Think about our global economic system. Who and what does it serve? It’s a human construct yet it has a life of its own and we are all but servants (or slaves) to the wants and needs of this system. Despite illusions that we make the decisions concerning the economy, there is little autonomy for most of us. We live in system that dehumanizes us all in the name of globalized profit. People, communities and even cultures are simply cast aside so that more profit can be realized by the few for whom the economic system is benefiting. We know that destruction of multiple ecological systems cannot be good in the short or the long term, yet, with almost evangelical fervor, we continue to support the economic system that does so. We are so entrenched in our beliefs that our standard of living is tied to this system that we remain transfixed as we consume and the economy generates more and more destruction in the name of profit.
I am not against profit. I am, however, against a system that will take us over the abyss just to maintain a way of living that most of us know does not inherently work for us. Until relatively recently you could not take a course in economics of the environment. The environment and the economy were mutually exclusive topics. Academia loves its reductionist approach to life in general. The relatively new topic of environmental science (1960s) came about as a new interdisciplinary way of looking at the world and its myriad variables that interact in extremely complex ways to allow life to succeed. Economics, however, is about how money moves in a system with many of the variables removed because they are inconvenient to have to consider. We usually refer to these as externalities – that is external to the system being studied. Try thinking of the environment without considering the flow of energy, minerals, and nutrients, only whether plants grow or not, and then quantify that as the primary variable of study. I have covered economics within the blog several times (e.g., see posts of October 2019, and January 2020). I doubt many would argue against the need for a new type of economics that connects and serves us instead of separating us and creating hardships and ego-gratification. But, what could this new economic system look like?
Well, for starters, economics would merely be a tool to provide for everyone’s basic needs. Abundance is really an option for everyone providing we stop consuming, hoarding, and disregarding others as we currently do, which are all symptoms of fear of not having enough. We must stop thinking of economics as simply finance, GDP, and market economy, and instead include all the externalities as inherently connected aspects of the system. Great modern economic thinkers like Herman Daly, Robert G. Chambers, John Ikert, and Robert Costanza, have all postulated new economic mechanisms that encompass the environment or the broader ecological systems (Environmental Economics and Ecological Economics). Kate Raworth talks about ‘doughnut economics’, which she understands as an economic model that balances between essential human needs and planetary boundaries – “two concentric rings, the outer symbolizing the world’s ecological ceiling (beyond which lies environmental destruction and climate change), and the inner symbolizing the social foundation (inside which is homelessness, hunger, and poverty). The space between the two rings—the ‘substance’ of the doughnut—was the ‘safe and just place for humanity.’”
I like a comment by Raworth that neo-liberal economists still insanely believe we can “grow our way out of inequality and ecological collapse.” I used the word ‘insanely’ because this insane belief that the whole world of humanity can somehow achieve a current North American lifestyle and still exist, flabbergasts me. Academic discussion is all fine and well, but how will a new economic system be set in place. Again, Raworth has a refreshing view, “implementing the ideas right away is key, “I … firmly believe 21st century economics is going to be practiced first, theorized later,” she says. Raworth has worked with major cities like Amsterdam and Philadelphia bringing key people together for doughnut economics workshops.
While I am enthused by this and many other ecological economic efforts going on around the world, at the back of my mind is the problem that the economy is still viewed as the primary objective of humanity living sustainably. It all seems to be predicated on a top-down approach where the movers and shakers are benevolent and have integrity. My cynicism seems to be getting the better of me. Obviously, I espouse a bottom-up economic paradigm as opposed to a top-down one imposed upon everyone. The main difference is that all the players controlling a top-down economic system believe they understand all the factors to maximize their own private welfare, with more benevolent ones believing monetary wealth trickles down to the rest of the masses. The fact that trickle down never worked, wealth accumulates at the top, multiple externalities exist, inflation, monopolization, and the economic systems crashes every few years, doesn’t dimmish their confident way of thinking. In bottom-up systems, people understand that the complexity of the economic system is beyond most individual’s ability to understands the whole picture. Most individuals can understand their part of the economic system as it relates to the whole and can apply simple rules within their piece of the system to make it work based on working knowledge of local conditions and situations. The key is that all parts of the local economy remain transparent to everyone within the system. As the system expands, so does the complexity, which eventually creates apparent chaos when viewed from a full system perspective. The key here is apparent chaos because it is a dynamic system with extraneous variables being introduced all the time. And as any good biologist will tell you, this is how most living systems exist with this bottom-up logic.
So, I suppose the bottom line for this post is that I believe economics will become more localized and then integrate with other local systems organically as the local conditions dictate. I think this localized system perspective fits more with what economic philosopher, Adam Smith, talked about in his Wealth of Nations than how neo-liberal economists use him to justify their Social Darwinian biases. In a large number of small sectors around the world, this localization is already working. Look up ‘Findhorn Foundation’ as an example. On a more globalized scale I suspect the majority of people will have to go through another major crash like 2008, with maybe the ‘too-big-to-fail’ allowed to fail before people finally are forced to develop their own local economies. Look in your area for pockets of local economies, you may be surprised just how many exist already.
When the people – and not authoritarian technocrats – are in charge of how the economy runs, then we will see more connectedness and equity, a willingness to share abundance and be of service with others without fear of lack, and a better world where we value our interactions with all life.
“We abuse land because we regard it as a commodity belonging to us. When we see land as a community to which we belong, we may begin to use it with love and respect.” And, “All ethics so far evolved rest upon a single premise: that the individual is a member of a community of interdependent parts. The land ethic simply enlarges the boundaries of the community to include soils, waters, plants and animals, or collectively the land” The Land Ethic: Aldo Leopold
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