August 18, 2019, Revised – Version 4
[This working paper was written by author, independent scholar, engaged citizen, and former Harvard Business School professor, Dr. David Korten, as a contribution to ongoing discussions framing a new economics for the 21st century. It may be freely shared in whole or in part. (For those who want to follow the progression of thought and discussion on this topic, see Version 1 of this working paper (May 23, 2019); Version 2 (June 19, 2019, and Version 3 (July 2, 2019).]

Our most prestigious universities continue to teach economics principles that empower corporations in the service of money, destroy Earth’s capacity to sustain life, leave the many in desperation, and drive humanity to self-extinction. An economics for the 21st century will guide us to an economy that empowers people in the service of life.

Humanity is awakening to a grim reality. We have embraced an economic theory that ignores our fundamental nature. We are living beings born of and nurtured by the regenerative systems of a finite living Earth. Yet we have created an economic system that destroys Earth’s capacity to sustain life in order to grow the fortunes of billionaires.

As the awakening spreads, voices from every quarter—from student activists to the Vatican—are speaking out in common cause.

Workers and their unions respond with the wrenching observation that “There are no good jobs on a dead planet.” Pope Francis condemns an economy devoted to the “idolatry of money.” A global alliance of citizen movements has banded together under the banner of WEALL to work for an economy devoted to the well-being of people and planet. New Zealand has announced a new budget that shifts the focus from growing GDP to growing well-being. A youth-led political movement in the United States calls for a Green New Deal. Rethinking Economics, a global student movement demands reform of economics seminars that rarely mention poverty, climate change, or inequality. The Club of Rome, a global alliance of new paradigm thought leaders, has launched an initiative on a new economics in addition to its initiatives on the climate emergency, a new finance, and a new civilization.

These calls are born of a spreading awareness of the institutional failure that drives humanity toward self-extinction. As we confront the challenge of survival, it becomes apparent that the choices we must make to survive are the same choices required to achieve a long-denied human dream of a world of peace, equality, material sufficiency, and spiritual abundance for all.

There is nothing inevitable about the institutions that now so badly fail us. They are products of choices made over decades, centuries, and even millennia by our ancestors. We now have the knowledge and communications capabilities to make different choices through conscious collective processes with a speed that previous generations could not have imagined.

Our choices rest on our answer to a fundamental question. Are we financial beings whose well-being depends on growing money and aspiring to ostentatious lifestyles? Or are we living beings whose well-being depends on securing the health and vitality of a living Earth while aspiring to healthy, spiritually fulfilling lifestyles?

We have tried the former and we have the result. We may still have time to achieve the latter. It will require a transformation of culture, institutions, technology, and infrastructure guided by the intellectual insights and moral principles of, among others, indigenous peoples, the Earth Charter, the papal encyclical Laudato Si’, and the Parliament of the World’s Religions’ Declaration on Climate Change. It will require that we prepare a new generation of leaders with the intellectual tools to navigate that transition. That will in turn require a serious update of what we currently teach as economic science in our schools and universities.

With few exceptions, economics, as it is currently taught, is grounded in the flawed theories and principles that bear major responsibility for the current human crisis. They value life only for its market price; use GDP growth as the defining measure of economic performance; assure us that maximizing personal financial return benefits society; recommend policies that prioritize corporate profits over human and planetary well-being; and ignore the natural limits of a finite Earth. A significant update of economics to align with reality, authentic values, and the environmental imperatives of our time is urgent and seriously overdue.

Continue reading (and/or download the PDF) HERE…