The term “new economy” is broad, but its definition is gaining a more solid footing in the grass-roots of localism, communalism and post growth(ism). When I hear the term I think of an economy based on people and planet, not greed and growth. It is one that focuses energy on resilient local communities and businesses. It embraces the knowledge that small is beautiful. The New Economy is not just a rebooted version of the Old Economy – it is a drastic reshaping of the economic landscape. (I also believe that the New Economy is a post growth economy)
Out of the Old Economy of big-business, inequality, wall street over main street, oil & gas, environmental destruction and social degradation will rise the New Economy of small business, fair distribution, local systems, renewable energy, environmental restoration and protection, social renewal and strong communities.
The path ahead is not entirely clear, there are many opportunities to improving our social fabric and strengthening our local economics, but I believe that certain ideas will shine above the rest. Most of the change will come from the bottom up. This is true not only because the viability of anything getting done at the top of the political spectrum is practically non-existent, but also because the local movements will out-pace the movement of congress any day of the week. Here is my list of Top Ten Things That Will Build The New Economy (in no specific order):
- Local Currency – Keeping the economy local, supporting the community businesses, and creating wealth within your region are all side effects of using a local currency. Local currency has really seen a boom in the last decade, too. From the Ithaca Hours to the Berkshare to time banks, there’s even a transition town book on the subject.
- Distributed Renewable Energy Systems – E.F. Schumacher was right when he said “Small Is Beautiful.” Community and home scaled energy systems not only help create resiliency, but when connected to a smart grid can easily amplify that resiliency to the system as a whole. Distributed energy systems encourage local green jobs and in most cases utilize otherwise wasted space (rooftops, for example).
- Co-ops & Employee Owned Businesses – What could be more empowering than employee ownership? It unifies a company from the base employees to the CEO. Instead of putting stockholder profit ahead of the actual people who make a company (employees), it puts in power those very employees – allowing them to decide what’s best for the company. When economic downturns hit, perhaps they will decide to collectively take a paycut instead of putting people on the street. When times are good they can invest in employee-supporting programs or back into the company. I’m willing to bet these types of corporate structures will outlive and out-thrive the stockholders in the long run. Why? Because they put the power in the hands of the people.
- State Banks - When the economy crashed banks put there hands up in the air and said, “sorry, no more loans.” Every bank except for a state-run bank in North Dakota. This state run bank wasn’t out to make huge profits on high risk loans or derivatives – it is owned by the people to serve the people. A banking institution that is owned by the people it serves is more likely to be thinking in the interest of the people and not the shortsighted, profit interests of shareholders.
- Fair Wage Distribution & Reduced Work Hours - I put these two into one because I think they will work hand-in-hand in the transformation of our working standards. In order to employ everyone we cannot afford to trust in GDP growth – it actually, will not happen. Equally important is the realization that GDP growth is unsustainable. To both maintain a sustainable economy and eliminate our staggering unemployment we must reduce our average work hours – spread the available work around, while increasing our personal and leisure time. But, we must not allow unfair wage distribution to continue in this restructuring or many will be pushed into poverty. Increasing base wages and decreasing the ungodly wages of CEOs is not only socially just, but necessary to maintain a middle class with a shorter workweek.
- Alternative Metrics – GDP is a grossly inadequate metric of prosperity. It is literally a measurement of total economic activity, not a measurement of well being or even of positive economic activity (oil spills tend to boost local GDP). A more comprehensive metric that takes into account both good and bads on a multitude of levels – economic, social, environmental, happiness – is necessary for us to better gauge the progress of our economy.
- Sharing, Bartering and Trading – Returning to the basics is not necessarily a bad thing. Non-monetary based transactions like sharing, bartering and trading are becoming more common place and will be the basis of a more resilient, local economy that will emerge from the wreckage of our current globalized, liberal disaster of an economy. We’ll still have currency (mostly local, see above), but we’ll be using a lot more of these basic non-monetary means as well.
- Cycling & Trains – Transportation is a fundamental part of our daily lives. However, we cannot continue to rely on oil and coal for cheap fuel anymore. Besides the problems of crossing over the peak of oil production, we must transition to a sustainable means of travel to avert runaway climate destabilization. Bicycling provides a great means of self-propelled transportation that is widely available, zero-emission, efficient and one of the few types of transportation that improves your health! Coupled with public and mass transit powered by renewable energy, cycling is a great small distance alternative to the gas-guzzling cars of the past. In the new economy we will see a larger emphasis on alternative means of transportation and I’ll bet money the cycling community will boom, especially when trains are bike-friendly.
- Backyard Gardens & Farmers Markets – A stable of our existence, food is no laughing matter. During the war efforts of the world wars “victory gardens” were rampant – everyone was supplementing their food with homegrown variety. Today’s local, resilient economies are seeing a resurgence of the backyard garden because they just make sense. And when we have reduced work hours, we’ll have more time to devote to growing our own foods! It is a simple way to connect with family, the Earth and become more self-reliant. Couple victory gardens with local farmer’s markets that keep your community farmers in business and you’ll have an even more prosperous economy. This is the future of food: sustainable, organic, community-based production.
- Transition Towns – The Transition Town movement takes pretty much everything I’ve just discussed and places it in a manual for cities to become resilient to the shocks of climate change and peak oil. But these are not simply measures taken to prepare for some horrible, looming future. Far from it. In fact, all of these measures connect the community, enhance the personal spirit, encourage sustainability, and improve our general well being. Sometimes thinking outside of the box and looking back to some of the simple things that worked in the past out larger dividends than business-as-usual.