G20, Dinosaurs and Living Within Our Means

The G20 summit has arrived and with it the chance to reshape our rather misshapen world.  Barack Obama has charmed us all with his ability to simultaneously discuss fiscal policy and hold talks with small people about dinosaurs.  I must admit, I probably spend quite a lot of time doing the latter, but fiscal policy might be my weak point!  Nevertheless this week I have been poring over Jonathan Porritt’s essay, published just ahead of the G20, ‘Living Within Our Means – Avoiding the Ultimate Recession.’ 

Porritt, not alone amongst green advocates, sees the current recession as a chance to reform capitalism along sustainable lines.  He argues in his essay, forcefully and coherently, that the system that has driven the collapse of the global economy is the very same system that is eating up the planet’s natural capital, in other words the ecosystems that sustain us.  Simply ‘fixing’ the economy and then hoping business as usual  will commence, in other words the unregulated and untrammelled, year upon year economic growth model we have all become used to, will not save us from the ultimate recession.  

It is time he argues to challenge the orthodoxies of free-market capitalism and the economic growth that has characterised the past twenty years.  Despite examples of good and successful practice from mutuals, the Co-operative and ethical banks such as Triodos, it seems amazing that nobody, especially under the watch of consecutive Labour governments, questioned more forcefully the unsustainable financial practices taking place under our noses.  Instead they contented themselves with the notion of Corporate Social Responsibility, believing that voluntary measures will somehow account for the true cost of economic growth – and perhaps we all went along with it because we were having such a good time. 

Governments need no longer be in thrall to financial institutions and banks, they owe us.  Years of untrammelled  economic growth without regulation, or any real questioning of the cost of that growth, has failed us all miserably.  Time for something new, argues Porritt.  We must not only recapitalise our financial institutions, but  safeguard our  ’manufactured capital’ - (infrastructures, buildings and technologies), recapitalise our human and social capital, all of which has to be underpinned by investment in our natural capital.  In short, a sustainable new deal.

So far only 6.9% of the UK’s spending on recovery has been aimed at green initiatives, in comparison to 37.8% of China’s recovery package.  South Korea are leading the world with a generous 80.5% of their $38.1 billion recovery package supporting green and sustainable initiatives.   

Porritt sees both deregulation in the financial sector, and the dismantling of regulations to protect the environment as part of the same economic growth imperative.  He calls for an end to debt-driven growth, both financial debt and our debts to the environment, the unsustainable depletion of our natural resources.  He is not an enemy of economic growth or of capitalism as such, (he admits he finds the alternatives scary), but calls for an economy that “has a chance of meeting the needs of 9 billion people, elegantly and sufficiently, by 2050.”

All of this takes place in a democratic world, populated not by consumers, but by citizens. Citizens who can make a difference at local and national levels, and are not constantly trumped by the demands of finance and business on goverment.  It is a world where human and social capital are as prized as financial capital, not a world in which many are overworked, underpaid and under stress. 

Regulation of banks is viewed as essential, as is regulation to protect and enhance the environment.  If we are going to pour money into the economy, and we surely are, it should be an investment in new green technologies, and ensuring we have the training and skills to go along with them.  Finally he calls for a ’general well-being index’ as a means of assessing government performance based on our levels of happiness.

I have probably not done justice here to Porritt’s essay and urge you to visit www.forumforthefuture.org to download the full document.  We will have to wait and see whether G20 delivers us a framework for a better future, there will, no doubt, be both disappointments and victories.  This recession is an opportunity to do things differently and better, I hope we take it before we go the way of the dinosaurs.                    


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