Towards a sustainable economy – Time for another game

The current state of the global free market economy resembles the final stages of the Monopoly game. When the game started, every player had the same opportunities. There were plenty of streets to be bought, and houses and hotels to be built. Every turn, more money was earned and spent. The economy was growing.

Nowadays, all streets are sold. Some players are getting richer, others are inevitably falling back into poverty and then bankruptcy. For the winners, the game is still fun. The rest just has to sit and wait until the game is over. Probably, some of them are even thinking about quitting the game or just want to throw the board through the room.

In the real world, we see the same. Natural resources are depleted, wealth is distributed in an extremely unequal way, and it is not very difficult to point out the winners and losers. And as the world population is growing, new players are joining the game every day. It is obvious that this cannot continue forever. We have to change the rules of the economy game.

Vision of a sustainable economy

When envisioning a sustainable future in 2035, we think these will be key elements:

  • Economic growth will still be important in 2035, but the definition of growth includes innovation, happiness and personal growth.
  • We do not consume more than our planet can produce. Edible fish species are no longer endangered, forests are harvested in a sustainable way. The focus on possession of goods (like cars) is replaced by access to goods and services (transportation), so less materials are needed. Prices reflect real costs, including all negative side effects of production, transportation and disposal.
  • Companies are owned by loyal shareholders or by cooperations, and managed by people who aim at adding value for the entire society and making profit at the same time. A new market index ranks companies accordingly.
  • Economic benefits are distributed in a fair way. Extreme poverty no longer exists, nor does extreme wealth.
  • Companies, banks and insurance companies can be trusted, not only because they are monitored by NGOs, media and governments, but also because they feel responsible for their role in society.

Play the game

In order to get to this sustainable economy within 25 years, all players will have to contribute. Leadership in this field will be necessary, not only by business leaders or politicians, but also by informal leaders in new, virtual networks. Also, tax systems will have to be reformed in a way that favors the conservation of natural resources, participation and equal opportunities. In financial markets, high frequency trading of stocks should be made less attractive so long term commitment of shareholders with companies is stimulated. Universities should develop new knowledge about measuring economic effects. Schools can educate their students about sustainability issues. Pension funds should facilitate the transition by investing in sustainable companies and by using their financial power to have companies shift to a more sustainable way of operating. Governments should focus their policies on stimulating the change needed. Consumers can do their job by shopping for sustainable products, and pay fair prices.

We are convinced that most people, governments and companies already realize that a sustainable economy is truly a better economy. However, in the way we are playing the game now, a rapid shift towards a sustainable economy equals losing it. The main challenge therefore will be changing the rules.

This is a short summary of the paper developed  by the OCF2 Economy Group. Summary by Jos Reinhoudt, based on the work of the Economy Theme Group of Our Common Future 2.0. The original working paper and abstract (both in Dutch) are available via www.ourcommonfuture.nl.

 

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