By Bill Shein
March 20, 2009

In the wake of the A.I.G. bonus scandal (which comes after, and in advance of, so many other corporate absurdities), and with public discontent over the longstanding economic status quo officially boiling over into fury, President Obama said on Wednesday that there will be no return to “business as usual.”

Before heading to California for an urgent meeting with America’s most respected policy wonk, Jay Leno, he also said, “The business models that created a lot of paper wealth but not real wealth in the country and have now resulted in crisis can’t be the model for economic growth going forward.”

It was a refreshing comment, given his administration’s muddled statements about reducing consumption (in Obama’s inaugural address) while also increasing consumer demand, as Treasury Secretary Tim Geithner recently told European finance ministers is the key to recovery. What this fog of contradiction ultimately means remains unknown.

For its part, Congress will soon hold long-overdue hearings on creating a new regulatory framework. No doubt the well-heeled lobbyists for the corporate elite are girding for battle, campaign-donation checks in hand, expecting their usual victories. Will they get them?

Let’s hope not. If the president and Congress (and the rest of us) are serious about a new economic model, then it’s time for bold action on ideas that are not, at present, receiving the attention they deserve. Because we have an unprecedented opportunity to reorient our economic life in support of fairness, equity, sustainability, and responsible stewardship of the earth. With a not-too-shabby side effect of actually making us happier and preventing the atmosphere from catching fire. Can’t forget that!

So, yes, let’s save the nation’s banking system, but let’s do it in a way that doesn’t further enrich those who gambled away billions while paying themselves millions. (Oops! Too late for that. Sigh.) And let’s rein in the “financial instruments” that few understand and that do little besides make money on money.

Are we truly tired of Wall Street’s definition of success? Then let’s embrace financial metrics that value companies on more than just a multiple of earnings. That means green economics that attaches real cost to externalities like environmental damage and social impacts. We can also better incentivize (with tax breaks) and reward (with our investment dollars) companies that value employees as human beings and this planet as a miraculous, finite, and fragile resource.

The fact that these investment priorities have long been labeled – derisively, by the so-called pros – as “socially responsible” is, to my mind, quite an indictment of any other kind of investing.

Let’s also accelerate the move to closed-loop production processes, in which energy is conserved and every component of what we manufacture is fully recyclable. Will this mean an end to container ships and long-haul trucks filled with cheap, plastic, overly packaged throwaway items? It sure will. And good riddance.

Most importantly, we must develop an economic model that doesn’t rely for its success on a fire hose of advertising that tells us we’re too fat, too poorly dressed, too ordinary, not having enough sex, not living glamorous-enough lives, not rich enough, not young enough, not driving the right car or using the right cell phone or living in a big house filled to capacity with gadgets and toys and fancy things.

Because if we are honest, we’ll see that modern consumer capitalism has become a cruel, manipulative, soul-destroying system that commits psychic violence on each of us – most notably our children – by nurturing self-doubt and mental confusion and unnecessary anxiety and regret. All in the name of “moving product.”

Indeed, striking evidence presented a decade ago by Yale political scientist Robert Lane demonstrated that even as market democracies identified and met every (alleged) consumer need, nearly all measures of individual happiness, emotional well-being, and satisfaction with life have declined. That’s what “business as usual” has wrought.

If we can emerge from this crisis with a responsible, low-growth, locally based, community-oriented, less stressful, full-employment economy, rather than simply recreate what existed before, we will have done right by future generations. We’ll also vastly improve the lot of the current ones.

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Thanks to “business as usual,” Bill Shein earns a massive bonus even if no one reads this.