The Myth of Scarcity

[Image description: fresh yummy cupcake in its baking paper]

McDonalds made $6 billion in profits in 2018 and paid its CEO $22 million, yet some people still say it can’t afford to pay all its employees a living wage of $15 an hour.

The Myth of Scarcity is the biggest problem of human history. At the heart of the myth is the idea of debt. The idea is much more complex idea than the four little letters suggest. David Graeber wrote one of the five best books of human history to explain the debt idea.

The myth leads to war, poverty and economic policies made for the rich. This myth is the first thing that most economic textbooks teach about the functioning of markets. It’s the first thing many people, even those with good will, bring up when government expenditure is discussed. In an astounding reversal of his whole economic belief system Alan Greenspan, the former  Chair of the United States Federal Reserve Board, admitted this. If he can admit it, we can all admit it.

The Myth of Scarcity is the belief that there is not enough food or money or resources for everyone to share. It’s a powerful myth because it taps into deep fears in some human brains. It’s a belief so strong that many people accept it as fact. It’s so powerful that it can make people vote against their own interests. Other people know it’s false; but they use the Myth to get rich or push their own political or warlike agendas.

The Myth of Scarcity surrounds us – we can’t afford better wages because businesses will go bust, we can’t afford to pay teachers more because the government doesn’t have enough money, we can’t afford the best medical care, because because because. The Myth of Scarcity is a great example of the logical error of the false dichotomy.

The fact is that we live in an incredibly rich world. Even in “famine” there is usually plenty to share. The so-called Irish Potato Famine from my own family history is an example. 1% of people control 46% of world wealth and about $18.5 trillion of this is in tax havens.

Many of us know this sort of stuff, but it’s still easy to fall for the Myth of Scarcity because our brains are wired to worry about scarcity.

If you’re interested to know how I came to understand the power of the Myth of Scarcity, here’s my story.

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