If, David Korten's presentation AND COMMON SENSE are correct, are we handing down SUICIDE to our offspring and future generations? Can we chance turning a blind's eye to the facts, escaping from reality?
TAKING ECOLOGICAL ECONOMICS SERIOUSLY: IT’S THE BIOSPHERE, STUPID
GDP is best treated not as a measure of benefit, but rather of the aggregate economic cost of producing any given level of human well-being.
The biosphere is not simply a resource to be priced....It is the foundation of life and as such it is sacred and beyond price.
The underlying system structure and dynamics of the suicide economy are in most every respect opposed to those of the biosphere.
Ecological economics must become a true living-systems economics that deals with the organization and management of the human relationship with the biosphere
...move the locus of economic power from global financial markets to local communities and shift the values focus from making money for the rich to creating community wealth for everyone.
...focus on realigning the cultural values and institutional structures that shape the economic system’s function.
- Problem 1: Financial Indicators. The use of financial indicators like gross domestic product (GDP) and the Dow Jones industrial average to assess the performance of the economy gives priority to making money for rich people over improving the lives of all.
Solution: A Dashboard of Living Indicators. Optimize sustainable human well-being by evaluating economic performance against an array of indicators of human- and natural-systems health. The Bhutan experiment with a happiness index is an excellent start.
- Problem 2: A Wall Street Money and Banking System. Wall Street control of the creation and allocation of money gives control of our lives and national priorities to institutions devoted solely to maximizing private financial return through financial games that contribute nothing to the creation of anything of real value.
Solution: A Main Street Money and Banking System:Decentralize and democratize the money system so that the power to create and allocate money resides in a system of community banks, mutual savings and loans, and credit unions accountable to local people and devoted to serving local financial needs. I’ll elaborate on this in a moment.
- Problem 3: Wealth Concentration. Wall Street interests use their political power to cut taxes for the rich and advance trade, fiscal, workplace, and social policies that suppress wages, erode worker protections and cut services and safety nets for those most in need—creating an ever more extreme concentration of wealth and social dysfunction.
Solution: Equitable Distribution. Implement fiscal, workplace, and social policies that distribute income and ownership equitably. Equitable societies are healthier, happier, more democratic, and avoid both extravagance and desperation.
- Problem 4: Soulless Corporations with Absentee Owners. An ideology of market fundamentalism has embedded a belief in the public culture that the sole purpose and responsibility of a business enterprise is to maximize financial returns to its owners. This belief legitimates the control of productive resources by soulless corporations possessed of artificial rights bestowed by unelected judges that seek immediate profit for absentee owners and sociopathic managers and deny responsibility for negative social and environmental consequences.
Solution: Living Enterprises with Responsible Living Owners. Advance public policies that favor living enterprises with living, locally rooted responsible owners who seek a living return that includes a healthy community and a healthy natural environment. Cooperative, worker- and community-owned enterprises are positive examples. Tax away the profits of short-term capital gains to discourage the speculative public trading of corporate shares by absentee owners.
- Problem 5: Market Monopolies and Big Money Politics. Global corporations operate beyond public accountability to monopolize economic and political power under unified management with no external accountability. They use this power to manipulate markets, extract public subsidies, and externalize social and environmental costs—all in violation of foundational principles of socially-efficient fair-market competition and one-person one-vote democracy.
Solution: Properly Regulated Markets and Real Democracy. Breakup concentrations of corporate power, bar corporations from competing with living human beings for political power, and implement rules and incentives that support cost internalization, and fair competition. Corporations are creations of government and government has a responsibility to assure that they are democratically accountable and play by proper market rules.
- Problem 6: Fragmented, Colonized Local Economies. Fragmented local economies dependent on global corporations for jobs and basic goods and services leave people and nature captive to the financial interests of distant institutions that are interested only in extracting community wealth, not creating it.
Solution: Self-Reliant Bio-Regional Economies. Pursue local economic development programs that build diversified, self-reliant, energy efficient, democratically self-organizing regional economies comprised of locally-owned living enterprises accountable to local owners and devoted to serving local needs.
- Problem 7: Global Rules By and For Corporations. Global rules formulated and enforced by corporate dominated institutions like the WTO facilitate and enforce the concentration of corporate power and shield it from democratic accountability.
Solution: Global Rules By and For People. Restructure global rules and institutions to limit the concentration of corporate power, support balanced trade and national ownership, and secure the economic sovereignty of people by assuring that any corporation that operates across national borders is democratically accountable to the communities in which it does business.
MONEY AS A FALSE CONSTRAINT
David Korten (livingeconomiesforum.org) is the author of Agenda for a New Economy, The Great Turning: From Empire to Earth Community, and the international best seller When Corporations Rule the World. He is board chair of YES! Magazine, co-chair of the New Economy Working Group, a founding board member of the Business Alliance for Local Living Economies. and a member of the Club of Rome. He holds MBA and PhD degrees from the Stanford University Graduate School of Business and served on the faculty of the Harvard Business School.
Ecological economics can engage with groups engaged in defining and advancing the New Economy through participation in the New Economy Network.