In 1992, Bill Clinton campaigned for the American presidency under the slogan ‘It’s the economy, stupid.’ As you know, he won, but you may not be aware than he won against the odds. The slogan was a work of a marketing genius.1 It outlived the elections and invaded public consciousness. It has been quoted and paraphrased ever since. Politicians take it for granted. The cheeky little phrase took over the world, expressing pithily what had already happened under Thatcher and Reagan over the previous decade. At this point though, in the Anglosphere at least, the ‘left’ and the ‘right’ sides of politics converged; both major parties now marched under the ‘it’s the economy stupid’ banner. Left-leaning intelligentsia likes to call it ‘neo-liberalism .’ At the dawn of the Trump era, we are told that ‘neo-liberal globalisation ’ has failed and its victims have raised their collective political fist by electing the loose-cannon president because he promised radical change. However, be sure: whatever Trump does and whichever way he tries to ‘make American great again,’ he is not going to throw the slogan out of the window. Which is a little ironic, given it is a Clinton slogan.
Rationality Versus Economic (Post)rationality
In this book, we ask whether the unchallenged rule of economic reasoning is a way to a bright future. How did the ‘healthy economy’—synonymous with the one that grows forever—become the pivot of the daily news, indeed the foundation of our social reality? Is it rational that we should always want more, individually and collectively, regardless of how rich we already are? Do all social issues have to be presented in dollars and cents? Do we really need to know how much it costs ‘the economy’ to beat up one’s wife? Does the action against domestic violence really need economic justification (Access Economics 2004)? Do we need to know how much it costs to raise a child? An undertaking that will, according to a calculation published prominently in The Australian, set you back a A$1,000,000 (Callaghan 2010, 6). Similarly, we learn the price of our life when we take out life insurance. Clever satirists have mocked the extreme application of economic logic by concluding that ‘life is in fact not worth living,’ as its ‘cost clearly outweighs the benefits’ (Onion 2005).
In this book, we will argue that economic rationality —the ‘cost and benefit’ analysis—has gone beyond its remit, pervaded all areas of life and created a one-dimensional reality. We entered the era of post-rationality. Politicians argue over policies exclusively in dollar terms, sport is about big bucks, art is about ‘art investment,’ universities are about attracting student-customers and selling them degrees, and working people are ‘human capital’ or ‘human resources.’ Ironically, Marxists are often criticised for ‘economic determinism,’ but neo-liberal s seem to be the extreme devotees of this creed. Such an approach is irrational because (nearly) everyone knows that there is more to life and society than dollars and cents—even if politicians and their advisors, almost exclusively economists, argued their economics properly and clearly. Yet, they often retreat to ‘econobabble ,’ a perversion and obfuscation of economic argument presented to justify their decisions while discouraging scrutiny (Denniss 2016). Even neo-liberal champion Fredrick Hayek , when he accepted his Nobel Prize in economics, was critical of the influence of economists: ‘[T]he influence of the economist that mainly matters is an influence over laymen: politicians, journalists, civil servants and the public generally. There is no reason why a man who has made a distinctive contribution to economic science should be omnicompetent on all problems of society […]’ (1974).
If we leave the terrain of economics and look at the broader idea of rationality, it is a difficult concept to define. We have a sense that rationality is a uniquely human characteristic, perhaps central to our humanity. We use the word in everyday discourse, but its precise meaning may vary from person to person and situation to situation. We think we recognise when we, or those around us, act ‘irrationally.’ Most of us would agree that gambling money away or binge drinking is irrational. Yet, bars and bottle shops, gambling dens and shiny casinos are economically rational enterprises that live off people’s irrational behaviour.
An everyday, common-sense meaning implies that rational behaviour is to one’s advantage, and irrational to one’s detriment. However, further questions instantly haunt this simple understanding. Our behaviour affects others, so an advantage for whom, us or the others? Certain behaviours can be advantageous, and therefore rational to an individual, a business, a family, a ‘community,’ a nation, but detrimental to outsiders. What about humanity as a whole, including future generations, as in warming up the planet for the sake of short-term rational economic goals? How do we reconcile local and global rationality, the rationality of short- and long-term goals? We can also ask what constitutes our ultimate ‘advantage,’ or ‘rational goal.’ Is it a pursuit of pleasure or happiness? Accumulating wealth? Leading a meaningful life? Or something else? And of course what is ‘happiness’ or ‘fulfilment’ is another million dollar question. Rationality is a complex concept; in this book, we step down from the most abstract, philosophical level and analyse it through several case studies highly relevant for the society here and now.
In his seminal 1945 book The Open Society and Its Enemies , Karl Popper (1973) argued that the readiness to listen to a critical argument and to learn from experience was the primary tenet of rationality. He defined rationality as ‘fundamentally an attitude of admitting that “I may be wrong and you may be right, and by an effort, we may get nearer to the truth”’ (p. 225, emphasis in the original). During the eighteenth and nineteenth centuries, when the West shed the last vestiges of theocracy and the secular elite dismissed God as the final arbiter of human affairs, human judgement was recognised as relative. In this context, Popper emphasised the social character of rationality; a particular type of rationality to which a society or an era adheres should be continuously tested through democratic debate.
There is an even broader meaning of rationality: an action is rational if the actor conceives a rationale (purpose, reason) and a (however basic) plan or method to achieve this purpose. We are able to define our goals, including long-term ones, and devise the means of achieving them. This is ‘instrumental rationality.’ Given the social nature of human existence, the purpose needs to appear reasonable to others—especially our ‘significant others.’ What is considered rational is dependent on social context, time and place. Consequently, an everyday meaning of rationality can be stretched almost endlessly. A ‘rational’ purpose of one’s action, as well as the ‘most efficient’ method to execute it may have myriad variations, as well as a posteriori interpretations.
Arguably, the broadest as well as most fundamental meaning of rationality points to our individual and social survival. Actions, habits and behaviours that are likely to prolong our individual life are considered rational; the same applies to the survival of human groups and the human species itself. Following Descartes , we can start with the one essential condition of any deliberation, the existence of the thinking person: Cogito ergo sum. Therefore, the primary rational goal we should be able to agree upon is our collective survival. This point of consensus can serve as a basis in defining rationality as a social issue.
This book started from the need to have a close look at the rationality of the society we live in. Our desire to explore the topic was triggered by daily news and current affairs, and particularly by the global warming debate. The wrangling over whether climate change is anthropogenic or not should be a rational debate grounded in science and based on evidence, but it has degenerated into a quasi-religious tug of war between ‘believers’ and ‘sceptics.’ Even more importantly, because it’s the economy, stupid, we seem happy to sizzle and freeze, drown and burn, due to an increasingly extreme climate in order not to hurt the economic ‘bottom line.’ Is this rational? Has the world gone crazy? Many middle-aged people have asked this question before us. But we do believe it is not just our mid-life crisis that led us to write this book.
We (Westerners2) highly value democracy and freedom from religious dogma and authoritarian repression, which allows us to have a free and open debate and be rational in the sense proposed by Popper . In this book, we argue that the ‘free debate’ has been locked within the iron cage of economic rationality . Wanting more has become a collective hypnosis. Yet, as a society, we would not want to be called anything but rational. Unlike irrational theocracies, some established (e.g., North Korea ) and some threatening to take form (the ‘Islamic State in Iraq and Syria’), we claim to inhabit a rational civilisation that relies on science and democratic debate as the basis for a good society. Yet, we choose to conveniently ignore science when heeding its environmental message may ‘hurt the economy’? Is this rational?
In the following chapters, we step back and look at particular social domains where post-rationality, in the form of dogmatic economic rationality , has taken over. Even without the threat to the survival of the world as we know it, what is the point of being wealthy, as an individual or as a nation, if it is just a source of anxiety and an obsessive concern to become even richer? In response to these questions, we identify a pervasive orthodoxy, neatly expressed in Bill Clinton ’s campaign slogan. We express it in an even shorter formula: more=better. We discuss this unquestioned truism of capitalism in Chap. 2.
Economic rationality is a neat set of principles—it is clear and credible. However, it has hardened into a doctrine which disregards some common-sense facts. For example, that our economies can neither grow indefinitely, nor do they need to. Most of us (comfortable Westerners) do not really need to be richer (saying this is a terrible heresy!), but we do need fresh air and clean water. We also need physical activity and other people’s affection to remain healthy. All this is essentially free—although also for sale, if you can be persuaded—as are many other important things. Of course, there is no denying that we need many products and services that are not freely available, and which we have to produce, sell and buy. As a society, we do this very efficiently. Our productive technologies are amazing and owing to these we reached the stage of the ‘affluent society ,’ defined by J. K. Galbraith 3 (1974) in his bestseller by the same name, as the society where ‘more people die of too much food than of too little.’ This is even truer today, in the midst of the obesity epidemic.
The West and the Rest
We, the ‘Westerners,’ about 20 per cent of the world’s population, are well-off and comfortable, and ‘emerging’ and ‘developing’ economies are rushing to join us. Through a process of globalisation , capitalism , usually in its early Darwinian form of the ‘survival of the fittest,’ has tightened its gri...