BUILDING A NEW ECONOMY

By Trish Morrow trishincyberspace[at]hotmail.com

What would our economy look like if we abandoned the notion of growth and embraced a
new economic system which was free of usury and went beyond the circular economy to
lead to net environmental benefits? On the weekend of 1, 2 and 3 September I attended the
Building a New Economy conference to find out just that.

Photo credit: Alison Bird 2017

At present, high school students of economics are taught that economic growth is both
necessary and useful, and the notion that interest on loans is morally correct is never
questioned. Ecology courses tend to feature recycling and tree-planting which are very
important, however the circular economy (building our economic systems and infrastructure
by modelling biological systems) is not part of the present curriculum. Islamic economics,
doughnut economics, steady-state economics and bio-mimicry are not on the radar. All
these themes and more were debated during the Building a New Economy conference.

Alternative currencies, the sharing or free economy, solar farms, ways of building trust and
social capital, use of blockchain technology and environmental law were discussed during
the weekend. Decentralized governance, co-operatives and credit unions, the role of the
environmental movement, and information technology for alternative trading systems were
among the topics presented. There was even mention of the production of eco-friendly
textiles from algae, and a solar cooking display. The New Economy Network of Australia
(NENA, https://neweconomy.org.au/ ) organised the conference, to bring together experts
from every facet of the alternative economic spectrum, to share ideas and brainstorm new
ways of working together for increased effectiveness. Participants and presenters came not
just from around Australia but also from Europe and the United States. Ripess Europe
(www.ripess.eu), a group representing the solidarity economy in Europe, was represented at
the conference. Ripess brings together 36 networks in 15 European Union countries.
Many Powerpoint presentations were given, and there were group discussions, workshops and
even a simulation game.....Quote of the day on Friday was, Power corrupts but PowerPoint
corrupts absolutely. Haha!

Ian Lowe raised the question of whether economic growth at the expense of the human species
and its environment was really a good thing, or whether growth in certain areas (e.g. production
of weapons, coal mining) could not rather be likened to a type of cancer. Other speakers
approved of economic growth in ecosystem restoration or poverty reduction, but working overall
towards a steady-state where growth in some areas is offset by shrinking in others.

Some solutions proposed to our present ecological and economic ills included a stable
population, an equitable distribution of goods and services, localised production of food,
prevention of flight of capital and resources from rural areas to big cities, and the abolition of
interest. This abolition of interest (usury) would see money being returned to its original role as a
simple medium of exchange with no intrinsic value in itself, thus avoiding stock market crashes
and concentration of wealth in the hands of a few. The Universal application of Extended
Producer Responsibility was advocated, as well as a basic universal minimum wage. To avoid
tax evasion by the richest and most powerful, the replacement of all current forms of taxation with
a tax on financial transactions was advocated.

In the linear economy, minerals and fuels are harvested, turned into goods, sold to fuel economic
growth and then dumped. The circular economy closes the loop by taking wastes from one
process and using these waste products as inputs for a new process. Moving beyond the
circular economy implies providing an environmental benefit, for example a carbon-positive
building would not just offset its greenhouse gas emissions but would actually act as a net
carbon sink, taking greenhouse gases out of the atmosphere. This can be done at the level of
Planet Earth, without violating the second law of thermodynamics, by increasing the use of
renewable energy. Renewable energy, which as we know is fuelled by the sun, is a seemingly
limitless source of energy when compared with our human dimensions of time and space.

Kate Rowlins Model of the Doughnut Economy Photo credit: Trish Morrow 2017
Joining the conference by Skype from Oxfams headquarters, Kath Raworth reminded us that not
only must we live within the sustainability envelope or barrier implied by our ecological limits, but
we must also raise the economic level of the disadvantaged in the worlds poorest countries to
live within the lower limit of human decency. Considering both the upper ecological limit and the
lower limit of human decency gives us a doughnut model of economics as illustrated above.
Auditing humanitys progress (or lack thereof) for each of the sectors of the doughnut shows
where we need to make the greatest changes - climate change, biodiversity loss and
phosphorous loading of our soils for example.

Mary Graham described the Indigenous relational economy which was based on decentralized
power and seeking economic advantage but not at anyone else's expense. Each tribal group was
responsible for sustainable use and management of their own area of land. Before the invasion
of Australia, the country was governed as a collection of independent local governments with
clearly defined boundaries and ecological responsibilities as well as rights. An effective model
from which our current society could learn very much.

It was interesting for me to learn of the differences between credit unions, cooperatives, building
societies and banks. Cooperatives are highly democratic structures as each person only has one
vote and everyone is involved in collective decision-making.

Photo credit: Alison Bird 2017

The concept of work and participation in the economy is changing. I found it interesting to hear
that Uniting Care and Anglicare combined employ more people than the coal industry. Investing
in robots as humanitys preferred future technology will lead to more unemployment but as
renewable energy is labour intensive there will be some jobs in renewable energy production if
we abandon coal and nuclear.

Many people who have skills to offer and basic needs are finding that they cannot participate in
the current cash-based economy, even though someone elses needs match up exactly with their
own skills. One solution to this is a community exchange network
(www.communityexchange.net.au) such as Brisbane Local Economy Trading System
(www.brislets.com). These networks trade in alternative currencies, as part of a cashless
economy. It is one step up from a barter system because two people dont have to exchange
directly with each other. Using debits and credits they can each trade with a third party.

Photo credit: Alison Bird 2017

Thirty years ago I was a member of the second Brisbane LETS group but was too busy to carry
out any trading activities. The NENA conference inspired me to give it another go.

Because of my longstanding interest in renewable energy, I attended a presentation on solar

farms. As yet there are no solar farms in Australia. At present, homeowners can invest in rooftop
solar and achieve a return on their investment over time through reduced power bills. Renters or
homeless people cannot easily earn an income from participating in the solar economy at
present. The only option for renters is to pay more on their power bills for green energy. Solar
farms are extensively used in the US to allow renters to purchase a share in a community-owned
solar power plant, which feeds into the grid, allowing these renters to achieve a return on their
solar investment over a period of some years. Community ownership and management of the
solar farm is also a great way of generating social capital.

http://4.bp.blogspot.com/-A3B2IowlbOk/UeIYPAhew5I/AAAAAAAAIJo/60pHowjGJyU/s640/cartoon.jpg

So much food for thought. ..Many of us have seen the film An Inconvenient Truth. Its easy to
despair of climate change and the increasing gap between the haves and the have-nots, but this
NENA conference highlighted just how many solutions are out there and how many individuals,
groups, cooperatives and communities are beavering away at implementing these solutions. It
will be great to see how all of us can join forces and use our People Power to have a wider
impact and generate more lasting and significant change.