Economy for the Common good

Rosario Gómez-Alvarez Diaz

Professor at University of Seville

“It’s is freedom of expression that we, human being, organise the

world we live in”

What percent of people is unhappy?

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Global survey -BBC World Service: 22 countries.

How have been economic benefits and labour charges shared in your country during the last years? “Unfairly” *Trends per country, 2008-2012

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Economy for the Common good

Christian Felber :

New values for economy (2008), with the aim of avoiding a fruitless

discussion:

“Who is against Capitalism, is for Communism”.

“Economy for the Common good” proposed with a group of Austrian

entrepreneurs ( 2010).

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Wconomy for the Common good

Ethical contradiction:

The values of the companies in the market ≠ the values

we want in our human relationships

Human values: Trust, honesty, responsability,

cooperation, solidarity, generosity and

compassion…

An economy that benefits everyone: Common Good

Changing the rules of the game

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Today: Future:

Common Good? Common Good

▲ ▲

Competence Cooperation

▲ ▲

Profit Contribute to Common Good

Results of market economy

The company to survive in the market

Minimum costs for the company = Maximum costs for the

rest

The capitalist market enables the unlimited accumulation

of benefits because the law system allows it

Barriers to Market Entry

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Results of market economy

RESULTS OF MARKET ECONOMY:

There is twice the amount of food for world population not to

suffer from hunger (almost 1,000 millions of 7,000 millions)

Environmental deterioration

Inequality

Economic insecurity

Unemployment

GDP DOESN’T MEASURE HOW PEOPLE LIVE

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How to measure the success in economy?

“What we measure affects what we do; and if our measurements

are flawed, decisions may be distorted”

Joseph Stiglitz, Nobel prize winning economist

Common Good measurements

Microeconomic level: Common Good Balance of organizations

Macroeconomic level: Common Good Product

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The Balance of Common good, another way of measuring productivity

This is the basic reference success indicator for an organization

5 essential values:HUMAN DIGNITY

SOLIDARITY

ECOLOGICAL SUSTAINABILITY

SOCIAL JUSTICE

DEMOCRATIC AND TRANSPARENT PARTICIPATION

With regard to this stakeholders:SUPPLIERS

SUBSIDISERS

EMPLOYEES

CLIENTS

SOCIETY

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VISIBLE RESULTS

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What are the advantages of the ethically responsible behaviour?

Companies with good common welfare balances will enjoy

legal advantages:

Reduced tax rates

Beneficial fees

Inexpensive credits

Privileges in public procurement and to get researching

programmes, and so on and so forth.

Non-allowed applications of the benefit

Swallow other companies up

Sharing with people not working in the company

Political party donations

Financial Investments

Financial markets disappear and are substituted by a

democratic bank that lends according to the savings gained

and charges to cover the costs.

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What will the benefit be used for?

Investments with social and ecological added value

Credit refunds

Deposits in limited reserve

Extra pay for employees in a restricted way

Credit without interests for cooperative companies

Excess won’t be used to credit people not working for the

company.

IMPLICATIONS: if the company grows cannot either accumulate

more benefits or create entry barriers

“In nature, growth is just a way of aspiring to the optimum size”

Leopold Kohr (“Small is beautiful”)

Unlimited growth?

• Austria 800 times

• Germany 5000 times

• USA (industry) 65.000 times

• USA (financial industry) 360.000 times

Top managers : Minimum salary

Employment

The source of income comes from the work

Employment is shared

Limited salaries allow to share them and not to appropriate the

others’ work

Companies creating employment are awarded

Companies look for joint solutions for unemployment problems

Sabbatical year does exist

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Inequality in Spain

In 2013: the number of millionaires grew a 13% in the country

The difference of patrimony between the 25% of the richest

homes and the 25% of the poorest ones raised from 39,3 to

50,4 times from 2005 to 2011.

Poverty risk: 28,2%

Social Barometer in Spain

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Limits to property accumulation

Limit income inequality (factor 20)

Limit the private property (10 million €)

Democratize companies (> 250 employees)

Maximum and minimum inheritance (“democratic dowry”)

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Bottom-up participation processes

SOCIALLY SPEAKING:

EDUCATION: SHARED VALUES AS COOPERATION AND NO COMPETENCE

COMMON GOODS: SELF-ORGANIZATION

PUBLIC SERVICES: “CITIZEN COMPANIES”

ECONOMICALLY SPEAKING:

THE COMPANY GENERATES COMMON WELFARE INSTEAD BENEFIT CCUMULATION FOR THE CAPITAL

POLITICALLY SPEAKING:

REPRESENTATIVE DEMOCRACY+DIRECT+PARTICIPATIVE

EBC (Common Welfare Economy) is a cooperative market economy

Is a project for a cooperative society