New Systems Series: Volume 4

November 4, 2016


Four New Papers

The fourth volume of papers in our “New Systems: Possibilities and Proposals” series offers visions ranging from participatory economics and a wellbeing economy to a green economy at community scale and a global eco-socialist democracy.


In What’s Next? Participatory Economics (Parecon), Michael Albert lays out his vision for a participatory economics, or “Parecon.” As Albert explains, Parecon aims to “provide an institutional setting that facilitates future people deciding for themselves what their own conditions of life and work should be.” To achieve such goal, Albert advocates for the establishment and implementation of four new core economic institutions and arrangements: self-managing councils and federations, equitable remuneration, a new division of labor through the creation of “balanced job complexes”, and “a self-regulating allocation alternative to both markets and central planning that is compatible with its other three defining features.” With no market and no central planning, Albert’s model is thoroughly decentralized through the process of participatory planning for the allocation of goods and services, challenging the limited choice typically on offer regarding our economic arrangements. As Albert concludes, Parecon can address economic disparities while having a beneficial impact on different aspects of society, including the end of discrimination, as “a religious, ethnic, or racial constituency cannot be subjected to decisions by some larger constituency which treats them adversely.”


In Wellbeing Economy: a Scenario for a Post-Growth Horizontal Governance System, Lorenzo Fioramonti advocates a new economy designed to improve the overall “state of existence for humanity and ecosystems” by restructuring the rules and the “framework of measurement by which the economy is controlled.” As a result, Fioramonti’s model focuses on the adoption of new economic assessment tools by which value is measured in terms of overall wellbeing. According to Fioramonti, the new tool must take into account many of the costs not included in today’s growth-driven GDP, such as the negative contributions of pollution and waste and the benefits coming from households’ and families’ work, small businesses, and nonprofit organizations. Fioramonti argues that the integration of key human and ecological dimensions into the economy will help prioritize the values and benefits of wellbeing, in addition to positively impacting the development of public, collective, and shared ownership models, promoting new identities (“prosumers”), addressing gender-based discrimination, and eliminating the economic need for international trade agreements and austerity programs.


In Towards a New, Green Economy – Sustainable and Just – at Community Scale, Tim Jackson and Peter Victor promote the adoption of a new economy based on values of shared and lasting prosperity and capable of providing the tools for people to “flourish on a finite planet.” To move towards such a green economy, Jackson and Victor outline the need for a new ecological macroeconomic model that accurately reflects the structure of the real economy, makes a full account of the ecological and resource constraints at the national scale, and incorporates a “consistent description of the financial economy.” As stated by the authors, the key changes to achieve this model includes the reconceptualization of enterprises, the structure and purpose of work, the adoption of new ways of conceiving and organizing investments, and the overhaul of the debt-based money and finance systems. The good news is that many local initiatives already incorporate several of the features advocated by Jackson and Victor. As they point out, local farmer’s markets, cooperatives, sports clubs, and libraries are just a few of the many examples showing that their desired changes are not only possible, but have clear and immediate applicability at the community scale.


Finally, in Six Theses on Saving the Planet, Richard Smith challenges the notion that degrowth and green economy proposals are capable of avoiding a global ecological collapse. Instead, he argues that the only way to save the planet is to replace capitalism with a new system, which he denominates “global eco-socialist democracy.” In this piece, Smith presents the six theses that make up the heart of his proposed system. The theses include major actions such as a substantial cut down on fossil fuel consumption in industrialized nations; the promotion of a “dignified living standard” for all, based on a sustainable average; a revolution in goods production built around quantity, quality, and need; the adoption of a systemic approach to handling and reducing waste and toxics; and ensuring jobs for displaced workers. As Smith further explains, in order to “reorganize, reprioritize, and restructure the world industrial economy in a rational and sustainable manner” we will need, and must be fueled by, democratic decision-making processes to help determine planning steps, along with the adoption of a mostly publicly owned economy. The challenges ahead are great, but—as Smith concludes—“what other choice do we have but to try?

The Next System Project’s “New Systems” paper series seeks to publicize comprehensive alternative political-economic system models and approaches that are different in fundamental ways from the failed systems of the past and present, and capable of delivering superior social, economic, and ecological outcomes. The introduction to the series and a full list of New Systems papers published to date can be found here.

Gus Speth

Co-Chair, Next System Project