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Behind the Scenes Gross Domestic Product Introduction

Katherine Trebeck: Corona Virus and Our Economy

A few days ago, I had the chance to catch up with Katherine – one of the two key protagonists in our film – about her thoughts regarding our current crisis, and what it means for changing our economies. This is a summary of the things she mentioned in our call.

“Corona is revealing to the wider community that it’s miserably paid armies of people in precarious work, hitherto dismissed as ‘low skill’, who really keep our societies going: the couriers, the nurses, the supermarket checkout staff, the care workers, the refuse collectors. They are now the ones who keep the shop open, who keep our streets clean, who deliver books and groceries to our door to help us get through lockdown. They are the ones who ensure our wellbeing these days.

Whereas the highly paid top managers are nowhere to be seen in such a terrain.

This should make us take a renewed interest in rather boring seeming and less glamorous aspects of our economy: schools, hospitals, the food industry (the so-called ‘foundational economy’). We should hold on to a new recognition of the importance of local supply chains.

And also ask ourselves new questions: what is the Care Economy really worth to us? How much do we value the “gift economy” — i.e. all the services that are provided in everyday life without payment (child supervision among neighbours, care for the elderly in the family, help here and there in the neighbourhood), which keep so much of our lives as individuals and as communities together.

And we should note that despite its vital role, so much of this is not calculated anywhere in the GDP of a country.

That is why now is the time to think new thoughts and imagine a better economy post-corona than the one we had going into it. This phase of crisis enables us to ask questions and give answers that were unthinkable only a short while ago. For example, the current UK Chancellor of the Exchequer seems to be thinking — or at least there were hints of this in some of his press conferences – in terms of the rich having to carry some of the burden of the mammoth income support programmes the government is having to bring in. We’ll see where that ends up, but it would have been hard to have imagined just a few weeks ago.

The risk is that this window of possibility will close again very quickly – that a “rollback” will come as people rush to return to how things were — forgetting or ignoring how grim that was for so many and for our planet. 

There is a similar diversity in the corporate world — the wheat separating from the chaff: some companies are now putting profits aside and trying to live up to their responsibilities. One example that has caught my eye is the supermarket chain Morrisons which has promised all its suppliers that from now on they will pay all deliveries immediately, to help them with their cash flow. This is significant because supermarkets are notorious for slow payment. Another example is whisky distilleries reconfiguring their operations to produce hand sanitizers — and making it available at cost or for free to front line workers. But there are others going in the opposite direction: Amazon has fired people who didn’t dare to come to work because of Corona, a chain of pubs forcing its staff to work when the government was advising against it.

This is exactly why we must do everything we can to start creating a better world now. The opportunity is to build back better as my former colleagues working in humanitarian situations would say. 

A lot of folks have been thinking long and hard for many years — decades even — about how our economy should be. Covid-19 may have just transformed the economic and political landscape so much that these ideas get the hearing they so urgently deserve.”

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Behind the Scenes OECD South Korea On the Road

2019: A Breakthrough Year for Our Film Project.

The development of this film project in 2019 was rather remarkable.

Our stories and protagonists took to the global stage!

Originally, we thought the final chapter in our story about the Wellbeing Economy Governments was going to be the big OECD conference in South Korea where the initiative was officially launched and publicly announced for the first time. But that event felt somewhat anti-climactic: It was a so-called “breakfast session” — very early in the morning, in a small room, with hardly anyone attending. And at the time, we asked ourselves: This is supposed to be the big breakthrough?

It seemed a little like the project had failed as it was succeeding.

But it turns out: A small launch can still lead to a big change. In the following months, all kinds of little things were happening in the three WEGo countries, and also between them. And then, another few weeks later, the big news broke that Nicola Sturgeon, the Scottish First Minister, was announcing and explaining the WEGo initiative from the TED stage. To this day, her talk has been watched over 1.7 million times — and that does look a lot more like the big event that we would have hoped for. And then towards the end of the year, Icelandic prime minister Katrín Jakobsdóttir gave a speech about the initiative in London, which got the BBC interested, and which finally even led to a brief radio interview I gave to the BBC about the WEGo initiative.

Lorenzo’s story also took an unexpected turn around the middle of the year — he was promoted from Vice Minister to Minister of Education in the surprisingly formed new PD/5-Star government. In this role, he made waves in Italy, he got plenty of pressure from many sides, his policies made him unpopular with many people — as he is proposing uncomfortable solutions to really transform the Italian society for the future, while he also got international headlines for his push to have Italian schoolchildren taught about sustainable living and the climate in all classes starting with the coming academic year.

All this culminated in him being invited to the Climate Conference in Madrid and to an audience with the Pope. (We were there with the camera for the former, but not for the latter.) And now, just before the end of the year he resigned from his job as minister. Which came as no surprise to us — on the contrary. But the background to his resignation doesn’t belong here, it’ll be in our film.

The key thing for us is that we were very lucky — which is a requirement for any documentary film project: When we met Lorenzo, he was not yet a member of the Italian parliament, and then he transformed into an internationally respected politician in under two years. When he resigned, the news was reported around the world. How often does the world take an interest in an Italian Minister of Education who has been in office for only a few weeks?

We found powerful partners!

Around the middle of the year we met a director and producer who is very well established in the German film industry and who quickly warmed to our project. In November we signed an agreement according to which we will finish and market the film together with his company. For the development of our film, the second half of the year was characterized by getting to know and discussing the film project with our new partners. In our exchanges we thought and learned a lot about how our film can work, how we should structure it and what the focus should be. This was enormously helpful for our understanding of what kind of film we are making. But it also took time, of course.

So … we are looking very much forward to an eventful year 2020 in which we will launch into the next phase of the production. Carving out a compelling story from all the material that we have collected. Happy New Year everyone, and wish us luck!

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Introduction WEGo in Practice Wellbeing Economies: Concept

The Vision of Wellbeing Economies.

A couple weeks ago, I had to summarise the “Wellbeing Economies vision”, for an internal document that we needed. I am neither a scholar nor a practitioner of wellbeing economics, but I still felt that the exercise of writing down what I had understood in our project to be valuable. Clearing one’s thoughts by putting them into writing is often quite helpful. Here are the results. Interestingly, the real experts in the matter — the team at the Wellbeing Economy Alliance (WEAll) – also just happened to put out a document about the very same thing. I haven’t had the chance to read it yet. But it may be fun for some to contrast and compare.

The concept of Wellbeing Economies (WE) does not attempt to explain the world through a central foundational economic model, nor does it recommend a particular path for achieving its goals. Rather, it is essentially a very pragmatic approach that begins not with a “system”, but with the end goal: an economy that serves people and the planet as a whole.

Five central concerns are to be achieved:

  • Dignity: Everyone has enough to live in comfort, safety and happiness
  • Nature: A restored and safe natural world for all life
  • Connection: A sense of belonging and institutions that serve the common good
  • Fairness: Justice in all its dimensions at the heart of economic systems, and the gap between the richest and poorest greatly reduced
  • Participation: Citizens are actively engaged in their communities and locally rooted economies

One of the reasons why there is no central (mathematical) model for Wellbeing Economies is that advocates of the “Wellbeing Economy” idea embed economics deeply in the social sciences and reject a purely model-driven, number-oriented approach — which tries to give Economics a false semblance of a natural science.

Rather, they acknowledge that the very particular social science “economics” is about the question of how the earth’s resources are to be treated and allocated in the best possible way, in order to achieve the above goals. And while there is no question that mathematical skills are required for this, at the same time it is also necessary to recognize that philosophical questions about the meaning of life, normative ideas about law and justice, and an understanding of human irrationality, emotionality and spirituality are just as important. And they are all factors that have no or only a very limited place in the traditional data-driven approach to economics.

Even though this may not always be explicit, a foundation of WE seems to be that they start from a different view of humanity than capitalism of the neoliberal school does. The latter assumes that the central driver of all human activity is personal benefit maximization (greed), which must be put at the service of economic development. WE, on the contrary, see a number of different needs in people, which are expressed, above all, in our social and cooperative behaviour. In the current design of our economy which is essentially based on greed, these do not come into their own. It is now necessary to change this orientation, in order to give other central human qualities more justice in a our economic logic.

But in order for this to happen, it is fundamental to acknowledge that every economic system is man-made and can therefore be rebuilt or readjusted.

For this readjustment, the Wellbeing Economies see a particular need in redefining the key measures of success of our economic systems: politics and the economy are profoundly influenced by what is measured as success and recognized as desirable.

A core requirement is therefore to abandon the goal of continued economic growth in the sense of a steady increase in gross domestic product (GDP) and instead to define and measure the prosperity and progress of our world’s societies in new, different ways. It is acknowledged that GDP growth in the western world after the Second World War certainly helped increase prosperity and improve living standards. But the resulting obsession with steadily rising GDP is now seen as a central cause for our world becoming more and more unjust and dealing with nature in an completely destructive manner.

The fight against the apocalyptic climate crisis, which results from the unlimited growth of the carbon industry in the post-war economic growth logic, is a central motive for many to work towards Wellbeing Economies.

Politically, Wellbeing Economists are therefore trying to convince governments to use other indicators, better suited to the goals of the WE, rather than classic indicators such as GDP, unemployment figures or stock market prices, to help define and verify the true goals of policies made for people and nature. Examples of implementations are the Scottish National Performance Framework or the New Zealand Wellbeing Framework.

A second demand on policymakers is that ministries in governments abandon their silo roles and understand that they can only create a better society in the sense of Wellbeing if they collaborate and cooperate intensively with each other. Many central problems in economy and society are at the same time the task of the Ministry of Social Affairs, Economy, Finance and Environment. Egoism or struggles for budgets within a government are very counterproductive. In a complex interrelated world, problems need to be approach jointly from all perspectives and then joint solutions need to be developed.

Further demands of the WE are:

  • Decentralized economies: Instead of relying on huge central production facilities, whose products or services must then be shipped all over the world, local production close to people should be the goal. This applies just as much to energy production (local, sustainable, citizen-driven) as it does to sustainable production or provision of physical products (repair shops, 3D printers, recycling, etc.) and services.
  • Plurality of approaches: The WE recognise that the objectives of the WE can be achieved in different ways around the world and that these different ways enrich the concept.
  • Democracy and participation: There seems to be a general consensus that a WE can only be enforced if it involves the local people in its emergence and thereby makes them partners and co-shapers of the new economy.
  • Experimenting and learning from each other: Wellbeing economies can only develop if we learn from each other – because much of what is not yet understood in one place has already been tried out in another. And we must experiment – because we still have to invent some aspects of how these Wellbeing Economies may function.
  • Wellbeing as a social task, not as a private project: One concern of the pioneers of the Wellbeing Economy is that the term “Wellbeing” could be adopted by neoliberalism and made its own. This would turn the concept against itself: Wellbeing would no longer be a political project, but would be interpreted as a task for each individual within the existing system. Mindfulness approaches in start-up companies, yoga retreats and other concepts that try to strengthen the individual in the struggle within the existing destructive version of capitalism can easily be misinterpreted as a wellbeing approach, while they are the exact opposite.
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Behind the Scenes

Global Lorenzo.

When we first started thinking about this film in early 2018, Lorenzo Fioramonti was a professor for Political Economy in South Africa, who had given up his job, in order to get involved in Italian politics. He knew very little about the inside of politics, but the “5 Star Movement” had invited him to join their ranks — to become a member of parliament and, potentially, a Minister in the next Italian government. What happened next is hard to summarise. And our film will need to do that job.

What matters to us right now is that you can never know, in documentary film-making, what happens to your protagonists. Sometimes nothing happens at all, to the extent that you realise that you may not even have a film.

And sometimes you get lucky and your protagonist does things that make a difference, that effect change, that have an impact.

Last week, we witnessed Lorenzo making global impact. His plan to introduce climate change education in Italy as a mandatory subject for school children created ripples around the world – after he spoke to Reuters about this plan (who also called him the “Anti-Salvini” in their article), media outlets everywhere picked it up, from Australia to the Netherlands. The New York Times ran a longer article about him and his ideas. CNN reached out. He gave radio interviews to stations in various parts of the world. A German paper praised Lorenzo as a role model for German politicians.

Over the weekend, Lorenzo told us that he got invitations to speak at conferences, he spoke with other ministers in the EU who approached him and want to do something similar in their countries, he even got an invitation to meet the Pope.

When I first heard about Lorenzo and his plan to bring post-GDP thinking to a G7 country like Italy, I thought “this sounds like a very interesting project. And a very interesting guy.” Turns out that has been a major understatement – on both accounts.

And today, we sure are glad to be part of this ride.

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Behind the Scenes Introduction

How an Advertising Man Became a Post-Growth Advocate.

I come from the dark side.

Between 1994 and 1999, I studied at two business schools. Then I worked in advertising and marketing from 1999 until 2016 — for 17 years. First I was an employee in a couple of advertising agencies. Then I got a doctorate in Marketing and helped build our own specialised agency, with a group of friends and colleagues. The one over-riding goal of everything was always:

Growth.

Advertisers may cite many reasons why they work with advertising and marketing agencies, but at the end of the day, they all want the same thing: to grow their market share, their profits, their sales.

And make no mistake: All advertising agencies ever want for themselves is growth, too. More clients. Bigger staff. More campaigns. More money.

Nobody who works in advertising ever questions any of this. There is no time. There is always the next deadline. The next flight to the meeting. The next crazy client request. The next ego emergency. Besides, why question the hand that feeds you? Growth pays for advertising. Then advertising begets more growth. Its a virtuously vicious circle.

I myself had no idea that something might be wrong. And when the news were reporting another year of GDP growth, it was the kind of good news I was happy to hear — I’d grown up in cold war “Economic Miracle” Germany, after all.

And yet, about a dozen years into my career it dawned on me that I could not, would not, should not spend the rest of my days trying to sell more of this shampoo or that floor cleaner. That that was simply not a worthwhile pursuit for a life well lived.

But I couldn’t leave right away, I had to stick it out for another four years, we had to keep growing our business so we could sell our company. I was fairly lucky with my contract and my role in the company — once the deal was done, I could quietly slip out the back door. The new owners hardly even realised that I was no longer there.

It was March 2016. I was in Munich.

I got an electric car — I thought that would be my contribution to protecting the climate. I went to Barcelona for a month, to spend time with friends. Then I moved back to Berlin. Brexit happened. It made me sad. I was living in a small apartment on Urbanstraße in Kreuzberg that I had rented from a friend. I was experimenting with a bit of freedom and with my underused creativity. In other news, the German right-wing party “AfD” was on the rise. I didn’t know what to do about it. Should I be more political? My father had been in politics.

I didn’t have a family of my own (I still don’t), I was alone. I made a hand-drawn animated short film. I reconnected with old friends. I thought about new professions I could take on. I felt a bit lonely. Autumn was coming. But overall, I was trusting that things would somehow be fine.

Then, Donald Trump got elected.

Many were shocked by the news, but ultimately this political earthquake did not leave much of an impact in the daily lives of many people in most European countries. Modern capitalism keeps us simply too busy to care: A presentation is due for the boss. There is the problems with the co-worker at the office. The neighbour just bought a new large SUV. Should we get one, too? One of the children is ill. Let’s just pray that the insurance will cover it. Also, the older one needs a new phone. The car has to go to the garage. A big SUV might feel safer, right? Oh my god, did we remember to book the flights for the holidays? Plus, can we even afford to put Ma in that retirement home? Oh man, health insurance rates went up again.

And so on. And then, at the dinner table, you might find a short moment, you’re looking at one another, saying: “Oh man, Trump is the American President now, that’s something else, isn’t it?” You shake your heads in disbelief, and then it’s back to the daily race.

Well, me … I had none of that.
I was by myself, no one needed me.
I was running nowhere.
No one waited for me.
I had no place to go, no job to do.
Instead, I was looking at the wall in that small apartment — and Trump was always there.

Soon I realised: This wasn’t about a complete catastrophe of a US President. It was about a very different question: What is going on in this world that the United States of America elect someone as horrific as him as “the leader of the free world”.

Where and when had things gone so badly wrong? What had I missed?

2017 became my fact-finding year. I read books and newspapers. I spoke with people. I launched a blog and wrote regularly about my experiences and questions. Soon, the climate crisis rose to the top of my agenda: jointly with my friend Kai Schächtele, I developed a show format called vollehalle — it talks about the climate emergency and the role of us all in it, in a constructive and inspiring manner. We also interviewed Tim Jackson for it. A giant among those who are imagining a better economy. Meeting Tim was my first brush with a new way of thinking about the system I had taken for granted.

And another thing happened to me in 2017: inspired by a small article in the German newspaper “taz”, I discovered the “Netzwerk Plurale Ökonomik” — the German arm of the “Rethinking Economics” student movement. Thanks in part to our meeting with Tim Jackson, and also to David Graeber’s book “Debt” and Wolfgang Streeck’s “Gekaufte Zeit” (English title: “Buying Time“), it was dawning on me that the way we are running and thinking about our economies is probably a big part of the problem. But so far, I hadn’t met anybody who had useful answers. So, I applied to attend the Netzwerk’s first Summer Academy, which took place at the beginning of August 2017 in the small village Neudietendorf outside Erfurt. And I got accepted.

That week in August of 2017 changed my life.

Never before had I seen 90 people — most of them millennial students — so heavily engaged in deep, thoughtful, intellectually curious and generous debate about the major issues of our time. They weren’t shouting their written-in-stone political beliefs or adherence to some political party at one another. Instead, these (mostly) twenty-somethings were soft-spoken and genuinely curious about each other’s thoughts, about how to advance their own thinking, in order to get to new solutions. And they were going at it non-stop, from 8 am at the breakfast table until 2 am at night, as they were having their nightcap beers in the courtyard.

It dawned on me: If there is hope for our world, it’s with critical economics thinkers like these students — with their radically open eyes and their real questions and their genuine curiosity.

And there was something else that I realised: Nobody knows this. Nobody outside these circles knows that the ideas that will solve many of our most dire problems may already exist. And they lie in truly rethinking our economy. In other words, nobody outside these circles seemed to realise that economics was the most important and most exciting subject of our time, if tackled in the right way. I understood that we needed to vehemently start telling these stories and bring this thinking to a wider world. The stories that I was hearing here, the thinking that was going on here, it needed to be shouted off rooftops!

And that was just the informal part of the week.

The biggest part of the official agenda were the workshops. The one I had signed up for was called “Prosperity Economics”, led by Katherine Trebeck and Himanshu Shekhar. At the time, Katherine was a researcher at Oxfam in Scotland. She explained to us how GDP was at best an imperfect measure of progress and how an alternative take on “prosperity” would look at the real issues. She also talked about the challenges of measuring prosperity holistically, in a way that deals with how people’s lives — and the lives of all other living beings on this earth, too! — are really going.

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And then she told us about a plan she had, jointly with an Italian professor named Lorenzo Fioramonti who was teaching Political Economics in South Africa. They wanted to build a “counter-G7”: A new summit that would bring countries together who tell the world: “Enough is enough, let’s show the world how to think differently about the economy — in a way that can actually save mankind and this planet.”

They wanted to call it the “WE7”: the Wellbeing Economies 7.

What a story!

Six months later, I got a call from Gustav Theile. He’d been one of the Summer Academy organisers, now he was Katherine’s intern in Glasgow. He told me two things: One, the summit was happening! With Scotland, Costa Rica and Slovenia as the first members, getting together in Slovenia — there, they would jointly sign the Ljubiljana Declaration. And two, Lorenzo had left the project: He was returning to his native Italy, in order to run for office in the Italian election — he wanted to bring his post-GDP thinking into a new Italian Government.

I could not contain my excitement. So I turned to my friend Nick Scholey — a media creation one-man powerhouse, musician, camera operator, editor, all around creative force — and said, “Man, we gotta start making a documentary about this. Let’s go to Scotland and to Rome, let’s start filming these people. What they are doing is too important for the world to miss.”

We were now on a mission. And we got support from Kim Münster, a film producer.

Today, one and a half years later, we have hours and hours of footage. Of Lorenzo’s political battles in that strange Five-Star-Lega government, which eventually fell apart — he’s now actually become the Minister for Education, in the brand new Italian Government. And of Katherine travelling around the world, helping save the Wellbeing Economies government project, after the summit in Ljubiljana got cancelled at the last minute. But Katherine and the amazing folks inside the Scottish Government kept at it. And so, a few weeks ago, Nicola Sturgeon, the First Minister of Scotland, gave a TED Talk about how Scotland, Iceland and New Zealand had joined forces as the Wellbeing Economy Governments!

I am a very different person from the one I was in early 2016. I really hope that I will look back one day and say:

I made my way from the dark side to the light. And it wasn’t too late.

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This text was originally published a few weeks ago as a guest-piece on the Degrowth.info blog. We are cross-posting it here because it tells the background story of this film project.

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Behind the Scenes On the Road

Visions of Italy and Scotland.

The lighthouse east of Dunbar

October was a “picture collection month” for us. We went back to both Scotland and Italy, to collect shots that would help us show the countries that we are speaking about in our film. And they are splendid countries indeed.

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Men on a mission in the Highlands: Martin, Mark (Katherine’s husband) and Nick
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When in Scotland, drink what the Scots drink (and this time it’s not about alcohol!)
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Composition with Tesla, horses and a power station (outside Dunbar)
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A composed shot of Katherine at the University of Glasgow
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Nick, getting the shot
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The view from Todi
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Todi
limone_lago
Lago di Garda (Limone)
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Lago di garda (Limone)
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Verona
Categories
Gross Domestic Product Introduction WEGo in Practice Wellbeing Economies: Concept

Replacing GDP with “Girls on Bikes”.

Since early 2018, we have spent a lot of time with our protagonist Katherine Trebeck. In the summer of last year, we also traveled to Costa Rica together, to film her while she was speaking at a conference about sustainable fashion, and while she met the Costa Rican First Lady.

On that trip, she told us about an idea that I forgot about later, and that I was again reminded of recently. It is a beautiful thought that very convincingly illustrates how much we must change our notion of what progress actually means.

You have a very tough challenge to overcome when you try to move away from an economy that is measured by the “growth” it produces, in terms of financially measurable output. Or, in other words, by how much it increases GDP every year. GDP is such an established measurement: Everyone has heard of it, it seems so incredibly familiar (even though most people have no idea what it really is), and that’s why people have a really hard time letting go of it.

Now, how does the growth of GDP tell us that a society is improving?

Well, it measures how much a society makes every year, in terms of how much money is being spent on things in that society. And then it assumes that we are doing better if more things are made and sold next year. And so on. Forever. More stuff is better. It’s as simple as that.

We are now finding out that more is not better. Up to a certain point, yes. But after that, more just hurts more: It hurts nature. It hurts equality in society. It hurts the psychological health in a population. It hurts the climate. Etc.

In the western world, and after we’d broken everything in World War II (“thanks” to the nation I come from, Germany), looking at the GDP was probably a good idea, for a while. We could simply count how much we are making and then assume that we’re doing better if we are producing more next year. It meant more people in jobs, more people could afford things, life was getting better. But those days are gone. We are no longer better off if the GDP keeps growing, we’re actually worse off, nowadays. And we’re clearly ruining the planet this way.

So we speak a lot about what might be a better measure. There’s not going to be a single thing that replaces GDP, of course. But if you ask Katherine which single measure she would pick if she could use only one, to analyse if a society is actually doing better year after year, she’ll say this:

Why not get countries to measure the number of girls who bicycle to school?

Ok, this may seem very strange at first glance. What? Rather than looking at how much economic output our country is producing, let’s count girls on bikes?

Think about it. It makes a heap of sense:

If more and more girls ride a bike to school, it means it’s safer and safer to cycle in traffic.

If more and more girls ride bikes to school, it means that bikes are increasinly accepted as a means of transport. And it means less parents’ cars — who are now doing the “parent taxi” thing (a big issue here in Germany) — are polluting the air and creating dangerous traffic jams outside schools.

If more and more girls cycle to school, it means that more and more girls are actually going to school and getting an education, period. That’s an important achievement in many countries.

If more girls are cycling to school, it means that they’ll get used to this mode of transport, it will translate to better health for them in the future, and to less pollution in society in the future.

If more girls go to school on bikes, it means that they are not afraid to be attacked by predators who do them harm.

If more and more girls ride bikes to school, more and more boys will do that, too.

If more and more girls cycle to school, it means that more of them are empowered and unafraid.

I think I agree with Katherine: This is an incredibly convincing measure of progress. And one that deserves serious consideration as a replacement for GDP. And I am not joking one bit.

Free photo by @luizmedeirosph.

Categories
WEGo in Practice Wellbeing Economies: Concept

The Scottish First Minister’s TED Talk – Let’s Move Beyond GDP

The Scottish First Minister Nicola Sturgeon gave a TED Talk — it was just published on the TED.com website. In her talk, she makes the case for governments to focus the efforts of their work no longer on GDP, but on increasing the well-being of their citizens:

In early 2018, we decided to tell the story behind the Scottish and other governments who were trying to join forces, to move beyond GDP. Not knowing if this would happen, and not knowing how it would play out. The fact that the Wellbeing Economy Governments now do exist, and that Nicola Sturgeon just delivered her courageous message is very exciting for our film project.

Categories
Gross Domestic Product Introduction

On Economic Growth As A Concept.

I just read the text “Economic growth: a short history of a controversial idea” by Gareth Dale — and thought that some of its points merit mentioning here, as they relate to the core issue of our film project: the unhealthy obsession of most governments with GDP Growth, and how to end it.

Dale’s text is all about where this idea came from, originally.

The first key point he is making is rejecting Elias Canetti’s “will to grow”, which posits that the desire to (economically) “grow” — in other words, to accumulate “more” — is a human quality that sits inside our DNA. From wanting your child to grow, to wanting your power to grow, to wanting your riches to grow, to wanting your farm to grow, this is just how we are made, we always want more.

But Dale disagrees and says that Canetti is throwing things together that don’t belong together:

Canetti’s ‘will to grow’ doesn’t withstand scrutiny. The diverse behaviours he describes can’t be reduced to a single logic. The ‘will’ behind creating babies is quite unlike the will to accumulate acreage or gold. And the latter is relatively recent. For much of the human story, societies were nomadic or semi-nomadic, and organised in immediate-return systems. Stashes of food were set aside to tide the group over for days or weeks, but long-term storage was impractical. The accumulation of possessions would hamper mobility. The measures that such societies used to reduce the risks of scarcity centred not on accumulating stores of goods but on knowledge of the environment, and interpersonal relationships (borrowing, sharing, and so on).

The next crucial point he is making is about data. It was only possible for humans to “want more” once they were able to properly count what they had. In other words, the development of statistical tools plays a key role for instilling this idea that we could “have more tomorrow” than we have today. This links directly to the discussion we experienced at the OECD Forum in South Korea, about new measurements and their political implications. Dale writes:

The same centuries experienced a revolution in statistics. In the England of 1600, the growth paradigm could scarcely have existed. No one knew the nation’s income, or even its territory or population. By 1700 all these had been calculated, at least in some rough measure, and as new data arrived England’s ‘material progress’ could be charted. Simultaneously, the usage of ‘growth’ had extended from the natural and concrete toward abstract phenomena: the growth of England’s colonies in Virginia and Barbados, the ‘growth of trade,’ and suchlike.

And as the advancement of science and the development of colonialism went hand in hand, the colonialists had a whole host of new quantitative questions to answer:

How profitable is this tract of land, and its denizens? How can they be made more profitable? Answering such questions was enabled by modern accounting techniques, with their sharper definition of such abstractions as profit and capital.

In other word, “growth of the economy” needed a lot of inventions before it could even be thought. And the idea was heavily based on thinking that originated from the development of colonialism. In the new colonies, it seemed even more important than anywhere else to count and “grow” the new properties that were being accumulated.

And what was the result of all that? A very simple story about how people evolved from barbarism to civilisation. Barbarism was the lifestyles of the people that colonialists found wherever their greed took them, civilisation was the way of living and counting and robbing and thinking in property terms that the colonialists brought. Since the invading nations were the “more advanced ones”, that gave them “the right” to control and harrass the others. And economic growth was always part of the story:

Through its marriage to progress and development, in the belief that social advance requires a steady upward ratchet in national income, growth gained its ideological heft.

And this takes us into the twentieth century. The idea of economic growth turned into a global competition and race, for power, influence and promises to the electorate. And in the fight between the political systems of the Cold War, it became the tool for everything:

Growth was firmly established everywhere: in the state-capitalist economies of the ‘Second World,’ the market economies of the West, and the postcolonial world too. It became part of the economic-cultural furniture, and played a decisive part in binding ‘civil society’ into capitalist hegemonic structures — with social democratic parties and trade unions crucial binding agents. It came to be seen as the key metric of national progress and as a magic wand to achieve all sorts of goals: to abolish the danger of returning to depression, to sweeten class antagonisms, to reduce the gap between ‘developed’ and ‘developing’ countries, to carve a path to international recognition, and so on.

And then to me, the most interesting conclusion can be found in the penultimate paragraph:

Growth, although the result of social relations among people, assumes the veneer of objective necessity. The growth paradigm elides the exploitative process of accumulation, portraying it instead as a process in the general interest.

It’s actually an incredible sleight of hand: The accumulation of wealth is redefined as the primary public interest. We are lead to believe that as long as a massive accumulation of capital happens, somehow everyone will be better off. Even though it’s overwhelmingly a narrow group of people benefiting from this type of accumulation. Because ever since the TINA years, so much taxation has been dismantled, bit by bit.

Not too long ago, this whole idea was also referred to as the “Trickle-Down-Effect” — an effect that doesn’t actually work in the real world. Just because the rich get richer doesn’t mean the rest are better off. Quite the contrary. Unless we rethink the way we distribute access to capital and resources: Wellbeing Economies.

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OECD South Korea WEGo in Practice Wellbeing Economies: Concept

The Wellbeing Economics Governments Are Moving Forward.

In the past weeks and months, we’ve been excited to notice how the Wellbeing Economics Governments have been making progress.

New York Times About New Zealand’s Wellbeing Budget
The most visible example may have been the New York Times article about New Zealand’s Wellbeing Budget. We were excited to see this in part also because in January we had the chance to interview the very same Grant Robertson who is mentioned in the article for our film — he is New Zealand’s Finance Minister. And some of what he told us then was pretty much verbatim repeated in the article. The text provides an inspiring view-from-the-outside picture of what the current New Zealand government is trying to do differently, and it’s encouraging to see that the NYT is taking note.

The First Wellbeing Economy Governments Policy Lab
Even closer to our film’s subject was the first meeting of the WEGo policy lab in Scotland on May 1st of this year — in a house that Adam Smith himself had lived in.

Back in November, we were in South Korea as the WEGo — the Wellbeing Economy Governments initiative — was first publicly presented at the OECD Forum in Incheon. What may be the crucial part of this project is said Policy Lab. If governments want to move towards a holistic approach to Wellbeing of People and Planet, they need to do a lot of things very differently. And that is hard.

So in order to figure out how to make this happen, they are trying to learn from each other, by organising these policy labs. In the words of First Minister Sturgeon:

But we know that we don’t have all the answers. We know that we have got a lot to learn – and a lot to gain – from working with other like-minded countries.

That’s why the Scottish Government established the Wellbeing Economy Governments initiative and it’s why we’re so pleased to be hosting the first of these Policy Labs. And it’s why we’re delighted to have such a wealth expertise represented here today.

Our film’s protagonist Katherine Trebeck attended the opening session, where both the First Minister of Scotland, Nicola Sturgeon, and the Prime Minister of Iceland, Karin Jakobsdottir, gave speeches (New Zealand’s Prime Minister Jacinda Ardern was not at the lab, but NZ sent representatives). And Katherine published a blog post about what that was like, on the Wellbeing Economy Alliance website. Here is how she explains in her text what the WEGo are about:

WEGo is about governments rolling up their sleeves, linking arms, and walking together down a path that sees national success as being defined by the quality of life of citizens rather than the growth rate of a country’s GDP. As the Chief Economist of the Scottish Government said, WEGo is about driving the wellbeing agenda in economic, social, and environmental policy making.

First Minister Sturgeon’s speech from the event is available online, and some of her statements show where the WEGo are headed, particularly when it comes to their stance on the role of the GDP:

GDP has too often come to be seen not just as an indicator of a country’s wealth, but as the main measure of its success.

(…)

As governments, we see the promotion of sustainable and inclusive growth as a vital way of raising living standards for all. But we also understand that growth is only of any real value if it makes people’s lives better, it is not, and never should be seen, as an end in itself. We have to test whether we are creating a fairer, healthier, happier nation in the process.

And then I cannot help but notice: The heads of these three Wellbeing Economy Governments are all strong and inspiring women. I’m beginning to doubt that that’s a coincidence. And instead a sign of a future that needs a lot more female leaders.