What Would A Mutually Responsible Economy Look Like?

Economy, Featured

I have now reached the point where I may indicate briefly what to me constitutes the essence of the crisis in our time. It concerns the relationship of the individual to society. The individual has become more conscious than ever of his dependence upon society. But he does not experience this dependence as a positive asset, as an organic tie, as a protective force, but rather as a threat to his natural rights, or even to his economic existence. Moreover, his position in society is such that the egotistical drives of his make-up are constantly being accentuated, while his social drives, which are by nature weaker, progressively deteriorate. All human beings, whatever their position in society, are suffering from this process of deterioration. Unknowingly prisoners of their own egotism, they feel insecure, lonely, and deprived of the naive, simple and unsophisticated enjoyment of life. Man can find meaning in life, short and perilous as it is, only through devoting himself to society.” – Albert Einstein, 1949 A Mutually Responsible Economy? In essence, we already know what a mutually responsible economy looks like. It is the economy that exists within the family. In the family, each person operates according to need and merit. There is the mother, father, children, and the extended family. Each operates according to a particular role: The baby, the mother, the father, grandparent, etc. These roles then are further broken down. The baby is, “helpless,” “precious,” “in need of protection.” The father is perhaps the “bread winner,” the mother, “the caregiver,” etc. To contemplate what form an economy based on mutually responsibility would look like, where...

Time To Act: Continued Constant Economic Growth Will Lead To Collapse

Economy, Featured

The earth is full. It’s full of us, full of our stuff, full of our waste, full of our demands; yes, we are a brilliant and creative species, but we’ve created a little too much stuff—so much that our economy is now bigger than it’s host, our planet…” – Paul Gilding, independent writer and adviser on sustainability. The above and following quotes are from Gilding’s TED talk on sustainability. A Familiar Message With Little Regard Given To It It is nothing new that advocates and scientists are warning that consumption is out of control on our planet. However, little is done to educate us, the various populaces of the planet, that our current levels of consumption are detrimental to the future survival of our species, other species, and the planet as a whole. As Gilding says, We’re burning through our capital, or, stealing from the future… what this means is our economy is unsustainable … when things aren’t sustainable they stop.” In Love With A Crazy Idea When we think about economic growth stopping we go, ‘that’s not possible,’ because economic growth is so essential to our society that it is really questioned… it is based on a crazy idea, the crazy idea being that we can have infinite growth on a finite planet… I’m here to tell you the Emperor has no clothes, that the crazy idea is just that: It is crazy.” Gilding states a counter argument: But we need growth. We need it to solve poverty. We need it to develop technology. We need it to keep social stability.” His reply: I find this argument fascinating, as...

Can Africa Continue Booming In A ‘Global Crisis Economy’?

Economy, Featured

Africa As Other ‘Emerging Markets’ Is Still In An Upward Swing, Especially Compared To The Stagnating Western Economies An article, “Africa’s Big Boom” on the pages of Project Syndicate discusses the recent positive developments on the “forgotten continent.” Africa is undergoing a period of unprecedented economic growth. According to The Economist, six of the ten fastest-growing countries in 2011 were in Africa. Average external debt on the continent has fallen from 63% of GDP in 2000 to 22.2% this year, while average inflation now stands at 8%, down from 15% in 2000. This positive trend is likely to persist, given that it is based on structural geographic and demographic factors, such as rising exports, improved trade conditions, and steadily increasing domestic consumption.” Is Local Development, Continuing Growth & Progress Possible In An Otherwise Struggling Global System? One of the biggest problems and reasons  that no solution has been found for the global economic crisis is that isolated outlooks on all kinds of situations, including the economy of single nations or continents, still prevail. In other words, outlooks that do not take the full, global picture into account. Thus, there is a lot of talk about “emerging markets,” China and India, and now also Africa, regions and continents that were either suppressed, or were dormant up until recently and that have now started to catch up to the more developed part of the world. This, however, does not mean that the system being used, which copies the Western model, is a fruitful one. It simply means that they now have a lot of growth potential in relation to where they were...

How To Deal With Tax Evasions

Economy, Featured

Singapore, A Tax Haven, A Refuge For Tax Evaders, Started Taking Steps In Tightening Regulations The article “Singapore: Full disclosure” in The Economist describes how Singapore is introducing tougher measures trying to combat tax evasion in line with the worsening financial crisis in the Western world. From July 2013 financial institutions will be legally obliged to alert authorities to any overseas customer who they suspect of bringing in funds to evade taxes at home, just as they are expected to report on other offences. Equally, the authorities have been sending out stern circulars to all the banks warning them to monitor their customers better, follow the existing guidelines more closely and generally get their houses in order. The flurry of activity is partially a consequence of the debt crisis in Europe and America. Cash-strapped governments have been ramping up tax-collection efforts. Inevitably, attention has therefore turned towards those countries perceived to be offshore havens. Just as Switzerland has become a target for European tax authorities, so has Singapore.”  People Need Either A Negative Or Positive Motivation For Change The key to solving these problems is motivation. As long as the solution is forceful, there will always be people who will find another way, tax evasion, offshore accounts, one trick to the next, and there will always be people, organizations and nations helping them since it is in their best interest. Firstly, today’s global society will have to find a way of educating its citizens, aiming to lead them to the understanding that by cheating, by harming the system, they actually harm themselves. Today there is enough actual field data...

2 Roads To A Different World

Economy, Featured

People Are Running Out Of Options How To Save, Maintain The Integrity Of The Eurozone Ashoka Mody, a visiting Professor of International Economic Affairs at Princeton University writes about the narrowing options for the Eurozone in his article, “The Eurozone’s Narrowing Window.” Thus, the eurozone faces three choices: even more austerity for the heavily-indebted countries, socialization of the debt across Europe, or a creative re-profiling of debt, with investors forced to accept losses sooner or later. Austerity alone cannot do it. Some countries face the growing risk of near-perpetual belt-tightening, which would further dampen growth and thus keep debt ratios high… …More ambitious pan-European efforts are embodied in various Eurobond proposals. These schemes imply socialization of debt – taxpayers elsewhere in Europe would share a country’s debt burden. These proposals, once in great vogue, have receded. Not surprisingly, the political opposition to such debt mutualization was intense. Given that perpetual austerity is untenable and others in Europe can only do so much, without robust growth the options will narrow quickly. As a result, much now hangs on the ECB’s actions – and how long they will be sufficient to maintain a truce with financial markets…” It Seems, As It Happened So Far In Human History, Humanity Will Only Make The Necessary Next Step In Development When The Present System Collapses, When The Present State Becomes Intolerable While based on the article’s argument that the window is narrowing, and that European countries as well as the whole global economy are gradually running out of options, this narrowing and eventually closing window still leads to solution, to the next stage of...

Trying To Push A Cube Through A Circular Hole

Economy, Featured

Politicians Are Desperately Helpless In Tackling The Issues Of The Deepening Crisis Hugo Dixon, the founder and editor of Reuters Breaking Views writes in his article, “Spanish circle getting hard to square“: The art of politics is about squaring circles. In the euro crisis, this means pushing ahead with painful but necessary reforms while hanging onto power. In Spain, where I spent part of last week, these circles are getting harder to square. Mariano Rajoy isn’t at any immediate risk of losing power. His 10-month old government has also taken important steps to reform the economy – cleaning up banks, liberalizing the labor market and reining in government spending. But the recession is deepening, the prime minister is a poor communicator and his political capital has plummeted. Madrid will also find it harder than thought to access help from its euro zone partners…” Humanity Is Trying To Push On With A Fragmented Worldview In A Rounded World The example of squaring circles is a fitting one, and it is even more fitting turned around. The problem with Spain, Europe and in fact with the whole global economy and political leadership is that everybody tries to push a square through circle, or more precisely try to push on, force a polarized, fragmented and isolationist mindset and behavior in a world that has become round, global, that has evolved into a totally interwoven and interdependent network. All the present tools and even Nobel Prize winning ideas are based on the “old” square reality, and they do not work in the new round, circular reality. Not only are they useless; they are...