Towards a New Sustainable Economics

John Nicholls

On October 4th at Leeds Metropolitan University, I attended the Leeds Schumacher Lectures, entitled ‘Transforming the Global Economy: Solutions for a Sustainable World’. The aim of the lectures was to address the issues of economic justice and ecological sustainability posed by the increasing dominance of global corporations in the international economy. The day involved lectures from three high profile speakers with expertise in climate change and economic justice, followed by time for questions and discussion.

Susan George, Chair of the Planning Board of the Transnational Institute, and prominent author and activist in the alter-globalization movement was the opening speaker at the event. She mentioned that the ‘neoliberal’ project, whereby people are encouraged to believe that they have no responsibility for others or the fate of the planet, has resulted in the creation of a ‘triple crisis’, namely the social crisis of poverty and inequality, the financial crisis, and the environmental crisis and threat of species extinction, and remarked that there was no excuse for mass poverty and deprivation today, in a world of such material wealth. She stressed the fact that a reliance on economic growth certainly isn’t the answer ecologically and isn’t even economically as the benefits have been shown to go to the wealthiest portion of society only. She also highlighted the difficult point that localised solutions to dealing with climate change, whilst often preferably, are necessary but tragically insufficient in addressing the issue with the speed required. The need for a ‘New environmental Keynesianism’ of targeted government spending on in renewable energy resources was stressed, as was the idea that such a conversion to a green economy is technically feasible. Other possibilities such as taxes on currency and other financial transactions and cancellation of debt with environmental conditions, and the need for a broad alliance within the global justice movement were mentioned.

The second speaker was Ann Pettifor, executive director of Advocacy International, and leading figure in the Jubilee 2000 debt campaign. She has recently spent time working on her blog, “Debtonation”, which analyses the underlying core issue of debt in the current financial crisis. She has also recently authored a thinkpiece published by the democratic left pressure group Compass, entitled ‘The Credit Crunch and the Green New Deal’. She spoke passionately about the need for an effective understanding of the current crisis amongst activist circles, and an effective response that has environmental sustainability and social justice at its core. She traced the causes of the crisis back to the massive increase in credit that began with the deregulation of the international economy following the collapse of the Bretton Woods system of monetary management in 1971. The led to the development of high levels of inflation in the 1970s, that led to a new system of economic management of ‘monetarism’ from the late 1970s onwards, focusing on the use of interest rates cut backs in government spending to curb inflation, associated with the right-wing governments of Margaret Thatcher and Ronald Reagan. She was keen to stress once again the interlinked nature of the different crises (financial, ecological, social) currently unfolding, something that she suggested hadn’t been understood by the current Labour government. “When Gordon Brown sets up a Climate Change and Energy department and simultaneously appoints Peter Mandelson as Business Minister charged with telling the City of London not to worry about re-regulation, you can tell he hasn’t made the connection”, she said. She suggested the lowering of interest rates as an immediate priority, as part of a longer-term strategy of ‘subordinating finance to the real economy’.

The final speaker was Andrew Simms, Policy Director at the New Economics Foundation and head of the Climate Change programme at the Centre for Global Interdependence. He is also author of, amongst other works, ‘Tescopoly: How One Shop Came Out On Top And Why It Matters.’ He talked about the volatility of the global oil and food distribution networks on a ‘fragile energy edifice’, and the need for a progressive rather than exploitative interdependence between nations. He also talked about the need for effective energy demand management through a ‘Green New Deal’, as well as co-operatives, mutuals and credit unions on a more local scale. An immediate priority for him was the stabilisation of the world’s financial systems, involving the breaking up of discredited institutions, and a clamp down on tax havens. Secondly he stressed the need to raise resources for change, using an oil legacy fund and a recurrent windfall tax on energy companies. He championed the idea of a ‘World Alliance for Decentralised Energy’, creating, above all, the conditions in which ecosystems and the core economy can flourish.

The day was deeply informative and inspiring, and I left wanted to learn more and take action. I hope to take some of the ideas from the sessions into academic learning, and hope to be part of a new movement for a green, sustainable economics: one that puts people and the planet at its very heart.

For more information go to:
www.schumacher-north.co.uk
www.tni.org
www.neweconomics.org
www.debtonation.org
www.advocacyinternational.co.uk