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The Great Transition - Let's Get On With It! - nhpeacenik
The Great Transition - Let's Get On With It!
I know that the general opinion of economists and politicians is that we must have a "recovery", in which jobs are created and economic growth resumes, consumers start buying and borrowing again, and so on. But deep in my bones I sense we must hold out hope for something completely different. We can't afford to restart the economy we had in 1997 or 2007, just fly more, drive more, start more wars, trade faster and globalize everything willy-nilly, charging it all on our VISAs. Where are the alternatives? I, for one, don't think the days of Enron and Madoff, of long commutes and 16-hour days, of Wal-Marts full of plastic nonsense from China were paradise. Is there anyone seriously working on how we start over again? Is anybody really thinking about long-term sustainability and that supposed gold-standard of philosophy and economics, human well-being?

I have been reading a great paper on how the British economy, and  by extension, the economies of all nations, can be restructured to increase the well-being of people, decrease carbon-dioxide emissions, and reduce economic inequality in time to head off all the major catastrophes that now loom over us, by 2050. It's called "The Great Transition" and can be downloaded from http://neweconomics.org/sites/neweconomics.org/files/The_Great_Transition_2.pdf . It is the work of the New Economics Foundation , a think-tank founded in the 1980s to counter the development framework of the G8 countries with one that focused on real human well-being rather than growth for growth's sake. This article, and all the others posted on the NEF website are well-researched and copiously footnoted, so that you can learn as much of the background of the issues discussed as you are inclined to and challenge them if you see a flaw in the reasoning. I find the conclusions of the article encouraging and the reasoning of the authors both intellectually sound and humane. It takes as a starting point Karl Polanyi's 1944 "The Great Transformation", in which he discusses the disruptive effects of the "industrial revolution" on social cohesion in society. The article carries Polanyi's train of thought forward into an age where global warming and depletion of finite resources, along with economic inequality, have brought these forces to a point where they can't continue without tearing the planet apart. As the executive summary of the paper puts it:

The world is warming. The atmosphere cannot absorb the levels of CO2 being pumped into it for much longer without triggering irreversible climate change. The majority of the planet’s ecosystems are being pushed to breaking point. Our ‘footprint’ in the developed world has grown too heavy, and we are showing no signs of our being able to tread more lightly.

Measures of life satisfaction in developed countries are flat. Overwork for many combines with widespread worklessness for others. Set alongside those who have far more than they need are those who do not have enough. Falling social mobility sees these patterns repeated from one generation to the next, while unsustainable levels of debt affect all parts of society. As real incomes have fallen, many have had to take on debt to fund the essentials of life. For the more affluent, status-driven consumerism, often fuelled by debt, is the norm.

We can’t afford to carry on as we are

Restoring business-as-usual – if such a thing is even possible – won’t make us happy, and it will cost us dearly. This report forecasts that in the period to 2050 the cumulative cost associated with climate change will range from £1.6 and £2.6 trillion, while the cost of addressing social problems related to inequality will reach £4.5 trillion.

We appear to be locked into this state of affairs, but are we really?
It can still turn out right

We think that there is an alternative; one where we live within the limits of the natural world and more fairly with each other, locally, nationally and globally; where we focus on the things that really matter, applying our core human values to what is really valuable. We estimate that the measures proposed in this report would create up to £8.65 trillion of environmental and social value in the period to 2050.

This won’t just happen. It requires us to rethink much of what we have taken for granted. As the well-off consume less, headline indicators such as GDP will have to fall by as much as a third, but we can grow ‘real value’ at the same time. By 2050, this increase in value would far exceed the fall in GDP, which is a very poor measure of ‘progress’ in any event. Rapid decarbonisation that moves toward global fair deal limits will avoid between £0.4 and £1.3 trillion in environmental costs. A progressive redistribution of incomes to reach Danish levels of equality will cut the costs of inequality-related social problems and increase social value by £7.35 trillion.

By sharing our resources more equally, by building better communities and a better society and by safeguarding the natural environment, we can focus on the things that really matter and achieve genuine and lasting progress with higher levels of well being. Taken together this would amount to what we have termed the Great Transition.

According to the paper, to do this we need to (1) accurately measure the real value of goods and services, (2) redistribute income and wealth so that no one earns less than the minimum needed to live a decent life and workers progressively gain ownership stakes in the enterprises they take part in, (3) set costs of goods and services so that environmental and social "externalities" are included, assisting the market to favor good outcomes over bad ones, (4) structure decision-making to favor the local over the regional and the regional over the national/global arena when possible, (5) "re-skill" the population to reduce economic passivity and increase local autonomy, (6) re-negotiate the relationship between the local and the larger economy so that money flows rationally between these levels, (7) ensure that "developing" nations are treated fairly, given their less advantageous initial positions, and allowed to reap the benefits of the transition and achieve the same level of well-being as that achieved  in the "developed" countries. This is a wholly inadequate summary, but I do recommend the article and the entire New Economics Foundation project to your serious consideration.

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Current Music: Steve Tilston, "The Greening Wind"

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