A New Economy for People and Planet

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A New Economy for People and Planet 2017-05-23T06:19:19+00:00


Living beings born of and nurtured by a living Earth, our most fundamental relationships are those on which our nurture depends. To survive and prosper, we must live into being a cultural and institutional system in which money serves life and power resides with people who care for one another, their community, and the whole of Earth’s community of life. Welcome to the New Economy.

The Nature and Purpose of a Healthy Economy

The economy is a system of relationships by which we engage with one another and Earth to create the essential means of our living. Given their centrality to our health and happiness—even to our existence—the institutions that define these relationships are the defining institutions of the society.

The word “economy” is derived from the Greek word oikos, meaning household management. The Greeks recognized the household as the basic unit of social organization by which humans meet their needs for nurture relying on local lands and the water and forest commons. They made their living from what nature provided locally, with the help of neighbors they knew and they shared. They were a community of mutually dependent households of people who knew one another.

The mutual dependence of people and nature was self-evident. With few exceptions, for example salt, relationships were defined by mutual caring and obligation. The purpose was nurture. Money was incidental.  And dependence on nature was self-evident.

We now depend for our nurture on a global economy. The proper purpose, however, is still to provide our nurture.

Essential Conditions of a Global Healthy Economy

As a now global species, a finite living Earth defines the boundaries of our now global human household. And a healthy global economy would fulfill three essential outcomes:

  1. Earth Balance As living beings born of and nurtured by a finite living Earth, our health and well-being depends on Earth’s health and well-being and we must manage our economy to keep our aggregate consumption in balance with the needs and capabilities of the whole of Earth’s community of life. We now consume an estimated 1.6 times what Earth can sustain. The excess 0.6 comes at the expense of Earth’s capacity to support life—including human life. Most of what is required to bring ourselves into balance will can improve our quality of life, including the elimination of war, use of carbon fuels and toxic chemicals, increasing resource efficiency, providing women the means to assure every child is a wanted child, and restoring the health of soils, waters, forests, and fisheries.
  2. Shared Prosperity. The most equitable human societies are also the most psychologically, mentally, social, and environmentally healthy societies. For all the claimed progress toward eliminating poverty, we now have the greatest global maldistribution of wealth in human history. As of 2017, the combined financial wealth of world’s 8 wealthiest billionaires  equals the combined financial wealth of half of the world’s people—3.6 billion humans struggling to survive on their decreasing shares of what remains of Earth’s real wealth resources. As the rich engage in a competition to outdo one another in austentatious displays of extravagance, the poor compete for survival on what remains of the land, water, and other essential resources not already enclosed and denied them by the rich.
  3. Living Democracy. Here we get into less familiar territory. Life creates and maintains the conditions essential to its own existence by organizing as communities of living organisms. Together these organisms manage a constant exchange of energy, water, nutrients, and information to meet their changing individual and collective needs in response to their distinctive and constantly changing conditions. Each organism, from an individual cell to a human body, is making constant choices that balance its own needs with those of the community on which it in turn depends. Think of the constant exchange between the cells of your own body and the complex exchanges by which they maintain your body’s health as a complex multicell organism. The health of our now global human society depends on our learning to organize as local communities controlling their own resources, setting their own economic objectives, and exchanging with one another in ways that global corporate rule actively blocks. What we need in the place of corporate rule, is an expression of democratic decision making far beyond anything human societies have yet mastered—a truly living democracy.

These are the outcomes that the economic institutions of an Ecological Civilization must support. For each outcome, the corporate ruled global economy drives toward exactly the opposite result. Its institutional values and reward systems set us on a course that actively destroys Earth’s capacity to sustain life, concentrates wealth, and strips away local control.

The human future is at risk because the economy fails to fulfill its most essential function: support a co-productive relationship between people and planet that secures the health and well-being of both.

Reversing Course and Creating a New System

We face an immediate imperative to reverse course as we work to create, from the bottom-up, the new cultural and institutional systems of a living Earth economy despite the determined resistance of powerful individual and institutional interests. By rational reckoning, what we must now do is both essential and impossible.

Think of an antiquated coal fueled, steam powered side wheeler with a leaking hull headed toward Niagara Falls. A neoliberal economist in the pilot house is shouting to the crew of corporate bankers, CEOs. and politicians at the helm and in the boiler room. “I see an opening ahead and the river is gaining speed. Hold steady on our course and keep shoveling the coal.”

We the passengers—and those members of the crew who sense that increasing speed of the river is not a positive sign—must take control of the ship, reverse direction, convert the power system to a renewable energy source, replace the navigation system, replace a leaking hull, train ourselves to crew the boat, keep the crew and passengers fed and hydrated, and on and on. A crude analogy, but if you are among those of us who see what lies ahead, I expect you get the point.

We are headed toward system collapse and leadership in reversing course and replacing a failed system must come from people acting in their roles as citizens exercising their democratic rights.

A New Economy Narrative

In exercising that leadership, we must embrace the most advanced of ethical standards, spiritual insight, and scientific understanding. Together these point to a guiding narrative for the work at hand.

We humans are living beings born of and nurtured by a living Earth. Life exists only in living communities of place that create and maintain the conditions essential to their own existence. Human health and happiness depend on the relationships of strong and healthy families and communities. Money is just a number of no intrinsic value or existence outside the human mind. It has value only because we accept in exchange for things of real value, like our labor and real capital assets like land.

An economy in which the richest people make the rules to maximize financial returns to themselves without regard to consequences for others will inevitably destroy the social and environmental foundations on which it depends. The economy’s only legitimate purpose is to support living communities in meeting the essential needs of healthy, happy, and productive living with each person using no more than their just and rightful share of our Earth mother’s life sustaining gifts.

Societies  that equitably share wealth and work enjoy greater physical and emotional health, stronger families and communities, less violence, greater resilience, and a healthier natural environment. In return for sacrificing material excess, violence, and competition for dominance, we gain life, material sufficiency, community, love, meaning, and spiritual abundance.

Ownership is Power

In any society, power ultimately resides with those who own or control access to the essential means of living, including food, water, shelter, security, transportation, recreation, education, and health care.  The power of kings resided in their ownership of the lands and waters from which their subjects harvested their food and quenched their thirst. Under state socialism, government owns these assets in the name, but not necessarily in the interest, of the people. Both centralize control over decisions best made locally.

Under a system of global corporate oligopoly, the powers of ownership reside increasingly with global corporations that use them to control our access to jobs, resources, and markets. The result is destruction of Earth’s capacity to sustain human life, an extreme concentration of wealth, and consignment of all but a tiny minority to lives of wage and debt slavery.

This system bears no resemblance either to Thomas Jefferson’s vision of a rural popular democracy of yeoman farmers or to Adam Smith’s vision of local market economies populated by small farmers, artisans, and shopkeepers. Though Jefferson focused on the politics and Smith focused on the economics, both recognized that the two are inextricably intertwined and ownership of real economic resources is key.

Capitalism as a Market Pathology

Many of us have grown up with the idea that markets are the best way to organize economies and that the only alternative to market capitalism is the failed ideology state socialism that China and the former Soviet Union abandoned decades ago. Markets are indeed one of our most important and effective institutional mechanisms for facilitating self-organization within and between human communities.

Money and markets are among the most important and beneficial of human inventions when recognizes as tools or means for facilitating economic exchange within a framework of rules and ethical standards. Capitalism is a pathology to which money and markets are subject when we forget that they are instruments and make them object of worship.

Capitalism is best described as an idolatry devoted to the worship of money and markets restrained by rules or moral standards. Though it claims to be a champion of markets and democracy, its opposition to the rules and ethical practice essential to the proper function of markets and democracy it is the moral enemy of both.

Real Democracy and Real Markets

Real democracy is a one person, one vote popular democracy. It bears no meaningful resemblance to one dollar one vote plutocracy. Similarly, the market economy of Adam Smith’s vision bears no resemblance to a global corporate oligopoly that honors none of the essential principles of a social efficient market economy. These principles include:

  • Buyers and sellers must be too small to influence the market price.
  • Income and ownership must be distributed equitably with no extremes of wealth or poverty.
  • Complete information must be available to all participants, and there can be no trade secrets.
  • Sellers must bear the full cost of the products they sell and incorporate it into the sale price.
  • Investment capital must remain within national borders, and trade between countries must be balanced.
  • Savings must be invested in the creation of productive capital rather than in speculative trading.

[For an elaboration and adaptation of these principles see “Ten Rules for Healthy Living Earth Markets.”}

Unregulated markets do not support these principles. To the contrary, unrestrained market forces systematically violate each of them, as the corporate ruled suicide economy demonstrates.

By and For Living People

A democratic, market-based economy is what we in fact seek. And it must be organized by and for people seeking to make a living as members of healthy vibrant communities; not corporations seeking to making a killing in service to global financial markets. Life must be the defining value and power must reside with living people who cherish life.

Economic democracy is an essential foundation of both political democracy and a true market economy. To support larger-scale enterprises, the rights and power of ownership may be exercised cooperatively. Control, however, must always be with people who depend on the enterprise for their livelihoods. Smaller enterprises are generally preferable to larger enterprises. And the interests of the individual firm must always be subordinate to the interests of the larger community in which it does business.

Leading from Below

The millions of people the world over who are joining together to rebuild their local economies and communities are the true patriots of our time.  They support locally owned human-scale businesses and family farms, develop local financial institutions, restore the healthy vitality of farm and forest lands, advance land use policies that concentrate human populations in urban centers and compact rural communities, reduce automobile dependence, retrofit buildings to conserve energy, and work toward local self reliance in food, energy, and other basic essentials.

To Birth a New System

Our future depends on navigating the transition to a New Economy that approximates the structures and dynamics of Earth’s biosphere. This requires shifting the economic system’s

  • Defining value from money to life
  • Locus of power from global corporations and financial markets to place-based living democracy communities,
  • Favored dynamic from competition to cooperation,
  • Defining ethic from reckless externalization of costs to responsible cost internalization, and
  • Primary purpose from growing the financial fortunes of the few to assuring the health and well-being of everyone.

Implementing actions will include redirecting economic resources from:

  • Instruments of war to health care and environmental rejuvenation.
  • Automobiles to public transportation.
  • Suburban sprawl to compact communities and the reclamation of forest and agricultural land.
  • Advertising to education.
  • Financial speculation to local investment and entrepreneurship.

Additional New Economy Resources

Many organizations dedicated to deep systemic change are mobilizing under a new economy banner. The New Economy Coalition brings together organizations from across the United States working to make a just and sustainable New Economy a reality. The Next System Project is exploring system design options. The New Economy section of the YES! Magazine website carries daily updates on the people who are living the New Economy into being.

The living systems perspective on the New Economy outlined here is spelled out in more detail in the Living Economy Forum’s various books. And is continuously elaborated and updated in my YES! Magazine Living Earth Economy column, and my Twitter and Facebook feeds.

These are some of the additional New Economy resources on this website.

  • The New Economy: A Living Earth System Model. This report prepared for the Next System Project is our most current and comprehensive presentation of the living Earth economy system frame.
  • Ten Common Sense Economic Truths foundational to a functional economy.
  • Ten Rules for Healthy Living Earth Markets. Essential rules for a market responsive to the needs and values of a living Earth economy.
  • Which Story? contrasts the underlying assumptions of the old and new economies and asks you to identify which you find more consistent with your experience and understanding.
  • Healthy Markets spells out the essential design principles of a healthy market economy that supports the structures and self-organizing processes of a healthy ecosystem.
  • Money Rules addresses the system design choices that determine whether money flows to the phantom wealth Wall Street economy to create inflated financial assets or to the real wealth Main Street economy to create a better life for all.
  • Confronting Systemic Evil. How capitalism undermines the rules and ethical standards essential to the proper functions of markets and democracy.
  • Life as Teacher outlines the case for looking to healthy living systems for the design principles guide our design of a new economy.
  • Advancing Transformation outlines eight action clusters framing a new economy policy agenda.
  • What’s New About this New Economy? spells out the differences between two contrasting visions of a New Economy: the magical high-tech fantasy economy and the reality-based living Earth economy.
  • New Economy Resources provides a guide to resources for further study, organizing discussions, and action engagement.

See <new-economy-resources> for more details. You will also find a wealth of additional materials in the library section of this site.