A hole new doughnut economy

Issue 40 - 26 January 2021 (7-min read)

This week in The Global Tiller, we take a look at doughnut economics. To be honest, all the doughnut photos I browsed through to find a nice one to go with this newsletter already makes a compelling case for this new way of thinking about our economy. But, trust me, the real theory is even better than the best doughnut you’ve ever had.

The February 2021 edition of TIME magazine will be making a case for "doughnut economics" and they couldn’t have done it sooner enough. With the pandemic raging and economies expected to suffer historic depressions, there will never be a more opportune time to rethink our economic structures more creatively, and more humanely.

Fed-up with the GDP-only focus of economic science, Kate Raworth - the thinker behind doughnut economics - suggested in 2012 a 'new compass for human prosperity’: 

The Doughnut consists of two concentric rings: a social foundation, to ensure that no one is left falling short on life’s essentials, and an ecological ceiling, to ensure that humanity does not collectively overshoot the planetary boundaries that protect Earth's life-supporting systems. Between these two sets of boundaries lies a doughnut-shaped space that is both ecologically safe and socially just: a space in which humanity can thrive.

Raworth is right when she says in her TED Interview that, "…the -isms of the 20th century weigh us down in the 21st century." She is, of course, talking about capitalism. If we want to make sure that every human being on this planet gets to live a life of dignity, we have to rethink our current economic structures. 

It is grossly unfair for rich countries to continue to pursue unlimited GDP growth at the cost of our planet, while a significant majority of the world population cannot afford life essentials, such as toilets and drinking water. For the poor countries, economic progress (even if it is measured only through GDP) is the only way forward, which means that the rich countries will have to put a lid on their growth at some point. That’s where the doughnut comes in - pull people out from the doughnut hole towards prosperity but not so far that it is causes ecological devastation.

There are some who criticise the idealism of a doughnut economy, saying human beings are unwilling to feel they have enough. They will always want more. But Greta Thunberg’s climate action movement is a good indicator that the new generation has had enough with 20th century institutions formed on the erroneous, and in some ways, self-fulfilling prophecy, that all human beings are selfish and rational. In fact, a majority of millennials and Gen-Z support socialism.

These goals may seem idealistic at first but several cities who have hopped on board the idea of doughnut economics are showing how it can be done. If you buy a zucchini in Amsterdam, you will know that they cost a little more than normal and you will know why: the price shows how much is for carbon footprint, a fair wage for the farmers, and for the toll farming takes on land. This is the true-price initiative and it helps the city consume more responsibly. 

Amsterdam, which launched its transformation into a doughnut city in 2020, had innovative ideas even during the pandemic. When Covid-19 forced everyone to work and socialise virtually, the city realised not every resident had a computer. Instead of bulk buying new sets of laptops, the city collected old and broken laptops from its residents, hired a firm to refurbish them and then distributed them among those who didn’t have even one to begin with! 

Other cities are also hopping on board. Melbourne (Australia), Philadelphia (United States), Portland (United States) and Dunedin (New Zealand) are following suit, while several others have adopted several projects with the goal of a regenerative future. 

Much the same way that human beings first created capitalism, we can do away with it too. We, at The Global Tiller, are ready to bite on this doughnut. Let us know if you’re willing to as well.

Happy reading and take care!

Hira - Editor - The Global Tiller

Interested to learn more about how cities are adopting the doughnut economy? Join the Barbados Doughnut:

Introducing Doughnut Economics for Barbados
The Barbados Doughnut - Rethinking the Future so Barbadians can thrive in a ‘safe and just space’
Tuesday, February 2, 2021 - 2pm GMT

Conversation with a leader

Welcome to the Episode 2 of our new series "Conversation with a Leader". In this episode, we meet Audrey Tang, the digital minister of Taiwan in charge of social Innovation. Audrey is a civic hacker who played a key role in the Sunflower Movement of 2013 and has made the 2019 list of 100 global thinkers published by Foreign Policy magazine. She defines herself as a conservative anarchist. She has managed to make the best of two worlds that are sometimes seen as incompatible: public and private sectors, tech and grassroots communities, business and government. Her story gives us lessons of great leadership for our own communities.


…and now what?

I was so excited when I heard about today’s topic! I loooove doughnuts, so to have an opportunity to talk about them….no wait, I’m being told it’s the other kind.

Anyhow, this is exciting too because social innovation is also a yummy topic! 

Now I have a question for you, dear reader: after almost 12 months of the Covid-19 pandemic, can you help me find the 'Great Reset' everyone was talking about? I’m still struggling to see it. 

Okay, there have been some changes but it still doesn’t feel enough. It looks a lot like the 'old normal'. In the recent Business Casual podcast, they were saying that it may be time for traditional car manufacturers to drop petrol cars all together and start building electric vehicles only. It may be costly, at first, but it’s a winning bet in the long run. It seems to be the only reasonable thing to do now.

How about applying the same logic to our institutions? Yes, we did some small changes here and there yet the fundamentals of our institutions and our systems are still based on the same principles and ideas. Even if we know now that those principles are flawed, if not completely wrong: humans are not selfish individuals facing the “tragedy of the commons”. We are able to share and there could be enough for everyone (and not just for the 0.1% who had a great pandemic!). We survived for thousands of years out of friendliness, not out of greediness.

But this requires some truly effective and courageous leadership. One that will strongly advocate for and demonstrate that ethical decisions are profitable and necessary. One that will be able to understand that: yes change happens more smoothly when done at a pace people can bear but this should not come as an excuse to go way too slow or not go at all. For example: rejoining the Paris Agreement seems great, but this instrument is probably already obsolete. So there’s actually a need for more.

I was recently discussing this with Taiwan’s Digital Minister, Audrey Tang  who had a very simple and efficient take on our institutions: "just as we can change the different semiconductor layout designs, we can also change how the government listened to the people. Not necessarily just every four years casting a vote, which is roughly three bits of information per person...” 

This may be the time to finally agree that: yes some foundations of our institutions are “sacred” and that we cannot change everything overnight. But let’s not forget that institutions are created by humans and we may allow ourselves for some updates to make sure we are tackling the challenges of today. 

As Edward O. Wilson puts it: 

The real problem of humanity is the following: We have Paleolithic emotions, medieval institutions and godlike technology. And it is terrifically dangerous, and it is now approaching a point of crisis overall.

It may be harder to work on the emotional part but we can at least update the institutional part. Because when life gives you doughnuts, leaders should start spreading the icing of change on the cake of a better humanity!

If you want to dig deeper into these ideas, you may want to read my blog on the past decade that ended with the pandemic. Let me know what evolutions we should engage in right away, and maybe we can actually start working together!

Philippe - Founder - Pacific Ventury

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