within the global carbon budget and other ecological boundaries that
we need for a thriving planet. The inventor of GDP himself, a brilliant
economist called Simon Kuznets, became his own greatest critic.
He said 'the national income can scarcely be taken as the measure
of the welfare of a nation'. GDP just tells you the financial value of
the goods and services that are sold. It tells you nothing of the value
created by the community, nothing of the unpaid caring 'vork that
goes on in homes, it tells you nothing of what's happening to the
living planet on which we depend.
So, either growth isn't possible because it is a threat to the integrity
of the planet we depend on, or in some countries gro,\rth just isn't
coming. The IMF have forecast what they very politely call 'flat
grovvth' for a number of countries. Suddenly there is a question about
what happens when the long run of gro"rth and the presumption
of future growth has gone. To me, these are the existential economic
questions of the century because it's so far from what any politician
wants to talk about. vVhen you listen to a politician talking, the word
growth appears all the time because it's a proxy for progress and
success. We need to move away from the paradigm that growth is
progress. We currently have economies that need to grow 'vhether
or not they make us thrive. I believe this century we need economies
that make us thrive, whether or not they grow. It's a different
challenge, and I'm not saying we have all the answers of ho'v we
get there but I think it's a very real question.Big ideas often emerge from crisis. Out of the
Depression came Keynesian economics, out of
stagflation in the 1970s Thatcher and Reagan turned to neoliberalism,
and the GFC of 2008 certainly shook up the complacent idea of
finance as infallible, and the notion that financial markets were acting
to stabilise the economy it turned out to be the opposite. Today, ·we
find ourselves in the middle of a massive ecological crisis, of chmate
breakdo·wn and loss of biodiversity. 'Ve're in the middle of a social
crisis. Globally, the richest one per cent of the people in the world own
half the world's wealth. This is insane! US 'vriter vVilliam Burroughs
once wrote: 'After taking one look at this planet any visitor from
outer space would say "I want to see the manager"'. 'Ve've become
used to the situation ·we're in but it's become extraordinarily extreme.Do we need
nnolhcr crisis'~Is lhere hope for
lhe fulurc?There's something crazy about penalising
companies for hiring people. They pay labour
taxes for the employees they hire. Instead, we should be charging
companies for using new materials and producing waste. Apply taxes
in a way that actively encourages companies to stop chasing labour
productivity and employ as few people as possible, and instead chase
resource productivity - to use resources for as long and efficiently and
thoughtfully as is possible. This is one obvious way that transforming
the paradigm can be achieved by transforming tax policy.
There is hope when a really progressive business says: 'You know
whaU We're going to have net zero carbon in our supply chains,
actually, no, scratch that, \ve're going to be a net positive company
and we're going to sequester 1nore carbon dioxide than we emit'.
Change starts to happen when ambitious governments dare to set
a different vision - New Zealand has just introduced a well-being
budget - when communities create transition to,vns, and when
students march world,vide.Doughnut Economics
Kate Raworth
Random House
Business Books, 2017
This piece is based on a longe1· audio
recording originally published
on rnz. co. nz