After fleeing the genocide of Nazi Germany, social psychologist Erich Fromm immigrated to the United States, where he researched human behaviour within totalitarian regimes. This groundbreaking work led him to conclude that the system of production and consumption that emerged in the 1950s was not conducive to the healthy and productive mental wellbeing of society.
As Fromm argued in The Sane Society: “The fact that millions of people share the same vices does not make these vices virtues, the fact that they share so many errors does not make the errors to be truths, and the fact that millions of people share the same form of mental pathology does not make these people sane.”
Fast forward to the 21st century and plenty of evidence supports Fromm’s conclusions. Indeed, since the publication of his treatise on society in 1956, rates of depression—which currently account for about 90 per cent of suicide cases, according to the World Health Organization (WHO)—have increased by 1,500 per cent.
Prior to the COVID-19 outbreak, 500,000 Canadian workers were calling in sick every week due to mental health issues—which were costing our economy $20 billion annually (with $6 billion of this being directly shouldered by organizations through a lack of productivity). Globally, at least 3.85 billion people—half the world population—are expected to have their lives impacted by mental health issues, which currently contribute to the death of eight million people annually.
This crisis has more than one driver, but a major factor is clearly the hectic pace of modern society. Facing constant pressure to reach ever-increasing objectives, people across all walks of life have become dislocated from what is essential and meaningful to a happy life. As a result, many of them turn to various forms of escapism, ranging from drugs and alcohol abuse to conspicuous consumption. When addicted to acquiring stuff, consumers become anxious between fixes, fueling debt-financed consumption. As things stand, individual debts across North America are well above incomes, with total household debt approaching US$2 trillion in Canada and US$14 trillion in the United States. This unsustainable situation is often exacerbated by companies taking advantage of it by creating the presumption that consumerism dives contentment.
The happiness of consumers, of course, is not increasing with their debts. In addition to driving up the rate of individual bankruptcy filings, debt-financed consumption serves to increases stress at home and in the workplace, where performance is affected (see my 2016 research paper entitled “Cyclical Workplace Stress and Employee Pathology: A Conceptual Framework” in International Journal of Work Organisation and Emotion). This, in turn, fuels unhappiness, along with feelings of unworthiness and various other negative emotions, which lead to a need for more escapism. Individuals stuck in this vicious cycle are not slaves in the historical sense. They often live in large homes, drive nice cars, and take paid vacations. They have human rights, although troubling inequities exist in how these rights are protected. Technically speaking, they also have mobility. But without financial independence, many people lack the means to move and find themselves forced to work under extreme levels of stress, often performing tasks that they despise.
Evidence supporting Fromm’s conclusions can also be found in rising rates of depression among youth—which have increased by 70 per cent since the early 1990s. According to The American College Health Association, students were already overwhelmed by anxiety prior to the pandemic, with close to 60 per cent defining themselves as extremely sad.
In addition to increasing stress on families, this impacts the economy. In a recent study, nearly 80 per cent of parents reported their work being greatly affected by a child’s mental health, which reportedly results in a $421 million decline in productivity per annum while impacting the personal finances of 71 per cent of parents surveyed.
As things stand, our system of production and consumption clearly threatens the long-term wellbeing of individuals and corporations alike, not to mention the survival of numerous species and the planet itself. Meanwhile, the ability of governments to cope with the issues created by debt-fueled consumption have declined as national debts also soar.
In the 1970s, central banks removed the gold standard from their currency, which provided them with additional monetary flexibility during economic downturns. But while this flexibility proved useful in overcoming past economic challenges, it had already driven public debt to unsustainable levels before COVID-19 moved governments and central banks around the world to unleash unprecedented amounts of stimulus spending.
With the pandemic driving expectations of major change, we have an opportunity to deploy some big-picture thinking to instill more sanity into our consumption society. This article proposes ways to address some of our common vices and historical missteps, aiming to improve mental health and enable the pursuit of sustainable happiness through reforms to how we educate our children, manage the business cycle, support entrepreneurs, and provide healthcare.
Although governments rely on consumer spending to support economic growth, they have invested in attempts to address the growth of consumer debt by implementing financial literacy programs through the Canadian education system. In these programs, children learn how to plan for retirement through three steps: (1) picking a career, (2) forecasting their retirement age, and (3) estimating their year of death. But this approach is problematic, and not just because it is too abstract to work on children, who have never worked or lived as an adult.
Perhaps most concerning is the fact that our financial literacy programs fail to teach future generations how to be content in the present. By stressing the life-long need to pinch pennies for the future, these programs normalize the idea of living in a constant state of lack, which conditions our children to feel they never have enough.
Children are not responsible for our flawed system, which they are trained to accept by an outdated educational system that was used as a model for residential schools. The last of the residential schools—mandated by the government to assimilate Indigenous children into Western European and British Canadian culture—closed in 1996. But the system that spawned them remains relatively unchanged, wedded to a flawed 20th-century paradigm that forces children to sit quietly for long periods. Those incapable of doing this are often sedated after being misdiagnosed with mental illnesses, such as ADHD, while others who have difficulty conforming have been known to be verbally abused and told they will “never amount to anything” because they are “stupid” or “lazy.”
“Through improved mental health training, we can help individuals develop coping strategies that enable them to face adversity throughout life without turning to harmful escapist addictions.”
Education should fight the mental health crisis, not compound it. In other words, it is time to review the whole public-school system through the lens of the Truth and Reconciliation Commission’s mandate. And one of the main objectives should be an increased focus on mental health training.
Using regular consciousness practices, like yoga and meditation, individuals can achieve a profound state of relaxation that simultaneously alleviates deep-rooted stresses, trauma, and anxiety. Through improved mental health training, we can help individuals develop coping strategies that enable them to face adversity throughout life without turning to harmful escapist addictions.
As we rethink education, we should also consider the long-term implications of how we currently navigate economic downturns. Just because the current approach of stimulus spending has been used for decades doesn’t mean that it is the most appropriate method going forward.
There is no obvious alternative without real reforms. One way to go would be to attack the short-term corporate thinking that drives the need for bailouts. Another option would be to allow the market to correct itself, naturally, without the expectation of government intervention, as this does not allow businesses to be responsible for their own actions. Whatever the solution, the time to think openly and critically about our economic model in comparison to other models, both known and unknown, was upon us prior to the pandemic, so we should use expectations of major change set by COVID-19 to our advantage before a system collapse is thrust upon us.
Being an entrepreneur in this country was highly stressful before the pandemic. Not only are there significant challenges around raising capital, the corporate tax rate in Canada acts as a deterrent to growth (see the 2018 IBJ article “Fighting Canada’s Entrepreneurial Complacency”). With a failure rate of nearly 90 per cent, entrepreneurs are 50 per cent more likely to suffer from a mental health condition, two times more likely to suffer from depression, six times more likely to suffer from ADHD, three times more likely to suffer from substance abuse, two times more likely to have suicidal thoughts, ten times more likely to suffer from bipolar disorder, and two times more likely to require psychiatric hospitalization.
Given the added stress that entrepreneurs are experiencing today, it is clearly time for Canada to better support them. Following the policy flexibility of other G20 nations, the entire corporate tax system needs to be fully restructured to reduce the entrepreneurial failure rate.
In China, start-ups do not pay income tax for the first five years. In the sixth year, they pay 25 per cent. A similar policy would not only incentivize our existing labour force to start more businesses, but would also keep more businesses sustainable. Furthermore, it could help reverse our existing brain-drain issue and instead drive global migration of talent to Canada—similar to the one experienced in the United States post-WWII.
Part of the reason for the mass quarantine and cancelling of essential surgeries during the pandemic stems from the fact that Canadian hospitals were already operating at 100 per cent capacity when the virus outbreak threatened to dramatically drive up demand in a very short period of time.
It is no secret that hospital capacity has not kept up with population growth as our aging society screams out for reforms. We have all heard the horror stories of people waiting over 12 months to see specialists, and six months for MRIs. In extreme cases, people waiting to receive specialist care have needlessly died as a result of this mismanagement.
The WHO recognizes denial of healthcare as a human rights violation. But even if a citizen has the money to pay for faster, private care, they cannot get it in this country. They have to travel abroad. With healthcare costs (approximately $141 billion in 2015) soaring along with government debt, it is time to re-visit the decades-old debate around establishing a hybrid (or two-tiered) healthcare model in Canada. This works in Germany, where a hybrid model provides private healthcare for those that work and have insurance and public universal healthcare for those who do not. This delivers improved service through a better functioning system, along with significantly reduced wait times, and a reduced tax burden on citizens.
The need for society to change has been debated for quite some time with limited direction or action taking place. At the very least, with the wellbeing and survival of numerous species and the planet at stake, it is safe to say that making our consumer society less susceptible to its vices isn’t an insane move to make.
E. Fromm, The Sane Society (New York: Holt Paperbacks, 1955).
J. S. Overall (forthcoming), “The Working Class: An Entire Class of People Left Behind,” International Journal of Business & Globalization. Accepted for publication and in press.
J. S. Overall, “Fighting Canada’s Entrepreneurial Complacency,” Ivey Business Journal, 2018, https://iveybusinessjournal.mydev.ca/fighting-canadas-entrepreneurial-complacency.
J. S. Overall, “Cyclical Workplace Stress and Employee Pathology: A Conceptual Framework,” International Journal of Work Organisation and Emotion 7, no. 2 (2016): 98–103.