An open letter to economist Paul Krugman: can we move toward a small-is-beautiful model?

The following is an open letter to Nobel-Prize-winning economist sent Saturday, September 18, 2010, asking for his help in envisioning a sustainable future.

New York Times columnist Paul Krugman

RE: Asking for your ideas on building a new economics that is not based on escalating growth

I reside among the throngs of people who never miss your columns and blogs in the New York Times. And I appreciate your articulation of a progressive Keynesian approach to our current economic woes. However, as one of those who was trained by former Vice President Al Gore and The Climate Project, I think the challenge also requires envisioning a future where growth is not defined in the same way as it was in the past.

I look down the road at Detroit, and I am struck by the fact that many of those jobs are not coming back – and even if we could goose the economy into one more orgasm of escalating consumption, is that a sustainable model in a world of finite resources and an ever-expanding population?

I recently read Bill McKibben’s Eaarth and was struck by the limits imposed by the box we find ourselves in. The American dream has long been built on growth, but as we run up against the constraints imposed by global warming and peak oil, it seems important to make sure we are not trapped into fighting the last war.

Some of us think “small is beautiful” alternatives offer better options. I think of the artists we know in Detroit who survive by supplementing their income with concerts held in their spacious home bought for less than $10,000. In addition to hearing great music, ticket-holders can dine on food gleaned from dumpster diving.

Enterprising young people in these new urban communities grow food in backyard gardens. Some have small-bore enterprises like a basement tempeh factory or an in-home raw food restaurant. Health-care focuses first on prevention through diet, exercise and meditation, and treatment often includes paying healers from a variety of old and new traditions.

Rob Hopkins of Britain’s Transition Movement uses the word “resilience” to describe community-based approaches such as these. Douglas Rushkoff’s book Life, Inc. contributes to growing interest in creating local scrip or using barter to build a neighborhood-based economy that comes in under the official radar, built on trust fostered by face-to-face relationships. Rarely if ever do these activities show up in official statistics, but not only do they keep people alive in hard times, for many, they provide a welcome alternative to the frantic, stressful and ultimately insecure careers of the mainstream economy.

Michigan’s thriving new medical marijuana industry provides numerous examples of new home-based entrepreneurs who view this opportunity not as a way to get rich, but as an alternative to today’s economic instability. The couple I know who have built a growing parlor are sweet people who strive to tread lightly on the planet, leaving the environment in better shape than they found it.

Questions abound, of course, about whether this kind of mini-micro-economics can provide a solid foundation for the formation of families and their long-term economic health. But when I see the faces of 50-year-old unemployed professionals who fear they may never find a job again, I question whether traditional economic models can fulfill the promise of putting a floor under the American dream.

Many of us are groping our way toward a new kind of economy that contradicts the assumption that a decent standard of living is inextricably tried to high rates of growth. The mere substitution of green energy for cheap fossil fuels may not be enough of a leap to ensure the long-term survival of humans on the planet.

Your work looking at the Great Depression reminds me that people survived those tough times by individual enterprise and community support. I grew up when people still grew Victory Gardens in their backyards, as a way to feed their families. We wore our clothes until they wore out, not because they went out of fashion. We re-used what we could and made do.

If we need increased consumer spending to pull us out of this recession, those ideas above are a recipe for continuing disaster. But is there a way to scale back and actually live better, while saving the planet from climate change in the process?

Would freeing ourselves from the corporate model of wealth production toward an economics based on a more human scale be liberating? Could harnessing the power of new tools such as the Internet offer ways to build this new world, as McKibben argues?

Unfortunately, government policy often stifles neighborhood-based, small-bore innovation. We give huge tax breaks to corporations but people who engage in local barter dare not go public for fear of the IRS. I can invite 20 people over for dinner but I cannot charge unless I put in a certified kitchen.

We see encouraging signs of change. Michigan recently passed a new Cottage Law, where people can sell up to $15,000 of home-based food products each year before inspection requirements kick in.

Many of us want to explore ways to building a new economy grounded in personal initiative, community resilience, environmental accountability and respect for human values. However, we do not have lobbyists fighting to exempt our small, community-based enterprises from taxation and one-size-fits-all regulation. Do you see encouraging policies that promote micro-mini-enterprises as a viable way to encourage community resilience, particularly at a time when one-fifth of our people live in poverty? Can you help us envision how to get there from here?

Thank you for your time and attention -

Bonnie Bucqueroux