Is the reduction of consumption compatible with economic development?

Assisted by Antton Pérez de Calleja. It is precisely with this crisis that we are seeing that the reduction of consumption, the reduction of household consumption, is a decisive element for the decline of the economy and the dismantling of the economic model. But if other orders of preference are established, which would not be for consumption, but what I know, the development of public or private health, or the preservation of the environment... Any other alternative, while one consumption is replaced by another, is compatible, at least in theory, with economic development. The fact is that today private consumption accounts for almost 70% of GDP [Gross Domestic Product] and it is not easy to replace it. In addition, I believe that citizens are less willing to sacrifice themselves at the personal and consumer level. Society should be convinced that other values are necessary and other characteristics are essential. For example, it is clear that in the coming years we will have to sacrifice energy consumption, there is no doubt that society cannot continue to finance this pace of energy consumption, and especially the consumption of non-renewable energies.

The economy is very plastic; we have seen in history how in a relatively short time one can move from an economy of war to an economy of peace, and an economy of war is a radical change. American factories, during World War II, stopped building cars and started making tanks, or starters. And in a relatively short period of time. The key is that society agrees and agrees with the objectives that have been proposed.

by Lucio Tabar. The question has many interpretations. Consumption reduction and economic development, by whom? Or of whom? Because we are making our economic development from the neck of the rest of the world. So perhaps reducing our consumption would be necessary for the rest of the world, not only to develop, but to not starve to death. And when I say “we”, I mean the rich, the rich countries or the rich citizens of the rich countries. I know that when you ask the question you are referring to the reality here, but in our pro-growth group Vuelta a la Otra we proclaim that it is necessary to take a step forward in our analyses and have a world-wide perspective. Limiting ourselves to a vision here at least doesn’t help us. And from the left perspective, if we do not try to reverse the practice of society that is willing to continue living from the neck of the rest, that is, if we do the practice that is contrary to what we theoretically defend, we have a feast.

Assisted by Andoni Eizagirre. I would like to add the environmental variable. What is clear to me is that what is not compatible is the model of development of our societies and the biophysical environment to which we depend. There are several scientific and technical data that corroborate this assertion; since 1980 it is already seen how the ecological footprint, the global demand for natural resources and ecosystem services by humans, exceeds the biosustainability of the planet. On the other hand, we also see the crisis of the energy system: on the one hand there is the crisis of energy sources, the end of cheap oil and the depletion of fossil fuels, but on the other there is also the crisis of swamps, and consequently the anthropogenic global warming of the planet. I mean, there are limits, physical limits, on resources, but also when it comes to swamps. And climate change is happening because of the excessive burning of fossil fuels and deforestation, harming biodiversity. There is a broad consensus on the instability of oil prices and the crisis of the energy model; there is also a consensus on climate change and the loss of biodiversity; it is scientific data, with a broad political consensus, we are already there, the problem is more about how to deal with these problems. And to combat it, it is necessary to rethink the political agenda and international geopolitics.

In fact, consumption responds to a linear system (exploitation, production, distribution, consumption, dispossession of natural resources), but the planet is limited. Can the model explode?

I'm talking about A. Assisted by Pérez de Calleja. There is no linear trend. It is a subjective interpretation, but history itself and economic development work through growth and rupture. In other words, there are qualitative changes that occur periodically. It is not the same as the 19th century economy, based on coal, steam, trains, ships... or the 20th century economy, or XXI.ekoa. So we're consuming quite different things. Remember the colonization developed by Europe in the 19th century, looking for raw materials, food (cocoa, etc.). At present this colonization is not granted because the raw materials can be obtained in a different way, or because consumption habits have changed. In history there will always be controversy among those who think that on the one hand there is nothing new, that the same scheme is always repeated, and on the other that history is always changing. What is clear is that human beings have a great plastic capacity to change their state when conditions force them to do so. First they have to convince themselves that there is no other way. The energy field is an example of this: if it were for society and social politicians, the economy would continue to consume energy indefinitely, look at how much it has cost to believe that climate change is taking place. From this perspective, society always goes to extremes, until it clashes with the extremes of economic development, but if it is convinced of the opposite... There is a new sensitivity to climate change and sustainable consumption and in this sense society will evolve. And as an economist I would highlight another aspect: when I have been asked, “what are the best ways to save energy?”, I have always answered: “The prices.” Neither persuasion nor mentalization... You will increase your energy costs and you will see how your consumption habits will change. But that's why we have to get to the oil barrel at $300 or $400. In this sense, when asked if the oil will end, someone answered that it will never end, it will become so expensive that it will not be possible to continue consuming at these prices and the little that will remain will be destined to more noble tasks or higher added values; to make plastic products, houses... but not to burn them. The economy changes through prices.

I'm talking about L. Assisted by Tabar. What I see is that we have overcome the limits of the planet, as Andoni said, and it seems to be scientifically confirmed. Antton, I'm not so optimistic because I think there are two options: one you say, that through crises (which we think will become harder and more frequent) we will move towards positive change. And the other, that there will be less and less rich, but richer, and more and more poor, poorer. This is what is happening in the world in recent years: 20% of the richest people on the planet are becoming richer, to the point that they make up 80% of the world’s wealth, and 80% of the population lives with the remaining 20%. This didn’t happen 20-25 years ago. Where will society go? What we can do together will have a lot to say about it. When we were talking about ecological limits, we were talking about potential: it is impossible to keep pace with economic development at these levels; but we are also trying to take into account the social aspect: even if we could keep pace with it (because there are people who say that technical advances will make it possible), would it be desirable? Is it socially fair? Is this model of economic development (the only one we know today), in the distribution of wealth, in the achievement of a decent life for more and more people... positive or negative? It seems negative to us.

I'm talking about A. It's about Eizagirre. A new concern in the field of economics seems to be developing in relation to physical examination, understanding the economy as an open system, open to the input of energy and materials, and open to the extraction of waste. In this sense, it is affirmed that, linked to the flows of matter and energy, the industrial economy is linear, because the resources are disconnected from the waste and therefore the cycles are not closed. What needs to be proposed is a change of perspective: not so much to ask how to provide natural resources, but to ask about the biosphere limits and how to adapt human systems to these limits. A simple example: the post-fossil model could also be a dirty alternative. This leads us to rethink what we consider to be an economy, and to broaden the debate to what would be desirable and social. Reducing primary energy consumption and self-limiting are precisely the driving principles that few speak of. However, no matter what is desirable, the planet itself puts limits on you and so change is mandatory.

Will we then be forced to consume less, or Pérez de Calleja, as you say, the economy is very plastic and we will look for other types of consumption, less linked to natural resources?

I'm talking about A. Assisted by Pérez de Calleja. As an economist, I am convinced that the economy is quite plastic. Vast areas of the planet that until recently were completely abandoned, with insignificant levels of consumption, are joining higher levels of consumption and economic development, especially in China and India. Looking back, we see that there are always profound changes. China has just become the world’s second-largest oil consumer, creating competition among players who were not present before. This is fine because it forces us to become aware, but we now talk to the Chinese and Indians about climate change, etc. and they tell us: “My consumption, compared to Americans, is one sixth or ten per capita income; you start.” We will come to very conflicting situations. Water will also become a scarce resource, food has always been a quilt... It is true that the economy and especially the scientific-technical revolution are delaying the moment of truth. I remember the impact on the economists of our generation of the report of the Club of Rome on the limits of economic development in 1975, which stated: In 20 years, the oil will run out. It's been 35 years and there's still oil for another 15-20 years. But we are seeing that for much more, the new reserves are becoming more and more difficult to find, more and more difficult to exploit, and probably more and more expensive to produce. Therefore, even if the scientific revolution delays the moment of truth, sooner or later it will happen.

For me, the most significant change in recent years is not economic, but demographic. I have lived in a world with 2 billion inhabitants, and now it has more than 6 billion, which is inherently negative in a balanced and developed society, especially if a high percentage of that society starts to demand the same or similar level of consumption as we do. The time will come, and that is why a new energy source (such as nuclear fusion, clean and cheap) is being seriously sought. The fact is that man always acts on the assumptions of continuity, but history does not. There is a curiosity that is widely used in economics: In 1860, in the face of the growth of London’s carriages, it was concluded that by 1900 the streets would have a layer of manure of ten centimeters, since they assumed that the growth would take place on the basis of the previous bases.

But when this moment of truth comes, will we return to a model based on consumption?

I'm talking about A. Assisted by Pérez de Calleja. He doesn't have a reason. The concept of goods and services has changed a lot. I have known that in the Spanish economy, services accounted for only 25% of GDP, and today they account for 70%. We are not only talking about goods, but also about goods, but this same organization can change if GDP is measured differently, as proposed by Nicolas Sarkozy: not a GDP measured in monetary terms, but in quality of life. If we start to introduce variables, if we start to measure the economy in a different way, we can start to introduce changes. But there is one thing for sure: all the economists and historians who have tried to predict what the world would be like in the long run have been confused. It is impossible to predict what will happen because something like chaos and luck works.

I'm talking about L. Assisted by Tabar. But there are some trends that allow us to see not how the world may be, but how many changes have taken place in the last 30 to 40 years. For example, the ecological limits of the planet are a clear trend in the consumption of energy, swamps, natural resources, and also, as I said before, that wealth is being concentrated in fewer and fewer people, in more and more poor and worse conditions. Here is the case of Africa: Before you mentioned the colonization of Europe, which is no longer done; it is not done directly, but it is done through transnationals, and this is a much more widespread practice than in the colonial era, which imposes many more controls. These two trends are undeniable, and unfortunately new countries are joining this model. But of course, what are we, with our model of society and consumption, to make sure that they do not take this path? Their model should be modified to open up other paths of development that are not based on the consumption of material goods, or that are less based on brutal consumerism like ours. The other day I read that we only use 80% of the products we use once before throwing them in the trash. This responds to the so-called programmed obsolescence, which are products made with the date of breakage or expiration, without the possibility of repair or replacement; how is it possible? To obtain the maximum profitability in the shortest possible time, of course. If these are the values that guide the economic organization of our society, it does not seem to me that this is a great advance, nor that this economic development (due to the search for clean energies, etc.) is a satisfactory development.

I'm talking about A. It's about Eizagirre. I go back to the first one. We know that the environment is limited, and that the world is saturated from an ecological point of view. On the one hand, there is the need to change the productive model, and on the other hand, there is the need for a new management of demand. And this is where the question arises to me: is it enough to change a productive model, or is it possible to overcome the dependence on oil without reducing energy consumption? I would like to highlight two points here. On the one hand, it is not possible to replace oil, given its characteristics such as high energy density, easy handling, variety of uses and the volume we use at the moment. Secondly, it is true that we have to learn to do things differently, that is where eco-efficiency and things like that make sense, but the hardest challenge is to do fewer things. That is sustainability.

I'm talking about A. Assisted by Pérez de Calleja. I remember that when the first oil crisis erupted, it affected Spain quite a lot. The essence is the price in the economy. In a very short time, the Western economies were able to replace oil, which cost Spain a little more, or reduce the weight of oil in terms of energy consumption or total consumption. Drastically, too: today the advanced economies are consuming about a third of what they used to consume 30 years ago, compared to about half in Spain. Due to energy savings, technological advances that reduce energy consumption, insulation, laws that force sustainable energies in homes... Transport is the area that makes the most energy consumption and transport will enter into crisis. This will put into play one of the key variables of economic development, productive specialization and international division of labor (such as buying and assembling parts abroad). Until 1940-50, in Spain (towns and even cities), they were supplied with products produced for about 10-20 kilometers and this has changed radically: slaughterhouses were designed to be consumed immediately after the death of the animals of the area. Suddenly, we have gone from 3,000 slaughterhouses in Spain to 200-300, and today we eat meat from dead animals in Aragon or Andalusia. The Basque Government says that between 60 and 70% of energy pollution is generated by transport, so it can be seen that we are already trying to develop another model. We always try to do the same thing in a different way. We don’t change the way we go to work, or move from one place to another, but we do change the type of energy used by cars. We’ve been talking about electric cars, hydrogen cars for 20 years, and we still don’t really know what this technology will be like. There is nothing like a big increase in the price of oil (and as soon as the economy recovers a little, the price of oil will skyrocket) to provide processes of internal change.
It should not be forgotten that, as a result of all this model, Europe will no longer be a global centre; it is no longer, but it still has strength because of its relations with the United States; the global centre will then move to the Pacific, to the relationship between China, Indonesia, Korea, Japan, the United States and themselves. Europe will be confronted with its own problems: less capacity for change, less dynamism, less spontaneous initiative, more dependence on others, older people... Even if it is an optimistic fact: The economies of Europe, the US and many other countries are no longer economies based on industry, consumption, production... but on knowledge. And knowledge is a person in front of a computer that does not consume too much energy, does not move from one place to another and is connected through the Internet.

On the other hand, I do not agree with Lucio’s assertion that the economy concentrates wealth in the hands of fewer and fewer people. In the modern economy, at least as we know it in Europe, development has been centred on the creation of a broad middle class social class; about 60-70% of our society. Between 5 and 10 per cent of society is very rich and 20 per cent is very poor, although there are differences between countries. After all, this was driven by the consumption model itself and Ford was the first to realize it: if I don’t pay my employees enough, they won’t be able to buy a Ford, so let’s create a social class that can buy cars, yogurts and vacations.

I'm talking about L. Assisted by Tabar. Yes, there is a European and American middle class, but at the expense of the rest of the world's population. If capitalism were really able to take the development that has taken place in the Spanish state over the last 30 to 40 years to the rest of the world... But this is absolutely impossible. And American society will be very productive, but if everyone consumes the average American, we would need six planets, because that is the ecological footprint of the United States. Therefore, although it has focused its economy more on the service area, it remains utterly destructive. The cities supplied themselves with what was about 20 kilometers away and we had 3,000 slaughterhouses, that's right. All this has not necessarily disappeared, it has disappeared because of an economic and social policy that seeks to concentrate profits.

I'm talking about A. Assisted by Pérez de Calleja. The efficiency...

L. Assisted by Tabar. Efficiency, but only from an economic point of view, only to increase profits, through the growing number of companies that occupy an increasing part of the market. We return to the same: what are the values that govern the economic performance? The self-sufficient society has not disappeared, it has disappeared. When I see that in Pamplona, our mayor eliminates the orchards that have always been there to leave beautiful riverbanks to transform them into public parks, I think, wow, that’s an ecological measure! And this happens at all levels because it is this dominant policy. Antton, you've talked about cars going to work, saying that we're trying to do the usual in a different way (another kind of car): but 25 to 30 years ago there was no current traffic at all! Many workplaces were in the center of the cities, so it is not that we continue to do what we always do, but that this policy has led us to absurdity. Slaughterhouses for example: You say that we feed on the slaughterhouse in Aragon... The other day I read about how the langostins captured in Scotland are taken to Thailand for peeling and cleaning (who knows what the working conditions and wages are) and sent back to Scotland for sale in the restaurant chain Marks & Spencer.

I'm talking about A. Assisted by Pérez de Calleja. Don't even think about it. People believe that many decisions have been made on purpose, following specific intentions and plans, and that is not the case. I know a little about economists, entrepreneurs and politicians and I can tell you that they hardly have a medium- and long-term vision. We can accuse them of being irresponsible, but not of being malicious, so to speak. The answer to these examples that you mentioned is the cheap price of energy. After World War II, this model has been established by cheap energy, these multitudes of displacements, based on cheap transport. 20,000-25,000 trucks drive on these roads every day, carrying and bringing things. Increase the energy, and the model will automatically end. We should once again learn how to produce and consume food over shorter distances. You mentioned the mayor of Pamplona, but in Amsterdam, Rotterdam, many villages in England... gardens have been converted into so-called leisure deserts by other mayors. I knew the founder of the Arizmendiarreta cooperatives a lot and he was fascinated by the need with the experience that took place in England during World War II: there was a proliferation of family deserts where everyone could consume their own lettuce and vegetables. The world works between the stick and the carrot, between the prizes and the castigos, according to which we will take one direction or the other, because as we said before, society is more flexible than we think to adapt to different situations. Over the next few years, we will have big surprises.

You mentioned the knowledge-based economy model. Can consumption that is not based on natural resources be the way to seek balance?

I'm talking about A. Assisted by Pérez de Calleja. 70% of Americans work in services. When I started studying economics, 50% of the Spanish population lived from agriculture, today less than 5%. I have also known a time when half of the Basque economy was industrial and today it is less than 25%. That is to say, the two main economic actors that have been the basis of humanity since the Neolithic period are today barely 30% of the population. It is true that operating in services does not mean that we are not dependent on natural resources, since natural resources are distributed by different fields such as trade or transport, but we have entered into another type of economy.

I'm talking about L. Assisted by Tabar. But that’s not the way, because once again we face the myth of development. The service-based society appears to be more advanced than the industrial one and the industrial one more advanced than the agricultural one. In reality, however, industrial society is more unbalanced and unequal than that based on agriculture and even more so on services. In fact, the society of services continues to promote and increase consumption, because industrial production has to be carried out I do not know where and it will have to be carried out I do not know where and the same with agricultural production. It's changing, but that's not the point, it's whether it's changing for better or worse. That’s where the scale we use to measure that for better or worse comes into play. If a single scale is the purchasing power of citizens, then it is for the good, but for us that is neither the single scale nor the main one.

I'm talking about A. Assisted by Pérez de Calleja. Some things have been beneficial. If this change had not occurred, we would not have the health care system we have. “I would like to dedicate myself to agriculture in an isolated village”, when they tell me, I reply: “Then you wouldn’t have a doctor or a pension.” People want the best features of the current system without the drawbacks that it has. This is a utopia that has always been repeated: I want to live as before, but also with what I didn’t have before. The system is based on constant productivity growth, the productivity rate is the basis of the growth rate, and the way farmers move to other sectors (as happened during English industrialization) is for fewer people to produce more food. Otherwise they would not be able to leave the farm and go to the cities. We have witnessed the disappearance of entire sectors of the integral steel industry, thousands of companies in the... But let’s not forget: today 25% produce more than twice what 50% produced 20 years ago. The model is based on the improvement of productivity that moves human and capital resources to other sectors. This year in Spain, 50% of the productive system has been taken over by the public sector. I always say that the most unsustainable part of the economy is the public sector, because its level of productivity is very low. The municipalities, communities and administration of Madrid will face great tensions to adapt with 5 to 10 to 15% less than what was lived recently. They spent their money on piles of nonsense. Let’s not forget that behind the construction speculation there have often been municipalities. In the Basque Country, 54% of the value of a dwelling was land, which was often in the hands of municipalities. Therefore, the economic system is not the only one that needs to be adapted, but also the public system, because it is already half of the whole. One of the first reactions has been an increase in taxes, VAT, and in the next three or four years the public sector will have to make a brutal cut. However, the economist is convinced that he will not be able to do so at the pace required and that he will not be in deficit at 3% in 2013. This will probably lead us to a situation similar to that of Greece, although I do not know if it will be so serious. The system must adapt to a situation of less growth, and pensions must also adapt. It is inconceivable to maintain the current level of pensions in the coming years, i.e. 80-85% of the final salary. It is unthinkable that people will be able to retire at the age of 62-65. Austerity and consumption reduction should be applied.

I'm talking about L. Assisted by Tabar. Yes, it is inconceivable, because those who will pay again will always be the ones who pay, the ones who have the least, the ones who care less about politicians. Why don't the rich pay?

I'm talking about A. Assisted by Pérez de Calleja. It pays for the middle class because it's controlled.

I'm talking about L. Assisted by Tabar. And why don't we eliminate military spending instead of cutting pensions? Why don't we eliminate the advertising

spend... Assisted by Pérez de Calleja. Military spending is less than 2% of GDP in Spain and you don’t do much with it.

I'm talking about L. Assisted by Tabar. No, not at all, because the Ministry of Defense is committing a great fraud there, and it does not even meet the criteria established by NATO when it comes to extracting the calculation. It divides a lot of items destined for military spending into several other ministries, but in reality, Spanish military spending is almost 7% of GDP. And in 2004, for example, in France, they spent €31.2 billion (2% of GDP) on advertising, which is three times the social security deficit in France. There are other options, but the system never raises them. With an economic growth of 3% applied to the entire planet, the conclusion is that in a century production would be 20 times higher, in two centuries 400 times higher. Growth at the Chinese level of 10% means that in a century production would be 736 times higher. This cannot be maintained under any circumstances.

I'm talking about A. Assisted by Pérez de Calleja. I’ve known Japan with 10% growth, and then I’ve known Japan with 0% growth for a decade. All countries have stages. Spain, in the 1960s, had an economic growth of 7%, and how much will it grow in the next ten years? I think about 1% on average.

I'm talking about L. Assisted by Tabar. And Antton, about the other thing you brought up: that we have this economic model because energy is cheap. But behind this impersonal “is” cheap energy there are multiple realities: wars that have been waged to control oil, for example. Ask the people of Iraq if the availability of oil has been “cheap”.

I'm talking about A. Assisted by Pérez de Calleja. I mean cheap in terms of affordability, not in absolute terms. That people have had access to gas stations so far.

I'm talking about L. Assisted by Tabar. Yes, but it is cheap because of the political and economic decisions that have been made to make it so. You say that economists and politicians do not have a medium- and long-term vision. I don’t know any high-ranking economists and politicians, but I see the results of their actions, and as the law says, ignorance doesn’t exempt you from guilt. I don’t know if they are aware of the consequences of the decisions they make, if not more embarrassing.

I'm talking about A. Assisted by Pérez de Calleja. Look what happened to the financial crisis. The best economists in the world were in the most important banks and no one, except two or three, was able to predict the crisis.

I'm talking about L. Assisted by Tabar. So what happened to the financial crisis? Public funds have been used to save private banks, and now it is rumoured that it is these private banks that are squeezing and bankrupting governments that have been saved. The blame is not on the bankers, they are there to make as much money as possible, like the entrepreneurs; the problem is the political system, capitalism. Capitalism with continuity, despite all those changes that you mentioned (using different energy sources...), but ultimately capitalism based on the collection of goods, the exploitation of nature and the exploitation of people. We ourselves, the “poor” in our social model, the famous millennials, are the rich bourgeoisie on a world scale.

You have also talked about the Gross Domestic Product, is it the right index to measure economic growth?

I'm talking about L. Assisted by Tabar. As I am not an economist, I will read what a member of the association, professor of economics at the Public University of Navarra, has written to me: “GDP measures economic growth poorly because it does not take into account goods that do not pass through the market, self-production and domestic work, necessary for society; because it uses prices to measure the value of goods and services, but that price is not always a sample of the contribution that goods and services make; because it counts as production, which is really only the exhaustion of the natural heritage. Despite these limitations, it can be used profitably, along with other indicators, to measure part of production, but in no way, as is often done repeatedly, to measure the well-being or suitability of society.” I'm talking about

A. Assisted by Pérez de Calleja. I agree with you. Sometimes, those who see the economy from the outside think that the things that economists do are very well thought out, calculated and designed, and it is not true. For example, they thought the economy needed a meter and in the 1930s economist Hicks designed the concept of GDP. But economists have always been very clear that this is a very primitive tool. It excludes not only, as you have said, self-production, but also the entire hidden economy. And in Spain, for example, it is estimated to be more than 20% of GDP. It is true that it considers as production what is a reduction of the good, for example of natural resources. It does not take into account the impact on the environment... GDP constantly involves variables of a political nature: for me as an economist it is incomprehensible not to charge factories for the energy or water they waste, or the damage they do to the environment. For example, we have electric power as one of the cleanest and most convenient (cars are also intended to be electric), but the electric system has never considered acid rain and such, and in Germany they saw that if the impact on the environment were taken into account, the price of electric power would have to increase by 30%. And they immediately asked in Germany: and why is it not done? Because it would have caused so much loss of competitiveness in all industries that the country doing so would automatically lose competitiveness in international markets. And this in Germany, where ecological awareness is much higher than ours. Why is it that an international assembly is not held to set the price of energy where it belongs? These are political problems.

I'm talking about L. Assisted by Tabar. To what extent, however, are these variables in the hands of politicians not dependent on economic variables? For example, in the U.S. (and also largely here), a private position goes public and as soon as you leave the public position, you automatically get an even better position in a private company. How the hell is this person, from his public office, going to hurt those who have made him rich before and those who will continue to make him rich afterwards? Do we have a lot of cases here because they were high-value professionals, or in return for the favors they had done before? It should be seen whether politicians respond to the interests of citizens or to the interests of those they hire before and after.

Yesterday I read in the newspapers that the last summit of European leaders did not agree on anything. The United States asked the Stiglitz Economy for advice and recommended the Nobel Prizes to eliminate the tax haven of the Cayman Islands, to which the Treasury Secretary replied: “Yes, it is! I have my money!” A global proclamation, yes, the words of Sarkozy and Obama in full crisis... but then time passes and everything remains the same or almost the same.

I'm talking about A. Assisted by Pérez de Calleja. In the crisis before the crisis of 1929 there was a huge change of banking regulation. But human beings have a bad memory; 30 years after the crisis of 1929, a golden rule that worked very well, not to confuse business and commercial banks, was broken and huge speculation spread. Bill Clinton opened that door. It’s the same with housing speculation: I’ve known two or three bubbles because people forget! It is estimated that the memory of the people, in the case of housing, is given for about ten years.

And do you think that the economic crisis will serve to rethink the current model, or that we will also forget about it?

I'm talking about A. It's about Eizagirre. What caused the economic crisis? What diagnosis has been dominant when talking about the crisis? Well, there has been a kind of asymmetry between the financial economy and the productive economy. With GDP growth, indebtedness has been higher than it could be paid. The diagnosis has been that the situation was not sustainable from a financial perspective. This does not imply a rethinking of the economic model, the consumption model, but the measures have been obvious to maintain it. In any case, as long as it is not recognized that there is a contradiction between the productive and the real economy (the real linked to the limits that nature places, for example in the case of oil), it will not be granted. The most toxic asset is a euphemism, we should be more concerned about carbon debt and other poisonous debts. In fact, they are saying again that things are returning to that, because the diagnosis of the crisis says that the productive economy is not able to pay debts, but it is not said that there is the contradiction mentioned, that GDP is not ecologically sustainable.

I'm talking about A. Assisted by Pérez de Calleja. It is also paradoxical how the substance of the matter has changed. A year ago all economists demanded state intervention, public spending, Keynesianism. A year later, we are calling on the state to drastically reduce spending and reduce the deficit. Back to the beginning again.

I'm talking about L. Assisted by Tabar. I read in the newspaper the article by Miren Etxęeta, Professor of Economics at the University of Barcelona. This is what he says: “Let’s assume that the recovery returns and returns due to the demands of global markets. If everything has to be sacrificed to improve the deficit and competitiveness, the society that is perceived as emerging from the crisis is very worrying, with a kind of asymmetric Keynesianism, contributing capital, squeezing work, it is giving a hard victory for economic interests at the expense of the well-being of the population. With unemployment going to take more than ten years to repair, with rising wages and job stability, diminished social services, powerful financial powers and companies pushing the exploitation of their workers to the limit, is it not cynical to call this a revival? We should ask ourselves if this is the model of capitalism that will lead to the exit of the crisis: the model of global oligopolistic companies and financial institutions, inevitably supported by public money and with a multitude of business satellites in their century, where only the economic and political elites can have an adequate standard of living. Societies that are less and less democratic, in the hands of corruption, with an increasing need to resort to repression, and with absolute disregard for the problems of citizens and the environment. The revival, if it happens, will lead us to even more austere societies: we are moving towards corporate and institutional capitalism. It seems clear that the strategy of outsourcing capital will lead to a deterioration in the living conditions of the non-elite classes. What will come out of the crisis?” And that's what someone who knows about the economy says. It was this fear that prompted us to forge our partnership for growth and to bring our own stumbling block to this path. If we continue in this direction, we see that the economic crisis will become more and more severe, affecting more and more people, getting closer and closer to us. So it is not a question of changing the energy source, of polluting it less, of producing the product with less oil... Either we change the values that sustain society, or we will have it very difficult. Will the ecological collapse come? Will the hungry in the world come and eat us? Who knows, but our society will increasingly become a more controlled and rigid society, with a middle class without direction. We are the first generation that can’t make sure that on an economic level our children live better than we do.

I'm talking about A. Assisted by Pérez de Calleja. I'd say we can make sure our kids live worse than we do. Because we lived very well. In any case, the text you have read seems to me very biased and Pharisee, because Miren Etxezarreta is an official and if there is a sector that has not suffered at all with the crisis, that is public officials [the round table we held before the Spanish government decided to reduce the salary to officials].

I'm talking about L. Assisted by Tabar. Not even the rich. The income of the rich has increased by 29% in 2009. In the Trapero de Emaus in Navarra we see who has been affected by the crisis, since the society throws it away because we live, since the Navarrese society throws it away, and the amount of products they have brought us has remained. What’s more, in July last year we received 10,000 TVs, most of them in perfect condition, because the Government of Navarre subsidized the purchase of plasma TV for 60 euros. Instead of saving, we’ve seen the opposite, with TV being a “vital commodity”! Putting DTT on these old TVs was enough to keep them running, but plasma TV has been promoted by the Government of Navarre, a social policy unparalleled at all.

So, what seems to be really there to change the consumption pattern is a change of values and mentality. Are people willing to change that mindset?

I'm talking about A. It's about Eizagirre. According to opinion polls, environmental protection is a positive and desirable value. People say that environmental disaster is a serious problem. But opinion polls carry a methodological risk, because society itself accepts what people consider to be a good and desirable answer, and the question also determines the answer. Without denying the social value that the environment deserves, we could hardly say that a cultural change is taking place. In fact, a conception, an attitude, means a hierarchy of values, that some ideas take precedence over others, and in this sense the pattern of preferences has been maintained. Even an insidious reading is gaining strength. According to this, everything could be compatible, we want to believe that the economy and the environment are not only complementary but also interdependent. These ambiguities, which I have already said, could be seen tenderly in social opinions about behaviour and actions. One thing is to ask your opinion about environmental damage, and another is to ask what you do for the environment. And indeed, more rigorous opinion polls show that there is a clear contradiction between behaviors and actions. In recent decades, there has been no cultural change, no change in the hierarchy of values.

I'm talking about A. Assisted by Pérez de Calleja. I believe that changes must be imposed from the outside because they do not develop from the inside. In the case of the environment, the impulse for renewable energies has come from the outside, not from the will.

I'm talking about A. It's about Eizagirre. Going back to the polls, when people are ready to develop actions in favor of the environment, it is usually passive. For example, recycling, reducing water consumption and saving energy. We must also remember that there are often incentives for this. But this does not happen with more active actions that force us to change consumption habits.

I'm talking about A. Assisted by Pérez de Calleja. Oh, yeah, yeah. The consumer index, which measures consumer confidence, has improved for six to seven months, but consumption has not increased. The behavior has changed, but the action has not. To what extent are we willing to sacrifice wages to support employment? In Germany, it would be normal for the company’s people not to be thrown out if the working group is prepared to lower their wages, something that has never been done here.

I'm talking about L. Assisted by Tabar. In a Navarrese company that submitted its Employment Regulation File, the workers decided to lower their wages so as not to throw people out, although the company did not accept it and the Government of Navarre finally accepted the EEC proposed by the company.

I'm talking about A. Assisted by Pérez de Calleja. This is very rare; in 2009, with the highest unemployment rate in history, wages increased by more than 4%. People are willing to change, but it doesn’t cost them anything.

I'm talking about L. Assisted by Tabar. But for example, public education unions managed to get teachers to collect 80% of their salary in five years, taking the fifth year as a sabbatical. At first very few people signed up and today there are quite a few more applications. I think there are a number of people who can be counted on, who would be willing to cut their salary in return for time.

And yet, many of you sold the old one to buy plasma TV. Do we have hyperconsumerism in us?

I'm talking about A. Assisted by Pérez de Calleja. We have a theme there for another full round table: advertising. Advertising is the main element of socialization in society and there is no defense against it. If at Christmas the plasma TV becomes the star gift, that will be the most bought, and if it is the Play Station, so much more. Advertising takes everything first. It is with the children that we see very clearly, with the most vulnerable sector of society, how they constantly ask for things. Man has an inherent passion for appropriating things, he always wants to have things and then he is entirely in the hands of propaganda that offers happiness instead of things.

I'm talking about L. Assisted by Tabar. What is the name of a society like ours that allows people to be manipulated in this way, starting with children? A curiosity: many years ago, a former colleague tried to get Pepsi-Cola to participate in a campaign for the Basque language. We worked in teaching for adults, and Pepsi-Cola replied that if it had been with children, they do advertising designed for children under 7 years old, because for that age the child has already decided whether he prefers Pepsi-Cola or Coca-Cola. Do you really think that it is normal for a society to accept this? And we have to add credit to advertising, because credit allows us to spend more than we have, and it also takes advantage of the weaker ones, who have the least control over themselves.

I'm talking about A. Assisted by Pérez de Calleja. A bank friend is amazed at how people come to ask him for credit to go on holiday to Seychelles, probably because some friend has gone to the Maldives before. We cannot forget that there was a system called socialism, based on positive beliefs: solidarity, individual sacrifice for the benefit of society, and so on. Well, he suffered a terrible defeat for a capitalism based on pessimistic values: greed, usury, possession... If we read the Bible and the history of humanity, the basis has always been much desire, greed, appearances, possession of things. Capitalism has not invented, exploited or used anything.

So is it inherent in the human being’s desire to take ownership of things, or do we rely on advertising?

I'm talking about A. Assisted by Pérez de Calleja. I think we're wearing it inside.

I'm talking about L. Assisted by Tabar. The few tribes that have stayed out of our consumer society don’t have that passion.

I'm talking about A. Assisted by Pérez de Calleja. Because, among other things, they don't have many

alternatives... Assisted by Tabar. It is said that some American evangelists went to a tribe and gave them machetes so they could cut down the trees. When they came back a while later, they asked: “How about machetes?”, “great, we cut ten times faster”, “then you’ll cut ten times faster...”, “no, we cut ten times faster and work ten times less”. The opposite is philosophy here.

I'm talking about A. Assisted by Pérez de Calleja. But they didn’t work ten times more because they couldn’t exchange what they were going to get for anything. Productivity growth made no sense in this case. Here, however, people will spend extra hours paying for their weight, and the car, and the holidays... I know entrepreneurs who encourage skilled workers to buy a house or get married to link to the company.

I'm talking about L. Assisted by Tabar. We're getting into very psychological approaches. I believe that people are dual: we are selfish and supportive, petty and altruistic, close to defending what is ours and willing to sacrifice for something else. But when all the stimuli of social actions reinforce this side of negative values over and over again, you either find other frameworks and other stimuli to reinforce optimistic stimuli, or you will follow this path. Because we don’t act the same in family and friends, relationships are different. The system, on the other hand, marks a pessimistic path and we often take this unconsciously because it seems to us that this is the natural thing to do. What would happen if the stimuli strengthened the other side?

I'm talking about A. It's about Eizagirre. But, what do the ads stimulate? The negative values? The announcements are unfinished frames, they stimulate change, autonomy, all human abilities that are pending in the future. Marxist analysis would say that we are alienated by advertisements, but I believe that the virtue of advertisements is precisely that they stimulate us to change, the possibility of achieving from our autonomy what advertisements do not completely close. Why buy one car and not the other? What motivates us? Not the features of the preschool car.

I'm talking about A. Assisted by Pérez de Calleja. The advertising sells freedom, status, happiness... so you can buy an artifact that consumes a piece of iron of 1,500 kilos and a lot of gasoline. The best social psychologists work in advertising.

I'm talking about L. Assisted by Tabar. We end up associating these desires with consumption.

I'm talking about A. Assisted by Pérez de Calleja. Psychologists have found that buying produces endorphins. There's a disease, people who buy things they don't need.

I'm talking about L. Assisted by Tabar. I think buying what you don't need is not just a disease. We receive a lot of second-hand clothes, and quite a few of them still have the label. I mean, they're unused.

I'm talking about A. It's about Eizagirre. A passion that is self-consuming. Our problem is not to not get what we want, but to get what we want, because we quickly realize that what we consume does not satisfy our desires. The virtues that are exalted are not the usefulness and possessiveness of an object, the values that influence it on a more subjective level are the ones that penetrate us, and in this divorce there is the happiness of desire and the discontent of achievement. It is curious, on the other hand, to see the importance of the market of affliction. And remember, these are also the engines of economic growth.

I'm talking about A. Assisted by Pérez de Calleja. After all, we are a being that responds to external stimuli.

I'm talking about L. Assisted by Tabar. Beyond external stimuli, you can make an effort to know yourself and create social spaces with a more reasonable level of consumption, to realize that this possibility is better in practice, because you get other elements that deserve it: social relations, free time, quality of life... They will make you happier than consumption.

I'm talking about A. Assisted by Pérez de Calleja. This debate took place in the 1960s and 1970s. Living with two hours of work a day, for example, and many people in the U.S. only worked for a month or two a year. But the weight of what is politically correct is so great that acting outside of it makes you a marginal person and people don’t like being marginal. Want to work two hours a day? No one forces you to the opposite, but there are many factors at play. We should evolve towards less needs, but it has been the other way around, we have more and more needs. The reduction of schedules was done 40 years ago (40 hours a week), and since then it has not been reduced any more, we have not advanced anything!

In conclusion, you pointed out that consumers depend on advertising. But also, if companies and the economy are targeting the consumer, what real power does the consumer have, to what extent do they depend on the consumer?

I'm talking about L. Assisted by Tabar. Call a person a “consumer” afterwards! Knowing what we are talking about when we talk about the consumer, the consumer person, is already serious. The consumer, individually, has no power. At best, if it has a level of consciousness, it will test the ins and outs of the system to limit the influence of this model, but it only has no power over what is produced, how it is produced, for what, at what cost... It is another thing as a person, and as a social person, if it proposes a different way of life, considering consumption within it. This is where an opportunity opens, on the one hand, to learn to live better and, on the other, to influence society and try to change reality. But not as a consumer.