How Accountants Can Save the World: Implementing the Genius Concept of Happy Money

Read this blog to discover the cutting-edge, clear, clean concepts that generate a new economic model for the world, and to find out what you can do immediately to apply these concepts to help yourself and the world through your finances. If you are an accountant, you will discover the unique, critical and immediate contribution you must make to be the hero of our times.

Most of us want to do better for the world. But how much better? We need to know, and with a few exceptions, we don't. We don't know whether we should buy a Prius, grind fair-trade coffee, turn off lights, recycle, or run for the hills. We are bombarded with factoids like "Americans throw away 100 billion plastic bags a year" and "It takes the equivalent of ten acres of forest ten years to soak up the greenhouse gasses used in one flight from Des Moines to Seattle" and "Half of all tax dollars world-wide are used to fight wars". We, consumers, are the whipping boys of the do-good industry. Depending on our politics, we've been taught to cringe or scoff, be in despair or denial, but whether we are panicked about big polluters or big government, all that feeling bad isn't going to translate in doing good unless we get down to real business.

The "real business" I'm talking about is accounting. Scorekeeping. You already know that today's way of keeping score in business is to maximize dollars coming in, and minimize dollars going out. The difference is called profit. I would put the concept of monetary profit above the invention of the wheel as the one innovation that has brought the most positive development to humanity. But "profit" has become a dirty word because it is tainted with what we call "greed".

It's time for much more precise definitions of "profit" and "greed", because the mushiness around these terms is literally killing us. We can make this very simple by introducing a genius concept called "Happy Money". Ken Wilber, the famous synthesist philosopher, defined genius as stating a new idea in a way that makes it seem obvious. The genius behind "Happy Money" is my partner in co-creating the next evolution of humanity, Amber Lupton. Amber defines Happy Money as "earning, spending and investing your money in a way that makes everyone happy." I could, and probably will, write a book unfolding the genius of this statement; as Pollyanna-ish as it might seem at first blush, Amber's expression is not only a genius-level distilled communication of a new meme that is a linchpin of humanity's evolution, it also holds up under deep examination in the light of what we currently know about economics, human nature and current affairs. "Happy Money" is no less than the definitive synthesis of the previously competing notions of "doing well" and "doing good." Let's look at Happy Money for a moment in the language of economics.

Garett Hardin (1915-2003), leading ecologist, coined a phrase in 1968 called "the tragedy of the commons". When there is a resource that belongs to nobody, then it becomes both over-used and neglected. Professor Hardin gave the example of a large number of shepherds who share common grazing land, then all the shepherds have an incentive to graze their cows, but no incentive to maintain the land as fertile, since their efforts would only go to benefit all the other shepherds. The land becomes over-grazed and unproductive. The "tragedy of the commons" is one example of what economists call "an externality". An externality is any cost that is imposed by some people, but paid by others. For example an oil company that causes environmental damage, imposing a cost on local inhabitants, but not paying that cost, is benefitting from an externality through not bearing the cost of the environmental damage. Ecuador is currently suing Chevron for exactly this reason. Externalities are unfair, and they often result in big lawsuits.

"Happy Money" is living our financial lives without externalities. We earn our money with imposing costs on others; we spend our money without paying prices artificially lowered by externalities, and we invest our money in ventures that make returns without imposing unfair externalized costs. We pay taxes to our governments without financing suffering. The spirit of Happy Money goes beyond not doing harm, to earning, spending and investing our money in ways that benefit all of humanity. Happy Money puts the burden of responsibility for external costs where it properly belongs: with individuals. Each of us is responsible for all of our financial decisions-earning, spending, investing-and we are responsible as individuals for the financial decisions we participate in, whether in government or corporations.

Using the Happy Money model, we have crisp, useful definitions of "profit" and "greed". "Profit" is earning Happy Money-even earning a whole lot of Happy Money. In fact, the more Happy Money we earn with our jobs or companies, the better off everyone is. "Greed" is Sad Money-imposing costs on others as a consequence of our profit, our spending or our investing.

So far, so idealistic. Here is where the rubber meets the road: even though externalities of war, pollution, corruption and violations of human rights continue to pile misery upon misery, and threaten the extinction of our species, yet we have no way to systematically measure and account for the externalized costs of how we live our lives. We have no consistent way of knowing whether our money is happier if we buy BP gasoline or if we take a job with Starbucks or buy Google stock. Yes, there are already well-developed efforts for socially responsible investing, for green living, for fair trade goods, organic foods. We need these efforts, and at the same time they are taking place inside of our system of economics that has become dysfunctional and threatens our existence due to un-accounted externalities.

So, I call on the accountants to save us. Help us change the game. The most powerful way to change a game is to change the way we keep score-and you intrepid men and women of the accounting profession are the scorekeepers. You count it all up, balance it out, and tell us whether we've been winning or losing. Well, it turns out you have been failing-you have not kept accurate score, and we are all suffering.We are all losing.

I call on your profession to create a system of measuring, tabulating and predicting externalized costs throughout the supply chain, government, and consumer goods. Do it first for industries, broad measures, then for companies, then for products, for individuals. Keep drilling down, create systems of measurement that are more accurate than what we have today. Create new "shadow currencies" and "shadow books" of ecological value, of human happiness, or of governmental competence. Create new Happy Money reports for every area of business and spending. Create supply chain Happy Money accounting, so that a company can know how Happy its suppliers are.

Make it your business to help every human know exactly how Happy their Money is, and how to make it Happier. This won't be easy-there are a thousand challenges. But if you don't do it, we are all lost-we don't know what the real score is. We can figure this out! We don't need to try to make anyone do anything-all we need is a new way of keeping score.

Imagine a world in which Happy Money is coming into being: people debate and nit-pick over standards of Happy Money externalized cost accounting. Companies feel unfairly victimized as their industries are revealed and reviled as villains of making Sad Money. Consumers become deeply empowered, and whole systems of reporting on Happy Money arise.  Spending habits change quickly. Countries complain about being targeted, or they get on board with national Happy Money programs. Regulations, natural resources, industries, corporations, indivuduals, entertainment, professions-all are newly measured based on their accountable contribution.

Here's what you can do right now, whether you are an accountant or not:

1. Look at how you earn money. Are you hurting people? Are you damaging the environment? You know if you are, if your company or industry does. Look to see if the people who criticize your industry, company or profession are right or wrong. Right now, write down three things you could do to increase the Happiness of your earned Money.
2. Look at how you spend money. Are you hurting people? Are you hurting yourself by spending money on things that don't make you happy? Are you supporting conflict, or environmental damage? This is what YOU care about-do you spend Happy Money or Sad Money?
   Right now, write down three things you could do to increase the Happiness of your spending Money. How could you spend money such that every time you did it, you knew you were helping people?
3. Look at how you invest, or how you are in debt. Are you paying interest to a Happy Company? Are you supporting positive activities in the world? Or are you stuck in the old way of blindly maximizing "profits" that may or may not be actual profits?
   Right now, write down three things you could do to increase the Happiness of your investment or debt Money.

Look at the nine things you wrote down. Pick your top three, that you feel most inspired by, that are most in alignment with your values. Now put the very next action in your to-do list or calendar. Great start! Post a blog here about what you discovered.