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The four P's of economic system change
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The four P's of economic system change
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The four P's of economic system change
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Articles
23 April 2022

The four P's of economic system change

Written by Katherine Trebeck

This story originally ran in issue #69 of Dumbo Feather

Discussed in this Story

You recognise the multiple and interlocking crises troubling the world.

You take on board the warnings of scientists that acting to address environmental breakdown is beyond urgent.

You know that communities across the globe all-too-often struggle to navigate the impact of decisions they cannot influence.

You have fire in your belly to help move us beyond the economy of today, with its growth obsession and blind spots to injustice and the health of the planet.

But where to start?

I can’t reveal a simple switch that will make everything change for the better, but I can share with you a framework that helps grapple with the plethora of changes needed to build an economy more aligned with the needs of people and planet.

First, let’s recognise that the evidence laying out the necessity for transforming the economy – rather than tweaking it – is substantial. We see it in news headlines every day, in the loud warnings of scientists, and in watching our neighbours reach for ways to cope with an imposed way of living that doesn’t serve them – whether they turn to the ballot box or the pill box.

Let’s also take solace in the diversity of voices calling for a different sort of economy. Whether it’s regenerative economics, solidarity economics, doughnut economics, participatory economics or economies for the common good – they all add brushstrokes to a beautiful and rich alternative vision to an economy that sucks so much life out of people and planet.

Perhaps most importantly, let us be reassured and inspired by the countless people around the world who are rolling up their sleeves and building part of that better economy where they are. Their work, even in microcosm, shows how an economy that serves people and planet is not just desirable, but entirely feasible.

The ‘why’ and ‘what’ are clear: we need to move away from an economy treated as a goal in its own right, an economy designed for and dependent on deadening productivity, the extraction of our living world, and growth with no end. What is sometimes less clear is the ‘how.’

During the COVID-19 lockdowns of the last few years, folks lucky enough to be able to shelter in their homes have found creative ways to keep busy. Many picked up jigsaw puzzles and cleared their kitchen tables to piece together the various parts of a wider story. If they are worth their salt as a jigsaw-er, they will likely have started with the corners. Similarly, as we seek to make sense of the suite of new practices and policies necessary to bring about change on the scale that our planet and societies need, we can start with the corners.

I suggest that each of those corners start with the letter ‘P’: Purpose, Prevention, Predistribution, and People-powered.

Purpose

Purpose is about realigning the goal of the economy and the entities that constitute it with the needs of people and planet. Think of the gathering momentum of activists and scholars calling for Gross Domestic Product to be removed from its ill-deserved pedestal as a measure of a nation’s success. Partly sparked by this, over half of OECD countries have government measurement frameworks designed to put wellbeing firmly on the table, rather than being constrained by the narrowness and blind spots of GDP. In turn, many governments are starting to shift to what is often called Outcomes Budgeting: looking at what is being achieved and changed, rather than just what is being spent and done. Also important is valuing what matters – things like nature, community-building, and care in the home – rather than equating market price with value.

As a tangible example of this corner of the puzzle, look no further than New Zealand’s Wellbeing Budget or Scotland’s National Performance Framework, both of which position wellbeing as a vital goal of government action – linking government budget spending and policy decisions to a wider set of goals than simple economic growth as measured by GDP.

Prevention

Tackling problems at their root cause is better than constantly putting Band-Aids on. The more circular an economy, the less need for beach clean ups. The more people can earn enough to live on, the less need for food banks and tax credits to top up wages. Prevention is about asking why a problem emerged, and then continually asking ‘Why?’ until the upstream drivers are understood and changes can be made that tackle them fully, rather than just their symptoms. We see how with more renewable energy, the less need there is for carbon sequestration; and with more jobs that do not constrain living good lives, the less need there is for anxiety treatments. The ACT’s success in moving to renewable electricity, and businesses moving to four-day working weeks or six-hour working days (such as Unilever in New Zealand and Pursuit Marketing in Glasgow) show that these changes are entirely doable.

Pre-distribution

It’s a bit of a clunky term, but pre-distribution is essentially about getting the economy to do more of the heavy lifting, so outcomes are fairer in the first place and less government intervention is needed to moderate the gap between rich and poor. Businesses whose mission is something other than short-term profit are vital. Wage ratios, living wages and flourishing local enterprises would also fit near this corner of the jigsaw. There are worker cooperatives – such as the global engineering firm Arup, and in the UK, businesses such as John Lewis and Go Ape – where workers are partners, and the purpose of the enterprise is to deliver benefits for them, rather than extract financial wealth upwards to remote shareholders. The community wealth-building efforts of towns such as Preston in northern England and Cleveland in the US show how local governments can use their procurement policies for the benefit of local people and support local suppliers to keep money circulating in the community.

People-powered

Who is at the table when budgets are designed? When economic strategies are written? When policies are prioritised? Putting a diversity of people at the forefront of shaping economic systems is the only antidote to an economy designed by and for a narrow group who do very well out of the current state of affairs. Participatory budgeting, where public money is deployed according to what local people decide it should be spent on, is happening from New York to Brazil. Citizens’ assemblies – which bring together groups of people representative of the wider population to input to conversations – are happening in France, Scotland, Ireland and beyond. These initiatives bring everyday people into the heart of government decision-making.

These ideas are just the tip of the iceberg: we are talking about a thousand-piece jigsaw puzzle. But it also means there is room for everyone – indeed, everyone is needed! As you scan the various pieces of the jigsaw, let your hands and energy gravitate to where you feel you can best help something fit into place, and where you feel most compelled to collaborate with others. It might be asking your workplace to think through how work-life balance is protected. It might be writing to a local councillor to suggest they set up a Participatory Budgeting project or a Citizens’ Assembly. It could be choosing to shop with local providers and talking to your friends about the dangers of equating Gross Domestic Product with success. Just know that anything you can do to make any one of those pieces sit snugly alongside the others will help the bigger picture come to life.

Katherine Trebeck is an advocate for economic system change and co-founder of the Wellbeing Economy Alliance (WEAll) and its Scottish hub.

This story originally ran in issue #69 of Dumbo Feather

This story originally ran in issue #69 of Dumbo Feather

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