The following article appears in the Spring 2009 issue of Inquiring Mind.

THE MIDAS ECONOMY:
BUDDHIST REFLECTIONS ON THE FINANCIAL CRISIS

An interview with and essay by David Loy

David Loy is Besl Professor of Ethics/Religion and Society at Xavier University in Cincinnati. His work is primarily in comparative philosophy and religion, particularly comparing Buddhist with modern Western thought. His many books include The Great Awakening: A Buddhist Social Theory, and Money, Sex, War, Karma: Notes for a Buddhist Revolution. A Zen practitioner for many years, he is qualified as a teacher in the Sanbo Kyodan tradition of Japanese Buddhism.

DAVID LOY: Is the current financial and economic crisis a good thing? I wouldn’t want to minimize the suffering it’s creating for many people, but the world economy is an unjust system, and absolutely unsustainable. If we don’t know how else to transform it, maybe it’s better that it collapse sooner rather than later so as to lessen the long-range impact both on people and on the biosphere. Our economic system is devastating the Earth. The financial losses from this collapse may amount to several trillions of dollars, but who can compute the value of the rain forests we have been cutting down? What price do you put on species extinction or global warming?

INQUIRING MIND: What do you see as a Buddhist approach to this current situation?

DL: On some level, the Buddhist solution is always the same—awaken yourself and live in harmony with others. In our time, especially, that means learning how to live in harmony with the biosphere. Our economic system has to be ecologically sustainable, and it has to work to the mutual benefit of everyone, rather than to just a small percentage of the Earth’s population.

IM: The Buddha and his followers chose a form of communalism or socialism: the Sangha.

DL: That’s true. The Buddhist scholar Trevor Ling believed that the Buddha wasn’t just forming a small group of monastics to support their own realization, but that he was modeling a broader, transformative vision for how society should function. Did he perhaps see the Sangha as the example or “vanguard’ for a more egalitarian social order? And more recently, the great twentieth-century Thai reformer Buddhadasa proposed what he called “dhammic socialism.”

But what is most distinctive about the Buddha’s social analysis is that the fundamental dichotomy is not between good and evil but between delusion/ignorance on one side and wisdom/enlightenment on the other. The challenge is to understand our economic system not primarily in terms of some people selfishly exploiting others but instead as a system of collective greed and delusion. Some suffer much more than others, of course, but even those at the top are trapped by their own ego-based cravings.

IM: So the current economic breakdown may be a “heavenly messenger”—a great opportunity for collective insight—as people begin to see more clearly into the fundamental flaws of the system. You say that you would like to see Buddhists step forward more vigorously at this time to offer an alternative perspective to the world.

DL: Yes. I’m encouraged by the “gross national happiness” movement inspired by Bhutan, for example. And recently there have been several Buddhist economics conferences, most notably in Thailand. Perhaps this is an idea whose time has come. Unfortunately, the people in politics who are closest to the Buddhist analysis—liberals, progressives and other left-of-center groups—often dismiss the Buddhist approach as simply “religious.” It’s Marxism’s old “opiate of the masses” critique. Maybe now, in the middle of our discontent, they will be encouraged to take a fresh look.

According to Legend, Midas was a Lydian king who was offered any reward he wanted for helping the god Dionysus. Although already fabulously wealthy, he asked that whatever he touched might turn to gold. Midas enjoyed his new powers, transforming everything in sight—until it came to be dinnertime. He took a bite—cha-ching! The food in his mouth turned to gold. He took a sip of wine—cha-ching! It solidified into gold. He hugged his daughter—cha-ching! She hardened into a golden statue. In despair, Midas pleaded for Dionysus to deliver him from this hateful power. Fortunately, the god obliged; Dionysus sent Midas to wash in the river Pactolus, which cleansed him of what he now realized was a curse.

We are all familiar with this story. Despite its simplicity it is one of the most profound of all Greek myths. So why do I retell it now? Because today it is more important than ever: it can help us understand the financial and economic crisis that has just begun and that is about to transform all of our lives.

Obviously, the Midas story is about greed, the first of the “three poisons,” or three unwholesome roots, according to the Buddha (the others being ill will and delusion). But the moral of this tale is about much more than greed. Midas valued gold more than anything else, so the great irony is his realization that a golden touch makes everything else worthless. He couldn’t eat or drink gold, and he certainly couldn’t love it the way that he loved his daughter.

By no coincidence, the same is true of our own currency: even a $100 bill has no value in itself. It’s just a piece of paper—in effect, nothing. We can’t eat it, drink it, live in it, ride on it, etc. When we treat money as the most valuable thing in the world, that’s simply because we have collectively agreed to make it so. We forget that money is a social construct—a kind of group fantasy. The anthropologist Weston LaBarre called it a psychosis that has become normal, “an institutionalized dream that everyone is having at once.” As long as we keep dreaming together, it continues to work as the socially agreed-upon means that enables us to convert something (a day’s work, for example) into something else (bags of groceries, perhaps).

Yet as Midas reminds us, money can also become a curse. In more psychological terms, the danger is that means and ends become reversed, so that the means of life becomes the goal itself. As Arthur Schopenhauer put it, money is abstract happiness, so someone who is no longer capable of concrete happiness can set his heart on money. Money becomes “frozen desire”—not desire for anything in particular but a symbol for the satisfaction of desire in general. But what does the Buddha say about desire? Frozen or not, it remains the root cause of suffering.

The news media have also been telling us that the financial crisis is due to desire—or, as they put it, the excessive greed of Wall Street speculators and the unbridled spending of Main Street borrowers. But the problem goes much deeper, and our predicament is much worse. Our financial and economic system has institutionalized the Midas touch. To use another metaphor, the “Midas problem” is not like a virus that has infected the economic hard drive; rather, it has become the software that runs our economy.

The Buddha’s first noble truth identifies dukkha (“suffering, dissatisfaction”) as inherent to the human condition: it is the nature of an unawakened mind to be bothered by a feeling of lack. Our society conditions us to understand this sense of lack as lack of enough money, so that we always want more, like Midas. Our economic system institutionalizes this lack into a collective craving that can never be satisfied. Consumers never consume enough, corporations are never profitable enough, the GDP can never be big enough, etc. The goal of the system is to end up with more money than we started with, to turn whatever we touch to gold. Those who think like Midas rise to the top. Investors seek increasing returns in the form of dividends and higher share prices. This generalized expectation translates into an impersonal but constant demand for ever more profit and growth, a desire that can never be fully satisfied.

But who is responsible for this unrelenting emphasis on profitability and growth? That’s the point: we all participate—as workers, employers, consumers, investors and pensioners. The ultimate irony—or rather, tragedy—of this process is that everything that gives life value is devalued into a means for maximizing something that has no value whatsoever in itself. Everything becomes a means to making more money. “Everything” in this case includes the biosphere (resources), human life (labor), and society itself (we must continually adapt to the changing requirements of the economy).

It is becoming increasingly obvious that this system is unsustainable because it involves a growth obsession that, left to itself, will not cease until the whole of the biosphere has been converted into profit. Capitalism made more sense a couple centuries ago when the Earth seemed infinite and capital (money for investment) was relatively scarce. Today the obvious metaphor is cancer on a planetary scale. Cells become cancerous when they mutate into uncontrolled growth and spread throughout the body to disrupt its healthy functioning. That is not a bad description of what might be called Midas globalization.

Midas could ask Dionysus to remove his self-imposed curse, but we cannot appeal to a god to remove ours. Individually, meditation practice reduces personal dukkha by reducing desire, but how are we to address the collective dukkha generated by institutionalized desire? Ultimately we must choose between this economic/financial system and the survival of the biosphere. Yet there really is no choice. Our current system is doomed no matter what in the same way that a cancer always ends up destroying its host. From that perspective, the financial meltdown is actually a wonderful opportunity to address a much deeper problem. Such a crisis would be a terrible thing to waste.

© 2009 Inquiring Mind