Ecological Economics
The essence of Buddhist economics
"While the materialist is mainly interested in goods, the Buddhist is mainly interested in liberation. But Buddhism is 'The Middle Way' and therefore in no way antagonistic to physical well-being... The keynote of Buddhist economics is simplicity and non-violence. From an economist's point of view, the marvel of the Buddhist way of life is the utter rationality of its pattern -- amazingly small means leading to extraordinarily satisfying results"
Small Is Beautiful: Economics As If People Mattered, by E. F. Schumacher
Economic Purpose
"The ownership and the consumption of goods is a means to an end, and Buddhist economics is the systematic study of how to attain given ends with the minimum means."
"Modern economics, on the other hand, considers consumption to be the sole end and purpose of all economic activity, taking the factors of production -- land, labor, and capital -- as the means. The former, in short, tries to maximize human satisfaction by the optimal pattern of consumption, while the latter tries to maximize consumption by the optimal pattern of productive effort."
Small Is Beautiful: Economics As If People Mattered, by E. F. Schumacher
Buddhist economics and the nature of work
"The Buddhist point of view takes the function of work to be at least threefold: to give a man a chance to utilize and develop his faculties; to enable him to overcome his ego-centeredness by joining with other people in a common task; and to bring forth the goods and services needed for a becoming existence. Again, the consequences that flow from this view are endless. To organize work in such a manner that it becomes meaningless, boring, stultifying, or nerveracking for the worker would be little short of criminal; it would indicate a greater concern with goods than with people, an evil lack of compassion and a soul-destroying degree of attachment to the most primitive side of this worldly existence. Equally, to strive for leisure as an alternative to work would be considered a complete misunderstanding of one of the basic truths of human existence, namely, that work and leisure are complementary parts of the same living process and cannot be separated without destroying the joy of work and the bliss of leisure."
Small Is Beautiful: Economics As If People Mattered, by E. F. Schumacher
Measuring Economic Health
"We may be witnessing the opening battles in a new kind of politics that will raise basic questions about growth--questions that defy the conventional left-right divide. Where the old politics was largely concerned with the role of government--with the relation between public and private sectors--the emerging one will be more concerned with such issues as central versus local, market culture versus family and community culture, material accretion versus quality and values. The new politics will not be anti-growth, because to be categorically against growth is as nonsensical as to be categorically for it. Rather, it will begin with Luttwak's sane observation that when your goal is simply to increase GDP, then "what you increase isn't necessarily good." It will insist that growth--and economics generally--must be a means to an end, and not an end in itself.
"This is not to suggest that such a new alliance is around the corner. But although the differences between the social-conservative and environmentalist camps are still large, they are probably etched more sharply among leaders in Washington than in the nation as a whole. These groups are converging on one crucial issue--namely, the ends of economic life. In their different ways they are expressing the feeling, widespread among the public, that the pronouncements from economic experts are fundamentally out of sync with the experience of their own lives; that economics must be about more than just the production and consumption of stuff; and that we need larger goals and better ways to measure our achievements as a nation."
If the GDP is Up, Why is America Down? by Clifford Cobb, Ted Halstead, and Jonathan Rowe.
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CAPITALIST ECONOMICS
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MARXIST ECONOMICS
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ECOLOGICAL ECONOMICS
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| Mainly interested in goods. |
Mainly interested in society. |
Mainly interested in liberation. |
| Measures "standard of living"
by amount of annual consumption. Assumes that person who consumes
more is "better off." |
Theoretically classless (no economic class divisions) |
Attachment to wealth stands in
the way of liberation because it brings not enjoyment of pleasurable
things, but craving for things. Non-violence and simplicity lead to
satisfaction. Aim: maximum of well being with minimum of
consumption. |
Want to maximize consumption by optimal
pattern of productive effort.
Consumption is the sole purpose
of economic activity. Production (land, labor and capital) is the
means to consumption. |
Want to produce only enough to meet the needs of society,
not for sale/profit. (Production for use) |
Want to maximize satisfaction by the optimal pattern
of consumption.
"The less toil there is, the
more time and strength is left for artistic creativity (Schumacher,
57-58)." |
| Externalities (economic costs/benefits not included in market price) are not addressed. Natural resources are to be used
to maximize production. |
Externalities are socialized; the community pays external costs and realizes external benefits. |
Externalities are internalized into market prices. Natural
resources are "sacred" and should be used sparingly. |
| Private ownership of economic means of life |
Social ownership and democratic control by all |
Bioregional self-sustaining communities
neighborhood economics
network economy
natural capitalism |
| Rising GDP ("growth") is an infallible indicator of a healthy economy. In the calculation of GDP, only monetary transactions count. Cost free inputs, whether capital (common assets and habitat) or labor (household and volunteer) have zero impact on the calculated GDP figure. Environmental sustainability and social equity are irrelevant to economic health. |
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New indicators, such as the Genuine Progress Indicator (suggested by the organization Redefining Progress), and local/regional sustainability and community indicators need to be created and used to determine whether the economy is healthy. Indicators need to address environmental sustainability and social equity. |
E. F. Schumacher
Decentralism
- What is Decentralism? - "In a world afflicted with giantism in its social, economic, and political institutions, decentralism is often mistakenly identified as radical, but it is in fact based on many traditional values...." This is a short introduction to this "ism" on the E.F. Schumacher Society page.
Appropriate Technlogy, Intermediate Technology
"Appropriate technology is being mindful of what we're doing and aware of the consequences. Appropriate technology works from the bottom up; it is not an overlay to the situation; it is a genuine grassroots solution to economic needs.
"In the Industrial World small businesses account for more technological advances in their areas of expertise than government supported researchers or research departments in massive corporations. Third World craftspeople, farmers and other villagers invent, create, and contribute to the technological process of their area much more than outside 'experts' do.
"The definition of 'Appropriate Technology' changes with each situation... One quality that remains the same, however, is taking care of things. In each situaton, the essence of AT remains appreciating, helping, caring. Planned obsolescence, throw-away products, poor quality all go against intelligent decision-making and the true spirit of appropriate technology."
-- From "What is Appropriate Technology?" by Steve Troy of appropriate technology suppliers Jade Mountain:
http://www.jademountain.com/whatis.html
Ecological Economics and Community Indicators
- If the GDP is Up, Why is America Down? by Clifford Cobb, Ted Halstead, and Jonathan Rowe. The Atlantic Monthly, October 1995 - "The GDP is simply a gross measure of market activity, of money changing hands. It makes no distinction whatsoever between the desirable and the undesirable, or costs and gain. On top of that, it looks only at the portion of reality that economists choose to acknowledge--the part involved in monetary transactions. The crucial economic functions performed in the household and volunteer sectors go entirely unreckoned. As a result the GDP not only masks the breakdown of the social structure and the natural habitat upon which the economy--and life itself--ultimately depend; worse, it actually portrays such breakdown as economic gain."
- Examples of Sustainability Indicators
- Sharing the Wealth: If We Shift the Tax Burden From Work to Waste, Everyone Benefits, By Brian Dunkiel, M. Jeff Hamond and Jim Motavalli. E/The Environmental Magazine, March-April 1999. - "In 1998, according to a Friends of the Earth (FOE) report called Dirty Little Secrets: Polluters Save While People Pay, anti-environmental tax breaks, like those that subsidize oil exploration and logging in national forests, cost the nation $20 billion in a five-year period. Pollution, for the most part, is a business write-off. Eliminate these incentives and the resulting revenue would equal the federal income tax paid by 12 million low-income Americans, or the populations of both Arkansas and Montana."
- Redefining Progress - "Redefining Progress is a public policy organization that seeks to ensure a more sustainable and socially equitable world for our children and our children's children. Working both within and beyond the traditional economic framework, RP generates and refines innovative policies and ideas that balance economic well-being, the environment, and social equity so that those living today and those who will come in the future can have a better quality of life."
- Center for a Sustainable Economy - "The Center for a Sustainable Economy is a non-profit, non-partisan research and policy organization that promotes innovative tax and other market-based approaches to achieving a sustainable economy -- one that integrates long-term economic growth, environmental quality and social fairness."
- World Resources Institute - "World Resources Institute provides information, ideas, and solutions to global environmental problems. Our mission is to move human society to live in ways that protect Earth’s environment for current and future generations."
- The International Society for Ecological Economics - a professional organization
Local Currencies
"Here in Ithaca, New York, we've begun to gain control of the social and environmental effects of commerce by issuing over $63,000 of our own local paper money, to over 1,300 participants, since 1991. Tens of thousands of purchases and many new friendships have been made with this cash, and millions of dollars value of local trading has been added to the Grassroots National Product.
"We printed our own money because we watched Federal dollars come to town, shake a few hands, then leave to buy rainforest lumber and fight wars. Ithaca's HOURS, by contrast, stay in our region to help us hire each other. While dollars make us increasingly dependent on transnational corporations and bankers, HOURS reinforce community trading and expand commerce which is more accountable to our concerns for ecology and social
justice."
Paul Glover
Community Land Trusts
A community land trust is a form of common ownership land in accordance with a charter based on the principles of sustainable and ecologically sound stewardship and use. The land in a CLT is held in trust by a democratically-governed group, while individuals own the improvements created by their own labor and investment. Through an inheritable and renewable 99 year lease, the trust removes land from the speculative market and facilitates multiple uses such as affordable housing, agriculture, and open space preservation.
Value 6
Community Based Economics.
Greens seek a new economics based upon the limits of our natural resources, which meets the basic needs of everyone, under democratic, localized community control.
Value 5
Decentralization.
Power and responsibility must be restored to local communities within an overall framework of ecologically sound and socially just values and lifestyles.
Updated September 14, 2000
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