Can we be sensible?

There is a succint analysis of why the world is facing a financial crisis from Larry Elliott in The Guardian today. You can read it here:
http://www.guardian.co.uk/business/2008/nov/21/us-economy-recession

I posted the response below:

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What is the sensible response to an economic crisis caused by people being up to their eyes in debt?

One would think it would be for people to spend less and to sort out the finances. Get used to the idea of putting money aside for a rainy day, or, novel idea, actually saving for things before buying them.

And isn't that actually what the masses are doing? Seeing troubled times ahead, people are spending less, thinking of having a more frugal Christmas and putting money by in case they lose their jobs. Getting used to living within our means and valuing what is closer to us, taking local holidays instead of weekend breaks in Prague, etc. will also have positive repurcussions when it comes to the depletion of resources and the carbon-overloaded atmosphere.

Sensible steps, which could mark a shift in how people consume.

Except these are exactly the opposite of what is needed to preserve the global financial system. Our leaders are worried that people aren't taking on yet more debt, so trying to make it as attractive as possible. They are toying with the idea of tax cuts, but worried people may save the money instead of blowing it. Deflation is feared because people may wait before buying in the expectation that prices may fall further.

It is sensible behaviour that our leaders fear.

The question is, can the global financial system be re-engineered so it not only allows for sustainable living, but promotes it?

Or is it our duty to spend and consume more because the system cannot even stand us being satisfied? The economy has to grow year after year after year.

Again, maybe we should trust the masses to answer this question, by putting forward their proposals to the Simultaneous Policy campaign. The recent policy supplement was on the theme of avoiding financial and climate meltdown, which may be a good starting point if you want to get involved in telling our leaders what they need to do. See:
http://globaljusticeideas.blogspot.com/2008/10/avoiding-meltdown.html
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You can add to the sensible, planet-saving action from people, the switch from gas-guzzling SUVs. Ford's sales fell by 53.9% GM is rushing to get out an electric car. See:
http://www.guardian.co.uk/business/2008/nov/21/automotive-useconomy