Economy
A
New Vision of Development
by Roar Bjonnes (PNA)
The rationale
behind the current model of global development was first advanced by
U.S. President Harry Truman in his inauguration speech before Congress
in 1949. In his address, Truman spoke emphatically about the deplorable
conditions of the poorer countries. He defined them for the first time
as "underdeveloped areas." In one grand, rhetorical sweep,
Truman had created a concept that soon would divide a diverse world into
three neat categories--developed, underdeveloped, and undeveloped nations.
According to this new vision, all the people of the world were climbing
up the same economic ladder, some slow, some faster, but all toward the
same material goal. On top of this ladder were the Northern countries,
most particularly the United States, and at the bottom were the countries
of the South, with their hopelessly low Gross National Products (GNP).
The
Failure of Economism
The worldview that Truman so successfully articulated has been termed economism
by the German author and green activist Wolfgang Sachs. According to this worldview,
a country's level of civilization is based on its ability to produce material
goods--that is, to increase its GNP. To the society's in the South, who had,
for centuries, advanced a more or less sustainable agricultural economy and
advanced some of the world's most sophisticated cultures, this model appeared
to have little meaning. Yet, according to the Truman doctrine, these Southern
countries were from now on to be recognized as poor, struggling nations, whose
main goal was to copy the North by climbing to the top of the ladder of material
progress.
Thus economic
values superseded all other societal values. According to Sachs, a society
no longer had an economy, society simply was the economy. However, this
materialistic and one-dimensional ethos was not always embraced by the
countries of the South. For them, society included a tapestry of functions,
ideals, modes of knowing and cultural legacies that were often diametrically
opposed to a society driven by the streamlined dictates of maximum economic
output.
Consequently,
over the past 40 years, the North's development strategies have caused
tremendous cultural upheaval. Thousands of local or indigenous subsistence
cultures have been decimated during the forced process of joining the
global race toward economism. However, the gap between the so-called
underdeveloped and developed countries has not been closed. To the contrary,
it has widened. In the process, millions of people have become uprooted
from their local environment to join the poor day laborers or unemployed
struggling to eke out a living in dilapidated and burgeoning shanty-towns
from Mexico City to Calcutta. In short, modern development practices
have been, for the most part, detrimental to both local economies and
local cultures.
Economic
Development and the Destruction of the Environment
The myth that the global economy can continue along the path it has been following
since Truman's speech in 1949 stems in part from the narrow worldview of economism.
According to the business weeklies and forecasts by economists, the world's
economy is relatively healthy and long term economic growth prospects are promising.
That is, relatively healthy for those countries with an advanced industrial
or post-industrial economy, fueled, in part, by cheap labor and raw materials
from the South.
In Africa
and Asia, for example, the economic prospects for most people are not
promising. But more to the point, when it comes to relate economic demand
levels to the health of the natural world, economic planners are at a
loss. In fact, economic planning, guided as it is by economic indicators
and basing its future predictions on past performances, have worried
little about its impact or relation to the environment. Economism, in
other words, often do not see the intricate relationship between economic
output and its effect on the global ecosystem.
This shortsightedness
has had disastrous environmental consequences with often equally calamitous
consequences to people, their culture and livelihood.
Five
Reasons Why Development Has Not Eradicated Poverty
The dominant neo-liberal development model has also failed to deliver its promise
of eradicating poverty in the world. Here is a summary of the the five main
reasons:
1. It has
failed to bring economic equity. Economists Herman Daly and John Cobb
maintain that development itself contributes directly to the growth of
global poverty: "On the whole,...development policies in the Third
world have made many landless, filled the vast slums surrounding Third
World cities, and added to the problem of hunger."
2. It has
failed to integrate economic and ecological concerns. Too often we are
consuming and destroying our biosystems instead of living in harmony
with them. More to the point, the materially rich Northern countries
extract natural resources from the biologically rich Southern hemisphere,
thereby causing both economic and environmental breakdown in the so-called
Third World.
3. It has
failed to protect local cultures and communities. Multinational companies
generally do not ask the local people for permission to profit from its
extraction of resources from an area. A typical example is the Choco
region of Ecuador were oil and other natural resource companies have
built a destructive network of roads, colonized and destroyed half of
the country's rainforest, and devastated the lives of thousands of native
peoples.
4. It has
failed to establish a global, human security policy, to bring about human
rights, peace and justice. According to Michael Renner of the Worldwatch
Institute: "A human security policy [must] include...redistribution
of wealth, debt relief, job creation, technology development , more democratic
and accountable governance, and the strengthening of civil society."
5. It has
failed to provide depth of meaning. Official development policies has
expanded the money economy ever more deeply into every sphere of human
life. The increasing hunger for more material goods and profits has created
a world of inequity, but also an impoverished global culture lacking
in deep, human and spiritual values.
Toward
Sustainable Economics
The most basic tenets of free market capitalism or economic liberalism, which
is the predominant economic model today, can, according to author David C. Korten,
be described as follows:
--Sustained
economic growth, measured by Gross National Product, is the foundation
of human progress and essential to alleviate poverty
--Free markets
are the most efficient and socially optimal way to allocate resources
--Economic
globalization--the free flow of goods, irrespective of national borders,
in an increasingly integrated world market--is beneficial for all
--Local
economies should abandon goals of self-sufficiency and instead attract
outside investors in order to become internationally competitive
" These
tenets," according to Korten, "have become so deeply embedded
within our institutions and popular culture that they are accepted by
most people without question... To question them openly has become virtual
heresy and invokes the risk of professional censure and career damage
in most institutions of business, government, and academia."
Moreover,
the philosophical underpinnings upon which economic liberalism rests
are rarely questioned. Briefly, according to Korten, these are: 1) humans
are motivated by self-interest; 2) the action that yields the most profit
is the most beneficial to individual and society; 3) competition is more
beneficial than cooperation; 4) human progress is best measured in consumption,
i.e.... those who consume the most contribute more to progress.
" The
moral perversity of economic liberalism," according to Korten, "is
perhaps most evident in what it views as economic success in a world
in which more than a billion people live in absolute deprivation, go
to bed hungry each night, and live without the minimum of adequate shelter
and clothing."
This moral
perversity is even more appalling in light of the
mounting evidence that the recent years increase in poverty and deprivation
is a direct result of economic liberalism's monopolistic domination of the Third
World
The
Need For New Models of Development
Central to the question of how to eradicate poverty is the question of which
type of development is best suited for the task. According to the dominant model
of development that arose during the post-War era, economic growth is seen as
the best way to eradicate poverty. Furthermore, economic growth is best promoted
by privatizing community assets, deregulating markets, removing barriers to
free-trade and investment, and protecting intellectual property rights.
However,
this model, as promoted by the so-called developed nations, has so far
failed to eradicate economic inequality, human oppression, environmental
imbalance, and the destruction of local cultures. In other words, development
has failed to curb the underlying causes of global poverty. Consequently,
new development models have arisen as alternatives to the dominant model.
These new models are often referred to as "sustainable development."
Sustainable
Development
The sustainable development paradigm was first defined by the UN's Brundtland
report as "development that meets the needs of the present without compromising
the ability of future generations to meet their own needs." Development
is defined as "a progressive transformation of economy and society."
Said another
way, sustainable development involves balancing the environmental demands
of human economic activities with the regenerative capacity of earth's
eco-systems. While sustainable development calls for substantial reforms
in the functioning of the global economy, it does so--in most of its
variants--within the context of the neo-liberal, free-market economy
dominated by transnational corporations, the IMF and the World Bank.
Alternative
Development Models
These development models--which also are referred to as sustainable--call into
question some of the core institutions and ideological foundations of the world
economy, such as growth, centralized economies, unprotected local markets, private
domination of resources, and material increase as the sole measure of progress.
Post-development--holds
the view that development theory is riddled with the fundamentally flawed
assumptions of Western, industrialized civilization. The discourse of
development theory must be abandoned, and new models must be formulated,
informed by the traditions of indigenous peoples, spiritual values, and
authentic regional cultures. Post-development supports the critique that,
as expressed by Vandana Shiva, "development devalued people by declaring
them underdeveloped."
Thus, development
promotes a perception of "the Other,"--in this case, the global
poor--instead of asserting humanity's inherent unity.
Sustainable
society--holds the view that sustainable development as held by
the Brundtland Report is inherently unsustainable, as it calls for dramatic
growth in the world economy in order to eliminate poverty. Gowth on
such a scale, according to founders Justin Lowe and David Brower of
Earth Island Institute, would be "attainable only with cataclysmic
costs to the Earth and the future."
Grass-roots
development--a term coined by the New Internationalist magazine
to signify a decentralist approach to sustainable development in which
individuals and local communities take increasing control over their
economic and social destinies, with a corresponding elimination of the
influence of big business and, for the most part, big governments. This
view has close affinities with the agenda of the bio-regionalists, who
would add the need for local control over culture as well.
People-centered
development--popularized by David C. Korten of the People-Centered
Development Forum. Attempts to advance the emergence of "an awakening
civil society," particularly as it is seeking expression by progressive
citizens organizations. Suggests that truly sustainable development
can only occur where culture and the institutions of civil society are
strong, local communities exercise economic self-determination, ecological
systems remain vital, and societies are just and economies equitable.
Natural
Capitalism--proposed by Paul Hawken. Advocates socially responsible
business practices in order to reverse global environmental and social
degradation. This "double bottom line approach" to economics
holds that commercial activity should generate both financial and social
dividends. Economic reform will occur by holding corporations responsible
for their actions through green taxes and external cost accountability.
The task of this "capitalism with a green face" is to create
new industrial and market designs that are "self-actuating as opposed
to regulated or morally mandated."
Balanced
Development--proposed by social theorist Sohail Inayatullah, and
others, attempts to move away from the language of development theory
by using the ideas of P. R. Sarkar and his PROUT theory (Progressive
Utilization Theory). PROUT calls for a dynamically balanced use of physical,
mental and spiritual resources for the development of individual and
society, and within the context of a strong ecological ethic. Development
is not only balanced and dynamic, but it is progressive; progress being
conceptualized as movement toward spiritual enlightenment.
Central
to PROUT's vision of a more balanced society are decentralized economics,
economic democracy, cooperative enterprises, self-sufficiency, and both
a minimum and maximum income.
Emerging
from these alternative models of development is the need for a comprehensive
theory of development, one which must address, in integrated fashion,
economy, ecology, society, and spirituality. To establish this new concept
of development in practice, however, will require a fifth element--the
political.
All these
five elements are today to be found in the dialog on sustainability and
development. But how can they be brought together in an integral fashion?
Through the large scale integration of political action with the creation
of model community-based socio-economic development projects. These locally-based,
small scale model development projects can spearhead a development movent
that can counter the top-down planning characterized by today's global
economy. Nothing less, it appears, will suffice if we are to replace
the world-wide dichotomy of affluence and poverty with a more equitable,
humane, and ecological economy.
Economics
As If All Living Beings Mattered
What will be the underlying values of the new economy? David C. Korten claims
that "a sustainable society needs a spiritual foundation. Why? Because
spirituality, not materialism, is the ultimate foundation of life. Economic
liberalism has partly failed, he claims, because of its denial of the human
quest for inner meaning and meaningful relations. The late British economist
E. F. Schumacher concurs. In his seminal book, Small is Beautiful, he warned
against the unsustainable nature of capitalism's rampant materialism:
"Economy
as the content of life is a deadly illness, because infinite growth does
not fit into a finite world. That economy should not be the content of
life, has been told to mankind by all its teachers; that it cannot be,
is evident today... If the spiritual value of inner man is neglected,
then selfishness, like capitalism, fits the orientation better than a
system of love for one's fellow beings."
Here Schumacher
points out a central dogma in current economic thinking: that it is possible,
even desirable, to fulfill infinite human longings with finite things.
This materialist philosophy forms the underlying economic doctrine of
today's market capitalism, of our system of unlimited control over productive
property. Put bluntly, it supports the dictum that selfishness and greed
are good, even necessary fuels for the capitalist engine of growth.
This paradoxical
philosophy has resulted in a market system in which land, food, and intellectual
ideas are bought and sold without restrictions. As we have seen above,
this "free market system" has created an economy of disparity,
of unequal buying power, and of a deep schism between rich and poor.
More specifically, this philosophy grants the concept of "the divine
right of kings" to corporations. In other words, that corporate
owners are ultimately only responsible to themselves and their shareholders,
not to their employees, nor to the environment, nor to the human community
at large.
Finally,
this philosophy grants that unlimited accumulation of wealth is both
positive and a basic human right.
Today it
is widely accepted that unlimited exploitation of the globe's finite
natural resources is unsustainable. There is little support, however,
for the idea that an economy based on unlimited accumulation of wealth,
or unlimited control over private property, may be the direct cause of
today's economic and environmental problems.
Nevertheless, the accelerated accumulation of wealth in the hands of the few,
has caused both economic disparity and environmental degradation. In short,
while there has been an increase in the unbridled accumulation of wealth--which
has resulted in an increase in GNP and per capita income, particularly in the
Northern countries--there has also been an increase in the spread of poverty--both
in the North, and, particularly, in the South.
As long
as the basic tenet of unlimited hoarding of wealth remains fundamental
to our economy, economic disparity and environmental degradation will
continue. We will continue to accept as fair and inevitable that economic
growth creates concentration of wealth, on the one hand, and unemployment,
displacement of people and poverty, on the other. Without a fundamental
rethinking of the current economic dogma of private property rights as
an absolute right above all other values, and that human progress is
best measured as increased material consumption, we cannot create an
environmentally sustainable and poverty-free society.
Cosmic
Inheritance
Economist E. F. Schumacher wrote that "no system or machinery or economic
doctrine or theory stands on its own two feet: it is variably built on a metaphysical
foundation, that is to say, upon our basic outlook on life, its meaning and
its purpose." The "metaphysical foundation" of economic liberalism
is motivated by self-interest, individual property rights, and the fulfillment
of our material or economic needs.
What, then,
should be the basic outlook on life of the new economy? The spiritual
conception of wealth, as described by Sarkar, expresses a common sentiment
among many alternative development thinkers: "This universe is created
in the imagination of the Supreme Entity, so the ownership of this universe
does not belong to any particular individual; everything is the patrimony
of us all. Every living being can utilize their rightful share of this
property...This whole animate world is a large joint family in which
nature has not assigned any property to any particular individual."
Sarkar termed
this concept of wealth "cosmic inheritance," and made clear
its implications for economic theory: " The system of individual
ownership cannot be accepted as absolute, hence [economic liberalism]
too cannot be supported." With a spiritual worldview as the basis
for a new economy, the psychology of greed and selfishness is replaced
with the psychology of collective welfare and cooperation.
Sustainable
Spirituality
If the purpose of development--as presently conceived--is to increase material
amenities, then sustainable development will certainly help us to continue to
consume, but it will not help us attain inner fulfillment. Therefore, sustainable
spirituality--the idea that true progress is movement toward inner fulfillment,
toward self-realization-- must be embraced by the sustainable development program.
Spiritual progress subsumes material development, as people cannot pursue spiritual
growth without adequate basic necessities such as employment, food, shelter,
education, and medical care. So, the purpose of development, guided by a sense
of spiritual progress, is to help us pursue personal and social pursuits that
foster inner growth and communion with people and nature. Activities such as
sports, art, music, theater, yoga, meditation, hiking, etc., do not simply fill
our lives with more material things, instead they fill our lives with enjoyment,
purpose and meaning.
Neo-humanism
Reverence for nature, for all non-human creatures, is a natural extension of
such concepts as cosmic inheritance and spiritual progress. "Our universe," according
to Sarkar, "is not only the universe of humans, but the universe of all;
it is for all created entities." Economic activity, therefore, must take
into account the existential rights of other species. This outlook is an integral
aspect of what Sarkar terms neo-humanism--the view that expands humanism to
include a common, unified consciousness behind the diversity of nature. This
outlook, this spiritual ethic, is growing amongst many seeking an alternative
to the disparities of the global economy.
According
to activist Helena Nordberg-Hodge, "we are talking about a spiritual
awakening that comes form making a connection to others and to nature.
This requires us to see the world within us, to experience more consciously
the great interdependent web of life, of which we ourselves are among
the strands." Thus, neo-humanism--in essence a fusion of spirituality
and humanist rationality--is based on principles of love and respect
for all beings, sharing, cooperation and spiritual progress. A stark
contrast to economic liberalism's idea that the most conspicuous human
motives are self-interest, competition and hoarding of wealth.
