business climate change sustainability wealth

Is the whole of civilization a pyramid scheme?

Bernard Madoff will wake up in jail tomorrow morning instead of his Manhattan penthouse. At 70 years of age, he is likely to serve a mere fraction of what could be a 150 year prison sentence, for what has been described as the biggest fraud in history. Over the past decade, Madoff scammed investors, funds, and charities out of $65 billion if an elaborate ‘Ponzi’, or pyramid sheme.

A pyramid scheme is a fraudulent investment plan that delivers high short-term gains by paying back investors with other investor’s money, rather than profits. As long people keep joining the scheme, their contributions pay the people before them. Since no profits are actually being generated, it crashes as soon as investor recruitment slows down, and the perpetrators disappear with the capital.

While it is easy to see Madoff as a rogue and dismiss such schemes as a criminal interest, climate writer Joe Romm suggests that our whole way of life has all the characteristics of a pyramid scheme.

“We created a way of raising standards of living that we can’t possibly pass on to our children” he told Thomas L Friedman in the New York Times. “We have been getting rich by depleting all our natural stocks – water, hydrocarbons, forests, rivers, fish and arable land – and not by generating renewable flows.”

Our consumer lifestyle relies on unsustainable use of resources and cannot continue indefinitely. Just like a pyramid scheme, those arriving last will find there is nothing there. In this case, those will be our children, who may inherit a world devastated by climate change and plundered of its resources. ” Every generation that comes after the Baby Boomers are poised to experience the dramatic changes in lifestyle that inevitably follow the collapse of any Ponzi scheme.”

Read Romm’s insightful article here at Climate Progress.

Add to FacebookAdd to DiggAdd to Del.icio.usAdd to StumbleuponAdd to RedditAdd to BlinklistAdd to Ma.gnoliaAdd to TechnoratiAdd to FurlAdd to Newsvine

One comment

  1. Jeremy, you hit the nail on the head, as they say. The current growth of our economy and way of life is a pyramid scheme. It will likely be our generation or the next that comes to the end of the rope.

    Keep up the good work!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: