Kate Raworth’s TED talk A healthy economy should be designed to thrive, not grow is one of the most inspiring talks I’ve seen in a long time.
Nothing can grow forever. All things beautiful that do grow stop one day—and hopefully thrive for a long time. Cancer cells, which try to grow forever, ultimately kill.
Economies should be no different. Our relentless pursuit of economic growth is devastating our planet and our livelihoods.
The idea of doughnut economics centers regenerative and distributive designs for our economy, rather than the linear and centralized versions that we have now.
Kate has a series of explainer videos. Big picture overview:
- Change the goal: Endless GDP growth fails to care for many parts of our world and has contributed to massive collapses in several areas: climate change, ecosystem stability.
- Tell a new story: In April 1947, a small group of economists met to propose the idea of neoliberalism. The core premises of neoliberalism were that the market is efficient (so give it free reign), the state is incompetent (so don’t let it meddle), the trade is win-win (so open your borders), the commons are tragic (so sell them off), that society doesn’t exist (so ignore it), the household is domestic (so leave it to the women), that finance is infallible. But the global financial collapse so clearly disproved that last point that the rest of the theory has been called into question too.
- Nurture human nature: Last century’s economists gave a picture of a (hu)man that was convenient for supporting their theories: Rational Economic Man. Rational Economic Man has money in his hand, has a calculator in his head, has ego in his heart, stands with nature at his feet, hates work, loves luxury, has insatiable wants, knows the price of everything. Researchers have found that the more students study this Rational Economic Man, the more they become like him. We need a noew model. Our brains are wired for cooperation, empathy, and mutual aid. We’re not fixed—our desires change when our values do. We’re not dominant over nature—we’re deeply dependent on her.
- Get savvy with systems: In the 19th century, some economists wanted to make economics a science as reputable and precise as physics. Inspired by Newton’s laws, that so accurately described the movement of planets, they searched for economic laws that could describe the movement of economics. In their pursuit to constrain economics to the realm of mathematics, economics lost the ability to predict the catastrophic crashes of our age. Future economists must move away from picturing themselves as engineers controlling the levers of the economy but rather as garners tending the economy. How should that economic garden be designed?
- Design to distribute: In traditional economics, inequality has been described as a necessary phase of a developing economy. “No pain, no gain” to convey the idea that we need to put up with inequality for a time and wait until the wealth “trickles down”. But the reality is that inequality is a policy decision. Economies need to become distributive by design. We need to redistribute wealth (not just income)—wealth that comes from controlling land, money creation, business, technology, and ideas.
- Create to regenerate: Take-make-use-lose has been our MO for 200 years. We can’t wait for more economic growth to clean things up—it won’t. We need a regenerative, circular economy.
- Be agnostic about growth: In the 20th century, GDP growth was the central focus. The focus was on economies that grow, whether or not they make us thrive. But we need economies that make us thrive, whether or not they grow.
- Planetary Economics: The word economics comes from the Greek philosopher Xenophon who was thinking about managing a single home, but at the end of his life, he let it expand to thinking about the city-state. Then Adam Smith expanded that thinking to nations. We need to take that to the next level: thinking of the planet as our household.