ALTERNATIVE ECONOMIC AND SOCIAL CONCEPTS
SERIES ›ZUKUNFTSDOSSIERS‹ NO3
Future Dossier
Imprint
The publication series “Zukunftsdossiers” (Future Dossiers) commissioned by the Austrian Federal Ministry of Agriculture, Forestry, Environment and Water Manage-ment provides information on themes of future relevance in compact form to an interested readership. The first two Dossiers have only be published in German language.
This Future Dossier entitled “Alternative Economic and Social Concepts” is published in the framework of the “Wachstum im Wandel” (Growth in Transition) initiative, to accompany the 2nd International Conference ”Growth in Transition” taking place in Vienna, Austria, 8–10 October 2012. Further information is available under www.growthinstransition.eu
This Dossier was compiled by Elke Pirgmaier from SERI, the Sustainable Europe Research Institute ([email protected]), with the assistance of Julia Gruber. SERI is the scientific partner of the «Growth in Transition» initiative and is one of Austria
,s
leading sustainability research institutes
September 2012
Proprietor and publisher:Federal Ministry for Agriculture, Forestry, Environment and Water Management (Lebensministerium), Section V, General Environmental Policy (Allgemeine Umwelt- politik), Department V/8 – EU Affairs – Environment (Director: Elisabeth Freytag), and Department V/2 – Environmental economics and energy (Director: Martina Schuster), Stubenbastei 5, 1010 Vienna Contact: [email protected] opinions expressed in this Future Dossiers are those of the authors and do not necessarily represent those of the Federal Ministry of Agriculture, Forestry, Environ-ment and Water Management.
The original version was written in German. Translation: Ursula LindenbergLayout: Gerda Palmetshofer Year of publication: October 2012All rights reserved.
SERI on behalf of the Austrian Federal Ministry of Agriculture, Forestry, Environment and Water Management
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Preface ......................................................................................................................................................................... 4
Summary ..................................................................................................................................................................... 5
New Forms of Economy and Society, Aiming for Growth with New Attributes ...................... 6
New Forms of Economy and Society, Aiming for Growth with New Attributes .................... 14
Green Growth, Green Economy, Green New Deal—The way out of the crisis is green ........ 14
Europe 2020—The European Growth Strategy ........................................................................ 17
Study Commission on Growth, Wellbeing and Quality of Life—The debate about social
progress in the German Bundestag .......................................................................................... 20
The Blue Economy—100 innovations inspired by nature ....................................................... 23
Cradle to Cradle – Intelligent waste ......................................................................................... 25
Factor X—The absolute reduction of resource consumption by a factor X. ......................... 28
New Forms of Economy and Society, Focusing on the Problematics of Growth and
Aiming to Reduce Growth Dependency ..................................................................................................... 31
Steady State Economy—The optimal size of an economy ...................................................... 31
Degrowth—Downsizing as a way out of the crisis .................................................................. 34
Post-growth society—The renaissance of growth critique ..................................................... 37
New Forms of Economy and Society, Placing Central Importance upon
Human Wellbeing.................................................................................................................................................. 41
Buen Vivir – Spirit of change in the Andes ............................................................................... 41
Common Welfare Economy—A growing democratic alternative ............................................ 44
The Solidarity Economy—Putting people at the centre .......................................................... 47
Transition movement—Moving into the post-oil era .............................................................. 50
New Forms of Measuring Wellbeing and Progress .............................................................................. 52
Synthesis................................................................................................................................................................... 56
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Preface
"As Gregor Samsa awoke one morning from uneasy dreams, he found
himself transformed into a gigantic insect...‖ Franz Kafka in "The
Metamorphosis‖ tells the story of a man who at first believes his trans-
formation to be temporary and then gradually adapts to the con-
sequences of his metamorphosis. It could be said that Kafka's story
describes a social utopia. The creation of social utopias not only takes a
literary form but can also be found in normal everyday life. Finding ways
to avoid all kinds of phenomena of crisis is the focus of widespread
discussion. There is a consensus that the current structure of both eco-
nomy and society is crumbling and is also undergoing a process of
transformation. Climate change, species loss, demographic shifts and
the debt and currency crisis have made it increasingly clear that it will
not be possible to continue as before for very much longer. And just as
doubts about the "old system" are growing, so too are a plethora of new
ideas for alternative models. The search for alternatives to the current
economic model and way of life is underway!
This Future Dossier provides interested readers with an overview and
examples of the alternative economic and social concepts that already
exist, to counter any suggestion that alternative visions are lacking.
Many of these concepts and ideas for other ways of life and economic
forms are either on the drawing board or already being tested in
practice. They all demonstrate that other ways do exist. The following
paragraphs illustrate how the spectrum of proposed alternatives show
more or less utopian features – suggestions range from partial correc-
tions of the current system to the abandonment of the capitalist system
as a whole. Thus discussion focuses on themes from the greening of the
economy to "post-growth" societies and solidarity and common welfare
economies. Although the precursors and advocates of the approaches
presented here may differ significantly from one another, all place
emphasis on the importance of business figures, activists, researchers,
individuals and collective associations all working today for a future that
will sustain their descendants.
The material contained in this Dossier aims to provide orientation and
inspiration for people to take an active role in this process of social
transformation. Growth in Transition invites everyone to join the
conversation!
First, I saw how life is.
And then I understood
why it is so,
and then I grasped, why
it cannot be different.
And still, I want it to
change.
Kurt Tucholsky
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Summary
This Future Dossier describes various economic and social visions that
all pursue one goal: to improve the quality of life and wellbeing of
humankind while simultaneously remaining within the limits of the
planet's carrying capacity. The following descriptions of alternative
economic and social concepts are divided into three groups:
New forms of economy and society, aiming for growth with new
attributes
New forms of economy and society, focusing on the pro-
blematics of growth and aiming to reduce growth dependency
New forms of economy and society, placing central importance
on human wellbeing
The final section of this Dossier provides an overview of new approaches
to measuring wellbeing and progress.
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New Forms of Economy and Society, Aiming for Growth with
New Attributes
Keywords
Energy and resource efficiency, eco-innovations, environmental
technologies, decoupling, sustainable development, ecosystem
services, natural capital approach, environmental and resource
economics, green growth, sustainable growth, Green Economy
Current environmental discourse often focuses on economic growth with
new attributes - green, sustainable, inclusive, smart. Some even talk of a
"golden growth". Behind all these strategies lies the concept of eco-
logical modernisation. Proponents of this approach base their
arguments on the assumption that economic development and environ-
mental goals can go hand in hand and that the economy stands to
benefit from the pursuit of environmental interests. Technological
advances should facilitate the decoupling of economic growth and
environmental destruction. A more efficient use of natural resources
and energy is a core strategy in this respect and is seen as capable of
driving economic growth. Economic growth is perceived as desirable and
necessary for wellbeing and social progress. Market and pricing
mechanisms are seen as the fundamental prerequisite for a well-
functioning, efficient and competitive economic system. The green
modernisation of the economy aims at innovative structural change,
without transforming the capitalist logic of competition and com-
petitiveness. Plans for sustainable or green growth are intended to
convert unsustainable trends into economic advantages. First mooted in
the early 1980s, this concept has attained fresh impetus in recent years
among decision makers in politics and public administration particularly
through the Green Economy debate. In science and research circles,
this discourse has dominated environmental and resource economics.
The hopes placed in green capitalism have also faced increasingly
strong criticism, on the grounds that these new suggestions still adhere
to neoliberal economic logic and thus fail to address existing con-
sumption and production practices in a critical manner. The inherent
drive for profit and competitive advantages and the focus on the "free
market" and pricing mechanisms is seen by critics as likely to hinder
comprehensive solutions for social and ecological problems. The
proposals are also seen as too technocratic in approach and as focusing
Climate protection
and economic crisis
are compatible
Criticism of
green capitalism
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too little on society, while ignoring existing power structures—
particularly in politics, financial markets and multinational companies. In
this sense, false hopes can be raised that are likely to suppress
alternatives rather than support them (Brand, 2012). Furthermore,
empirical evidence for absolute decoupling is thin, to say the least. On
the contrary, efficiency improvements created by technological solutions
often lead to rebound effects that increasingly aggravate environmental
problems.
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New Forms of Economy and Society, Focusing on the Problematics of
Growth and Aiming to Reduce Growth Dependency
Keywords
Limits to growth, post-growth society, post-growth economy,
Steady State Economy, degrowth movement, sufficiency, downsizing,
Voluntary Simplicity, ecological economics
What happens if Plan A—in other words the decoupling of economic
growth and resource use—fails to work? Those who advocate
approaches that are critical of growth respond with the argument that
high GDP growth rates in the developed economics today are neither
possible nor desirable for moral, ecological, social and economic
reasons. The precautionary principle makes a debate about how an
economy could still function well—or even better—in the absence of
growth absolutely necessary.
Critics of growth make the high level of material consumption
(―overconsumption‖) that is required for an economy tailored to growth
responsible for a range of social and ecological problems. Growth is no
longer seen as a part of the solution for environmental problems and
combatting poverty, but as part of the problem. Representatives of
post-growth, steady state or degrowth concepts call for the abandon-
ment of pointless consumption that is wasteful of resources and
promote the advantages of a lifestyle based on sufficiency. Proponents
hope that this approach will provide a double dividend: on the one hand,
improving the quality of life and human wellbeing through less con-
sumption and reduced working hours, and on the other hand, cushion-
ing negative environmental impacts. Since the dynamics inherent in
growth under existing conditions mean that lower consumption leads to
huge economic problems, for example unemployment or public debt,
growth critics are working to develop alternative models that would
allow for a good quality of life even in an economy with little or no
growth.
Discussions that are critical of growth are rarely taken seriously by
"mainstream" economists, politicians and business people and are often
dismissed as academic, intellectual discussions among the green middle
classes, seen as neither credible nor able to garner majority support.
The post-materialists in their ivory tower are said to be naive for
Focusing on the goal of
economic growth is
leading to ecological and
social collapse
Criticism of
growth critique
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thinking that it is possible to halt or restrict growth and for failing to
think through the international consequences of the strategies they put
forward adequately or in enough detail. Furthermore, their critics
suggest that there is no evidence for stabilising effects of an economy
without growth, which would justify social experimentation on such a
huge scale. It might lead to an uncontrollable downward spiral, which
should be avoided at all costs. Overall, it is seen as too early for a post-
growth society. The paradigm shift involved in "beyond growth"
concepts is not seen as an option, because the scenarios put forward so
far evoke a host of critical questions.
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New Forms of Economy and Society, Placing Central Importance on
Human Wellbeing
Keywords
The good life, Buen Vivir, wellbeing, quality of life, human needs,
capabilities approach, sufficiency, common welfare economy, solidarity
economy, Transition Towns
Central to all these approaches is a return to human values and needs.
In line with the motto "the economy is there to serve the people‖,
different paths are explored - often deliberately excluding the market
and the state - that can provide benefits to those involved. Profit motives
and competition give way to community-oriented economics and
cooperation. The multiplicity of different characteristics and forms
is broad, because people negotiate in a collective setting to identify a
chosen form for their community-based economy. Examples range from
cooperatively organised associations to regional direct marketing,
complementary currencies, common welfare economies and the South
American debate about what constitutes the good life. These
approaches are often underpinned by the critical judgement that broad
swathes of life have become commercialised and lead to activities that
are devoid of meaning. Alternative economic "islands of resistance"
often set themselves in opposition to dominant economic and power
structures and/or an assumed failure of political decision makers to take
effective action. In contrast, these approaches aim to strengthen
community and to consume and produce at mostly local or regional
level in the framework of collective action, as well as to enjoy partici-
pating in meaningful working cooperation.
As flowery and progressive as these descriptions may be, they none-
theless face criticism. Critics of bottom-up approaches often point out,
for example, that such projects often lack structure, which can lead to
highly inefficient and impractical economic practices. In addition,
advances and transformations are often impossible to measure or
compare with one another, something that would help to popularise
alternative economic forms on a broad basis. Given this, it is doubtful
whether these perspectives can emerge from their respective niches and
win a mandate to shape political strategy. The frequently proclaimed
local economic cycles are regularly decried as regressive and anti-
globalisation tendencies, that by reducing the division of labour and
Diverse components
of the good life
Criticism of local
bottom-up approaches
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creating a more inefficient economy would lead to goods and services
becoming more expensive. As such, they are seen as neither desirable
nor capable of winning majority support. In addition, it is claimed that
the vision being painted of a happy subsistence economy is an illusion,
because only very few local alternative economies can function to fulfil
their needs without the involvement of global patterns of supply.
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New Forms of Measuring Wellbeing and Progress
Keywords
Beyond GDP, Stiglitz-Sen-Fitoussi Commission, OECD ―Measuring the
Progress of Societies‖ and ―Happy Life Initiative‖, five capitals
approach, environmental and social indicators, measuring quality of
life and life satisfaction, environmental economic accounting
Following the descriptions of alternative economic and social concepts,
the final section of this Dossier presents a guide to the current debate
concerning how progress and wellbeing can be measured more
comprehensively. For a long time, GDP has been used as the primary
indicator for wellbeing and for economic and societal progress. Today
there is a consensus in scientific, political and civil society spheres that
GDP has clear limits as the key indicator for identifying progress in
societies. Increasing growth rates no longer necessarily entail an im-
provement in quality of life. There are many factors that are not
reflected in GDP but that play a central role in determining the quality of
life, e. g. security, leisure time, income distribution, or an intact
environment.
The current measurement debate focuses on questions such as: how do
economic growth, prosperity, quality of life and wellbeing hang
together? What are the key factors determining quality of life? Is our
living situation actually continuing to improve? What are the prospects
regarding the potential for creating and maintaining prosperity into the
future? Is our prosperity sustainable? How can a long-term perspective
be integrated within surveys and consultations? A range of initiatives
has addressed these and other similar questions in order to find out
how social progress and prosperity can be measured in a more
comprehensive fashion than is possible using GDP. The measurement
debate has also reached UN circles. The concluding document of the
Rio+20 world conference, which took place in June 2012, tackles this
discussion in Article 38 and provides the statistical apparatus of the UN
with a clear working mandate to participate in the more comprehensive
measurement of prosperity and progress.
The following table provides an overview of the alternative economic
and social concepts that are described in the subsequent sections.
More comprehensive
measurement of
wellbeing and progress
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Overview of alternative concepts of economy and society
Aim/Vision Representatives Perspective Approach
Green Economy A green restructuring
of the economy,
leading to
sustainable
development
UNEP, OECD national and
international
political
Europe 2020 Decoupling is
possible through
smart, sustainable
and inclusive growth
European
Commission,
European Council
European
Union
political
Study Commission on
Growth, Wellbeing
and Quality of Life
Concrete political
recommendations to
create higher
wellbeing and quality
of life in Germany
17 members of
German parliament;
17 external experts
Germany in an
international
context
parliamentary
debate
Blue Economy The innovative use of
waste and resources,
leading to a
flourishing zero
emissions economy
Gunter Pauli, Blue
Economy Institute,
Blue Economy
Alliance
international scientific and
business-
oriented
Cradle to Cradle Material closed-loop
cycles enable
―intelligent waste"
Michael Braungart,
William McDonough
international scientific and
business-
oriented
Factor X Higher prosperity
derived from less
nature, through
increase in resource
productivity by a
factor X
Friedrich Schmidt-
Bleek, Ernst Ulrich
von Weizsäcker,
Factor 10 Institute
at the level of
products,
services,
businesses,
national
scientific,
business,
political
Steady State Economy Economic
development with an
optimal physical
scale
Herman E. Daly global scientific
Degrowth Economic degrowth
for more social
justice, ecological
sustainability and
wellbeing
numerous activists
and scientists
local to global scientific and
civil society
Post-growth society An economy that
even without growth
can produce higher
quality of life within
ecological limits
Tim Jackson, Niko
Paech, Peter Victor
national scientific and
civil society
Buen Vivir Development model,
leading to the good
life
Alberto Costa,
Eduardo Gudynas
South
America, esp.
Ecuador and
Bolivia
scientific,
political, civil
society
Common Welfare
Economy
An economy based
on common welfare
principles
Christian Felber,
500 pioneer
companies
national civil society
and business
Solidarity Economy Multiplicity of basic
democracy and
needs-oriented
economic forms
multiple actors mostly local civil society,
self-organised
Transition Movement Cooperatively
developed resilient
and self-sufficient
local communities
Rob Hopkins,
Naresh Giangrande,
Louise Rooney
local, regional civil society
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New Forms of Economy and Society, Aiming for Growth with
New Attributes
Green Growth, Green Economy, Green New Deal—The way out of the
crisis is green
Profile
Green restructuring of the economy should lead to a win-win situation:
reducing poverty, strengthening economic growth, securing
employment and ecological sustainability.
Representatives: UNEP, OECD
Perspective: National und international
Approach: Political
Since the beginning of the crisis in 2007, the credo for contemporary
political discussions has been predominantly "green". The Green New
Deal, Green Economy and Green Growth are closely interrelated
concepts, which have the green restructuring of the economy at their
core. These concepts aim to alter political framework conditions in order
to transform the financial, economic and ecological crisis into win-win
situations. They understand the crisis as an opportunity and are well
on the way to becoming the new mainstream in the political arena. Many
politicians and policy-oriented institutions make reference to this new
economic paradigm, which is supposed to (finally) make sustainable
development a more concrete phenomenon.
The Green New Deal in its original form refers back to US President
Roosevelt. Roosevelt assembled a massive publicly funded economic
stimulus package in the 1930s under the title "New Deal", to aid re-
covery from the global financial crisis of that era. In retrospect, this was
clearly a success. In reference to the first New Deal, the Green New Deal
denotes green economic stimulus programmes that are aimed at
restructuring the economy. The idea is to use publicly initiated invest-
ment in key sectors to simultaneously produce economic stimulus,
For decades, we focused
mainly on protection,
clearing and cleaning
up […]. But that is
no longer enough.
We have to connect
ecology and economy in
an entirely new way.
Achim Steiner, UNEP
Executive Director
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create Green Jobs, and minimise climate change and threatened
resource shortfalls. Green investments include, for example, energy-
efficient building adaptations, the expansion of public transport
systems, promotion of renewable energies, or the removal of subsidies
that are counterproductive in terms of environmental protection. The
United Nations Environment Programme (UNEP) has played a key role in
popularising the concept of the Green New Deal. In 2008, UNEP started
the Global Green New Deal initiative, to promote global structural
transformation in a globalised world. The international framework
suggested for this essentially comprised three elements: financial
support for developing countries to prevent their national economies
from contracting; support for national governments in bringing together
green economic stimulus packages; and international policy coordina-
tion, to ensure that the planned economic stimulus measures would
support the positive development of poorer countries. The Green New
Deal has meanwhile largely been replaced in international discussion by
the term Green Economy.
The Green Economy is also a concept that UNEP has taken the lead
in promoting. UNEP sees the Green Economy as an economic approach
that "results in improved human well-being and social equity, while
signifycantly reducing environmental risks and ecological scarcities"
(UNEP, 2011). To implement this vision, UNEP created the Green
Economy Initiative, the first results of which were published in the report
Towards a Green Economy. The initiative aims to support decision
makers in moving towards a more resource efficient, low carbon and
socially inclusive economy in practice. UNEP aims to demonstrate the
reforms and political framework conditions that can motivate private
and public investments to finance the transition to a green economy. To
this end, examples of best practice from around the world are brought
together to illustrate the positive impacts of green investments and
policies. Ultimately, this involves embedding individual measures in a
coordinated way within a comprehensive strategy, in order to make
quick progress towards the goal of a green economy. The Green Eco-
nomy was one of the two key themes forming the focus of this year's UN
Conference on Sustainable Development Rio+20 in Rio de Janeiro. It
remains to be seen whether the term can establish itself as a new
guiding concept in international sustainability discourse.
Green Growth describes an alternative path to growth in contrast to the
conventional paradigm of economic growth. Green growth is based on
the sustainable use of natural resources, upon which the quality of
human life depends. The idea is that the environmentally necessary
restructuring of the economy to include greater energy and resource
efficiency and better management of natural capital can be a strong
Alternative Economic and Social Concepts
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driver for growth. The thesis suggests that the inclusion of new green
markets, the development of eco-innovations and the management of
ecosystem services create both improved competitiveness and new
business opportunities. In this way, Green Growth—as with the Green
Economy and the Green New Deal—should provide solutions to the crisis
and demonstrate a commitment to the belief that growth and environ-
mental protection can go hand in hand. Green Growth as a concept
is closely linked to the OECD. In 2009, government ministers from
34 countries signed a Green Growth Declaration and thus gave the
OECD a political mandate to develop a Green Growth strategy. The
strategy was published in 2011 under the title Towards Green Growth as
the starting point for a long-term Green Growth Agenda. It represents
a political framework and set of guidelines for national efforts, identify-
ing ways to obtain Green Growth. As with the Green Economy, Green
Growth should also be understood as a new political strategy for
achieving sustainable development.
Sources of further information and links
Brand, Ulrich (2012). Schöne Grüne Welt. Über die Mythen der Green Economy.
Rosa-Luxemburg-Stiftung: Berlin.
UNEP (2011). Towards a Green Economy. Pathways to Sustainable Development
and Poverty Eradication. http://www.unep.org/greeneconomy/
GreenEconomyReport/tabid/29846/language/en-US/Default.aspx
(16. July 2012).
OECD (2011). Towards Green Growth, http://www.oecd.org/document/
10/0,3746,en_2649_37465_47983690_1_1_1_37465,00.html (16 July 2012).
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Europe 2020—The European Growth Strategy
Profile
As the European Union's most important political strategy,
Europe 2020 sets out a vision for the next decade of smart,
sustainable and inclusive growth.
Representatives: European Commission, European Council
Perspective: European Union
Approach: Political
Europe 2020 forms the central economic policy strategy of the European
Union. It was proposed by the European Commission and adopted by
the European Council in June 2010. As the successor to and further
development of the Lisbon Strategy, it defines the parameters for the
economic policy agenda for the period from 2010 to 2020. Whereas the
Lisbon Strategy adopted the motto "Growth and Jobs", Europe 2020
promotes a more differentiated concept of growth. Growth is not to be
pursued in any form, but only as sustainable, smart and inclusive
growth. Europe 2020 establishes three clear priorities. Smart growth is
oriented toward the development of a knowledge- and innovation-based
economy (e. g. through measures in the areas of education, research,
innovation and ICT). Sustainable growth means building a low-
emission, resource-efficient and competitive economy (e. g. through
measures in the areas of climate, energy, environmental technologies).
Inclusive growth means promoting an economy with a high level of
employment and strong social and regional cohesion (e. g. through
measures in the areas of education, poverty reduction, cohesion). These
three priorities were translated into five concrete key targets:
Europe needs to get
back on track and then
stay on the right track.
That is the message of
Europe 2020. This is a
strategy about more
jobs and better lives.
José Manuel Barroso,
President,
EU Commission
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Employment: 75 % of all 20- to 64-year-olds should be in
employment.
Research and development: EU to use 3 % of its GDP for research
and development.
Climate change and energy: Reduction in greenhouse gas
emissions of 20 % (or even 30 %, inasfar as conditions allow)
from levels in 1990; increase in share of energy coming from
renewable sources to 20 %; increase of 20 % in energy efficiency.
Education: Reduction in early school leaving to under 10 %; in-
crease in share of 30- to 34-year-olds who have completed
higher education to at least 40 %.
Poverty and social exclusion: The number of those affected or
threatened by poverty and social exclusion should be reduced
by at least 20 million.
These quantifiable aims should be achieved EU-wide by 2020. Each EU
Member State has established national targets for the effective imple-
mentation of the strategy. These targets are adapted to take account of
national conditions and opportunities. This ensures that individual
Member States are able to regulate the design of reforms independently
while still contributing to EU-wide targets. Progress towards the EU tar-
gets are recorded on an annual basis in the framework of the National
Reform Programmes and presented to the European Commission,
which issues country-specific recommendations in coordination with the
European Council.
At EU level, the reform efforts of Member States are supported through
seven EU flagship initiatives, which serve the central priorities of
smart, sustainable and inclusive growth. For example, the flagship initia-
tive "Resource efficient Europe" aims to support the decoupling of
economic growth and resource use through the application of low-
emission technologies and renewable energies, thereby contributing to
the goal of sustainable growth. The flagship initiatives are intended to
provide impetus and support the reform efforts of Member States and
thus to contribute to the achievement of the key targets. The entire
range of EU instruments is available to aid this endeavour, e. g. legisla-
tive initiatives or the exchange of best practice examples.
In addition to the substantive focus on content, the governance
mechanism was strengthened through the introduction of a so-called
European Semester as a controlling instrument. This comprises an
annual cycle of governance aimed at strengthening coordination and
monitoring as well as leading to greater political commitment.
Alternative Economic and Social Concepts
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Sources of further information and links
Europe 2020 (2012). Official website of Europe 2020, http://ec.europa.eu/
europe2020/index_en.htm (16 July 2012).
European Commission (2010). Europe 2020. A strategy for smart, sustainable
and inclusive growth. KOM(2010) 2020 final, http://eur-lex.europa.eu/
LexUriServ/LexUriServ.do?uri=COM:2010:2020:FIN:EN:PDF (16 July 2012).
European Council (2010). Council Conclusions, EUCO 13/10, http://ec.europa.eu/
eu2020/pdf/council_conclusion_17_june_en.pdf (16 July 2012).
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Study Commission on Growth, Wellbeing and Quality of Life—The debate
about social progress in the German Bundestag
Profile
The Study Commission aims to identify ways in which wellbeing and
societal progress, according to a modern understanding of the terms,
can be secured and implemented in a social market economy.
Representatives: 17 members of the German Parliament and
17 external experts
Perspective: Germany
Approach: Parliamentary debate
The Study Commission (Enquete-Kommission) of the German Bundestag
on "Growth, Wellbeing and Quality of Life" has a broad, tripartite man-
date. The commission was set up to investigate the importance of
growth in the economy and society, develop a holistic indicator for well-
being and progress and explore the opportunities for and limits to
decoupling growth, resource consumption and technological progress.
Study commissions can be constituted from a quarter of the members of
the Bundestag, to undertake preparatory analysis informing decisions
regarding comprehensive and important topics. The Study Commission
on Growth, Wellbeing and Quality of Life was established at the initative
of the SPD and the Green Party. It consists of 34 members: 17 members
of Parliament from different parties and an equal number of external
experts. The committee focuses its work, undertaken in the framework
of project groups, on the following aspects.
The importance of growth in the economy and society. This working
group looks at the question of how much and what kind of growth
developed states such as Germany or Austria need in order to achieve
their social goals. Discussion addresses controversial aspects of the
theme, both in scientific and political respects. The project group,
according to Karl-Heinz Paqué (BpB, 2012), is divided into two camps:
the quantity theorists, who interpret growth predominantly as a physical
"more" in terms of goods, and the quality theorists, who point out that
technological advances make it possible to generate added value even
where resource consumption remains constant or is reduced, in other
words: qualitative growth: The working group faces the challenge of
The idea that growth
means wellbeing just
doesn't work anymore!
Daniela Kolbe,
Chair,
Enquete-Kommission
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transforming the points of conflict, which arise from different traditions
of thought and fundamental attitudes, into concrete policy
recommendations.
Development of a holistic indicator for wellbeing and progress. The
second project group has agreed upon developing a set of indicators to
provide easily understandable, meaningful and visually engaging
information on growth, wellbeing and quality of life in Germany. The set
should reflect between three and five dimensions backed by headline
indicators together with other appropriate indicators. Key areas of
wellbeing and progress are, for example, the material standard of living,
access to and quality of employment, distribution of wealth, political
participation, educational opportunities, subjective assessment of life
satisfaction and an intact environment. The development of the indi-
cator set is scheduled for completion by the end of 2012. Thereafter, it
is to be used as the basis for policy decisions (BpB, 2012).
Growth, resource consumption and technological progress—
opportunities for and limits to decoupling. The third working group
addresses the question of how GDP can be decoupled from the con-
sumption of national resources, emissions and environmental capital.
Based on an analysis of decoupling processes, the group identifies
concrete opportunities for action and implementation strategies relating
to individual resources, selected sectors of the economy and key actors.
The results of the working group will be presented in autumn 2012 and,
among others, should serve as input for the fourth project group in
shaping sustainable governance (BpB, 2012).
The project groups Sustainable governance und Employment, con-
sumption patterns and lifestyles were not yet constituted in summer
2012. They will focus upon how to shape economic policy so that it is
oriented towards more valuable growth and social progress and
investigate what other social opportunities exist for a change of direc-
tion towards wellbeing and progress.
Advisory reports commissioned from experts support the work of all five
project groups.
To date, the study commission has convened 21 times. At the end of the
2013 legislative period, it will present its reports and concrete re-
commendations, which should indicate ways in which sustainable econo-
mics can be strengthened within the social market economy. On this
basis, the next parliament will decide whether the commission should
continue its work.
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Sources of further information and links
Enquete Kommission (2012). Enquete-Kommission “Wachstum, Wohlstand,
Lebensqualität—Wege zu nachhaltigem Wirtschaften und gesellschaftlichem
Fortschritt in der Sozialen Marktwirtschaft, http://www.bundestag.de/
bundestag/ausschuesse17/gremien/enquete/wachstum/index.jsp
(18 July 2012).
BpB (2012). Wohlstand ohne Wachstum? APuZ, 62. Jahrgang 27-28/2012,
http://www.bpb.de/shop/zeitschriften/apuz/139104/
wohlstand-ohne-wachstum (18 July 2012).
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The Blue Economy—100 innovations inspired by nature
Profile
The Blue Economy is a business model that—inspired by nature—
makes innovative use of resources and waste products, to create
100 million jobs by 2020, to generate additional revenue for
businesses and to achieve a zero emission world by 2050.
Representatives: Gunter Pauli, Blue Economy Institute,
Blue Economy Alliance
Perspective: International
Approach: International network of businesses,
investors and researchers
The term Blue Economy was coined in 2010 by the business figure
Gunter Pauli in his book of the same name. Blue refers to the colour of
the ocean, the sky, and the earth when seen from space. The original
idea was to collate the 100 best technologies inspired by nature that
are climate-friendly, resource-efficient and simultaneously competitive,
in the water, energy, construction and food production sectors. The
starting point for the Blue Economy was the project "Nature‘s 100 Best",
undertaken in collaboration between the Zero Emissions Research
Initiative (ZERI), founded by Gunter Pauli, and the Biomimicry Institute.
This collection of 100 innovative ideas was published in book form
under the title "Blue Economy". Since the publication of the book, the
Blue Economy Alliance has made information about these innovations
available online to the general public and supports their implementation
in business models.
For Gunter Pauli, the Blue Economy takes a step beyond the Green
Economy—it is intended to be achievable for all and entirely environ-
mentally friendly and aims to transform the economic system as a
whole. A new generation of businesspeople, using only those resources
that are available locally, taking the waste generated by products as the
basis for new products, and using efficient and sustainable manu-
facturing processes, will create a new economic model. According to this
thesis, employment opportunities will be created, social capital
expanded and the economy and society will move in the direction of
sustainability.
After the financial and
economic crisis of 2008
it became […] absolutely
clear to me that Green
is only good for those
with money. And that's
not good. We should
build an economy that
can secure the basic
needs of all people—
by using what is
actually available.
Gunter Pauli,
Founder of ZERI
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The Blue Economy is based on the functioning of ecosystems. Its
model of a cascade economy refers to nature, in the sense that the
waste produced by a metabolic process functions as the source material
for the next such process. One example of how this principle can be
applied to the economy is the following: coffee grounds, that are gener-
ally seen as waste material, are ideal for growing mushrooms. After
harvesting these, the remaining material is rich in amino acids and thus
a good source of feed for chickens. The chicken manure can be pro-
cessed in a treatment facility to create biogas. Because byproducts can
be re-used as input factors and waste is minimised, resources have a
longer lifecycle and are utilised more efficiently.
A further observation from nature, of which the Blue Economy
innovators make use, is that ecosystems to a very high degree obey the
fundamental laws of physics, while chemical processes are of lesser
importance. In reference to this, Blue Economy innovations inspired by
nature adhere closely to the laws of physics. Thus, for example,
researchers have studied zebras and the construction of termite mounds
to gain knowledge of how buildings can be naturally ventilated with the
help of differences in air pressure and temperature, and consequently
operating costs can be reduced.
The Blue Economy is thus a business model that aims to use waste
materials as input factors to create better quality products at lower costs
together with additional revenues and employment opportunities. The
Blue Economy Alliance provides open source access to 100 innovative
ideas and supports their implementation in practice.
Sources of further information and links
Blue Economy Alliance (2012). Plattform der Blue Economy,
http://www.blueeconomy.eu (16 July 2012).
Pauli, Gunter (2010). The Blue Economy. 10 years, 100 innovations, 100 million jobs.
Paradigm Publications: New Mexico.
Pauli, Gunter (2010). The Blue Economy. Summary for UNEP, http://www.unep.org/
pdf/OP_Feb/EN/OP-2010-02-EN-ARTICLE7.pdf (16 July 2012).
The Blue Economy on YouTube: http://www.youtube.com/watch?v=1af08PSlaIs
(16 July 2012).
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Cradle to Cradle – Intelligent waste
Profile
Cradle to Cradle is a business model, in which materials circulate in
closed-loop cycles, with their quality either maintained or improved
in order to develop and market safe and healthy products.
Representatives: Michael Braungart, William McDonough
Perspective: International
Approach: Scientific and commercial
Nature provides the model for Cradle to Cradle (C2C). In the C2C vision,
all materials— biological and technical— circulate in closed-loop cycles
and products are conceived in such a way that they have no damaging
impact on the environment. Since no nutrients are lost during the cycle,
humans may be as boundless as nature itself, which produces in
abundance. Michael Braungart talks in this context of intelligent waste.
The C2C concept was coined by Michael Braungart and the Environmen-
tal Protection Encouragement Agency (EPEA) founded by him, beginning
with the development of Life Cycle Assessments in the late 1980s. The
C2C model is not restricted to products, but can also be applied to
urban planning of building construction. Worldwide, C2C is practiced by
businesses, organisations and governments, predominantly in the EU,
China and the US. An example in Austria is the ecoregion of Kaindorf in
the federal province of Styria, which has committed itself to an ecologi-
cal closed-loop economy and obtains its energy requirements as far as
possible from renewable sources.
The C2C design is closely linked to eco-effectiveness philosophy,
which goes beyond improvements in efficiency. Rather than aiming to
produce goods that are less damaging to the environment and to
optimise systems and products, the C2C concept has a more ambitious
focus: to produce completely healthy and safe products the quality and
productivity of which is either maintained or improved during their
lifecycle. Whereas efficiency strategy attempts to delay the point at
which materials are emitted from the cycle, with C2C they remain in
closed-loop cycles. Hence the name "Cradle to Cradle"—in contrast to
"Cradle to Grave". Herein lies an important distinction from the Blue
Economy, in which a cascade economy attempts to utilise input factors
Sustainability is boring.
The best things in life
are neither sustainable
nor efficient: think of
Mozart, sex or five-
course Italian meals. We
shouldn't create
restrictions for ourselves!
Michael Braungart,
Founder of EPEA
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for longer. With C2C, materials may ideally be utilised indefinitely,
because they circulate constantly in the closed-loop cycle.
The closed-loop economy of C2C is based on three insights, that derive
from observation of the natural world. The central observation is that
humans are the only life form that creates waste. In the biological cycle,
waste equals food, which means that the remaining materials from one
metabolic process function as the starting point for the next such
process. Accordingly, in C2C for the development of new products the
materials are already designed to be biologically or technically
reusable. The capability for recycling is an integral part of planning
from the start. Consumer goods that consist of biological nutrients and
that undergo wear and tear during use, are designed to be composted in
a non-toxic way and capable of reintegration into the biological cycle.
Consumer goods contain only those technical nutrients that are not
harmful for the environment and that are capable of further use. The
quality of materials is either maintained during production cycles or
actually increased, with the help of increased knowledge and networking
between actors in the production chain (upcycling). Following from the
original concept put forward by Braungart and McDonough, consumer
goods remain the property of the producer and are leased by users.
Thus the consumer is released from any responsibility to ensure that
appropriate disposal is carried out, while the producer is responsible for
reusing the nutrients involved. In a further reference to natural pro-
cesses, C2C uses solar energy as a central energy source, since its un-
limited use is theoretically possible. A further insight gained from
observation of nature is that diversity leads to increased resilience. In
this sense, with C2C, human systems should be adapted to reflect local
conditions and needs.
A much-used image for C2C is that of a flowering cherry tree. In spring,
the tree displays an abundance of blossoms, yet only a few of those
flowers will result in new trees growing. The rest are apparently wasted.
Yet these flowers fall to the ground and can be used by other organisms
as nutrients. Transposing this concept to a concrete example from
business, the C2C philosophy could look like this: During the planning
of a C2C warehouse, other usage options are already under considera-
tion and the warehouse is designed with the capability for later adap-
tation. Thereby, the building can be of use to several generations with
varying needs. All the materials used in the process are not harmful for
either humans or the environment, the biological nutrients are compost-
able and enrich the biological cycle, while the technical nutrients can be
recovered in the same quality after the building's useful life has ended,
and flow anew into production. According to the C2C concept, the
Alternative Economic and Social Concepts
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energy required for erection, maintenance, re-design or demolition
would derive from the sun as an inexhaustible source of energy.
C2C is a concept that utilises non-toxic and environmentally benign
materials to create products that pose no threat to health or to the
environment. This does not concern decreased use of resources but
rather their intelligent utilisation in closed-loop cycles. According to
Michael Braungart, this gives rise to a benign throwaway society, so that
instead of avoiding and renouncing consumption, we may consume with
a clear conscience.
Sources of further information and links
McDonough, William, Braungart, Michael (2002). Cradle to Cradle: Remaking the
Way We Make Things. North Point Press: New York.
Cradle to Cradle Network (2012). Cradle to Cradle: Theoretical Framework.
http://www.c2cn.eu/sites/default/files/C2C_theor_framework.pdf
(16 July 2012).
C2C Österreich (2012). Cradle to Cradle Design Österreich,
http://www.cradletocradle.at/ (16 July 2012).
EPEA (2012). Internationale Umweltforschung GmbH, http://www.epea.com
(16 July 2012).
Alternative Economic and Social Concepts
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Factor X—The absolute reduction of resource consumption by a factor X.
Profile
The Factor X concept provides answers to the question of how
environmental consumption can be measured and substantially
reduced.
Representatives: Friedrich Schmidt-Bleek, Ernst Ulrich von
Weizsäcker, Factor 10 Institute
Perspective: At the level of products and services,
corporate or national
Approach: Scientific, commercial, political
Global material consumption has grown over the past 30 years by
almost 80 % and today constitutes some 70 billion tonnes per year. As a
result, humanity is becoming increasingly dependent on non-renewable
materials, such as fossil energy carriers, metals and minerals. If all
people were instead to consume materials to a degree that is sustain-
able in the long term, the inhabitants of the northern hemisphere would
have to reduce their resource consumption by up to 90 % over the next
30 to 40 years at the latest.
This thesis forms the basis for Factor X. It concerns the demateriali-
sation of the economy, i. e. reducing material consumption worldwide
to a degree that is sustainable. There is no expert consensus about the
dimensions of the reduction in resource consumption needed to
approach a sustainable level. Ernst Ulrich von Weizsäcker proposed
Factor 4— doubling global wellbeing by halving resource consumption;
Friedrich Schmidt-Bleek does not believe this is sufficient and proposes
at least a Factor 10 in developed industrialised countries—in other
words, a reduction to a tenth of current dimensions—to allow develop-
ing countries enough room for economic development while wellbeing
in developed countries remains the same. Factor 4 could be achieved
through an annual increase in resource efficiency of 3 %; for Factor 10,
an annual increase in resource efficiency of 5 % would be required.
To be able to measure environmental consumption and progress
towards Factor X, Friedrich Schmidt-Bleek developed the MIPS concept
in the 1990s. MIPS stands for material intensity per service unit.
Willing and capable
countries should not
delay in joining together
to show that the creation
of dematerialised and
social wellbeing is
possible and profitable.
Friedrich Schmidt-Bleek,
President,
Factor 10 Institute
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Material intensity is determined by measuring all environmental con-
sumption required for a particular product or service in kilogrammes,
beginning with raw material extraction and including production,
distribution and disposal. Environmentally relevant consumption forms
are renewable and non-renewable resources, land and water. Non-
renewable raw materials include fossil energy carriers, such as oil, gas
and coal, together with ores or minerals, which are required by the
construction industry, for example. Renewable resources include renew-
able raw materials such as wood, and foodstuffs such as grains or fish.
Although these are "renewable" they are also in short supply. The same
applies to drinking water. The earth's land area is subject to absolute
limitations, particularly when fertile land is considered.
To exemplify the concept, Friedrich Schmidt-Bleek invented the ex-
pression "ecological rucksack‖ as a synonym for material input. This
represents the consumption of natural resources in the form of earth,
water and air (or greenhouse gases) required during production pro-
cesses. Rucksacks can also be calculated for individual input categories,
e. g. water rucksacks or CO2
rucksacks. Thus, for example, it may be
calculated that 2kg of resources are required to produce a pork cutlet
(and 13 litres of water), 150 g for a cup of coffee (and 150 litres of
water) or 3 tonnes for a flatscreen television (Hinterberger and Ax,
2013). A sustainable level of resource use would be .approx. 10 kg per
person per day (Hinterberger and Ax, 2013).
Such calculations help businesses to identify opportunities for
potential savings regarding resources and thus to take a step towards
Factor 10. One example is as follows: In the course of a study for SPAR
(SERI, 2010), it was discovered that around 50 % of the greenhouse gas
emissions produced by the Austrian pork industry could be saved if
farmers replaced imported soya feed with soya produced along the
Danube.
This explains the ―MI‖ part of the MIPS concept. The second part of the
concept—the ―PS‖ (per service unit) element—comes into play as soon as
the product or service is used. MIPS is complete when one is able to
evaluate how much benefit is derived from the natural resources
invested in the product. Where disposable products are concerned,
MIPS = MI, while S = 1; in the case of durable products, MIPS approaches
a small part of the original MI. The design of products in accordance
with the MIPS concept begins by considering the desired use/benefit.
Then a technical solution is worked out that will provide this use/benefit
while requiring the lowest possible investment of natural resources and
also being profitable commercially. There are many examples in
Alternative Economic and Social Concepts
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everyday life of how more wellbeing can be created using less natural
resources.
MIPS thus focuses upon the micro-level in economic terms, on indi-
vidual products or services, or buildings or infrastructure. Resource
comsumption can also be measured at the macro-level too, e. g. with
indicators such as DMC, TMR or TMC. Domestic material consumption
(DMC) represents the domestic material extraction including imports
and excluding exports. Total material requirements (TMR) represents
the annual total material flows through an economy in tonnes per
annum, including the ecological rucksacks. Total material consumption
(TMC) takes a consumption perspective and denotes the quantity of
materials in tonnes that an economy consumes annually.
The macroeconomic perspective highlights the political relevance of
Factor X: indeed, the concept is now established within mainstream
international sustainability policy. Resource calculations constitute a
basis for evidence-based policy development. The European Commission,
for example, draws upon this type of calculation for the proactive
development and implementation of resource efficiency. Japan made
Factor 10 a strategic component of its economic policy as early as ten
years ago. The concept also finds application in the ecological labelling
of products. To summarise, the key policy issue concerns how to create
incentives for limiting the consumption of natural resources, avoiding
rebound effects and simultaneously creating employment opportunities
and a competitive economy.
Sources of further information and links
Factor 10 Institute (2012). Factor 10 Institute, http://www.factor10-institute.org/
(24 July 2012).
Hinterberger, Friedrich, Ax, Christine (2013 forthcoming). Ausgewachsen. Vienna.
Schmidt-Bleek, Friedrich (Hrsg.) (2004). Der ökologische Rucksack. Wirtschaft für
eine Zukunft mit Zukunft. Hirzel: Stuttgart.
SERI (2010). Schweinefleischproduktion in Österreich—Klimaauswirkungen und
Ressourceneffizienz. SERI Endbericht, http://seri.at/de/projects/
completed-projects/spar-pork-meat/ (25 July 2012).
Von Weizsäcker, Ernst Ulrich, Hargroves, Karlson, Smith, Michael (2010).
Faktor Fünf: Die Formel für nachhaltiges Wachstum. Droemer: Munich.
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New Forms of Economy and Society, Focusing on the
Problematics of Growth and Aiming to Reduce Growth
Dependency
Steady State Economy—The optimal size of an economy
Profile
The Steady State Economy is a vision of an economy that at an optimal
level no longer grows in physical terms but instead develops further
at the level of sustainable consumption with a stable population.
Concrete macro-economic policies are suggested for a transition
to and implementation of a Steady State Economy.
Representatives: Herman E. Daly, CASSE – Center for the
Advancement of the Steady State Economy
Perspective: International
Approach: Scientific
Herman Daly raises the question of the optimal physical size for
economies. Daly and other advocates of this concept observe that the
economic subsystem that is embedded in ecological systems has
outlived its usefulness. Economic growth has already become
uneconomical: as a whole, it no longer produces wellbeing, but rather
reduces the capital stock on which our prosperity is built. On this basis,
Daly criticises the pro-growth orthodoxy and proposes an alternative
vision: the Steady State Economy (SSE).
The SSE is characterised by a constant physical capital stock and a
constant population level, both of which should be maintained at an
optimal level. The SSE is thus a physical concept with the aim of
maintaining an ideal physical capital stock with a minimum of material
throughput. An SSE does not imply a constant level of material
throughput, or less technological advancement, or an unlimited lifespan
for the economic system. It is a strategy for achieving the longest
While technology will
continue to pull rabbits
out of hats,
it will not pull
an elephant
out of a hat—
much less an
infinite series of
ever-larger elephants.
Herman E. Daly,
Professor Emeritus
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possible preservation of our ―Spaceship Earth‖. In Herman Daly‘s vision,
our economy will die some day from senescence and not from the
cancer of ―growthmania‖.
The Laws of Thermodynamics play an important role in this vision,
providing the theoretical framework for the SSE. According to the laws of
thermodynamics, a limited budget of energy with low entropy is
available to humanity with which it is able to run the economy and to
live. If too much of this energy is used for economic activities, then the
complex life-sustaining ecological systems begin to break down.
Herman Daly takes this as the basis for his critique of orthodox
economic theory and the logic of growth, because they run counter to
the second law of thermodynamics (and also against common sense, in
Daly‘s opinion): an economy simply cannot grow indefinitely with a
limited stock of energy and resources.
Based on these theoretical considerations, Daly proposes three
institutions for the achievement and maintenance of an SSE. Firstly, an
institution tasked with maintaining a constant population. As an
instrument for this policy, examples such as tradable birth-licences are
proposed, which the institution would administer. Secondly, an
institution charged with securing a constant physical capital stock and
ensuring that the material throughput is kept within ecological limits.
This aim could for example be achieved through the implementation of
auction-based cap-and-trade systems for natural resources that would
function in a similar way to emissions trading. And thirdly, an institution
for greater fairness of distribution, to restrict the unequal distribution
of constant capital stocks between the members of a stable population.
As a measure promoting distribution fairness, Daly suggests, for
example, the introduction of upper limits for income and personal
assets. Daly‘s ideas constitute a model that builds on the existing
institutions of private property and the fundamental principles of the
market economy. In this sense, it is highly conservative.
To obtain an idea of how this economy might function, one should
picture an ancient forest. At some point, a forest no longer continues to
grow, but is instead a complex living system, in which different life
forms cooperate and compete, and in which new species and eco-
systems develop over time. No longer growing is not synonymous with
stagnation but has far more to do with dynamic balance. Transposed to
an SSE, this means that although it can develop further, it remains within
the regenerative capacities of nature.
Daly is convinced that the SSE could function if it were to be accepted by
the people. He estimates that although such acceptance is not there in
Alternative Economic and Social Concepts
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the short-term, it would at least be plausible on the basis of his
proposals in the not all too distant future. This is particularly true
because all the institutions and measures could be gradually adapted
and expanded.
The fundamental idea of SSE was originally formulated about 150 years
ago by the classical economist John Stuart Mill in his discussion on the
Stationary State. Herman E. Daly, a student of Georgescu-Roegen and
former World Bank economist, has adopted this idea and provided it
with concrete form over recent decades. Today, many economists relate
to Daly‘s ideas and continue to develop them further. The Center for the
Advancement of the Steady State Economy (CASSE) is a scientific
association in the US, whose mission is to promote the idea of the SSE.
The SSE can be interpreted as an attempt to develop a political economy
that takes account of ecological and existential scarcities and that can
be understood by the average citizen. It describes a framework for a
new economy that comprises the definition of an SSE, provides
arguments as to why this is necessary and desirable and makes
suggestions for appropriate institutions and political instruments.
Sources of further information and links
CASSE (2012). Center for the Advancement of the Steady State Economy ,
http://steadystate.org/ (18 July 2012).
Daly, Herman E. (1974). The Economics of the Steady State. American Economic
Review 64(2), 15-21.
Daly, Herman E. (1991). Steady State Economics. Island Press: Washington, D.C.
Daly, Herman E. (2010). From a Failed-Growth Economy to a Steady-State
Economy. Solutions Journal, http://www.thesolutionsjournal.com/node/556
(18 July 2012).
Alternative Economic and Social Concepts
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Degrowth—Downsizing as a way out of the crisis
Profile
Degrowth means reducing consumption and production as a route
towards more social justice, ecological sustainability and wellbeing.
Representatives: Numerous activists and researchers,
particularly in France (e. g. Serge Latouche),
Spain ( e. g. Joan Martinez-Alier, Giorgio Kallis)
and Italy
Perspective: Local to global
Approach: Scientific and civil society
Degrowth denotes economic downsizing. It has decreased con-
sumption and production at its core: less industry, less cars, less
shopping centres and less long-distance travel. Supporters of degrowth
argue that humanity already lives beyond its means, overstretching eco-
logical systems in the process. The limited carrying capacity of eco-
systems and finite availability of natural resources suggests that
degrowth should be imminent. Degrowth advocates therefore pose the
question not of if but of how the upcoming degrowth can be managed in
order to avoid social and ecological collapse. To achieve a "soft
landing" that is ecologically sustainable and accords with social justice,
both consumption and the production of material goods must be
reduced. Less consumption in this context is not synonymous with less
quality of life, but rather the opposite. Human wellbeing can in fact be
increased, as unnecessary tasks and work stress cease to be a burden
and people liberate themselves from material excess.
The degrowth idea arises from the debate surrounding critiques of
growth. Economic growth is characterised as a problem and not as a
solution for social and ecological problems. Technological innovations
and greater resource and energy efficiency are not enough in them-
selves because rebound effects occur that increase production and con-
sumption and thus lead to yet more environmental consumption. In its
critique of neoliberal economic theory and practice, degrowth stands
in opposition to the concept of sustainable development. Any form of
additional economic growth, whether it be sustainable, green, or social,
is seen as legitimising the continuation of the status quo and as a
If one notices on the way
from Rome to Milan that
the train is in fact going
to Naples, just slowing
the engine down won't
help. The only course of
action is to jump out and
join a train travelling in
the other direction.
Serge Latouche,
Professor Emeritus
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distraction from the contradiction that GDP growth and renaturation on
a sustainable level are mutually incompatible. For degrowth adherents,
the necessity for degrowth—as soon and in as democratic a form as
possible—is the logical conclusion of critiques of orthodox economic
systems and the awareness of social and ecological problems.
The vision of a degrowth society comprises a relocalisation of the
economy, a fairer distribution of income and resources, new and more
democratic institutions, sufficiency, and social and technical innovations
that support a convivial and frugal way of life. According to this
vision, wellbeing essentially derives from many things that are not
dependent on consumption - spaces for social interaction, more time for
friends and family, greater simplicity in life, neighbourly assistance, a
fairer distribution of employment opportunities and reduced material
consumption.
Supporters of degrowth come from diverse fields, although most are
scientists or activists. They pursue very different strategies in promoting
the idea of degrowth. Some constitute protest movements against new
large-scale infrastructure projects (e. g. motorways, nuclear power
stations), others attempt to promote alternative infrastructures
(e. g. solar energy, cycle transport); some focus on individual actions
(e. g. ―voluntary simplicity‖), others on collective measures (e. g. co-
housing); some wish to replace existing institutions, while others wish
to see their adaptation; some work in research fields, whereas others
insist that action at local level is of primary importance. All this makes
clear that degrowth embraces the diversity and complementarity of
strategies.
Nicholas Georgescu-Roegen, who published numerous essays on
economics and degrowth in the 1970s, is viewed by proponents of the
degrowth movement as one of the leading pioneers of the concept.
Nonetheless, it is only in recent years that the movement has obtained
momentum. The first international conference in Paris in 2008, largely
responsible for coining the English term "degrowth" to represent the
concept, marked the beginning of the academic debate and civil society
movement that exist today. Since then, two further international
conferences have taken place: 2010 in Barcelona and 2012 in Venice.
The degrowth movement is particularly active in France (―décroissance‖),
Spain (―decrecimiento‖) and Italy (―decrescita‖). The movement has
undergone a partial institutionalisation through the academic associa-
tion ―Research & Degrowth‖ (R&D), carrying out research related to the
degrowth theme, raising awareness and organising events. A stated aim
of R&D is to bring together scientists, practitioners, activists and civil
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society representatives to work together on developing the building
blocks of a degrowth society.
Sources of further information and links
DegrowthPedia (2012). Information platform on degrowth,
http://degrowthpedia.org (18 July 2012).
Kallis, Giorgos (2011). In defence of degrowth. Ecological Economics 70, 873-880.
Research & Degrowth (2012). Degrowth network, http://degrowth.org
(18 July 2012).
Schneider, Francois, Kallis, Giorgos, Martinez Alier, Joan (2010). Crisis or
opportunity? Economic degrowth for social equity and ecological
sustainability. Introduction to this special issue, Journal of Cleaner
Production, 18/6, 511-518.
Van den Bergh, Jeroen (2011). Environment versus growth—A criticism of
“degrowth” and a plea for “a-growth”. Ecological Economics 70, 881-890.
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Post-growth society—The renaissance of growth critique
Profile
Post-growth society denotes the vision of an economy that is no longer
dependent on economic growth and precisely because of this
contributes to a better quality of life and longer-term stability within
ecological carrying capacity.
Representatives: Tim Jackson, Niko Paech, Peter Victor,
Irmi Seidl, Angelika Zahrnt
Perspective: Developed countries, predominantly in Europe
Approach: Scientific
The publication of The Limits to Growth 40 years ago caused a furore.
The 1972 report by Dennis und Donella Meadows to the Club of Rome
launched a scientific and socio-political debate looking critically at the
concept of growth that has continued since then in various waves and
levels of intensity. In recent years, such discussions have gained new
momentum.
Critics of growth, who come predominantly from the academic sphere,
argue their case along the following lines:
Growth has created prosperity in the past in early-industrialised
countries, but times have changed.
Meanwhile, from a global perspective, growth has become a part
of the problem rather than a part of the solution, and increase-
ingly runs up against limitations for ecological, social and eco-
nomic reasons.
The western model of prosperity is not transferable to all other
regions of the globe.
A new model of prosperity/wellbeing that coexists with little or
no growth is necessary, feasible and desirable.
Critics of growth believe that the "question of growth" is a fundamental
issue concerning the basis of our very existence. Because economic
growth is inevitably coupled with the consumption of physical resources,
empirical evidence for global environmental problems will
accumulate. Climate change and species loss are prominent key terms in
this respect. Furthermore, there are developing shortages of natural
1970s: There are no
limits
1980s: There might be
limits, but they are far
away.
1990s: The limits might
not be too far away, but
the market will solve the
problem
2000s: The markets
might not function, but
technology will save us.
Dennis Meadows,
Co-Author,
The Limits to Growth
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resources (―Peak Everything‖), upon the unlimited and cheap availability
of which the industrial prosperity model has so far depended. The side
effects of growth are also becoming more visible in the social sphere,
for example regarding unequal distribution of income and assets. In
economic terms too, limits are palpabile as long-term problems set in.
The current escalation on financial markets and the enormous increase
in public and private sector debt are indicators in this respect.
The growth paradigm is regarded as bearing core responsibility for
these developments. Because growth leads to huge problems, but so
also does a lack of growth under existing conditions, and a return to
familiar rates of growth appears highly unlikely, the following is
required: A restructuring of both economy and society is needed until a
system is created that can survive with little or no growth - a "post-
growth" economy and society.
A more encouraging message suggests that growth in the richer
countries even today is not automatically associated with improved
quality of life. Indeed, in some cases the opposite is true. From this
perspective, turning away from the paradigm of growth is seen as an
opportunity to obtain freedom from material ballast and to refocus upon
fundamental - mostly immaterial - values that characterise the good life.
In recent years, particularly since the beginning of the economic and
financial crisis, the critique of growth has developed into a lively
discussion that has also achieved prominence through the media.
Articles and special issues appear regularly in a range of print media;
numerous conferences and workshops take this theme as their focus.
The following section provides an introduction to a number of central
actors in the current debate about growth.
Tim Jackson through his book Prosperity Without Growth has become
the "star" of the growth critique community, achieving recognition far
beyond this sphere. He analyses the relationship between prosperity,
wellbeing, growth and sustainability and argues that prosperity is
possible without growth. Building upon this analysis, Tim Jackson
addresses a catalogue of recommendations to policy-makers, concern-
ing how the transition to a sustainable economy can be undertaken. The
measures he suggests begin with the development of an ecological
macro-economy that creates stability within ecological carrying capacity
and in structural terms is no longer driven by increasing consumption;
secondly, safeguarding chances for realising the unfolding of human
potential; thirdly, adhering to ecological limits; and finally, creating
room for new possibilities and design opportunities, so that the vision—
We are persuaded to
spend money we don‘t
have on things we don‘t
need to create
impressions that won‘t
last on people we don‘t
care about.
Tim Jackson,
Professor at the
University of Surrey
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―human flourishing‖ within the ecological limits of a finite planet - can
be made a reality.
Niko Paech makes the case in his latest book Liberation from excess.
The road to a post-growth economy for a departure from the conven-
tional prosperity model. Why? Firstly, because people in modern
consumer societies live beyond their means, because the prosperity
created by growth is only made possible by "ecological plundering".
Secondly, because all attempts to decouple growth from ecological
damage through technological innovations are, in the best case,
doomed to fail and in the worst case, going to make the situation even
worse. As an alternative programme, Niko Paech proposes a post-growth
economy that focuses on sufficiency and subsistence. He argues for a
partial dismantling of industrial and above all global value added
processes based on the division of labour in favour of strengthening
local and regional models for self-sufficiency. He also recommends
casting off unnecessary material ballast, to make way for more time and
greater happiness. Concrete measures for the proposed restructuring
and dismantling of the economy range from repair, maintenance and
servicing practices to shorter transportation distances, more meaningful
value added, based on craftsmanship skills, regional complementary
currencies, strengthened communal use of goods and sustainability
education as a compulsory subject in schools. The conceptual basis was
developed in 2007 and has formed the subject of ongoing discussion
since then.
Irmi Seidl and Angelika Zahrnt published the book Postwachstums-
gesellschaft. Konzepte für die Zukunft (Post-growth Society: Concepts for
the Future) in 2010, which enlivened debate surrounding this theme in
Germany and throughout the German-speaking world. The book's focus,
as the title indicates, lies with the social transformation that is required
alongside an economic, technological and structural shift, if liberation
from growth dependency is to be achieved. Essentially, this involves
reflecting on how key areas of social life and institutions that currently
drive growth or are dependent upon it can be restructured so that
politics, society and the economy can relinquish the pursuit of growth.
Areas examined include old-age provision, health services, education,
employment, the financial markets, state finances and citizenship. For
each area, experts were invited to put forward realisable concepts and
to draw upon practical experience that would contribute to the develop-
ment of a post-growth society. In conclusion, theses were formulated
that would provide focal points for social discourse on this theme. For
example, where old-age provision was concerned, it was suggested that
the monetary inter-generational contract should be supplemented by a
non-monetary, social inter-generational contract. Another proposal
Jettisoning the ballast of
affluence would give us
the chance to focus on
essentials instead of
routinely making
ourselves dizzy on the
treadmill of shopping for
self-fulfillment.
Niko Paech,
Professor at the
University of Oldenburg
Living well instead of
working a lot.
Angelika Zahrnt,
Honorary Chair,
BUND
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concerned transforming the healthcare system into a cost-effective
system based on solidarity, co-defined by personal responsibility. A
research map of a post-growth economy was developed for scientists, to
identify research questions and to continue to address these themes.
Peter Victor presents a macro-economic model for the Canadian
economy in his book Managing Without Growth. Slower by Design, Not
Disaster that explores the following question: can full employment,
poverty reduction, fiscal stability and reduced greenhouse gas emissions
be achieved without substantial economic growth? He describes various
scenarios for the Canadian economy and demonstrates how, with the
application of different policy measures, the key social, economic and
ecological goals are also achievable without substantial growth. Thus
within a relatively conservative and applicable framework, it becomes
clear that a choice of appropriate policy measures can enable a healthy
life and economy even in the absence of growth.
Sources of further information and links
Postwachstumsgesellschaft (2012). Blog on the post-growth society,
http://www.postwachstum.de (18 July 2012).
Jackson, Tim (2009). Prosperity Without Growth. Earthscan: London.
Miegel, Meinhard (2010). Exit. Wohlstand ohne Wachstum. List: Berlin.
Paech, Niko (2012). Liberation from Excess. The Road to a Post-Growth Economy.
Oekom: Munich (forthcoming).
Seidl, Irmi, Zahrndt, Angelika (2010). Postwachstumsgesellschaft. Konzepte für
die Zukunft. Metropolis: Marburg.
Victor, Peter A. (2008). Managing Without Growth. Slower by Design, Not
Disaster. Edward Elgar: Cheltenham.
Managing without
growth seems like a very
radical, even crazy idea,
yet for all but the tiniest
sliver of time since
humans evolved,
humanity has managed
without growth.
Peter Victor,
Professor at the
University of York
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New Forms of Economy and Society, Placing Central Importance
upon Human Wellbeing
Buen Vivir – Spirit of change in the Andes
Profile
The South American concept of the "good life" aims for balance with
nature, the reduction of social inequality, an economy based on
solidarity and a pluralistic democracy with new opportunities for civil
society participation.
Representatives: Alberto Costa (Ecuador) and
Eduardo Gudynas (Uruguay)
Perspective: Starting points are Ecuador and Bolivia,
with a view to global relevance
Approach: Political, scientific, civil society
Buen Vivir means "the good life". The South American concept is a
response based on critical systems thinking to Western development
thinking in recent decades. The neoliberal reforms that significantly
influenced the political agenda in South America in the 1980s and 1990s
have done little to improve the social situation of the poor and to
dismantle the glaring inequalities that exist in the region (Fathauer,
2011). Buen Vivir presents a counter model to the capitalist life model. It
may be understood as a new development concept that wishes to move
away from the Western paradigm of prosperity.
Sumak Kawsay is the original, multi-faceted Quechua term. Sumak
encompasses the good and the beautiful, the sublime and the
wonderful. Kawsay signifies life, understood as an active process that is
perpetually changing. The Spanish translation of Sumak Kawsay is Buen
Vivir (good life) or Vivir Bien (live well) (Schmid, 2011).
At its core, Buen Vivir stands for a post-modern, post-colonial and post-
capitalist concept that represents a return to the philosophy of life
held by the indigenous peoples of South America. Proponents of the
concept place importance on indigenous traditions and values and also
upon diversity in terms of realities and forms of living (pluralism) and a
new understanding of nature. According to this, nature has an intrinsic
The concept of Buen Vivir
depends upon society
asking itself this
question: how much
should we consume, how
should we evolve, are
there alternatives to the
consumer society?
Jorge Juardo,
Ecuadorian Ambassador
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value, and excessive exploitation and instrumentalisation of nature as a
resource are to be condemned. Buen Vivir is seen as only conceivable
within a social context. Alberto Costa formulates the concept thus: Buen
Vivir for all, not Dolce Vita for the few.
Buen Vivir is thus in stark contrast to the idea of an individual good life
in the Western tradition, that for example derives from Aristoteles or
Amartya Sen. With Buen Vivir, it is not humankind that is central but
rather all existence, as a unified whole (Schmid, 2011). It would
therefore be too limited an interpretation to equate the Buen Vivir
philosophy with increasing individual wellbeing and high standards of
living.
Although Ecuador is the country that is primarily associated with Buen
Vivir, the good life is also the subject of debate in other South American
countries, such as Bolivia, where Vivir Bien is also prominent. These
progressive governments have halted and partly reversed privatisation
and place emphasis upon a stronger role for the state in economic and
social policy. And they seem to have had success with this approach: the
Presidents of Bolivia (Evo Morales) and Equador (Rafael Correa) have
both received affirmation through at least one election success and their
popularity appears to be increasing overall (Fatheuer, 2011).
In both countries, Buen Vivir has attained constitutional status. The
constitutions were voted for by a large majority in 2008 in Ecuador and
in 2009 in Bolivia and are seen by many as pioneering instruments of
fundamental structural change. In the constitutions, the right to a good
life and nature as the subject of rights are enshrined as guiding
principles. Among these principles are the right to nutrition, health,
education and water. In this way, human rights are complemented by
the rights of the natural world and vice versa. Eventually, the attempt to
implement Sumak Kawsay in politics should result in a permanent
endeavour to effect the participatory democratisation of society, with a
solid foundation in citizenship (Acosta, 2009).
Since the constitutions came into force, partial successes have been
observed. For example, in Yasuní National Park in the Amazon Basin,
Ecuador has allowed oil reserves to remain untapped in return for
payments from the international community. President Correa unleashed
a furore after 2007 with the unique Yasuní-Initiative. Texaco (or
Chevron) and BP were ordered by the Ecuadorian courts to pay
compensation in 2011 und 2010 for the huge environmental damage
caused by their oil production activities in the Amazon region. This
action was possible because Ecuador is the only country that recognises
nature as a subject possessing rights (Schmid, 2011). At the same time,
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the concept is controversial because there are many aspects that show
just how difficult it is to implement the Buen Vivir vision in Realpolitik. It
remains to be seen whether a new boom in raw materials associated
with anticipated high profits will prevail and if oil production in nature
conservation areas will continue in future.
The Ecuadorian Ambassador to Germany, Jorge Jurado, gave an interview
to the German Tageszeitung newspaper in April 2012 in which he said
that he saw great opportunities and options for the poorest developing
countries in embracing the concept of Buen Vivir, while in the highly
developed industrialised countries, the opportunity lies in opening up a
discussion about the limits to growth.
Sources of further information and links
Fatheuer, Thomas (2011). Buen Vivir. Eine kurze Einführung in Lateinamerikas
neue Konzepte zum guten Leben und zu den Rechten der Natur, Volume 17 in
the "Ökologie" essay series. Heinrich-Böll-Stiftung: Berlin.
Acosta, Alberto (2009): Das “Buen Vivir”. Die Schaffung einer Utopie, in: Juridicum
2009/4.
Schmid, Elisabeth (2011). Die Frage nach dem guten Leben. Ein kritischer
Vergleich des Fähigkeitenansatzes von Amartya Sen mit dem
verfassungsrechtlichen Leitprinzip des Sumak Kawsay in Ecuador. Masters
thesis: Danube University Krems.
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Common Welfare Economy—A growing democratic alternative
Profile
The Common Welfare Economy offers a vision of an alternative
economic system, built upon values that support common welfare,
such as cooperation and solidarity. It aspires to be an open-ended and
participatory process of development.
Representatives: Christian Felber,
currently approx. 500 pioneercompanies
Perspective: National
Approach: Civil society
The Common Welfare Economy describes central elements of an
alternative economic framework. The goal is to establish a legally-
binding framework in which an economy oriented towards the common
good can be embedded. Common welfare economics means shifting
entrepreneurial motivation away from competition and maximising
profits towards the pursuit of the common good and cooperation.
The Common Welfare Economy can thus be understood as an attempt to
build on values that allow interpersonal relations to flourish. These
include confidence building, responsibility, empathy, mutual support
and cooperation.
The proposed model is built upon two key elements: the common
welfare balance sheet and 20 cornerstones regarding content. Behind
the Common Welfare Balance Sheet lies the idea that entrepreneurial
success should no longer be measured in terms of monetary gain (as in
conventional balance sheets), but rather in terms of a company's
progress towards a Common Welfare Economy. Adherents aim to
measure "what really counts", which, when compared to current
economic behaviour, is more beneficial in social, ecological, democratic
and solidarity terms. The more companies could be persuaded to act
according to common welfare values, the better their Common Welfare
Balance Sheet would be. A positive balance sheet should be rewarded by
a range of incentives and "systemic reinforcement" measures. This
means that companies would be rewarded for cooperation, e. g. in the
form of lower taxation or cheaper credits, and would be disadvantaged
by competition. The Common Welfare Balance Sheet would be a
voluntary instrument set up by companies themselves but that which
There is always
an alternative.
Christian Felber,
independent journalist
and pioneer of the
Common Welfare
Economy
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would eventually take on a legally binding character. Identifying which
concrete elements should constitute such a balance sheet is the subject
of an ongoing process of development, with a large number of
participants. Version 4.0 of the Balance Sheet is the most recent version
of this model.
The 20 content cornerstones of the Common Welfare Economy are
the subject of ongoing discussion and further development. They
contain a number of innovative suggestions. One example at the macro-
economic level involves replacing GDP as the indicator of economic
success with the Common Welfare Product. Capping the transfer of
inheritance assets ( e. g. at 500 000 Euros per person) would produce a
democratic endowment for succeeding generations, and thus ensure
greater equality of opportunity. Directly elected regional economic
parliaments are proposed, democratic commons in education, health,
social, mobility, energy and communication sectors, and a democratic
bank. The creation of a fair trade area (―Common Welfare Area") is
aimed at, while the education system should communicate the values of
common welfare, e. g. 'emotionology', values and ethics, communi-
cation, democracy, nature and environmental education/experience, and
body awareness. All 20 cornerstones should be developed through a
broad participatory process. At the end of the process, these key
aspects should be anchored politically and reflected in legislative
changes through the work of democratic conventions. Those aspects
of the model that receive popular approval through referenda should
then be anchored in the constitution.
Initial traces of the developmental process towards a Common Welfare
Economy since 2001 should be noted here. The Common Welfare
Economy was presented in book form in 2010, with contributions from
numerous advocates of the concept. Author and political activist
Christian Felber brought together the basic principles of the concept in
detailed form. 70 companies put themselves forward as the first
advocates of the concept in the business world. Shortly thereafter, The
Common Welfare Economy process began with the vision of expanding
the community of participating companies and pioneers. 2012 marks
the beginning of Fiscal Year II for the pioneer companies involved;
approx. 200 companies plan to produce a Common Welfare Balance
Sheet. At the end of 2011, approx. 500 companies from 13 countries
had given their support for the initiative. In numerous regions the first
so-called energy fields (regional support groups) of individuals
committed to implementing and developing the Common Welfare
Economy were founded. The idea, which originated in Austria, has thus
continued to expand and grow in recent years.
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Source of further information and links
Felber, Christian (2012). Die Gemeinwohl-Ökonomie. Aktualisierte und erweiterte
Neuausgabe. Deuticke: Vienna.
Felber, Christian (2011). Die Gemeinwohl-Ökonomie. Eine demokratische
Alternative wächst. 20-Punkte-Zusammenfassung,
http://www.christian-felber.at/schaetze/gemeinwohl.pdf (18 July 2012).
Gemeinwohl-Ökonomie (2012). Gemeinwohl-Ökonomie. Ein Wirtschaftsmodell mit
Zukunft, http://www.gemeinwohl-oekonomie.org/ (18 July 2012).
Gemeinwohl-Matrix: http://www.gemeinwohl-oekonomie.org/
wp-content/uploads/2012/03/Gemeinwohl-Matrix_4.0_2012.pdf
(18 July 2012).
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The Solidarity Economy—Putting people at the centre
Profile
Solidarity economies are often local alternative forms of economic
system in which people take economic matters into their own hands
with the help of basic democracy and a needs-oriented approach.
Representatives: Numerous actors
Perspective: Local to global
Approach: Predominantly self-organised
There is a broad spectrum of alternative economic forms that place
human needs in the centre of their activities. According to the premise
that the economy exists to serve the people, those participating in a
solidarity economy do not do so for profit. ―Solidarity" means that
economic activities are oriented at answering the needs of participants
and should provide benefits for them. In a solidarity economy,
solidarity stands in opposition to competition, and also means taking
account of the needs of future generations, and thus taking care of the
natural environment. Alternative economic systems that take such form
are brought together under the umbrella term of the solidarity economy.
Although there is no clear single definition of what solidarity economics
comprises, a number of characteristics can be identified.
Common aspects of solidarity-oriented economic forms:
They contribute to sustaining life;
are self-organised, meaning that the means of production are
collectively owned;
are built on cooperation, which means that decisions are taken
collectively;
foster a relationship with society based on solidarity, e. g.
through collective associations and platforms (Exner, 2012).
The various forms of solidarity economy assume a common guiding
philosophy: that all persons have rights of access in accordance with
human dignity to everything they need in physical, psychological and
intellectual terms in order to be able to lead a good life in the social con-
text of their choice (Voß, 2010). In other word, what matters is: ―Using,
not owning‖, ―contributing, not exchanging‖, ―sharing, not purchasing‖.
It is people and their
needs that are important,
not competition, profit
maximisation and
growth.
Elisabeth Voß,
independent journalist
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The term "solidarity economy" must be understood as having a broad
meaning and as part of a negotiation process involving all the partici-
pants. It may relate to theoretical concepts or to practical projects. The
form it takes may range from self-managed businesses to local direct
marketing, exchange networks and fair trade, to cooperative associa-
tions, ecovillages, regional currencies, community gardens or living
projects, urban gardening, or to open source projects and community-
organised healthcare, cultural and educational institutions. In some
cases, solidarity economies are embedded in capitalist market struc-
tures, while in others they clearly reject market economics and see
themselves as an alternative to capitalism. In most cases, solidarity-
based economic activities are established at local level. Despite this,
there are instances in which large geographical distances are involved,
for example in the case of fair trade practices.
Originally, the term "solidarity economy" came from South America. In
the 1980s, the Chilean Luis Razeto Migliaro attempted to explain how
people living in poverty who joined together in small collectively-
managed companies, would be able in spite of their lack of resources
and low social status to achieve economic success. Razeto described the
ingredients of their success with the ―Factor C‖—Companerismo
(friendship), Cooperacion (cooperation), Comunidad (community),
ComUnion (unity in diversity), Colectividad (collectivity), Carisma
(charisma), Compartir (sharing).
Due to the economic crisis of the 1980s, the solidarity economy
experienced an enormous upswing in popularity, particularly in Brazil.
In 2003, the Brazilian government established a dedicated State
Secretariat for Solidarity-Based Economy, with the aim of mapping out
solidarity-oriented activities throughout the country and subsequently to
offer them support in the form of targetted assistance. Today, the
solidarity economy has a widespread presence in many South American
countries, both in political discourse and in practice. In the German-
speaking world, the early roots of solidarity-oriented economics are
found in the cooperative movement of the 19th century. At that time,
people joined together in cooperative business practices such as
consumer, credit and housing cooperatives to escape from the negative
consequences of industrialisation. Although this movement began as a
form of basic democracy, many of today's centralised cooperative
structures (for example, the Raiffeisen Confederation) have little in
common with forms of solidarity-based economy. The South American
concept of the solidarity economy was propagated by scientists such
Elmar Altvater. In 2006, the first Congress on Solidarity Economies took
place in Berlin, the impulses from which led to a further congress in
2009 in Vienna. The next Solidarity Economy Congress is due to take
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place in Vienna in February 2013. The current increase in the concept's
popularity has led to the founding of Solidarity Universities (Kritische
Solidarische Universitäten) in Germany and Austria. The awarding of the
Nobel Prize for Economics to Elinor Ostrom also directed public
attention to the solidarity movement and the closely related debate
surrounding common goods (or "commons"). Ostrom carried out
research into the notion of common goods and their beneficial use
beyond state and private property.
Examples of solidarity economics can often be found still—or again—in
the area of food sovereignty. In the course of discussions about Peak
Oil and climate change, agriculture and nutrition have once again
emerged as existential themes. The spectrum of forms taken by
solidarity economics begins with food cooperatives, in which people
join together to purchase regional and organic foodstuffs. In this type of
buyers' cooperative, members also take on work e. g. goods distribution
or accounting. By eliminating intermediary trade, goods can be provided
that are high in quality but low in cost. The concept of community
supported agriculture (CSA) goes a step further. An Austrian example
of this practice is the garden estate Ochsenherz Gärtnerhof in
Gänserndorf. This community-owned Demeter (biodynamic) farm was
set up to supply vegetables to a community of some 200 people, who in
return undertake the work involved in running the farm (Exner, 2012).
Sources of further information and links
Exner, Andreas und Kratzwald, Brigitte (2012). Intro Solidarische Ökonomie &
Commons. Mandelbaum: Vienna.
SÖ (2012). Initiative für ein Netzwerk Solidarische Ökonomie,
http://www.solidarische-oekonomie.de/ (18 July 2012).
Voß, Elisabeth (2010). Wegweiser Solidarische Ökonomie. Anders Wirtschaften ist
möglich. NETZ für Selbstverwaltung und Selbstorganisation e. V.: Dortmund.
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Transition movement—Moving into the post-oil era
Profile
The transition movement comprises groups of committed citizens who
join together in cities and smaller communities to respond to climate
change and Peak Oil by minimising their carbon footprint and increase
their resilience to supply deficits triggered by oil shortages.
Representatives: Rob Hopkins, Naresh Giangrande,
Louise Rooney
Perspective: Local, regional
Approach: Civil society
In the search for responses to climate change and Peak Oil, Transition
Communities aim to actively manage the transition to a resilient, self-
sustaining society. Their goal is to free themselves from a dependency
on fossil energy carriers and to practice a low carbon lifestyle. They view
themselves as a form of "social experiment" and as being on a learning
path. Rather than waiting for governments, politicians and other
institutions to take action, these communities wish to play an active role
themselves. With governments taking too long to act and individuals
being able to achieve little on their own, as a community ―it might be
just enough, just in time‖.
The term ―Transition Movement‖ originated in Ireland and Great Britain,
where the idea of transition as the futher development of the
permaculture concept was born. The first Transition Towns were
established in Kinsale (Ireland) und Totnes (England) in 2005, at the
initiative of Rob Hopkins. In 2008, Hopkins published the Transition
Handbook as a 12-step guide to support further Transition Initiatives.
Supported by the Transition Network founded in 2007, the movement
spread throughout the world. Today, there are Transition Initiatives in
the US, in Thailand, India, Nigeria, Brazil and Austria, as well as in many
other countries.
Transition Initiatives have a common goal of making a transition from
energy-dependent to locally-oriented and resilient communities.
Resilience in this context is understood as a local community's capacity
to withstand external disruption, for example supply deficits caused by
oil shortages. The availability of cheap oil facilitated a huge increase in
Transition doesn‘t wait
for permission to get
started, it is about
ordinary people making
things happen within a
bigger strategic context.
Rob Hopkins,
Co-founder
Transition Towns
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our standard of living in recent decades; at the same time, it made our
everyday life dependent on oil, whether for heating and transport, or as
a raw material for plastics, plant protection products, fertilisers,
medicines, and many other products. The big question facing
supporters of Transition Towns is how people will be able to continue to
live well (or better!) when the oil supplies upon which our current
prosperity is built run out. Transition Communities are looking for
answers to this question. Their concern is not to spread panic about the
situation but rather to seize the opportunity to take control of their lives
and reorganise them in a sustainable way.
The Transition movement does not provide readymade answers. It sees
itself as providing both the inspiration and catalyst for change. Concrete
ideas and projects are developed at community level in open and
creative consultation processes. Providing support for local structures
is of key importance, and takes different forms depending on the
initiative: self-sufficiency through food cultivation, local currencies, solar
panels, local energy companies or energy saving schemes. In Totnes, the
first Transition Town, many activities have been put into practice
including the foundation of a local currency, the "Totnes Pound", and
education and training projects in which traditional repair and
craftsmanship skills can be relearned, training courses in energy saving
and the development of an energy conversion action plan, a community
garden project and projects aimed at regionalising food production and
trading.
The Transition movement is diverse and is constituted by the individuals
who take part in their respective local communities. It is a grassroots
movement that sees the answer to climate change and Peak Oil in
remaking society in an optimistic and creative way to be both resilient
and free from its dependency on oil.
Sources of further information and links
Hopkins, Rob (2008). The transition handbook. From oil dependency to local
resilience. Green Books: Totnes.
Rob Hopkins on TED talks, http://www.ted.com/talks/
rob_hopkins_transition_to_a_world_without_oil.html (18 July 2012).
Transition Network (2012). Transition Network,
http://www.transitionnetwork.org/ (16 July 2012).
Transition Austria (2012). Transition Austria, http://transitionaustria.ning.com/
(16 July 2012).
Transition Initiativen (2012). Transition Initiativen in Deutschland, Österreich und
der Schweiz, http://www.transition-initiativen.de/ (16 July 2012).
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New Forms of Measuring Wellbeing and Progress
Profile
How do economic growth, prosperity, quality of life and wellbeing fit
together? Is our living situation actually continuing to improve?
A range of initiatives have addressed these and other similar
questions in order to find out how societal progress and prosperity
can be measured in a more comprehensive fashion than is possible
using GDP.
Representatives: EC, OECD, statistical authorities
Perspective: National, EU, international
Approach: Political and scientific
The following descriptions portray exemplary political initiatives that
share a common objective to record and measure prosperity and
progress in a more comprehensive fashion and to use this as a basis for
policy recommendations.
Beyond GDP
The aim of this initiative developed by the European Commission is to
identify which indicators are best suited to measure progress and how
these can be integrated into decision-making processes and public
debate. The second key milestone after the Beyond GDP conference that
took place at the end of 2007 is the communication entitled GDP and
Beyond from August 2009. The communication sets out a concrete
roadmap in the form of five key actions for the development of a new
set of indicators for progress that can be used alongside GDP. These
include, for example, high-level social and ecological indicators in near
real-time or more accurate reporting on distribution and inequalities.
The Commission is currently working to implement the communication.
Interim results are expected in an implementation report towards the
end of 2012.
http://www.beyond-gdp.eu
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Measuring the Progress of Societies
The global project entitled Measuring the Progress of Societies was
launched in 2008 to support the development of economic, social and
environmental indicators with the aim of obtaining a more
comprehensive picture of social progress. The project is hosted by the
OECD and is primarily aimed at supporting the use of indicator sets as
the foundation for evidence-based decision making. The project can be
described as a network of networks, connecting global actors who are
working towards an improved form of measurement for wellbeing and
progress, e. g. statistical authorities, public and private organisations
and scientists. Wikiprogress is the project's online platform. In the
framework of the OECD World Forum, actors meet to make an interim
assessment and to promote new developments. Meetings have taken
place in 2004 in Palermo, in 2007 in Istanbul and in 2009 in Busan
(Korea); the 4th OECD World Forum is due to take place on 16-19
October 2012 in New Delhi.
http://www.wikiprogress.org/
OECD Better Life Initiative
The Better Life Initiative is the OECD's own contribution to the initiative
Measuring the Progress of Societies. The OECD report How’s Life
analyses 11 areas of life that are seen as critical in determining
wellbeing, e. g. domestic and working life, environment and satisfaction.
Building upon this analysis, the Your Better Life Index was developed
with the aim of improving policy decisions to produce increased quality
of life. The Index was presented in May 2011 and addresses the
question of what is important to people in life. It is based on 20
individual indicators and is currently calculated for 34 OECD countries.
The Index is continually updated and improved with current data and
new indicators, and country coverage is being expanded.
http://www.oecdbetterlifeindex.org/
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Stiglitz-Sen-Fitoussi Commission
In 2008, then French President Nicolas Sarkozy set up a high-level
Commission on the Measurement of Economic Performance and Social
Progress, led by Nobel Prize recipients Joseph Stiglitz and Amartya Sen
together with Jean-Paul Fitoussi. In the framework of three working
groups, questions regarding classical measurement of GDP, quality of
life and sustainability were addressed. The Commission's key result, a
report on the current status of research in these three areas of
measurement, was presented in September 2009 and 12 policy
recommendations were made, which are subsequently being
implemented by the French National Institute of Statistics and Economic
Studies, INSEE. Recommendations include, for example, a stronger focus
on households, on aspects of distribution (income, assets and
consumption), and on physical environmental indicators. The OECD
provides the international forum within which this discussion may
be continued.
http://www.stiglitz-sen-fitoussi.fr/en/index.htm
Measuring subjective wellbeing in Great Britain
At the end of 2010, the British Prime Minister David Cameron
commissioned the Office of National Statistics (ONS) to undertake the
measurement of subjective wellbeing in Great Britain. The ONS is
considering questions of subjective wellbeing for inclusion in the
Integrated Household Survey (the largest national survey of social data
after the national census). The process began with a public consultation
to discover which domains of life and which factors play a key role in
contributing to the wellbeing of the British population. This forms the
basis for developing questions that are likely to be brought together to
produce a composite index of national wellbeing. Preliminary results
regarding subjective wellbeing analysis were published in July 2012.
Eventually, the results over time should show whether people's lives are
improving and also contribute to the design of policy measures capable
of increasing wellbeing.
http://www.ons.gov.uk/ons/guide-method/user-guidance/
well-being/index.html
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Findicator: an indicator set for social progress
Findicator is a joint project of the Finnish Prime Minister's Office
together with Statistics Finland. Current data, graphs, tables and
analyses relating to approx. 100 indicators for social progress are
presented and continually updated in online form. Findicator pursues
four aims: to provide information about social development in Finland,
to improve provision of and access to information in this context, to
support evidence-based decision making, and to develop links to similar
sources of information internationally.
http://www.findikaattori.fi/enlink
Measuring Gross National Happiness in Bhutan
In 1972, the 4th King of Bhutan declared Gross National Happiness
(GNH) to be the key consideration for national politics. In 2008, GNH
was accorded constitutional status; this idea, however, has a far longer
history. As early as 1729, it was written in the Bhutan legal code that: ―if
the Government cannot create happiness for its people, there is no
purpose for the Government to exist.‖1
GNH is a multidimensional
concept that not only comprehends subjective wellbeing and happiness
but also, for example, concerns regarding fellow human beings and
nature. Progress towards a greater level of gross national happiness is
measured using the GNH Index. The Index looks at nine domains –
psychological wellbeing, time use, community vitality, cultural diversity,
ecological diversity and resilience, living standards, health, education,
and good governance. These are measured with the aid of 33 cluster
indicators. Following a pilot phase that began in 2006, the first national
survey was carried out in 2010. According to the results of this survey,
10.4 % of Bhutanese people are ―unhappy‖, 47.8 % are ―narrowly happy‖,
32.6 % are ―extensively happy‖‘; and 8.3 % ―deeply happy‖. The survey
data can be analysed to reveal which sectors of the population are
unhappy in which areas. This should enable decision makers to improve
living conditions for less happy members of the population more
effectively.
http://www.grossnationalhappiness.com/
1 quoted from: Ura, Karma, Alkire, Sabina, Zangmo, Tshoki, Wangdi, Karma (2012).
A Short Guide to Gross National Happiness Index. The Centre for Bhutan Studies:
Thimphu, Bhutan.
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Synthesis
The Italian philosopher Antonio Gramsci once noted: "The crisis consists
precisely in the fact that the old is dying and the new cannot be born."
With this in mind, one could characterise the alternatives presented here
as building blocks for the transition from an economic system that is
beginning to disintegrate as its limits and limitations become ever more
apparent, for example in monetary (e. g. the debt crisis) or in environ-
mental policy ( e. g. climate crisis) terms. When the myth that we are
able to live beyond our means indefinitely is exposed as such, the
question as to what might replace it arises. This is the question to which
alternative concepts of economy and society, such as those described
here, attempt to provide an answer.
In spite of the apparently unbridgeable philosophical differences and
ideological perspectives of the many different approaches, similar ideas
and aims keep coming to the fore. The vision of a new quality of life and
coexistence shines through all these concepts. At their core lies the
desire for a good life and high quality of life—not only for us but also
for our children and grandchildren, and for people who are currently
living in poverty.
In terms of implementation and fleshing out these approaches in
concrete terms, clear differences do emerge, however: some call for the
economy to be emancipated from growth, while others go further and
suggest that the economy as a whole should be subject to a controlled
form of downsizing. Others assume that ecological and social inno-
vations and altered incentive structures will be sufficient to steer the
engine of growth and the hoped-for maintenance and expansion of
prosperity towards sustainable development.
A frequentcriticism of alternative concepts of economy and society is
that, as utopian visions of a different and better life, whether proposed
or partially put into practice, they can exist only in niches rather than
the mainstream. Critics ask: Is it not utopian to imagine that such ideas
could ever acquire the power to shape reality on a broad basis? The
counter-argument can be made, however that tolerance and acceptance
for new ideas are often achieved more quickly that expected. Ten years
ago, who would have thought that Irish pubs and Bavarian beer tents
would be smoke free, or that the 2007 elections would produce a black
President in the US, that investment bankers would be out of work, or
that Facebook would have almost 1 billion users?
The search for alternatives is thus well underway, and economic
practices that were dismissed a few years earlier as utopian are now the
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subject of serious debate. Examples such as those coming from Bhutan,
Bolivia and Ecuador show that the search for alternatives is not limited
to those countries that are already prosperous. However, compelling
visions of how the economic and social systems of tomorrow might look
are not all that is required. Courageous people who are prepared to
leave familiar pathways and take the road less travelled are also needed.
Erich Fromm describes the process of change in his work ―To Have or to
Be” thus:
―Not to move forward, to stay where we are, to regress, in other words
to rely on what we have, is very tempting, for what we have, we know;
we can hold on to it, feel secure in it. We fear, and consequently avoid,
taking a step into the unknown, the uncertain; for indeed, while the step
may not appear risky to us after we have taken it, before we take that
step the new aspects beyond it appear very risky, and hence frightening.
Only the old, the tried, is safe; or so it seems. Every new step contains
the danger of failure, and that is one of the reasons people are so afraid
of freedom. [...] Yet in spite of the security of having, people admire
those with a vision of the new, those who break a new path, who have
the courage to move forward.‖2
Although experience shows that we as human beings share a tendency
to adhere to what is tried and tested, we must recognise that today the
potential for failure is also inherent in every familiar step taken. In this
sense, we need to roll up our sleeves and join the many courageous
actors and creators helping to produce strategies of co-existence and
common economic visions for the future. We do not need to wait for a
grand plan to emerge. Many small pieces of the puzzle are already in
place and are helping to facilitate the transition.
2 Erich Fromm (1976) To Have or to Be. London, New York: Continuum, p.88.