generating ideas and meeting people.