economics

Since publishing Doughnut Economics in 2017, renegade British economist Kate Raworth has become a phenomenon that mainstream economics largely declines to acknowledge but increasingly cannot ignore. Her book has been praised by the Pope, the UN General Assembly, and Extinction Rebellion, and translated into over 20 languages. Guardian columnist George Monbiot calls the book “brilliant, thrilling and revolutionary,” comparing it to John Maynard Keynes’ bravura General Theory book, which revolutionized economics in 1936. 

Raworth’s reconceptualization of the economy as a doughnut accents two features that should be at the center of any economy: the ability to meet everyone’s basic human needs (the inner ring of the doughnut) and the ability to stay within the ecological “carrying capacity” of Earth (the outer ring). 

The framework doesn’t sound so controversial. But when I spoke to Raworth for my podcast Frontiers of Commoning (Episode #15), I was astonished to learn that the economics profession, at least within the academy, has largely ignored her book despite its popularity. Scholars in development studies, political science, and architecture are keenly interested, she notes, as are countless students, activists, and city governments. The cities of Amsterdam, Copenhagen, and Brussels, among others, have actually embraced “the doughnut” as a way to guide their municipal policies and programs.

One of the more spirited lines of research and action for building a post-capitalist future these days is coming from two related networks of international scholars -- the Community Economies Institute and an associated group, the Community Economies Research Network (CERN).   

Unlike most academic fields, Community Economies is highly transdisciplinary and socially committed. In fact, it is formally dedicated to “ethical economic practices that acknowledge and act on the interdependence of all life forms, human and nonhuman.”

It also rejects some premises of standard economics, highlighting instead the vast amounts of informal, off-the-books work that is not necessarily monetized or intended for the market. This takes many forms, as the Community Economies “iceberg” image (below) helps illustrate.  Even though parenting, community life, care work, gift economies, barter, vernacular culture, and many other form of life are productive and valuable, economists generally dismiss these as trivial or uninteresting. After all, there is no market associated with them and no money changing hands.

To get a better understanding of Community Economies and the work of both CEI and CERN, I recently interviewed Professor Katherine Gibson of the Institute for Culture and Society at Western Sydney University, in Australia, for my Frontiers of Commoning podcast, Episode #13.

Gibson is famous for developing -- along with Julie Graham, the geography professor at UMass Amherst who died in 2010  – the very idea of “diverse economies.” It is meant as a counterpoint to capitalism without being derivative of the capitalist worldview and epistemology.

Under the joint byline J.K. Gibson-Graham, the two wrote such books as The End of Capitalism (As We Knew It): A Feminist Critique of the Political Economy (2006), A Postcapitalist Politics (2006), and Take Bake the Economy (with Jenny Cameron and Stephen Healy) (2013).  

Much of the work of the 300-plus CERN researchers around the world is devoted to bringing “invisible” parts of the economy into the daylight. This consists of treatises on such topics as the Solidarity Economy, degrowth, co-operatives, community finance, local trading systems, underground markets, open source software, and commoning, among other topics.

The death of activist/anthropologist David Graeber last week was a cruel loss in these already-difficult times. Graeber was only 59....he clearly had many more dazzling books ahead of him....and those of us questing for system-change as multiple crises converge, took great inspiration from his thinking.

As a student of human societies, he had much to say not only about the human condition but about structures of social organization as they have played out over millennia. Even more: he applied this knowledge by fearlessly critiquing the pathologies of global capitalism – and then proposing and agitating for serious alternatives.  

This is not usually a career-advancing move for an academic. And in fact, he famously ran afoul of Yale University for his radical activism. When Yale indicated that he would not be kept on as a professor there despite his obvious brilliance, over 4,500 students signed a petition supporting him. But he lost the battle and was forced to move on to the greener fields of Great Britain. He eventually ended up at the London School of Economics.

I was bowled over by Graeber’s 2011 masterwork, the book Debt, which properly reframed finance as a preeminently political and social issue. I also took a great deal from Graeber’s extended critique of bureaucracy, The Utopia of Rules, and from his Bullshit Jobs, about the pointless jobs that capitalist hierarchies produce. Toward an Anthropological Theory of Value: The False Coin of Our Own Dreams is one of his lesser-known early works, but I found it a rare treat amidst the vast economics literature that regards “value” as a simple issue: market price = value. 

Graeber’s work on this topic eventually brought him into an orbit with me and my colleagues Silke Helfrich and Michel Bauwens. With Graeber, we co-organized a workshop in 2016 on the meaning of value. The title of the report from that event says it all:  “Re-imagining Value: Insights from the Care Economy, Commons, Cyberspace, and Nature.”

The following essay is adapted from a talk given on May 5 at Radical May, a month-long series of events hosted by a consortium of fifty-plus book publishers, including my own publisher, New Society Publishers. My talk -- streamed and later posted on YouTube here -- builds on two previous blog posts.

As the pandemic continues, it is revealing just how deeply flawed our societal institutions really are. Government programs reward the affluent and punish the poor, and are often ineffectual or politically corrupted. The market/state order is so committed to promoting market growth and using centralized hierarchies to control life, that the resulting systems are fragile, clumsy, and non-resilient. And so on. It is increasingly evident that the problems we face are profoundly systemic.

After dealing with emergencies, therefore, we need to pause and think about mid-term changes in how we can redesign our economy and governance institutions. We need second responders to help emancipate ourselves from archaic, ineffective institutions and infrastructures. We must not revert to old ideological patterns of thought as if the pandemic were simply a temporary break from the normal. “Normal” is not coming back. The new normal has already arrived.  

The pandemic is not just about rethinking big systems; it is also about confronting inner realities that need to change. We need to recognize and feel the suffering that is going on around us. We need to understand our interdependencies so that we can build appropriate institutions to rebuild and honor our relationships to each other. Our inner lives and external institutions need to be in better alignment.

Our years of leisurely critique of neoliberal capitalism are over. Now we need to take action to escape from its pathologies and develop new types of governance, provisioning, and social forms. Fortunately, there are many new possibilities for institutional change – in relocalization, agriculture and food, cities, digital networks, social life, and many other areas.

In corvid-19, neoliberal capitalism has met a formidable foe. The pandemic has shown just how fragile and dysfunctional the market/state order -- as a production apparatus, ideology, and culture -- truly is. Countless market sectors are now more or less collapsing with a highly uncertain future ahead. With a few notable exceptions, government responses to the virus range from ineffectual to self-serving to clownish.

While politicians clearly hope that massive government bailouts will restore the economy, it’s important to recognize that this is not just a financial crisis; it’s a social and political crisis as well. Many legacy market systems – generously subsidized and propped up by state power – are not really trusted or loved by people. Do Americans really want to give $17 billion to scandal-ridden Boeing while letting the post office go bankrupt? It is too early to declare that the old forms will never return, and we do need to remember that the authoritarian option is dangerously close. But it is clear that the future will have a very different pattern.

To me, one thing is obvious: searching for the rudiments of a New Order should be our top priority once emergency needs are taken care of. We need to identify and cultivate new patterns of peer provisioning and place-based governance, especially at the local and regional levels. We need new types of infrastructures and new narratives that understand the practical need for open-source civic and economic engagement.

This is not only necessary to help us deal with climate change and inequality; it is a preemptive necessity for fortifying democracy itself. Reactionary forces are already poised to try to restore a pre-pandemic “normal." “Prepare for the Ultimate Gaslighting,” writes filmmaker Julio Vincent Gambuto in a wonderful essay on Medium.

Gambuto astutely predicts that corporate America, the White House, and the rest of capitalist establishment will soon mount a massive marketing campaign to minimize the realities we’re now experiencing and rebrand the American Dream as back:

Get ready, my friends. What is about to be unleashed on American society will be the greatest campaign ever created to get you to feel normal again. It will come from brands, it will come from government, it will even come from each other, and it will come from the left and from the right. We will do anything, spend anything, believe anything, just so we can take away how horribly uncomfortable all this feels.

And on top of that, just to turn the screw that much more, will be the one effort that’s even greater: the all-out blitz to make you believe you never saw what you saw. The air wasn’t really cleaner; those images were fake. The hospitals weren’t really a war one; those stories were hyperbole. The numbers were not that high; the press is lying. You didn’t see people in masks standing in the rain risking their lives to vote. Not in America…. But you did. You are not crazy, my friends. And so we are about to be gaslit in a truly unprecedented way.

I’m thrilled to say that Free, Fair and Alive: The Insurgent Power of the Commons – the book I’ve been working on for the past three years with my long-time colleague Silke Helfrich – is published today. The book is our ambitious attempt to synthesize what we've learned from scores of commons around the world over the past twenty years.

The book is wide-ranging in its analysis of the power of commoning, but it focuses on the internal social and interpersonal dynamics of commoning; how the commons worldview opens up new possibilities for change; and the role of language in reorienting our perceptions and political strategies.

To dip into the book, check out the Contents page and Introduction. We will be posting new chapters every few weeks. 

Next week I’m embarking on a tour in Europe and UK with Silke to engage a number of audiences with the themes of the book. You can check out our appearances on the right of this webpage, or on the Free, Fair and Alive website at www.freefairandalive.org.

Our book is a foundational reconceptualization of the commons as a living social system. Instead of regarding commons as resources, in the style of standard economics and Garrett Hardin's “tragedy of the commons” essay, we show that commons are in fact dynamic, living social processes. (That’s why economists can’t see them!) They rely on a whole set of human values and behaviors that the standard economic narrative regards as marginal. Our book is a rare inquiry into commoning – the verb, the social practices, the moral relationships – which is quite different from the commons -- the noun, as resources and their exchange value.  

The further Silke and I got into studying and rethinking the commons as a concept, the more that we realized that prevailing categories of thought are simply too reductionist to capture what is really going on within commons. For example, standard economics, property law, and policy assume the reality of rational, autonomous individuals, as reflected in the idea of homo economicus, the philosophy of modern liberalism, and the presumed separation of humanity and “nature.”

George Monbiot, a columnist for the British newspaper and website The Guardian, may be the most prominent champion of the commons that I’ve discovered in mainstream journalism today.  He has long been a compelling, out-of-the-box thinker on all sorts of economic and environmental issues.  Now he is introducing the commons to his large readership and explaining its importance and its historic neglect by economists and politicians.  Bravo!

Monbiot speaks about the need for a new “restoration story” that he calls the “politics of belonging” – a theme explored in his recent book, Out of the Wreckage: A New Politics for an Age of Crisis. He explicitly focuses on the commons in his column of September 27:

"Are you a statist or a free marketeer? Do you believe that intervention should be minimised or that state ownership and regulation should be expanded? This is our central political debate. But it is based on a mistaken premise.

"Both sides seem to agree that state and market are the only sectors worth discussing: politics should move one way or the other along this linear scale. In fact, there are four major economic sectors: the market, the state, the household and the commons. The neglect of the last two by both neoliberals and social democrats has created many of the monstrosities of our times.

"Both market and state receive a massive subsidy from the household: the unpaid labour of parents and other carers, still provided mostly by women. If children were not looked after – fed, taught basic skills at home and taken to school – there would be no economy. And if people who are ill, elderly or have disabilities were not helped and supported by others, the public care bill would break the state.

"There’s another great subsidy, which all of us have granted. I’m talking about the vast wealth the economic elite has accumulated at our expense, through its seizure of the fourth sector of the economy: the commons."

Below is the opening paragraphs from an article of mine that originally appeared on TheNation.com on August 9, 2017. The full article can be found here: https://www.thenation.com/article/to-find-alternatives-to-capitalism-think-small.  Update, Sept. 28: An Italian translation of the article can be found here.

In the aftermath of Donald Trump’s shocking election victory, a shattered Democratic Party and dazed progressives agree on at least one thing: Democrats must replace Republicans in Congress as quickly as possible. As usual, however, the quest to recapture power is focused on tactical concerns and political optics, and not on the need for the deeper conversation that the 2016 election should have provoked us to have: How can we overcome the structural pathologies of our rigged economy and toxic political culture, and galvanize new movements capable of building functional alternatives?

Since at least the 1980s, Democrats have accepted, with varying degrees of enthusiasm, the free-market “progress” narrative—the idea that constant economic growth with minimal government involvement is the only reliable way to advance freedom and improve well-being. Dependent on contributions from Wall Street, Silicon Valley, Hollywood, and Big Pharma, the Democratic Party remains incapable of recognizing our current political economy as fundamentally extractive and predatory. The party’s commitment to serious change is halfhearted, at best.

While the mainstream resistance to Trump is angry, spirited, and widespread, its implicit agenda, at least on economic matters, is more to restore a bygone liberal normalcy than to forge a new vision for the future. The impressive grassroots resistance to Trump may prove to be an ambiguous gift. While inspiring fierce mobilizations, the politicization of ordinary people, and unity among an otherwise fractious left, it has thus far failed to produce a much-needed paradigm shift in progressive thought.

This search for a new paradigm is crucial as the world grapples with some profound existential questions: Is continued economic growth compatible with efforts to address the urgent dangers of climate change? If not, what does this mean for restructuring capitalism and reorienting our lives? How can we reap the benefits of digital technologies and artificial intelligence without exacerbating unemployment, inequality, and social marginalization? And how shall we deal with the threats posed by global capital and right-wing nationalism to liberal democracy itself?

Critiquing problems is far easier than imagining credible alternative futures.  That seems to be the biggest problem in our political culture today:  a colossal failure of imagination.  I was therefore pleased when a new friend introduced me to the writings of David Fleming, an iconoclastic British thinker about economics, the environment, and culture who had roots in the British Green Party and Transition Town movement, among other circles.

Fleming worked for thirty years to produce a massive book Lean Logic: A Dictionary for the Future and How to Survive It, which was finished just before his death in 2010 and published by Chelsea Green in 2016.  Many core themes of that book were skillfully distilled (by his colleague Shaun Chamberlin) into a shorter, more readable paperback, Surviving the Future: Culture, Carnival and Capital in the Aftermath of the Market Economy.

Fleming, one of the earliest to warn about Peak Oil, argues about the decline of the market economy with the rigor of an economist, ecologist and physicist.  But what really sets him apart is his  understanding that those things are intimately related to social organization and human culture.  He realizes that the needs and wants engendered by capitalism will inevitably change as a society kept afloat by cheap fossil fuels falls apart. 

What will society look like in the aftermath of this world?  Fleming believes that we will rediscover and invent a life of place and play – a world in which the traditions of carnival, gift culture and a sense of place re-emerge.  The post-market culture will also be a place where small-scale, local activities make sense again.  Once large infrastructures become too costly to maintain, we will likely build systems that restore elegance and beauty to a place of honor, and that honors local judgment and direct participation in one’s life.

What is “value” and how shall we protect it?  It’s a simple question for which we don’t have a satisfactory answer.

For conventional economists and politicians, the answer is simple:  value is essentially the same as price. Value results when private property and “free markets” condense countless individual preferences and purchases into a single, neutral representation of value:  price.  That is seen as the equivalent of “wealth.”

This theory of value has always been flawed, both theoretically and empirically, because it obviously ignores many types of “value” that cannot be given a price. No matter, it "works," and so this theory of value generally prevails in political and policy debates. Economic growth (measured as Gross Domestic Product) and value are seen as the same. 

Meanwhile, the actual value generated outside of market capitalism – the “care economy,” social labor, eco-stewardship, digital communities and commons – are mostly ignored or considered merely personal (“values”).  These types of “value” are seen as extraneous to “the economy.”

My colleagues and I wondered if it would be possible to develop a post-capitalist, commons-friendly theory of value that could begin to represent and defend these other types of value.  Could we develop a theory that might have the same resonance that the labor theory of value had in Marx’s time?

Marx’s labor theory of value has long criticized capitalism for failing to recognize the full range of value-creation that make market exchange possible in the first place.  Without the “free,” unpriced services of child-rearing, social cooperation, ethical norms, education and natural systems, markets simply could not exist.  Yet because these nonmarket value-regimes have no pricetags associated with them, they are taken for granted and fiercely exploited as “free resources” by markets.

So we were wondering:  If modern political/economic conceptions of value are deficient, then what alternative theories of value might we propose? In cooperation with the Heinrich Boell Foundation and anthropologist David Graeber, who has a keen interest in these themes, we brought together about 20 key thinkers and activists for a Deep Dive workshop in September 2016 to explore this very question.  So much seems to hinge upon how we define value.

I am pleased to say that an account of those workshop deliberations is now available as a report, Re-imagining Value:  Insights from the Care Economy, Commons, Cyberspace and Nature (pdf download). The 49-page report (plus appendices) explains that how we define value says a lot about what we care about and how we make sense of things – and therefore what kind of political agendas we pursue.