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Transforming Our Economic System From Egocentric Domination to Ecocentric Real Wealth

Saybrook University | Monday January 2nd, 2012 | 4 Comments

The following is a guest post by our friends at Saybrook University’s Organizational Systems Program (a 3p sponsor) – designed for students who want to understand the nature of organizations, collaborative practices, and transformative change.

By Julie Auger, organizational systems graduate, Saybrook University

A reoccurring theme has been emerging in conversations with my friends and colleagues: our economic system.

Does our current economic system work? Who does it serve? Who is it damaging? Is it sustainable? Is there a better way? Can the system be changed?

I’ve wrestled with the underlying purpose of our financial structure for some time. From an ecological and social justice perspective, I’ve never quite understood why we strive for affluence to the detriment of the environment and the majority of the world’s population.

According to statistics from GlobalIssues.org and The World Bank, almost half of the world—more than three billion people—live on less than $2.50 USD a day. Additionally, “more than 80 percent of the world’s population lives in countries where income differentials are widening,” GlobalIssues.org noted.

In 2007, Forbes magazine scouted out 946 billionaires across the globe—from Mumbi to Serbia to Madrid to Cyprus. “Ingenuity, not industry, is the common characteristic” among the rich, the article noted.

“These folks made money in everything from media and real estate to coffee, dumplings and ethanol,” according to Forbes. “Two-thirds of [2006's] billionaires are richer. Only 17 percent are poorer, including 32 who fell below the billion-dollar mark. The billionaires’ combined net worth climbed by $900 billion to $3.5 trillion. That equates to $3.6 billion apiece.”

Regardless of Forbes’ boasting, wealth has not proven to make us happier, which annuls any happiness argument for attaining material prosperity.

David Korten, a former Harvard Business School professor and author of the 2010 book Agenda for a New Economy: From Phantom Wealth to Real Wealth, refers to the current financial system as “structural violence.” Korten posits that violence is built into the very structure of our dominant institutions such as our financial markets, economic institutions, global corporations, and political system.

Structural violence ensues when information and technology are monopolized by a few and then held ransom over people who may need it; when access to food, water, and other natural resources are controlled by those in power; when quality education is unequally distributed; when political agendas are prejudiced by money markets, and so forth.

In a PeaceWeek 2011 recording titled The Peace Economy, Korten said, “The very structure of our economic institutions are devoted solely to maximizing financial return without regard to the human and natural consequences. …These [economic institutions] are structurally designed to destroy the environment, to concentrate wealth to the exclusion of the majority of the world’s people, and to corrupt even our democratic political systems by making them captive to financial interests rather than to human interests.”

A dominator economy is set up as winner-takes-all competition for power and for the world’s wealth. The wealthy get richer and those in power gain greater control. The middle class, however, disappears. The poor get more destitute and the biosphere suffers massive, long-term devastation.

Eventually, we all lose. Korten submits, “It’s a system that’s not only guaranteed to spread violence, but ultimately to self-destruct.”

The good news is we have alternatives. The first step towards change is to understand how the system works and then, as Korten said, “recognize that there’s nothing inevitable about it. It’s a result of human choice.”

We can change our story. Imagine an ecocentric “ecological economy” where the purpose is to balance human needs with biosphere needs. Imagine a system of self-organization, self-reliance, self-determination, and collaboration. Imagine a system that values an ecological sense of self and reciprocity with Earth.

Korten explained, “Part of the ideal is a world in which every person is participating in the ownership of productive resources and productive enterprise in their homes. Not in the abstract sense of a socialist system, but in the very real sense of a community-based system where you actually have an ownership stake in real enterprises, like local farms on which your local livelihood depends.”

In this new story, “real wealth” is life, happiness, loving families, health, caring communities, and life-generating environments. “Money is just an account accrue,” Korten said. “It’s just a number and should not be confused with the real wealth of land and talents, happy healthy children. Peace is a real wealth.”

In his 2010 book, Civilizing the Economy: A New Economics of Provision, author Marvin Brown wrote, “If we are to replace property relations with civic relations, then we need to replace the exclusive focus on individual gain with a relational notion of reciprocity as the basis for the economy. We need to restore reciprocity as the moral foundation for making provisions.”

Brown added that when we think about the ethical aspect of our economic framework, “the ethical is largely located either in the individual persons, or in relationships among persons outside the market. As long as we interpret persons and the planet as property, we will continue to lose valuable time that we need to redirect our economy toward a just and sustainable future.”

Brown noted, “Civil society includes all of us as global citizens.”

Both Korten and Brown agree that our new story can redefine value from money to life. The new story can be grounded in human freedom or dignity and civic membership instead of property; it can focus on local markets and ecological integrity.

Clearly, as stated by the New Economy Working Group, this new system “will require an accountable, service-oriented system of money, banking, and finance based on values, rules, and institutions very different than those currently in place.”

Business author and consultant Peter Block once said, “The system comes to know itself both as it is and as it can be.”

My hope is that we can rally around what it can be. My hope is that we choose to change our story.

Julie Auger is alumni of the organizational systems program at Saybrook University and is a regular contributor to Rethinking Complexity, a blog produced by students and faculty members of Saybrook’s organizational systems program. Read more of Julie’s work at: www.rethinkingcomplexity.com.


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  • Grampa Ken

    In my 77 years I have seen so many great advances made in living standards, for most; yet there has not been accompanying success in attaining greater social happiness, world peace or eliminating poverty.

    Commerce is devoted to maximizing profits in any manner allowed, increasingly without fairness. Effective laws to control unethical and harmful business practices, or the will to enforce those that do exist are lacking. This infected free enterprise system is allowed to grow with little obstruction and in such a way that social abuse for personal or corporate gain has become more acceptable with each passing year.

    Too many, too large corporations are producing too many goods and services that do not have positive value to society or may even be permanently harmful. They could be directed to producing more goods and services that have social and family values, such as in education, health, peace, poverty, and world friendly projects.

    The public must demand positive change or it will be unlikely to happen.
     
     

    • WW

      “Commerce is devoted to maximizing profits in any manner allowed, increasingly without fairness.”
      Fairness is relative.  The shareholders consider “fairness” to be, actions which generates profits.  They have a mandate to profit, or they can be sued by shareholders. 

      This is not just what commerce is devoted to, this is corporate law.  “Fairness” according to the law is make money for shareholders.  Period.

      Corporations are inherently, and by law and by definition, corrupted by a mandate to profit.  They will tear up mountains, poison water, exploit workers, as long as they can get away with it.

      We’re supposed to take heart that shareholders in 2012 began requesting something called Sustainability Reports from the corporations they’re invested in?  So, consider, what does that even mean?  What is it shareholders want to see sustained? 

      Profitability.  Usually the problem lies in the “short term profit scheme, and the failure to think more than perhaps a year or 3 out.  Thus this insane peanut scramble to liquidate the earth’s remaining resources and the wealth hoarding we see… all just a byproduct of the momentum of the mandate to profit.

      No one talks about this, and this silence is damning.

  • http://twitter.com/davidmasters David Masters

    Great article, Julie. In your opinion, what practical steps can an everyday person take towards an ecological economy? For most of us, money is an embedded part of our daily lives – and it is an important system of exchange.

    I think life, happiness, loving families, health, caring communities, and life-generating environments are all around us – so it’s learning to make these continue to flourish.

  • Anonymous

    Great post – and there is definitely more than just HOPE, there are opportunities driven by abundance of creative potential of humanity with a little help by technology! Put some ideas on it together based on personal life/ work experience especially in the Eastern part of Germany since 1993. http://leanthinkers.blogspot.com/2008/11/team-action-learning-jouney-into-future.html