Oikonomics: a social life of money

We make the markets we deserve...

We have been having sex for some weeks now – what about starting a relationship?

I found myself talking about the social life of money in two very different forums last week.  The first was on the topic of ‘promoting a savings culture’ in the UK at the CSFI, a no holds barred, lively debating forum MC’d by the incorrigible Andrew Hilton.  The second was at the invitation of the Finance Lab at ICAEW who ran a workshop on ‘Preventable Surprises’ with a select group of stakeholders and opinion formers about the financial crisis – applying the lessons of the Deepwater Horizon disaster.
In many respects, both sessions were a great confidence boost for the point of view that underpins Abundance Generation and what it is trying to achieve in the world of financial services and sustainability. Aviva’s ‘Big Picture’ think piece has much in common with Abundance’s own manifesto and even its language was very similar which generated some new friends and contacts amongst the CSFI audience who also think the time has come to rethink the way we ‘make’ money.

The core philosophy of Abundance; that we need to move from a world dominated by what you can ‘get’ with money (which fits with a world obsessed and addicted to all forms of cheap credit) to what you can ‘do’ with money (which requires a long term investment view of money and a more balanced perspective on risk) was something which helped simplify the complexity of ‘what do we do’ in the face of a crisis not just in our financial system (that is just a symptom of a deeper problem) but in the very values and use we ascribe to money in our society.

New thoughts coming out of the cut and thrust of CSFI and the more collaborative atmosphere of the Lab centre brought my own focus back to the problem of markets.  In particular, the idea that it is the State (or more pertinently in a democratic context ourselves as ‘the people’) that make markets and we make the markets that we deserve.  This instantly attracts attack from passive/implicit neo-liberal acceptance of the reality of markets as somehow universal and immune from the society or culture in which they operate – regulated by rational not social or cultural physics.  The idea that markets are ‘created’ or performed out of a social or cultural context challenges ideas of efficiency and objectivity despite copious evidence to the contrary coming out of the crisis itself and the success of socially produced and embedded markets such as Zopa or eBay.

The energy market in the UK is a case in point. It is a dysfunctional market, created by the State yes, but dysfunctional because of a lack of regulation and intervention from society to ensure the decisions it makes are right for the long term investment we need to make if we are not going to be held hostage to the price of high marginal cost fuels in the future (high marginal cost in economic as well as environmental terms).  Markets and the information they use and value have limits.  They “know” the price of everything but the value of nothing (to re-purpose a phrase) because markets seek to reduce the forces and costs of change – social, cultural and environmental – to a price at a particular instant and constantly discounts future cash and value flows which include economic  as well as the familiar ‘triple bottom line’ benefits.  To explain the slightly cryptic title to this post (taken from a cartoon in this week’s Private Eye) it is like deciding the value of marriage and family on the basis on the quality of the first time you kiss or have sex with your prospective partner. Or even perhaps the quality of restaurant choice for a first date... 

The recent decisions on Feed in tariffs by the UK Department of Energy and Climate Change reflect that blind belief that ‘price’ is somehow a signifier of “value” and that markets are the best arbiter of economic and political decisions about how we generate energy in this country for the next 50 years or more.  This is to miss entirely the point of subsidies for renewable energy sources (of whatever technology) which is to protect those technologies from the short term vagaries and volatility of a market which is driven by the high marginal cost of fuel (compared to renewable energy which has high set up costs but zero marginal cost apart from the discount rate on the money required to build the infrastructure something which requires market confidence to keep the price down, confidence which has been eroded by the current behaviour and signals coming from a department struggling with a arbitrary and short sighted decision not to make FiT part of the annual managed expenditure).

The economics of renewable energy makes its cost highly predictable and stable which limits the potential of the casino side of energy companies (betting on the rise and fall of energy prices – rather like those other well loved utilities our high street banks) to make money from speculation.  Spending on FIT and ROC’s now is about encouraging a more stable (and green) future where businesses can plan and grow in an economy with more stable (and based on evidence from Ireland and Germany were renewable energy installation is ahead of the UK slow and cautious tiptoeing forwards – one that reduces energy bills for ordinary consumers once a critical mass is reached due to something called the ‘Merit order effect’.)

The start of something new with www.abundancegeneration.com

I have been away from this blog for a long time but for a good reason.  After more than 2 years of effort, energy, bloody mindedness, up's and down's, battles, victories, set backs, surprises and not small amount of coffee, Leon lunch boxes and falafel consumed Abundance is finally ready to born into the world.

Abundance is a new way to think about investing money which aims to go to the next step after the likes of zopa and others in establishing an alternative way of using money that is fundamentally social democratic (i.e. open to all especially those with smaller amounts to invest) and sustainable, and like zopa, competitive in the mainstream financial services market.

Abundance is a community investment platform which allows retail investors to invest in renewable energy projects.  It is the product of the unlikely meeting of an anthropologist, environmentalist and an ex-banker, which sounds like the start of a joke, but has actually produced the first really new regulated financial product in more than a decade...

Exact timings of the launch are yet to be confirmed but you can sign up for email updates at our website which is www.abundancegeneration.com.

Because Abundance is regulated and authorised by the FSA you can find more details on the website and sign up for email updates directly there.

 

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Sign of the times

After a thought provoking start to the week, debating the meaning of "shared social responsibility" here I was brought back to reality as I queued for a cash machine in a branch of my bank (conoisseurs of wallpaper financial advertising will recognise the figures stretched along the bottom of this missive).

I am glad that they have identified that the role of the branch is to create a 'queuing experience' which can be enhanced,  if I feel the need to flex my neo-liberal volition, by choosing the 'fasttrack' lane. Of course, I would then face the paradoxical experience of queuing in my fastrack lane with all the other individualists who like me would be asking what function qualified as 'fasttrack'.  

If it means that I won't be cross sold to while I try to pay in a cheque ("have you reviewed your finances in the last 6 months?") then great, but I can see it being so popular that they will soon be advertising the 'collective queueing experience' at tills 1-5. 

Claus Offe (speaking at the Council of Europe conference) provided a telling reflection on the predicament of the individualistic consumer when recounting being stuck in a traffic jam and looking across at a sign which read, "you are not stuck in a jam, you are the jam."

So a big thank you for my bank providing the Alex Ferguson route to financial satisfaction as an alternative to standing with my fellow consumers in a more involved "queuing experience" in the slow lane. Freed of my social ties to my fellow customers I am liberated to enact my authentic self and carry out whatever mundane task I can't do online and go on my way to my next frictionless transaction. Well in Marx's terms at least we know where we stand with the banking crisis, we have had the tragedy now bring on the farce.

Are you a fixer or a changer?

The world is dividing. The divisions of ideology, culture, class and religion are being replaced by something more fundamental.  It is a question which vexes right and left, fundamentalist and liberal, conservative and progressive, neo-liberal and socialist.It is a question which requires each to question their beliefs and assumptions about the world as it could or will be. 

Are the problems of the sustainability – financial, economic, social and environmental going to be solved by fixing the current system or changing it completely?

Above all this question requires us to ask whether the way things are is a function of the realities of existence and the limited capabilities of human society to create real change or merely the construct of a particular way of thinking about the world and its future.

A fixer is not necessarily a conservative or reactionary, they believe in the passage of progress which has brought humanity into an age of globalised society enabled by technologies that simultaneously shrink the world and overwhelm you with its enormity and diversity.

A changer is not necessarily an idealist or revolutionary, they believe that progress is an illusion and in reality the passage of human civilisation is characterised by rupture and discontinuity rather than any rational model or plan.

A fixer would argue that the current crises of sustainability are a function of a poorly executed plan or lack of rational controls on society, hence a response based on developing new forms of regulation and billions of dollars and pounds spent propping up the institutions which caused our current set of crises – whether than money is supporting banks, oil or other powerful vested interests.

A changer would argue that the current crises are a function of an unsustainable system which is based on false assumptions about the limits and effectiveness of growth, financial capital and industrial scale institutions (of the State, private sector or third sector).  

A fixer sees the barriers to change being irrationality, complexity and resources.  A changer seeks new accounts of change which make sense of the contradictory nature of the world, aims for simplicity and optimises the use of resources for the long term.

A fixer lives in the now and is overwhelmed by the passage of change in a liquid modernity.  A changer makes decisions for the long now, seeing disruption as part of the process of change not a departure from the process.  For a changer, liquid modernity represents the opportunity to re-invent global society rather than simply re-build it.

Which are you?

Climate, energy and culture change

How many cultural change specialists does it take to change a light bulb?

A stimulating evening spent listening to Professor Mackay, Pilgrim Beart of Alertme and Stuart Groves of Booz and a plethora of the great and good of science, engineering, environmental policy, and me, (as an 'Energy Anthropologist' - a label coined by Mr Beart).

The question was the need for cultural change to address the challenge of reducing our national energy demand. A number of the more rational approaches to this problem were highlighted and critiqued.  There was a lot of discussion of clever ways to convince 'consumers' to use less of something they don't understand, don't explicitly value (I must keep me and my family warm, not just choose to do so) nor appreciate the true costs.

So the million dollar question which is being asked is 'what works?'.  A question which fills most researchers with a sense of dread because as Zygmunt Bauman quoted his own mentor saying, "don't make predictions, especially not about the future".

Clients usually say they want research to be 'actionable', which would be all well and good if actionable meant being able to think more clearly about what to do, but is less attractive when it involves leaping into the unknown with a do list and some verbatims.

At the risk of using a circular analogy in the context of sustainability and climate change, the problem at one level comes down to confusing the difference between weather and climate. Most research briefs ask questions about the weather and try to define the climate, others ask questions about the climate and try to predict the weather.  In general, weather is more interesting, more immediate and more open to objective measurement. I can measure rainfall on a particular day, but a flood does not mean that the climate is getting wetter. Likewise I can be pretty confident of a heavy lasting snowfall not presaging the next ice age (and a particular lack of snow not being a direct cause of global warming).   Climate, as the UN have found, is a much more slippery beast to define and measure.

However, we seem to be obsessed with researching the social and cultural weather and assuming that this means we are living in a changing social climate. And we perhaps miss evidence of climate change because we can't see beyond the extreme events and responses which obscure the bigger picture.  The recent announcements about measuring 'happiness' fall into this domain, as do predictions of the death of democracy in the face of voter apathy. 

Some businesses live or die on trying to predict social and cultural weather - fashion retailers for example - but others would better spend their money understanding climate and making decisions based on changing patterns while keeping an eye out for disruptive El Nino-El Nina like oscillations. 

This is important because our responses to the clamour of the climate change lobby, the need for energy sustainability and the need to provide affordable energy to everyone (not just the very few who can afford to go 'off the grid') are not generated from a blank sheet of paper.  They are situated in a complex social and cultural "climate" which itself distorts the meaning and effect of different statements, scientific or otherwise, and resists the modernist drive to leave behind traditional beliefs or superstitions and trust in the ulimate truth to be found in a rational pursuit of progress.

Perhaps this is because the world "out there", be it a "consumer" one or otherwise, is not reducible to a single, universal guiding morality, but is made up of a number of parallel, often dissonant moralities, and likewise, we don't live in a world inhabited by a single, universal rationality, but a dissonant set of rationalities.

Predicting the weather is enormously difficult and expensive, requiring ever more complex computer models (and the greater the granularity, it seems, the greater the potential for volatility) reflecting the individualisation of the liquid modern experience. Working from an understanding of climate, by contrast, enables organisations to play a longer game by preparing for periods of disruption and volatility but working to a probablistic but thereby more predictive model of attitudes and behaviours over time.

Each generation is heralded as bringing a new social climate when in reality they usually represent oscillations within a still recognisable sets of norms and values - a function of the ambiguity which definitions of either social or geographical climate need to encompass to maintain their integrity over the long view.

Solid money and liquid lending

Just when you thought that we might have moved on from the financial crisis with a modicum of self awareness, along comes this ad to interrupt my eBay auction watching.  It is from the sub prime lender Provident Financial (via their Vanquis Bank) and aside from the irony of naming a credit card after the off balance sheet and offshore mortgage vehicle of Northern Rock, it reflects what I think a lot of financial services companies are thinking and feeling at the moment.

The response to the loss of trust and confidence in the institutions which produce and stand guard over our money (easy come easy go) is to explicitly claim qualities of solidity and resilience.  The irony of the name aside, there is something deeper here about what role a credit card with a 34.9% APR is playing in 'building your credit rating'.  I am waiting to see how they deliver their promise of starting slowly and building up my credit usage as a reward for good behaviour - the APR doesn't exactly shout confidence about the effectiveness of the bonds produced by that particular social exchange. Am I really being asked to (re)build my financial future on the rock solid foundations of my credit limit?

This approach contains some of the contradictions of other attempts to get people to conform to accepted norms of the consumer-driven economic system (such as workfare).  My worth is calculated based on my ability to build up and pay off my debts on a regular basis (something which is fundamentally good for the consumer economy) and I am free to choose what those debts are used for. It is interesting to note that in the application process I am asked if I would like an upfront 'cash advance' which would seem a rather big "baby step" for someone who is supposed to be feeling their way into (or back into) the credit market.

This comes back to examining the meaning of the 'age of austerity' in which we now live and the difference between "austerity" as a temporary phase of temperance of our natural desire to consume versus perhaps the "age of sustainability" which requires a complete change not only of the strategies and tactics of consumption but also a fundamental redrawing of the mechanisms by which we engage in social, economic and cultural production.

I don't believe that Mr Smith would have been quite so impressed if he had examined the processes of a modern industrial financial institution as opposed to the pin makers of Scotland. True one man on his own cannot make 10,000 pins, but it seems that financial institutions for all their claims of efficiency of allocating resources/capital are remarkably inefficient in the way that they build and sustain relationships with their customers.  The individual decision makers on Zopa have arguably been more successful at lending in a recessionary climate than their mass market institutional peers. Financial institutions have been slow to react to the realities of the liquid modern life, seeing it more of a threat than an opportunity (hence why Zopa was launched by some refugees from a bank rather than coming out of some corporate innovation process). 

As I have blogged ad infinitum, when you talk to people "inside", you are struck by how their cognitive and linguistic framework for understanding money has become increasingly inward looking and specialised. This creates a distance between themselves and their customers who appear to do and say things which don't make "common sense".  I don't believe this is all a function of their current defensiveness about bonuses and bailouts, it is also a function of their desire to make money and the users of money behave in more 'rational' ways. It may well be 'rational' to conform to a system of credit rating which rewards you with more 'credit' based purely on your ability to pay it back not what you want to use it for (or who you really are) but that doesn't mean that it makes sense for me to do it.

Of course, according to everything 'rational' about money, Zopa really shouldn't work as well as it does, but as Chris Skinner recently tweeted,  Zopa lenders have now lent out more than £100m so far and no-one had lost their capital. You could go further, I doubt there are many who have lost out to inflation, the stock market or many other places you could have put your money in the last 5 years and made a return of 7-8%+ ....

A magna carta for money?: reflections on a week of talking about 'the long now'

 
Many of the questions being raised by discussing 'the long now' of money and finance at SIBOS are existential ones.  Unfortunately I am not convinced that many if any banks are willing to consider existential problems; despite that being the elephant in the rather big room that is SIBOS.

It is hardly surprising, seeing how the most of the banks present at SIBOS seem to be feeling somewhat existentially challenged; reduced as they are to considering mainly short term issues of liquidity, capital (or lack of it), risk (see the previous two issues) and focusing on making money from the bread and butter of banking (payments).  The Long Now team will be prefacing their summary to the plenary session today with a video which points out how and why banks are doomed in the style of Hitch Hiker's Guide, only without the "Don't Panic" reassurance that there is a manual of 'how to get out of this hole".

I am not sure that this will elicit 'engagement' as such from an audience of bankers, which is a shame because asking these sort of questions might help them see beyond the present crisis and work out what sort of banks we need in the future - based on the binocular hindsight of the long now approach.

Our own long now conversations, detailed by the ubiquitous Chris "I know where the next party is" Skinner on his blog, shifted the emphasis back to what is happening "in the real world".  As individuals, we are looking for institutions who can make money solid and tangible, not merely in terms of seeing cold hard cash (although that is a start), but in terms what we do with money and constructed in a way that fits with its Long Now role of being a function of its social utility rather than its narrow economic definition and usage.

By framing wealth in terms of concepts like legacy and immortality (or at least of guarantees of succession) which expanded what we thought really constituted 'wealth' in a world of uncertainty, our discussion began to look at the motivations of individuals to use money for good works (one form of legacy).

The problem here is that modern money in its current incarnation cannot adequately convey the 'spirit' of a gift.  Modern Money reduces a transaction to a question of economic value (like leaving the price tag on a birthday present) which leaves no legacy or lasting imprint - it merely reflects the price of a thing at a particular time (it does not signify for example whether I was generous in the price I offered or stingy).

If banks are to maintain their position as the 'producers' of money (as opposed to just the pipes it flows and is stored within) then they need to work out how to construct money products which can confer permanence and legacy on the giver and communicate that also to the receiver.  Which I guess is one million dollar question coming out of the long now (for me at least).

Perhaps a bit frustratingly one of the best ways of thinking about money in the long now was presented by Paul Saffo who in 90 seconds summarised the concept of the legal 'long now' and raised questions of whether the crisis was the prelude to a change in schema (i.e. a new money akin to a new common law), constitution, legislation, regulation, enforcement regime or merely fashion (i.e. will this be solved by bloody revolution or a marketing refresh at the extremes)? You might argue that neo-liberal capitalism has been regulation masquerading as a schema or constitution and as such should expect competing forms of regulation of markets (and therefore different forms of market) to emerge from the crisis and challenge its claim to natural hegemony as merely a function of legal precedent and entrenched power relations.

In other words, who are the barons who will force the signing of a magna carta for money?

Building the big society will be more than just a matter of fact

It is a recurring debate within most financial services companies to ask "does this constitute advice?'.  Advice in financial services is highly regulated as a result of Financial Services somewhat chequered history on the matter.  You don't have to go very far back in history to find repeated examples of sharp sales practices masquerading as advice.  My main 'stuck record' when talking to FS companies is to try to convince them that such practices reflect their own skewed view of the world and have very little to do with the meaning and value of advice in society at large. 

I have come across this problem in a related field, namely social care; specifically regarding the advice given by professionals such as GP's, and the perceptible shift in the definition of advice away from common sense or normal cultural praxis and towards something which is rooted in the theme of rationality and evidence led policy thinking which has dogged so much of what purports to be innovation in the public sector.

This is more than just a philosophical debate, although policy wonks and practioneers need (and I think this would be a good thing) to be more philosophical about the nature of advice (and information) if we are not going to see the dysfunctionality of advice in the financial services industry repeated in other sectors of public good - such as health, social care and sustainability.

So lets look at the 'facts'.  Facts are the holy grail of policy making and service design in the public sector.  We treat facts as 'real' and they always trump a good hypothesis or theory. One of the projects of the solid modern world is to make sure that all information is produced in the form of facts - or perhaps more accuratedly, every thing is/can be reduced to a fact.  We even call them 'hard facts'.  A fact is a self contained statement - i.e. all of the necessary the meaning is contained within it.  The value of a fact is that it is an objective bit of stuff (or content) which can be 'transacted' repeatedly between the state/institution/professional and the individual. 

Facts do not refer to or require context to be understood.  Facts are supposed to make things plain and simple so that people can make decisions without any undue influence.  Introducing context about the product or even asking about context (either of the product or of the individual) constitutes advice.

In Financial services I can only use facts unless I want to start giving 'advice' (and enter a painful world of costs, risks, liabilities, authorisations and bureacratic box ticking).

Advice in the solid modern world is enacted by introducing some element of context or personal details. I can identify that I have back pain to my GP or savings that I want to put in an ISA but the GP/FS salesperson will avoid moving to context of that condition/decision for fear of entering the realm of 'advice'.  In the case of a GP it turns a 10 minute consultation into an hour's conversation, and in the case of the FS salesperson (who is not 'trained in advice") it turns a harmless conversation into a regulated transaction of advice.  Advice is about more than the facts about a thing, it involves the application of some contingent context in which the thing will be purchased, used or chosen over another option.

I am sure that a philosopher would have something to say about this (or would assert the limits of what could or should be said), but understanding the gap between the way we define advice in theoretical and policy terms and the way advice is consumed in reality is fundamental to understanding why both the State and financial services are so poor at giving advice which is actually heeded and acted upon by its citizens/customers.

Of course, consumers in reality are less than comfortable with the idea that all they can have are facts about a thing; they are desperate for some context (theirs or someone like them) so that they can make a decision based on what they would define as evidence (i.e. experience).  They don't see the exchange as a finite transaction (one which will not be remembered the next time they interact with that insitution as this would constitute advice) but rather as part of the to and fro/reciprocation of a relationship building exercise.

It is like purchasing a work of art, such as a painting, without being able to know anything beyond what it is a painting of, what paints were used in its creation and what someone else paid for something very similar.  Information about the artist, and the fact that he / she may have painted similar works,  constitutes advice.  And advice is to be avoided.  We are left in the rather post modern state of being when the meaning of a thing is entirely constructed and enacted by the audience and the authors retreat behind a wall of facts about their work.  It is perhaps ironic that much of the rhetoric of the Big Society against the "Big State" is based on the falacy that the state was somehow interfering in everyday life.  The experience in many areas has been akin to the retreat of the financial services from our communities and high streets, i.e. the Big State has become obsessed with presenting only the facts and left the consumer to fend for themselves via choices. Of course, as you often find when marketing financial services products, the way you frame the choice (number of choices, use of brands and other symbols of trust, etc) can control the decision of the individual in much the same way as advice and this constitutes a much more insidious interference in many respects - an interference which could be framed as 'when nudge turns to prod'.

In fact, we are now faced with a system where even advice itself has been reduced to a transactional commodity, valued in temrs of work done to establish the context of an individual and recommendations (or at least priorities established) such that a decision can be made.  The problem is that the costs of this advice are so prohibitive that it is only worth seeking if you have sufficient money to afford it from the investment decision you are about to make.  Essentially the single digit percentage of the population with 100k + of net worth (not counting illiquid assets like houses).

And perhaps we come to the nub of the problem with my last post but one about the Big Individual.  Liquid Modernity delivers freedom for those with the resources to generate their own advice (technological, economic, social, cultural capital) while many are cast adrift in a sea of choices with little or no supply of such capital to navigate their own choices in any meaningful sense, recoursing instead to superstition (picking the third one in the list, picking the middle one) and habit/apathy (making no choice).

So perhaps it falls to researchers to stop selling the (mass) production of facts and start selling the search for meaning?  We only have to look at the essentially irrational behaviour of equity markets to realise the risks of relying purely on the production of facts to make sense of the world and decide how we are going to invest our increasingly finite resources. We don't need States to assume that Google is all the meaning we need to make decisions.  There must be a billion facts on Google which purport to be the 'meaning of life' each one, taken by itself, as useless as the last if you actually want to live that life.

Addendum:

This response from the Sustainable Development Commission to a request for evidence about Behaviour change seems to endorse the importance of changing contexts rather than changing minds and also points to a lack of research resource to understand the impact of interventions and policy changes.

Sustainable Development Commission Submission to the House of Lords Science and Technology select commitee

The Economics of Enough

A thought in progress which occurred when putting together a presentation on “The long now of finance” for SIBOS next week in Amsterdam. I will be presenting as part of the following ‘Innotribe’ whose remit is to think forward across the next century.  A slightly daunting prospect, as Bauman reminded us at his conference, “don’t make predictions, especially not about the future”.

I have always found it challenging to describe ‘what is going on now/here’ let alone make any assertions about the shape of the future. Perhaps that is the best to hope for, just as we write our histories for the present so we write futures.  One thing which is ‘going on now’ is an increasing instance of ideas of collaboration and inklings of new consumer moralities emerging under the banner of sustainability.

The economics of enough are bubbling up all over the place, not so much new era economics as “new age” currently, but then so was Gaia theory and environmentalism not so long ago. I have seen it used in the context of rethinking Thailand’s economic strategy post the 1997 Asian crisis and trying to assert some new moralities of economic endeavour through recourse to Buddhist teachings.

For me the “economics of enough” reflects a fundamental optimism of what we do as individuals in an open, transparent and social context.  It is a function of the compromise between individuality and security which Bauman places at the heart of all social contexts.   The Gordon Gekkos of this world thrive behind the opaque doors of regulated financial markets which enshrine and legitimise greed and ruthless competition in the name of liberalisation and the pursuit of money as an end in itself.  In many ways in the long now of finance, modern money has been an interesting and roller coaster interlude powered by a sixties style revolution of individual credit (the “pill” that liberated consumerism) and the glamour of an ultimately self absorbed and hedonistic elite (LSD replaced by CDO’s and other ‘exotic’ derivatives). Lehman’s was the gorilla /butterfly crushed by in this case a wheel of its own making. 

We are now prepared to consider the idea that you can have ‘enough’ money and be happy, it doesn’t leave you empty and wanting more.  Those who believe you always need more money are those which betray the stresses of the reality of servitude that underpins modern money’s promise of liberation.

However, the “economics of enough” are not just a closed loop of self reliance and drawing in of ourselves to our nearest and dearest, but about how individuals will negotiate their share of market returns and rewards for risk when it becomes clear that some investments needs to be made collectively to produce economically enabled social goods, and as such need to be made fairly and transparently to ensure that both sides of the bargain get a fair return or reciprocation.

Big Society of Big Individuals?

A stimulating day spent in search of evidence for the Big Society at NCVO left me feeling that rather like the term “social enterprise”, “Big Society” will end up being another interesting contradiction in terms that feeds the intellectual interest of policy advisers but leaves the ultimate beneficiaries – i.e. taxpayers, citizens, etc – rather cold.

Perhaps it is worth a minute to consider the view from the other end of the telescope.  We have spent the last two decades embracing individualism, (and the twin trends of personalisation and consumerisation of everyday life) both fueled and enabled by the equivalent of a consumer contraceptive pill of the 1990’s, the credit card.  The liberator of your money, because in your heart of hearts you know that it isn’t your money.  At the same time, technology has enabled us to live increasingly independent lives of personal choices and freedoms which hitherto were both unthinkable and unworkable. I look at my own freelance career, seemingly living without the need of a nurturing corporate body, constantly shifting from project to business, following my own interests in money, consumerism and sustainability and at any moment able to say “tomorrow, I will do something else” on the basis that my time, as a freelancer, is not sold in advance for a salary but paid by the day or even the hour.

Of course, the alternative to this narrative is the atomised individual cast adrift from the institutions and communities upon which previously we had relied and tyrannised by endless choice and so-called consumer ‘liberation’.

And, Ok, I am probably not typical. (Although my work for zopa showed that such lifestyles, which we called ‘freeforming’, were emerging as a significant trend which would foster new forms of social and economic activities and collaborations).  What is evident is that compared even to when I started as a freelancer, 11 years ago now, technology has leapt ahead to make living a ‘liquid modern’ life more accessible, more efficient and cheaper than ever before.  And perhaps more importantly, more ‘solid’ or ‘tangible’.

The same goes for the businesses which seek to harness such technologies for the creation of new low cost business models.  A business really can be built from your bedroom, something reminiscent of what started the rot in the music industry at the end of the 90’s when anyone with talent or an ear for a mash up could produce professional sounds from a laptop. 

Into this context comes the ‘Big Society’ which when understood from this liquid modern perspective appears to be an assertion of some of the very vested interests and traditional institutions which individuals have sought to subvert and undermine.  But I think this is perhaps just one interpretation of just what the Big Society is and a real danger sign that if it is isn’t defined in a meaningful and practical way (or as praxis) soon then the vacuum will be filled by the status quo which adopts BS as a new brand ‘marque’ of legitimacy for their public and private demands for power and resources.

As someone who is essentially optimistic about the ability of liquid individuals (or “freeformers”) to produce meaningful and moral outcomes through new forms of collaboration, the opportunity of the Big Society is to encourage individuals to become ‘big’ rather than replace one set of institutional interests with another.  At Zopa we used to talk about the ‘individual revolution’ of which zopa itself was at the vanguard of new ways of individuals getting together to achieve personal and social goals.  If Big Society is going to be more than a badge, then government needs to adopt a whole new set of beliefs about the potential of the individual and trust in their ability to shape their futures in a way that does not just maximise their pleasure but makes for a more sustainable and fundamentally human response to the needs and challenges of being a good society.