Suzanne's Mom's Blog

This interesting story about reaching for a more egalitarian type of economics says that capitalism got started in the Netherlands in the 17th century, but a very good book says that says it started with the enclosure of commonly used pasture in England in the 13th century. (See Steven Stoll’s Ramp Hollow: The Ordeal of Appalachia.)

Whenever capitalism started, it’s past time for a look at whether it inevitably caused the extreme inequality we see today.

Ciara Nugent writes at Time, “One evening in December, after a long day working from home, Jennifer Drouin, 30, headed out to buy groceries in central Amsterdam. Once inside, she noticed new price tags. The label by the zucchini said they cost a little more than normal: 6¢ extra per kilo for their carbon footprint, 5¢ for the toll the farming takes on the land, and 4¢ to fairly pay workers. …

“The so-called true-price initiative, operating in the store since late 2020, is one of dozens of schemes that Amsterdammers have introduced in recent months as they reassess the impact of the existing economic system. By some accounts, that system, capitalism, has its origins just a mile from the grocery store. In 1602, in a house on a narrow alley, a merchant began selling shares in the nascent Dutch East India Company. In doing so, he paved the way for the creation of the first stock exchange — and the capitalist global economy that has transformed life on earth. ‘

“[But, asks Drouin], ‘Is it actually making us healthy and happy? …

“In April 2020, during the first wave of COVID-19, Amsterdam’s city government announced it would recover from the crisis, and avoid future ones, by embracing the theory of ‘doughnut economics.’

“Laid out by British economist Kate Raworth in a 2017 book, the theory argues that 20th century economic thinking is not equipped to deal with the 21st century reality of a planet teetering on the edge of climate breakdown. Instead of equating a growing GDP with a successful society, our goal should be to fit all of human life into what Raworth calls the ‘sweet spot’ between the ‘social foundation,’ where everyone has what they need to live a good life, and the ‘environmental ceiling.’ By and large, people in rich countries are living above the environmental ceiling. Those in poorer countries often fall below the social foundation. The space in between: that’s the doughnut.

“Amsterdam’s ambition is to bring all 872,000 residents inside the doughnut, ensuring everyone has access to a good quality of life, but without putting more pressure on the planet than is sustainable. Guided by Raworth’s organization, the Doughnut Economics Action Lab (DEAL), the city is introducing massive infrastructure projects, employment schemes and new policies for government contracts to that end. …

“Raworth says DEAL has received an avalanche of requests from municipal leaders and others seeking to build more resilient societies in the aftermath of COVID-19. Copenhagen’s city council majority decided to follow Amsterdam’s example in June, as did the Brussels region and the small city of Dunedin, New Zealand, in September, and Nanaimo, British Columbia, in December. In the U.S., Portland, Ore., is preparing to roll out its own version of the doughnut, and Austin may be close behind.

“The theory has won Raworth some high-profile fans; in November, Pope Francis endorsed her ‘fresh thinking,’ while celebrated British naturalist Sir David Attenborough dedicated a chapter to the doughnut in his latest book, A Life on Our Planet, calling it ‘our species’ compass for the journey’ to a sustainable future. …

“Amsterdam is grappling with what the doughnut would look like on the ground. Marieke van Doorninck, the deputy mayor for sustainability and urban planning, says the pandemic added urgency that helped the city get behind a bold new strategy. … She says, ‘I think in the darkest times, it’s easiest to imagine another world.’ …

“Raworth published her theory of the doughnut as a paper in 2012 and later as a 2017 book, which has since been translated into 20 languages. The theory doesn’t lay out specific policies or goals for countries. It requires stakeholders to decide what benchmarks would bring them inside the doughnut — emission limits, for example, or an end to homelessness. The process of setting those benchmarks is the first step to becoming a doughnut economy, she says.

“Raworth argues that the goal of getting ‘into the doughnut’ should replace governments’ and economists’ pursuit of never-ending GDP growth. Not only is the primacy of GDP overinflated when we now have many other data sets to measure economic and social well-being, she says, but also, endless growth powered by natural resources and fossil fuels will inevitably push the earth beyond its limits. …

“The doughnut can seem abstract, and it has attracted criticism. Some conservatives say the doughnut model can’t compete with capitalism’s proven ability to lift millions out of poverty. Some critics on the left say the doughnut’s apolitical nature means it will fail to tackle ideology and political structures that prevent climate action.

“Cities offer a good opportunity to prove that the doughnut can actually work in practice. … Van Doorninck, the deputy mayor, says the doughnut was a revelation.

‘I was brought up in Thatcher times, in Reagan times, with the idea that there’s no alternative to our economic model. … Reading the doughnut was like, Eureka! There is an alternative! Economics is a social science, not a natural one. It’s invented by people, and it can be changed by people.’ …

“When the Netherlands went into lockdown in March, the city realized that thousands of residents didn’t have access to computers that would become increasingly necessary to socialize and take part in society. Rather than buy new devices — which would have been expensive and eventually contribute to the rising problem of e-waste — the city arranged collections of old and broken laptops from residents who could spare them, hired a firm to refurbish them and distributed 3,500 of them to those in need. ‘It’s a small thing, but to me it’s pure doughnut,’ says van Doorninck. …

“The doughnut model doesn’t proscribe all economic growth or development. In her book, Raworth acknowledges that for low- and middle-income countries to climb above the doughnut’s social foundation, ‘significant GDP growth is very much needed.’ But that economic growth needs to be viewed as a means to reach social goals within ecological limits, she says, and not as an indicator of success in itself.”

More at Time, here.