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The great transition - building a high wellbeing, low carbon economy


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The New Economics Foundation on the 'social economy'.

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The great transition - building a high wellbeing, low carbon economy

  1. 1. The Great Transition to a High Well-Being, Socially Just and Low Carbon Economy Hard Times Ahead Conference, 30th May 2012 Tony Greenham new economics foundationnef (the new economics foundation)
  2. 2. 4 ‘U’s of economics › Unsustainable › Unstable › Unfair › Unhappynef (the new economics foundation)
  3. 3. Unsustainable Nine ecological boundaries Source: Rockstrom (2009) ‘A safe operating space for humanity’nef (the new economics foundation)
  4. 4. Unfair The Gini coefficient, 1979 to 2008–09 (UK) Source: “Poverty and Inequality in the UK” Institute for Fiscal Studiesnef (the new economics foundation)
  5. 5. Unhappy Life Satisfaction in Selected OECD nations Available at www.happyplanetindex.orgnef (the new economics foundation)
  6. 6. Unstable It’s all connected - Sovereign debt and bank exposure Reproduced from the New York Timesnef (the new economics foundation)
  7. 7. Goal of a good economy Achieve high well-being and social justice within fair ecological limitsnef (the new economics foundation)
  8. 8. New Conceptual Frameworknef (the new economics foundation)
  9. 9. Six Pillars of the Great Transition 1 – Reform Finance and Money 2 – Create Good Jobs 3 – Measure What Matters 4 – Define Ecological Limits 5 – Redefine Role of the State 6 – Reduce Inequalitynef (the new economics foundation)
  10. 10. Taming the Vampire Squid….nef (the new economics foundation)
  11. 11. ‘Running out of Money’ Stories from the American Great Depression • Wasted milk, idle labour and hungry children KEY CONCEPTS – debt deflation, spare capacity • The parable of the $100 bill KEY CONCEPTS – relationships of credit; socially constructed; “money is not metal”nef (the new economics foundation)
  12. 12. The Miracle of Worgl • 1932: small town in Austria • 1500 local unemployed • 40,000 shillings public funds • Issued own currency • Re-paved streets, new water system , new bridge, new houses and a ski jump! • 200 towns ready to copy • 1933: outlawed by the central bank See (the new economics foundation)
  13. 13. Local banking – the reinvestment gap A UK snapshot from Barclays Bank…. Deprived Areas All Other Areas 7% 30% 70% 93% Reinvestment gap Reinvestment gap Ratio of lending to savings Ratio of lending to savings NEF (2006) The Power of Information: opportunities for disclosure NEF (2006) Full disclosure: why bank transparency matters.nef (the new economics foundation)
  14. 14. Keeping money local “Money is round, and it rolls away” Confuciusnef (the new economics foundation)
  15. 15. Plugging the Leaksnef (the new economics foundation)
  16. 16. Monetary vs core economy In 2005 average time spent on housework and care for children and adults in Britain worth £253.7 billion – 21% of GDP Source: nef - 21 Hours “No society has the money to buy, at market prices, what it takes to raise children, make a neighbourhood safe, care for the elderly, make democracy work or address systemic injustices… the only way the world is going to address the social problems that are dumped on it is by enlisting the very people who are now classified as ‘clients’ and ‘consumers’ and converting them into co-workers, partners and rebuilders of the core economy.” Edgar Cahnnef (the new economics foundation)
  17. 17. Stories of Co-Productionnef (the new economics foundation)
  18. 18. Complementary currencies Social exchange • designed primarily to motivate people’s behaviour • credits can be issued and simply deleted when spent Challenge: persuading people to appreciate credits which might be regarded as basically valueless Economic exchange • designed primarily to circulate • have a continuing existence once they are issued Challenge: persuading people to trust the credits; backing, balanced books; continued circulation Based on “More Than Money” by David Boylenef (the new economics foundation)
  19. 19. Social currencies Examples Outcomes Local Time-based exchanges, e.g. co-production, building Member-to-Member, Skill Swap, confidence, skills and social Rushey Green, Spice, Care Banks networks, supporting people for personal change or recovery, building community. National or Reward points, e.g. Nectar, Nu- Nudging behaviour, reducing international spaapas, Blue Dot, Wigan and emissions, building loyalty, Windsor, Time Dollar Youth Court recognising effortnef (the new economics foundation)
  20. 20. Economic currencies Examples Outcomes Local Local currencies, e.g. LETS, rebuilding local economies and Brixton pound, Ithaca hours, employment, using local Stamp Scrip, Community Way, resources more effectively, valuing local barter. local waste, tackling poverty National or Backed currencies, e.g. kWh re-valuing local renewables, international money, Carbon points, Liberty revaluing agricultural produce, Dollar, Terra, WIR, LLP money, providing reliable currency, goCarShare, C3. paying peoplenef (the new economics foundation)
  21. 21. Evidence: economic impact UK: 80-90% of money spent in multiples leaks out of the economy (nef 2002) US: 10% redirection of spending from chains to local businesses • San Francisco: $192 million in additional economic activity and 1,300 new jobs (2007) • West Michigan: $140 million in new economic activity for the region, including 1,600 new jobs and $53 million in additional payroll (2008) Source: nef (the new economics foundation): The Money Trail,, p115; Civic Economics and (the new economics foundation)
  22. 22. Complementary currencies - benefits • Local economic multiplier • Building community cohesion • Productive v speculative • Stimulate local production • Shorten supply chains • Increased resilience • Complementary not competingnef (the new economics foundation)
  23. 23. Community Currencies in Actionnef (the new economics foundation)
  24. 24. “A map of the world that does not include Utopia is not even worth glancing at” Oscar Wilde, Irish dramatist, novelist and playwright Tony Greenham @nefbusinessnef (the new economics foundation)