Eat, Drink and Be Miserable: The True Cost of Our Addiction to Shopping

There's a pamphlet scudding around my kitchen; it has accumulated coffee rings and fingerprints, but I keep rescuing it from the recycling bin with the good intention of signing up to a green tariff on electricity again. (I can't quite understand why the deal I signed up to years ago ever ended.) A good intention that has a 50-50 chance of fulfilment.

According to all the research, there are a lot of people like me: full of good intentions, deeply concerned about climate change and yet ineffective at translating that into their behaviour. Why? A mixture of information overload, time poverty (a much overlooked aspect of environmental sustainability is how much time it requires) and utter confusion about what "doing one's bit" entails. Plus the killer equation: what sacrifices is one prepared to tolerate when they are pathetically insignificant compared with Chinese power stations going up at the rate of two a week?

Is it enough to have halved family meat consumption, have foregone flights for several sun-starved years and arranged a life in which habits of cycling to work and walking to school are routine? No, it's just scratching at the surface. If the developed world is to implement the 80% cuts in carbon emissions the UN demands as part of the talks beginning in Bali today, the lives of our children will have to be dramatically different from everything we are currently bringing them up to expect.

In 2006, each person in the UK produced 9.6 tonnes of C02, and that needs to come down to less than three tonnes by 2050. That is the non-negotiable on which there is widespread consensus among environmental scientists and economists. The much more controversial issue is whether that means consuming less or just consuming differently. In other words, does sustainability require an entire recasting of the good life, or can we continue on our way, our aspirations to comfortable homes, nice cars and fancy holidays unchecked, delivered by green techno-wizardry?

Government environmental policy is entirely built around the latter. But the problem is that there is no evidence that techno-wizardry can deliver the cuts in carbon emissions needed. In the past increased energy efficiency has only driven up aspirations: "If my fridge is more energy efficient and thus cheaper to run, perhaps I'll now buy that air conditioning unit for these new hot summers." Technological innovation is an important part of the solution, but it won't be enough. Wizardry it is rightly nicknamed: there is an irrational faith at the heart of government thinking.

But the alternative of lower consumption is something no politician is prepared to consider. In one policy discussion on the subject, Treasury officials responded with contempt, and referred to it as tantamount to "going back to living in caves". We have a political system built on economic growth as measured by gross domestic product, and that is driven by ever-rising consumer spending. Economic growth is needed to service public debt and pay for the welfare state. If people stopped shopping, the economy would ultimately collapse. No wonder, then, that one of the politicians' tasks after a terrorist outrage is to reassure the public and urge them to keep shopping (as both George Bush and Ken Livingstone did). Advertising and marketing, huge sectors of the economy, are entirely devoted to ensuring that we keep shopping and that our children follow in our footsteps.

But there is a madness at the heart of this economic model with its terrible environmental costs. It's best illustrated by a graph used by the US psychologist Tim Kasser at a Whitehall seminar last week. One line, representing personal income, has soared over the past 40 years; the other line marks those who describe themselves as "very happy", and has remained the same. The gap between the two yawns ever wider. All this consumption is not necessary to our happiness.

Kasser's graph has both hopeful and disturbing implications. On the hopeful side, this is good news: a low-consumption economy wouldn't mean misery. But what's disturbing is how we continue to shop when it doesn't make us happier. He argues that our hyperconsumerism is a response to insecurity, a maladaptive type of coping mechanism. Over the past few decades, the sources of insecurity have multiplied: in addition to the manipulation long practised by advertising, there are new sources of insecurity in highly competitive market economies, ranging from identity (who am I and where do I belong?) to basics (who will look after me in my old age?). This relationship between materialism and insecurity helps explain why countries as diverse as the US and China are deeply materialistic; they are places of endemic insecurity.

The brilliance of this economic system built on insecurity is that it is self-reinforcing. The more insecure you are, the more materialistic; the more materialistic, the more insecure. As Kasser has shown, materialistic values (which are on the increase among teenagers on both sides of the Atlantic) make you more anxious, more vulnerable to depression and less cooperative. Studies show that people know what the real sources of lasting human fulfilment are - good relationships, self-acceptance, community feeling - but they face a formidable alliance of political and economic interests that have a vested interest in distracting them from that insight to ensure they work longer hours and spend more money.

The task of turning this around is enormous, and the transition to a low-consumption economy has to be carefully managed to ensure a soft landing. The greatest dilemma is that the shift could produce a damaging feedback loop - this is Kasser's anxiety. Lower consumption could lead to economic instability and increased insecurity; plus climate change makes people insecure. The response might be to reinforce our current frantic hyperconsumerism: an attitude of "eat, drink and be merry, for tomorrow we die"; or a lunge after as much as possible to insulate yourself against the impacts of climate change.

But equally possible is a win-win scenario; a low-consumption economy oriented towards facilitating the real sources of human fulfilment. Most of us dimly recognise that huge lifestyle changes are necessary, but we're waiting for someone else to initiate the process. It's a question of "I will if you will" - the title of a thoughtful report last year from the government's Sustainable Development Commission.

Hearteningly, we know it can be done - our parents and grandparents managed it in the second world war. This useful analogy, explored by Andrew Simms in his book Ecological Debt, demonstrates the critical role of government. In the early 1940s, a dramatic drop in household consumption was achieved - not by relying on the good intentions of individuals (and their ability to act on that coffee-stained pamphlet), but by the government orchestrating a massive propaganda exercise combined with a rationing system and a luxury tax. This will be the stuff of 21st-century politics - something that, right now, all the main political parties are much too scared to admit.