It does not take a genius to see that capitalist economics as practiced today is at a crisis point. Present-day capitalism is based on continuous growth and expansion that require unlimited resources; this cannot be sustained on a finite planet. (In fact, the finitude of resources may already have caught up with us.) This expansion produces higher and higher standards of living, and wages cannot keep up without producing inflation. To meet the demands of higher standards and their higher cost, people are forced to give up their other needs, such as the need of children for quality time with a parent or the need of adults for leisure time to pursue meaning. Thus, and invariably, some of the basic promises of capitalism are shortchanged by the nature of the beast itself.
Capitalism recognizes one basic need for people: the survival and security of their physical bodies. This basic ego need requires private property—and any economics that ignores this basic need of people is bound to fail. But as the psychologist Abraham Maslow pointed out, we have an entire hierarchy of needs beyond the body. One major defect of capitalist economics is the ignoring of the people’s higher needs. Following Maslow, but modifying his theory according to the insights of my general approach to spirituality—science within consciousness—we can easily see what these higher needs are.
Consciousness is the foundation of all being, and its possibilities are fourfold: material (which we sense); vital energy (which we feel, primarily through the chakras and secondarily through the brain); mental meaning (which we think); and supramental (which we intuit). “Supramental” includes discriminating contexts, such as physical laws, as well as contexts of meaning and feeling, such as ethics, love, and aesthetics. The material aspects of experience are sometimes called “gross”; the rest make up the “subtle” domain of our experience.
When consciousness chooses the actual event of its experience out of these possibilities (material, vital, mental, and supramental), the physical has the opportunity to represent the subtle. The material is like computer hardware; the subtle is software. Our capacity for making material or physical representation of the subtle evolves. Our capacity for making representations of the vital evolved through the evolution of life via more and more sophisticated organs to represent living functions such as maintenance and reproduction. Next, the capacity of making more and more sophisticated representations of the mental evolved. This is the stage of evolution we are in right now. Our capacity effortlessly to represent the supramental has not evolved yet. However, there is evolutionary pressure on us to move in this direction; it is the primary reason some of us are attracted to spirituality.
In this way, there must be an urge to satisfy not only physical needs but also the needs of all the other dimensions of our experience. Thus a spiritual economics must address the satisfaction of emotional needs both conditioned and unconditioned (positive emotions such as love, compassion, and satisfaction itself); the pursuit of meaning, including the pursuit of new mental meaning that requires creativity; and the pursuit of spiritual and supramental (soul) needs such as altruism, aesthetics, and happiness.
And in truth, this ladder of needs is not entirely hierarchical. If one satisfies higher needs, the urge to satisfy lower needs actually decreases. But if a lower need is satisfied, the demand for satisfying a higher need increases. In this way, a strategy for an economics more suitable than capitalism would be to address all of our needs simultaneously.
Whereas capitalism is an economics of physical well-being based on the satisfaction of our conditioned physical ego-needs, idealist or spiritual economics must be an economics of holistic well-being based on the satisfaction of both our (physical) ego needs and higher needs (pertaining to the exploration of the vital, mental, soul, and spirit).
Economics is about production and consumption, supply and demand, prices and so forth. How does all of this relate to our subtle needs? Let’s talk about these micro-details.
Production of positive vital energy can be accomplished in many ways: forestation (plants and trees have abundant vital energy), cultivating positive health in society (people of positive health radiate vital energy), and so forth.1 But the best way to ensure production of vital energy is to encourage ordinary workplaces to offer facilities for their employees to practice positive health, including space for yoga, tai chi, and meditation. As for production of mental meaning, we already have some things in place in the arts and entertainment industries. Both of these industries have the capacity to produce positive vital energy (positive emotions); however, they have largely been bogged down with the negativity of a materialist culture. But we can shift the emphasis from negativity to meaningfulness and positivity.
The production of supramental and spiritual energy requires more effort today than it used to. In the olden days, spiritual organizations like churches, temples, synagogues, mosques, and the like cultivated and produced supramental and spiritual intelligence in their leaders and practitioners. Nowadays, these organizations are more interested in influencing mundane politics than in investing in the supramental. But make no mistake about it; it can be done, although we may have to develop new spiritual organizations to do it. In the olden days, perhaps the most effective means of production (and dissemination) of supramental energy were travelling monks (called sadhus in India; troubadours are an example in the West). This we can revive; to some extent the many new age conferences on spirituality are already serving this purpose. Also effective are group meditations, through which (as some of parapsychologist Dean Radin’s experiments show) people can experience nonlocal consciousness and hence can take creative leaps to the supramental domain. This can be done even in workplaces.
Now to the question of consumption. Because the vital and mental are mappable in us, they can be consumed both by local and nonlocal means. For example, if we see good theater, it cultivates the processing of meaning in us, even new meaning. When we partake of good, meaningful entertainment, we also feel positive emotions; we are consuming them. As we consume, we ourselves have the potential to become producers.
Supramental energy consumption is nonlocal, but it requires local triggers. There are scientists who subscribe to the so-called Maharishi effect, according to which the spiritual and supramental energy generated by a group meditation is consumed automatically in the local vicinity. There have been claims of crime reduction in big cities where Transcendental Meditation groups perform such meditation. However, this is controversial and I am not advocating it. A purely quantum-mechanical consumption of your spiritual energy requires that I be correlated with you by some means or other. For example, experiments by Mexican neurophysiologist Jacobo Grinberg suggest that if two people practice meditative intention together, they become so correlated—but it should be simpler than that. There are many anecdotes of people who have felt peace in the presence of a sage (I myself have experienced this). So just being locally present may trigger consumption.
The best part of the story of subtle energy products is that it is mostly free. The subtle dimensions have no limits; we can consume a sage’s love all we wish, and the supply is not going to diminish. There is no zero-sum game in the subtle. Since there might be a bit of material cost of production, we might put a material price tag on subtle products to offset this—and that may not be such a bad idea, because it enables people to be more serious about their intentions when they consume subtle products. This would also be an opportunity for the government to subsidize the subtle industry, for example, in the form of tax exemption or research grants.
But how can spiritual economics—the economics of the subtle—address the problems of capitalism I articulated earlier? First, let’s look at the problem of limited resources. Capitalistic growth economics depends crucially on keeping consumer demands going; this is often accomplished by creating artificial physical needs, such as new annual fashions for women’s garments. It is very wasteful and detrimental to finite resources.
In spiritual economics, when people’s higher needs are met—even partially—their physical needs reduce, reducing the demand for consumption and thus reducing the wastage of limited material resources. The economy still expands—but in the higher planes, where resources are unlimited (there is no limit on love and satisfaction).
There is another, related problem with capitalism and material-expansion economics: environmental pollution. This is a tricky one. In the short term, production of pollution helps expand the economy by creating pollution cleanup sectors of the economy. Believe it or not, the Exxon Valdez oil spill disaster actually produced an economic boom in Alaska. But in the long run, environmental pollution on a finite planet is bound to end up with a doomsday of reckoning. Many environmentalists think that global warming has already reached doomsday criticality. In spiritual economics, material consumption is reduced, thus automatically reducing environmental pollution.
Next, let us consider the free market. Why isn’t it free in the way Adam Smith envisioned? The truth is, a really free market has large ups and downs—but a democratic government must level out these business cycles in order to survive; voters wouldn’t allow them to go unchecked. So the government intervenes, either through the Keynesian approach (tax the rich and increase government programs to increase jobs and economic movements) or the supply-side approach (reduce tax for the rich; the rich will invest, producing economic activity that will trickle down to the poor). If these steps require deficit financing, so be it. Now, nothing is wrong with government intervention per se. Adam Smith himself was quite aware of this: he suggested government intervention to reduce unjust income distribution, to ensure that the entry to the free market is really free even for the small entrepreneur (regulation against monopoly, for example), and to provide liberal education to everyone participating in the market. Governments today tinker with the free market in a few other ways that Adam Smith may not have approved of: they make bureaucratic regulations, bail out big companies from bankruptcy, and give tax incentives to segments of the economy counter to the spirit of capitalism. The problem with this kind of tinkering is the indefinite-growth economics that we seem to have become stuck on. I have already commented on how spiritual economics solves this problem.
More recently, the freedom of the market has been affected by more than this traditional sort of tinkering. Materialism has produced a wound in our collective psyche, one which has released the powerful among us from the search for mental meaning to the slavery of our instinctual greed, avarice, and competitiveness. One of the effects of this is the gross corruption of the practices that keep the market free. The current practice is to manage corruption through laws, but this has very limited success. The other effect is subtle.
There is now an active counter-evolutionary movement for taking away meaning processing from large segments of people. Right now, this is more of an American phenomenon, but it may soon spread to other developed economies with strong currencies. Americans have been in a unique situation since the gold standard shifted to the dollar standard. Americans can borrow money to buy resources and goods from other countries almost indefinitely because those countries have few options other than reinvesting their money in the American dollar and the American economy. The American government then has the capacity for large amounts of deficit financing—and it is using this deficit financing to cut taxes for the rich. This is not immediately detrimental to the economy, because the rich are the biggest consumers and they are also big investors. But the practice makes the gap between rich and poor larger and tends to eliminate the middle class. In this way, market share is becoming more concentrated in the hands of the rich, and a new class system is being created. Can traditional capitalism function when the capital becomes concentrated again as it did under feudalism or a mercantile economy?
Spiritual economics would foster a universal revival of idealist values; instead of dealing with the symptoms of the materialist wound, such as corruption, we should rather heal the wound so that the symptoms disappear. For example, take the case of deficit financing; right now it is being used to increase the wealth gap between rich and poor, contrary to the spirit of capitalism. Even worse, deficit financing removes the very important economic constraint against nations with aggressive ideas. George W. Bush’s Iraq war would not have been possible if deficit financing were not permitted. So should we be against deficit financing in spiritual economics? Not necessarily. How does spiritual economics deal with a government that creates income disparity between rich and poor or starts aggressive wars? In an idealist society, the root cause for a government’s actively creating income disparity or war—negative emotion—would be addressed, and attempts would be made to eliminate them by creating an oversupply of positive emotions. Through spiritual economics, we would then use deficit financing to eliminate income disparity (as Adam Smith envisioned) as far as practicable without affecting the proper functioning of the economy—nationally and internationally—so long as the deficit increase or decrease remains within a few percentage points of the increase or decrease of the Gross National Product (GNP).
Next, let’s take up the subject of multinational corporations. Multinational corporations have access to cheap labor in underdeveloped economies employed by shifting manufacturing to underdeveloped countries, outsourcing, etc. The labor thus loses the leverage of wage increase through negotiations with management, since the labor laws are very different in underdeveloped countries because of economic necessities. The labor of developed countries lose leverage, too, because of increasing fear of outsourcing of jobs.
In order to subject multinationals to uniform management labor practices, we need to turn from nation-state economies to international economic unions (but not necessarily with a single currency, like the European Union). In other words, the tendency of spiritual economics would be to move toward a single international economic union within which individual democracies would function with political and cultural uniqueness and sovereignty but with increased cooperation.
Finally, there is the important subject of the other counter-evolutionary tendency of capitalistic expansion economy—loss of the worker’s leisure time. Spiritual economics has a built-in constraint on expansion, as already noted, so the standard of living does not have to keep moving up at rates faster than wage increases. Even more importantly, spiritual economics values other needs and their satisfaction that require leisure time. So in this economics, “standard of living” is defined differently; increases are measured not in the material dimension but in the higher dimensions—holistic well-being—without compromising the worker’s leisure time.
How can we quantify holistic well-being? For our material needs, the GNP is a fairly good indicator of progress or decline. But can we generalize the concept of GNP for spiritual economics?
Most people believe that science only relates to the material world, because only the material can be quantified, can be measured reliably. We have to eradicate this prejudice. We may not be able to measure vital energy, prana, or chi in the same sense that we can measure a quantity of rice, but it is not true that we cannot measure it at all. For example, when vital energy moves out of you, you notice certain feelings at the particular chakra; the same is true of vital energy excesses. When vital energy moves out of the navel chakra, you feel insecurity, butterflies in the stomach. When vital energy moves into the same chakra, the feeling is quite different, that of self-confidence or pride. Similarly, meaning processing gives you a feeling of satisfaction in the crown chakra because vital energy moves into the body there. So we can quantify meaning to some extent by the “amount” of satisfaction we derive from processing it.
Even the supramental can be measured. If we altruistically perform a good deed for someone, we feel happy or blissful—not because there is any particular influx of vitality in any of the chakras, but because our separateness is momentarily gone. With love, it is even easier, because we not only feel the bliss of not being separate from the whole, but we also feel vital energy in the heart chakra. And both can be measured.
Of course, this kind of measurement is not accurate; it is indeed subjective and always a little vague. But if we remove the prejudice that only accurate and objective measurements count, what then? Then we can certainly establish criteria to judge a nation’s net gain or loss of currency (feeling, meaning, and godliness) in the subtle domain. We must note that quantum physics has already replaced complete objectivity (strong objectivity) with weak objectivity, in which subjectivity is permitted so long as we make sure that our conclusions do not depend upon particular subjects.
For example, we can send questionnaires to people to keep an ongoing tab on their feelings, meanings, and supramental experiences or lack thereof. When we tally all this for the entire year, we can easily calculate an index of vital, mental, and supramental well-being. This index would then complement the GNP, which is the index for our material well-being. In the same way, we can estimate the contribution to the vital, mental, and supramental energies from a particular production organization.
Some examples will show that well-being in the subtle dimensions really does count, and we are missing something in our economics because we do not count it. In the Native American culture of old, there was so much subtle wealth that nobody even cared to own material wealth. Native Americans treated material wealth in the same way as subtle wealth: globally, collectively, and without playing a zero-sum game.
In Hindu India (before the tenth century), the country and culture were fundamentally spiritual. The economy was feudal, of course, but according to all accounts (not only of indigenous people but also of foreign visitors) people were satisfied and happy despite the prevalence of the caste system. What gives? Hindu India certainly had wealth, but no more than today’s America. In a spiritual culture, lot of good vital energy, mental meaning, and spiritual wholeness is generated—that is the reason. The subtle wealth reduced the need for material wealth and more than made up for the lack of it. The same was true for Tibet until the recent takeover by China.
Of course, the Indian and Tibetan cultures are not perfect, because they did limit the meaning processing of the lower classes; so evolution of consciousness eventually caught up with them. But so much energy was generated in the subtle domains in the Indian culture that even today, at a time when there is real poverty in the material domain, the Indian poor are still able to manage, because they continue to inherit and maintain their subtle wealth. If Karl Marx had seen that, it might make him rethink whether the exploited classes are always unhappy!
Earlier I mentioned the business cycle, which is commonly referred to as a boom-and-bust cycle. In the nineteenth century, after some years of growth, capitalist economies seemed to fall into a recession. An even deeper stagnation (called depression) eventually happened in the early twentieth century. It is to prevent this kind of fluctuation that the cures of Keynesian and supply-side government intervention were proposed. With these cures, recessions still happen, but they have been milder, (except for the 2007–2008 recession.) However, these cures have created a perpetual-expansion economy. Because recovery depends almost entirely on consumerism, a perpetual drain of planetary resources has been created.
In a spiritual economy, since production of subtle products is cheap, in times of recession we could soften the blow by increasing production in the subtle sector (for example, through collective production of vital energy, or meditation by a large group), so that consumption in that sector would also increase. This would reduce demand in the material sector, giving businesses time to regroup and increase material productivity. But most people enjoy the subtle and transformative practices for awhile. In a matter of a few months, they reach a plateau. By the end of a year or so, most people have had enough transformation for now, and they are ready to resume “real work.”
In the same way, in “boom” times the production of material goods would increase, material consumerism would increase, and there would be fewer subtle goods produced and consumed. As the economy recovered, people’s material needs would be satisfied again, and they would once again become hungry for the satisfaction of their subtle needs, whose production would then increase. This would have the effect of putting a damper on the inflationary tendencies of “boom” times in a capitalist economy. The important thing is that there would be no subtle price for the subtle goods; there would be no inflationary pressure in the subtle dimensions. Paying attention to the subtle would just enable the entire economy to soften the blow of both recessions and boom time inflationary pressure. In other words, cyclical variations of the economy would be much less severe, so mild that little or no government intervention would be needed to keep the economy in a steady state. I am convinced that spiritualizing the economy is the way to accomplish a stable economy, something that many economists have thought impossible to achieve.
The million dollar question is, How do we go about replacing capitalist economics with this spiritual economics?
You might think, “Spiritual economics sounds good; it brings together spiritual values with the best of capitalism. But how is it going to be implemented? By the government? By social revolution, as with Marxist economics? By a paradigm shift in the academic practices of economics?”
But let’s begin with a different question: How did capitalism come to replace feudalism and the mercantile economy? Capitalism was first implemented not because of a social revolution or because academics welcomed the idea but because capitalism served the purpose of a modernist, adventurous people. During the period in which capitalism developed, people had begun to embark on new adventures of mind and meaning, as science broke free from religious authorities; and as this meaning exploration opened up, it was necessary to make capital available to innovative people and keep it available. Compared to feudalism or the mercantile economy (Adam Smith’s term for the economy prevalent in England in his time), in which the pursuit of meaning is highly limited and vast numbers of people are denied it, capitalism offered larger numbers of people the economic freedom and flexibility needed to pursue meaning in their lives. Hence capitalism was inevitable.
Spiritual economics is inevitable for implementation because our society needs it, just as capitalism was once inevitable because the society of its time needed it. As our society moves beyond our competitive ego needs, as we heal the wounds created by materialism, as we begin to explore the benefits of cooperation en masse, the old competitive capitalist economics must give way to a new economics in which competition exists simultaneously with cooperation, each in its own sphere of influence.
To understand this, we need to look at how any economics is really implemented: businesses, of course. It is how business is done that provides the drive for the change in economics. And vice versa: the change in economics helps businesses along. Each is essential to the other.
So what will enable spiritual economics to replace capitalism? Ultimately, it is the need of the workplace, the businesses. And there, if you look, you will find ample evidence that business is already changing its ways. Yes, competition will continue to exist; without it there would be no market economy. But in the workplace, inside how a business is run, we increasingly find a different philosophy and a different aspect of the human being at work. In many of our businesses, we have discovered the value of creativity, leisure, love, cooperation, and happiness.
The modernism of Adam Smith’s time has given way to postmodernism and trans-modernism. The old-fashioned exploration and expansion found in the material world are practically over in the face of finite resources and the challenges of environmental pollution. But while the old frontier is gone, there is a new frontier on the horizon, one that belongs to the subtle dimensions of the human being—and one that requires a subtler, spiritual economics.