Let’s talk about today’s economy!

Aug 2, 2018 by

Our first morning at the summer school was a public meeting with three speakers. Here we try to summarize what really affected us and what we learned.

Only one planet: Boundaries economy must respect. Kromp-Kolb
3 words that define the subject of this session: Finite, Collapse, Reconciliation

The most interesting fact we remember: 96% of biomass worldwide is ‘human’ such as domesticated animals, whilst only 4% is ‘wild’. Moreover Raworth and her Doughnut Theory argues the economy should operate in between external ecological boundaries and internal societal boundaries. Further we agree with Diamond’s identification of 12 central environmental problems in our civilization that chances of collapse will be intensified by climate change. Several theories were considered during this lecture among them the one of Tainter. Tainter suggested that problems within human societies are resolved through increasing complexity, however simplifications often resolve problems by removing this complexity and challenging social norms and values.

Doctrinaire Economics is outdated but still dangerous. Weizsäcker
2 words to define the subject of the session: Critical, New Enlightenment

The world today is no longer empty, there is a need for limits to growth in our economy as economic growth cannot be infinite without social and environmental consequences. A key point would be recognising the power shift after 1990 from the state to the private sector and the dominance of economic doctrine above democracy. His critical view of the United Nations Sustainable Development Goals was really interesting. 11 of the 17 SDGs are asking for more growth, meaning that the achievement of this goals will condemn the 6 others ( protection of the oceans and the biodiversity among them). He also critics the 2015 Paris agreement, where international delegation claimed they want to do more for the environment but keep legitimizing the need for growth to pay for this environment policies. We liked his conclusion linking economics and politics. He is advocating for a gradual rise of energy prices to adjust our production and consumption of energy according to the ‘ping-pong’ idea while asking us to remember to not let finance lead political action.

Bubble, Busts and Crashes – Why our economic system is financially unsustainable and what we can do about it. Kreiss
3 words to define the subject of the session: Inequality, Cancer, Redistribution

“730 shareholders control 80% of all operating revenue of TNCs (transnational corporations)”. This statistic shows how rent payments always flow to the top of the population, with the impact of increasing inequality. Further, nearly a third of consumer spending in Germany is in rent payments. That demonstrate how money flows upwards in society and that wealth is derived not through work but through speculation, rent and inheritance. Further Kreiss differentiates between rent seeking capitalism and entrepreneurial capitalism. The first one is characterized by the ambition to become rich and by what Keynes called “the functionless investor”, while money is re-injected in the production through investments in the second one. What we really appreciated is how he deconstructed economics and the economy to show the links between through actions and how this leads to systemic growth that resembles a cancer: the rent-seeking capitalism is destroying itself. We wished we had more time to focus on the solutions he just mentioned, since it is our research for change that brought us to the summer school.

To conclude, we really enjoyed as soon as ‘Day 1’ getting into the core of the subject of the the summer school. We got new valuable inputs to  discuss and debate. This is also what we are expecting from the next weeks to come.

Written by: Hannah Joy and Nolwenn Thiriet

Based on the lectures by: Helga Kromp-Kolb, Ernst Ulrich von Weizsäcker, Christian Kreiss