A New Economics for People Communities for Life

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A new economics . for people, for communities, for life - Dr. MichaelTowsey

I was asked to keep this talk positive – not to spend my time describing problems. This is goodadvice -- we need solutions. I will assume that we all share a common concern aboutenvironmental destruction, breakdown of communities and social and economic injustice. Thequestion is what to do about it?This is a big question because there are apparently so many diverse problems. I will approach itby painting a big picture. The detail can come later. My starting point is that any proposals for improving the world have to be informed by the wisdom that human beings have alreadyaccumulated. And the good news is that there is plenty of it!To keep things simple, I like to think that there are three primary traditions or sources of wisdomupon which we can draw …….(1) The environmental – goes back into pre-history and involves the indigenous people of theplanet(2) The spiritual – already with us 10,000 to 12,000 years ago and apparent in the Vedas of theIndian subcontinent which are considered to be the first human literature and mark the boundarybetween pre-history and history.(3) The humanist – already apparent in Greek writing 2500 – 3000 years ago and must havebeen crystallising before that.NOTE: In this talk, I am using the terms humanist and humanism in their broadest sense - as theideal which motivated European civilisation over the past 2000 years or so. I am not using thesewords in the narrow anti-religious sense which came later in the 19th and early 20th centuries.One of the great achievements of 20th century philosophy was to make a synthesis of these threetraditions. The synthesis was driven by a number of thinkers particularly feminist writers. Possiblythe most well known name associated with the project is Ken Wilbur. He developed the integralphilosophy and has strong following in the USA.However I will take as my starting point the approach adopted by Prabhat Ranjan Sarkar, theIndian philosopher, 1921 - 1990. I have two reasons –(1) He started on this project in the 1950s probably before many of us in this room were born; and(2) Because Sarkar’s approach underpins a comprehensive economic theory known as Prout.Sarkar calls his synthesis of these three traditions – Neohumanism. So why do we want asynthesis? Because each tradition by itself is incomplete – or put another way – each traditioncan be enriched by the others. What is humanism? The most succinct definition is still thatattributed to the Greek philosopher Protagoras 2500 years ago, who declared that “humans arethe measure of all things”. It means that human dignity and human welfare come before thedictates of kings, queens and priests. It is an amazingly bold idea – but says Sarkar, it is not

enough!If “humans are the measure of all things”, then what about plants and animals? Where do they fitinto the scheme of things – are they just our slaves and play things?CONCLUSION: The humanist tradition needs something else - an enrichment of environmentalwisdom.And if “humans are the measure of all things”, then what can we say about the future, about whathumans can become?CONCLUSION: The humanist tradition needs an enrichment of spiritual wisdom.For the remainder of my talk I want to look at what contribution these three traditions make to our understanding of economics.The photo is of Rachel Carson, whose book, "The Silent Spring" published in 1962, is justlycredited with founding the contemporary environment movement. Well, the contemporarymovement certainly, but environmental wisdom can be traced back to indigenous peoples all over the world. This book (left side) by Knudtson and Suzuki – "Wisdom of the Elders" – makes thecase. The book begins by asking a simple question – what do we mean by indigenous? How toidentify indigenous people?(1) They are the original people of a place.(2) They have a distinctive culture - “they have a profound and deeply rooted sense of place andrelationship with the entirety of the natural world.QUESTION: How would a deeply rooted sense of place and relationship with the entirety of thenatural world alter our understanding and practice of economics? What would our economicsystem look like if it incorporated this wisdom?The answer has many ramifications but I want to consider just TWO MAJOR IDEAS:(1) the idea of natural communities; and(2) the idea of an economy as a living system.This slide shows Aboriginal tribal areas for northern NSW - Sydney to Brisbane. Theseboundaries are based on linguistic evidence.Question – what factors shaped these boundaries?Observation – tribes living closer to the coast occupied smaller area of land. There are threefactors at play.(1) There is an optimum size for a community depending on its culture and technology. When acommunity becomes too big it fragments and becomes harder tomaintain as a cohesive unit. When a community gets too small it ceases to enjoy the advantagesof scale that come from people living and working together. In between is an optimum although it

may be quite a broad optimum.(2) Bioregion – communities are more closely knit when they face the same kind of problems andthey face the same kind of problems when they live in the same bioregion. Furthermore they willadopt the same technology to solve those problems.(3) Carrying capacity – land has an economic potential or to use agricultural language, it has acarrying capacity. Obviously land nearer the coast has greater biological diversity and rainfall andtherefore greater carrying capacity. Less land is required to sustain a population of a given size.Conclusion – Natural communities arise out of complex interaction between culture, bioregionand the economic potential of the land over a long period of time. These three cannot bedisentangled.One of the great defects of economics as taught in universities today, is that it consists of abstractmathematical models devoid of real people and real places. Communities are formed by theinteraction of environmental, social, historical and economic factors. Note that communities mustbe large enough in order to be self-sustaining.Note also that common religion is not accepted by Sarkar as the sole basis for a community.Consider for example, the previous Pakistan (East and West) which split into Pakistan andBangladesh. Different language, different history, different ethnic identity split the previous nationof Pakistan, despite common religion.The second important contribution of environmental wisdom to economics is the notion that aneconomy is a living organism. More accurately an economy is the metabolism of a livingorganism. Living things have two important properties that are relevant to economics.1. Firstly, all living things have a boundary. Animals have a skin and cells have a semi-permeablemembrane which allows selected substances to pass in and out according to the needs of thecell.2. The second property of living organisms is that they attempt to maintain constant internalconditions, despite an external fluctuating environment. Humans maintain constant levels of glucose and pH in their blood. Cells maintain constant proportions of potassium and sodium ionsand so on. This is known as homeostasis.If an economy is a living system then its health depends on similar organisational principles. Aneconomy has its border – a physical border with customs posts and a virtual border in the form of trading and currency exchange regulations. It has imports, exports and waste. Within aneconomy, we expect to maintain a homeostasis which in this case means a continuous supply of essential goods and services at stable prices, despite an external fluctuating global economy. Inthe neo-liberal agenda, free trade and the deregulation of commerce can have the same effect asstripping the skin off an animal. In the worst case it bleeds to death.The struggle to maintain homeostasis is an IMPORTANT PROPERTY OF ALL LIVINGSYSTEMS!!! whether biological or economic. Sarkar expresses this truth by defining life as

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