Thursday, September 13, 2012

Your Culture or Your Money

When students were asked, "How has your community changed over the last 10 years?", students came up with the following list:

Photo: Class brainstorm on shifting culture in their communities.

This exchange framed a class discussion around the definition of an 'asset'.  Robert Kiyosaki, author of the Rich Dad Poor Dad series of books, has said that the difference between the rich & poor is that the poor spend their lives buying assets which are really liabilities because they do not understand the difference, while the rich spend their lives acquiring things which are truly assets.

This is certainly true for the middle class in developing nations.  For example, if your income were to stop, most people would not be able to continue making they mortgage payments (and so would likely lose the house), whilst a positively cash flowing rental unit would keep putting money into your pocket. 

Therefore your primary residence, which the bank tells you is your greatest asset, is actually potentially your biggest liability.

According to Kiyosaki, properly defined: an asset feeds you, a liability eats you.

This simple definition of assets vs. liabilities can be a powerful tool for the consumerist middle class single-mindedly striving towards accumulating enough income and assets to elevate their standards of living, and could also be a powerful tool in helping families, organizations and communities manage their finances better.

However, it is too narrow a definition to be useful in the context of working towards ending poverty.

This definition of assets is framed by and perpetuates the prevailing capitalistic view of the world - one in which gross income (or GDP) is the primary indicator of a person's (or country's) overall well-being, and people are reduced to hedonistic accumulators & consumer.  It does not allow for any other paradigm.

If we limit ourselves to this definition then we deny ourselves the opportunity to account for the many other factors which contribute to healthy, thriving communities.  We deny ourselves the opportunity fully embrace the richness of reciprocal experience that is human culture, where people flourish most when given opportunities to create, contribute, collaborate, and celebrate.

Photo: Ifira Island keiki.  Are we born into this world focused on 'accumulation' and 'consumption'?

Instead, we can take this a step further and expand upon this definition to allow room for culture to evolve (adapted from Rosemary Morrow's 'Earth User's Guide to Permaculture'):


Photo: Reclassify your assets.


Degenerative Assets.
The more I use these, the less I have of it / the more I need of it.  Worse yet, the more I use this, the more it harms me / my community / my ennvironment.  Most items ('stuff') prized by consumerist culture falls into this category.

Generative Assets.
I can use these to make / create / modify / enhance me / my community / my environment.  Some of the things which fall into the first category could instead become 'generative' if used differently (ie using fossil-fuel powered equipment to create earthworks which pasively harvest water and rebuld soils).

Regenerative Assets.
I can use these, and they will multiply over time if properly cared for.  Biological resources, and many of our natural resources fall into this category.  If we were to focus on creating / developing / accumulating this type of asset, we take care of future generations while taking care of our own needs.

Knowledge-based Assets.
Ethical knowledge leading to self-reliance is the only asset class which can offer an unlimited yield; we are limited only by our creativity, our imagination, and our ability to apply knowledge.  When knowledge is framed by an ethical structure which values care of the earth, care of people,and stewardship of resources, it can result in actions & practices which are beneficial to all.



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