Dick has been a thought leader in the financial planning world for twenty-five years, including a stint as President of the Institute of Certified Financial Planners.  He is currently the editor of insidemoney.org, an online journal that addresses our personal and collective relationships with money.  Dick is also a regular columnist for Financial Advisor Magazine, and writes articles about money and what he terms “money forces” for various other publications.

He is something of an agent provocateur within the financial planning profession.  The conventional advice one gets from most financial planners is to save now for a comfortable retirement.  While this is undeniably good advice, it is based on an underlying assumption that money = security.  It evokes a paranoid mood, eg, “if you don’t save money now, you’ll be eating dog food in your old age”  The problem with the current financial meltdown is that you may have played by the rules, saved for a rainy day, and now your securities aren’t worth what you thought they were – so where’s the security? Money is not security. Money is one metric, along with happiness, health, and safety, in a larger idea of what “wealth” is.

So what does money have to do with sustainability?

When I was in school, we were presented with this concept of the “time value of money” as if it were an objective law of nature, equivalent to the law of gravity – ie decreed by God at the dawn of creation.  But money is actually a human invention.  And a very clever one at that.

Dick points out many positive, evolutionary aspects of money.  Money enables us to feed a high percentage of the 6.5 Billion people on the planet – not enough, to be sure, but astounding when you think about it. We have laws and rules about money that enable enemies to do business with each other.  Cross border ownership of resources, denominated with money, reduces the motivation for war.

So here’s the connection with sustainability:  Our debt-based money system inherently requires expansion and growth. Capital seeks the highest rate of return, at an acceptable level of risk.  That return derives from expansion of production and consumption. Economically, it’s a problem if we stay the same.  If we don’t get bigger all the time, we lose ground.

And, one of the results of our economic progress is that we actually become isolated from each other.  The elderly pay money to reside in an assisted living home.  Parents pay a third party to provide “child care” while they work, to earn money.

So debt has enabled a huge material benefit to many humans.  And, taken too far, it becomes an addiction. Financiers develop ever more sophisticated instruments to manage risk and squeeze out more returns – and sometimes it crashes, like recently.

I keep coming back to this theme about addiction – as a culture we are addicted to debt, to cheap oil, to novelty.  There’s a lot of good stuff there, but we have become immoderate, like a glutton who just can’t stop eating.

So how do we create an economic and monetary system that doesn’t demand endless increases in consumption?

I wish somebody would tell us the answer to that question right now.  But, just realizing that we created this system is a tremendous step in the right direction.  If we made it up, we can change it.

Here’s the interview: