Interview with Charles Eisenstein

New York, NY (TFC) – Charles Eisenstien is an important thinker for our times. He has written several books, and discusses alternatives to our current economical systems and new ways of thinking. His works include The Ascent of Humanity (2007), Sacred Economics (2011), and The More Beautiful World Our Hearts Know Is Possible (2013).  Earlier this year, I had the chance to speak directly with him on a number of topics.  My questions are in bold, followed by his responses.

Charles Eisenstein.  Photo Courtesy CharlesEisenstein.net

Charles Eisenstein. Photo Courtesy CharlesEisenstein.net

I’ve watched your TED talks and Occupy Wall Street talk, and you mention these stories of separation and I’d like to first of all thank you for disrupting my story of separation! Can you talk a little about how zero interest debt works and examples in history of how this happens and why it is preferable to accumulation and interest based monetary system?

Charles Eisenstein: Zero interest lending seems counterintuitive at first, because it seems to depend on altruistic motives on the part of the lender. What would motivate the flow of credit if lenders couldn’t make money? But actually, there is a very simple way to make it work — you have to design a money system with a built-in negative interest rate on cash. In the modern system, this could be done by imposing a liquidity fee on bank reserves. Let me offer an idealized version of how that would work. Suppose you are a bank and you have $10 billion in excess reserves. You know that in a year , those reserves will automatically shrink by 5% because of the liquidity fee, to $9.5 billion. So you lend to Acme Corp., let’s say, at zero interest. Acme spends the money, eliminating your excess reserves as the checks clear, and in a year pays you back $1 0 billion. So now you come out ahead of where you would have been. Why do you make money? It is because those reserves originate as deposits, on which you charge a fee of, say, 3%. So basically the banking system works as it does to day (or how it was intended to work), but with an interest rate floor that drops into negative territory. Cash and demand deposits (like checking accounts) would accrue perhaps -4% or -5% interest, time deposits and treasury bills maybe -2% or -3%, the prime lending rate would be around 0%; riskier lending would still be in positive territory. (Physical currency would have to have some kind of graduated expiration date.) Such as system would have the following effects: – It allows credit to circulate in the absence of economic growth. – It gradually redistributes wealth away from creditors towards debtors (mathematically it operates just like inflation, the main difference being that, as you may have noticed, inflation usually affects prices more than wages.) – It reverses the discounting of future cash flows, encouraging long-term thinking. – It discourages the hoarding of wealth. – It encourages a leasing economy of goods built for durability and repairability. Some central banks have flirted with negative inter est (the ECB is doing it now), but only at very low rates (close to zero). There are historical example s as well, most notably the town of Worgl, Austria, in the early 1930’s, when prominent economists like Irving Fisher supported it. Even J.M. Keynes wrote favorably of the idea. Of course, the idea seems quite counterintuitive today and invites all kinds of questions: “Would it promote over consumption?” “Would it promote speculation on commodities?” A fuller treatment of the idea is beyond the scope of this interview; suffice it to say that it cannot b e dismissed on trivial grounds. Much of what we know as “capitalism” stems from the nature of “capital,” in particular the set of social agreements that define money. If those agreements change, capitalism could look very different.

 

What do you think of those who would say sabotage is a necessity in stopping climate change? Is this a disruption of the story or simply using force to separate from those who profit off the destruction of our planet and ourselves?

I think that, generally speaking, sabotage is an in effective strategy that makes the saboteurs feel good about themselves, but fits neatly into the narrative of wacky, scary eco-terrorists who are a threat to orderly society. Such tactics will alienate the uncommitted and taint the cause. There might be times when it is appropriate though, for example by indigenous people whose lands are being stolen by mining and petroleum companies.

You’ve said humanity is entering an adult phase, and we are falling in love with earth ending our infinite growth cycle. Do we have time?

 

According to what most people understand to be practical and realistic, no, we don ‘t have enough time. To take one of many examples, consider climate change. What is political feasible is nowhere near what is needed. Technologically though , we could quite easily heal our biosphere, without sacrificing anything that contributes to authentic well-being. There are no technical obstacles to converting all suburban lawns to permaculture gardens, to implementing across-the-board zero-waste manufacturing, to ceasing arms manufacture, and so on. Such things are, politically speaking, impossibly far off; my point is that no technological miracle is needed, but only a shift in consciousness, perception, and narrative. Yes, the window within which currently recognized technologies will be enough is shrinking, but imagine what would be possible if we shifted the focus of our science and technology away from weaponry, exploitation of mineral wealth and fossil fuels, and so forth toward renewable energy, reforestation, toxic waste remediation, eco logical restoration, etc. In fact, there are already people on the margins doing near-miraculous things — Paul Stamets, for example.

 

You’ve said that we have to realize if we were the CEOs or bankers we’d do the same thing and that we must realize this and not hold contempt for them. What about more personal infractions? What are your views on forgiveness and defending oneself from abuse whether physical mental or systematic?

OK, first let me say why we shouldn’t hold them in contempt. This isn’t about morality or being a good person. It is that if we explain their behavior in dispositionist terms (i.e., they do bad things because they are bad people), then we are acting under a delusion. To be effective, we have to be i n reality. It might be emotionally gratifying to see them that way, and it certainly accords with the depict ion of bad guys in films, but it is not accurate. People’s choice s arise from the totality of their internal and external situation. If we recognize the complexity of what it is like to be, say, a Monsanto executive, we stand a better chance of being able to influence these people. Otherwise, we have no choice but to do battle with them, which I suppose would be OK if we could win such a battle. Unfortunately, if it comes to a contest of force, we on the left will lose. The powers-that-be have more force a t their disposal. Now that is not to say that there is never a time t o fight or to use force. The problem is that the dominant culture offers us a world-story in which fighting is a natural first response to a problem. It is the habit of fighting, the habit of force, that is unhelpful. Recognizing someone is not a bad person but merely enacting a brutalizing role in a brutal system, does not mean you let him have h is way. There are certainly times to defend oneself against abuse. We err, though, when we see the abusers as t he fundamental problem — those appalling people, t hose Tea Party wingnuts, those banksters, those corporate executives — and go to war against them. They are symptoms of a deeper problem. Again, in a given situation one might use force to protect oneself, for example getting a restraining order against an abusive spouse, or prosecuting police misconduct in court. Forgiveness is simply the authentic recognition (and no t just the intellectual position) that if I were in your shoes, I would have done as you did. One might seek t o protect oneself from someone doing harm, but one won’t seek to punish that person. This viewpoint also allows the possibility of avenues of change that don’t require a force-based victory; f or example, change that comes from knowing, “Mr. Banker, M r. Awful Person, I know that in your heart of heart s you don’t want to be doing this,” and holding open the possibility for a change of heart. How do we create conditions for that to happen? There is no simple answer to that question, but it is of utmost importance because we know the results, from history, of the mind set of conquering evil.

You mention that money doesn’t decompose and that those who accumulate it do so because they gain from simply holding it. is this a juxtaposition of love which also does not decompose in the way that bread does, but must be used to have value?

 

Actually it draws from the principles of gift-based societies, in which social status , security, and everything that we might call “wealth” accrued to those who gave the most, not to those who hoarded the most. “The gift wants to move” — a principle elucidated by Lewis Hyde in his classic work, The Gift , drawing from anthropological sources. Money today, though, is designed to allow one to gain from holding it and controlling it.

You mention that meditation and yoga may just be an opiate of the masses. Do you see any use for these spiritual pratices?

I mention that critique of yoga and meditation, but no, generally speaking I think they are much more than that. Certainly there is a lot of spiritual escapism going on, and a lot of self-satisfied “corporate mindfulness programs” that allow executives to pretend that the y are in some vanguard of consciousness and therefore must be basically justified in everything they do. However, to write off yoga, meditation, and spirituality as nothing more than that misses out on their transformative potential. These practices have the potential to illuminate hidden contradictions within oneself, to heal buried wounds that generate harmful behavior, an d to reveal self-deception. They are not magic bullets, bu t they can be useful, perhaps even indispensable.

What are your views on anarchism?

I guess it depends on which version of anarchism you are talking about, but in genera l my political sympathies lie in this direction. I think that one the on hand, we will always need ways to form and implement collective agreements, and thus we will always have something we might call “politics” or “government.” However, this can take a form very different from current conceptions of the nation-state, representative democracy, coercive authority, the state monopoly on force, and so on. Personally I have kin d of an antipathy to authority, in which various childhood wounds are mixed in with a lifelong indignation toward injustice, but I don’t have a well-developed political philosophy to share with you.

What do you like to read? What artists have inspired you?

I like to read pretty much anything that challenges established orthodoxy, whether in politics, science, sexuality, consciousness, medicine, education… My main interest is in how the defining narratives — the mythology, if you will — of our civilization are changing. An old mythology is dying and a new one is being born, and I see its lineaments in all the things we have marginalized. So for example, recently I read Gerald Pollack’s book on water, an article by David Graeber, and just today this fascinating description of the (African) shamanic approach to mental illness.

Any words for radicals and revolutionaries you’d like to leave us with?

We are embarking upon a revolution that goes much deeper than most of us realize. It goes beyond economic and political forms to reach the invisible narratives that embed them, that we have long taken for granted as unquestionable truths. It goes all the way to our metaphysics, to our theory of change, to our ways of knowing. That is why we are seeing a convergence of the spiritual and activist worlds. I use “spiritual” here not in the sense of a non-material reality, but in reference to the excluded other, the qualitative, the unmeasurable.