upside-down car

We now have, thanks to Kate Raworth, donut economics. Herman Daly gave us steady-state economics. Regular professionals gave us micro- and macroeconomics. And so on. Today, I am announcing a completely new type of economics: upside-down economics. It is the science of too much. From Adam Smith onward, economics has been largely about how to manage scarcity. But today, while scarcity is still a real issue for much of the world’s population, here in the US and other rich countries, the issue has been turned on its head; we have too much of a lot of things. It is important to keep in mind that I am only taking about real things here. We still have a huge scarcity of immaterial goods, like love, care, and, for me, most importantly, flourishing.

That’s the point. There is a connection between these two categories as I believe having too much of the former leads to having too little of the latter. So, what do I mean by all this? Let’s start with cars. There are simply too many around. Traffic is crazy everywhere from Boston, where I live, to New Delhi in India. (Today’s news showed New Delhi with pollution levels almost 10 times more than what is considered marginally dangerous.) Even my small suburb of Lexington is just one huge traffic jam twice a day. Two-, three-, even occasional four-car garages occupy land that would be much better utilized if left undisturbed. But, perhaps, the biggest downside to too many cars is the immense loss of time and peacefulness. A good example of what I am pointing out; too much of some material things creates losses of the existential, immaterial objects and qualities that are most critical for the full expression of our species potential. (If this last sentence grabs or puzzles you at all, you should buy a copy of my new book)

Mobile devices, social media, automobiles, processed food, education without a humanistic core, the internet, robotization of work, and many others, in no particular order, are nothing more than a glut of stuff that has and is creating scarcity in the most important domains that produce flourishing. In that sense, flourishing has an economy of its own. It is one of the least abundant things around. I use the metaphor of thing, here, because it helps with another metaphor, economy. We need a brand-new form of economics that will help us design societies to make sure we get enough of the care and love we really do need. How can or should one ever try to put a value on flourishing?

Too many mobile devices are destroying our children ability to converse writes Sherry Turkle. We adults are addicted to our smartphones, clicking and looking at them hundreds of times or much more a day. The CDC has data that indicates that nearly 40 % of US adults are obese. I am no doctor but expect that the size of the number is due to the prevalence of processed food or just too much at the table. The excessive availability of social media/digital devices has produced a glut of dubious information that can be related to the lack of meaningful conversation about public concerns and to the disappearance of sources that can be relied on by all.

I don’t need to enumerate every case where the problem is too many things, but more just popped up. We clearly have too many guns. Recent surveys put us at the top of the world with just more than one gun per person, more than twice as many as Yemen, the second in this ranking. There is no scarcity here. This economic fact is surely related to another, the number of homicides per capita. The US is number one with 16.2 per 100,000 inhabitants, compared to the whole world at 6, and to Europe with just 3.

When one stops counting all the over-abundant things we make, like cars, or guns, or mobile devices, on the Planet, there is still one object with a surplus that merits thinking about. There are too many of us. I raise this observation with great trepidation as I do understand its moral implications. But it is unavoidable in any discussion of upside-down economics.

In the production, consumption, and disposal of all the things that we humans use every day, we are over-stressing the Earth’s capacity to provide the resources for that production, etc. Footprint analyses estimate that we have exceeding one and one-half equivalent Earth’s. But there is only one. Perhaps the most obvious consequence of this situation is global warming and its manifestation as climate change. But there are many others, like this:

North America has lost nearly 3 billion birds since 1970, a study said Thursday, which also found significant population declines among hundreds of bird species, including those once considered plentiful.

It sounds like “Silent Spring” all over again. Pollinators are disappearing. The oceans are being inundated with plastic waste. I have read estimates that by 2050, the amount of plastic waste in the Earth’s oceans will outweigh the amount of fish.

Neo-classical economics presumes to have an answer for even this profound challenge to both a flourishing Planet and the life that inhabits it. Produce more living space. There is little left on Earth, so let’s simply expand the frontier! Colonization of space objects is absolutely not the answer. The Wikipedia article on the subject offers four main pluses: survival of human civilization, vast resources in space, expansion with fewer negative consequences, and alleviating overpopulation and resource demand. Claims by NASA, Elon Musk, and others that space colonization is the answer to the reality of the over-stressing I just mentioned are not just pie in the sky; they are dangerous.

This whole idea is, perhaps, the biggest cop-out, of anything around these days. It is a chilling example of what systems dynamics calls shifting-the-burden, dealing only with the symptoms, while ignoring the root causes. This proposal also exemplifies another systems archetype with the same structure: addiction. Space colonization reeks of the addiction we have to technology as the way to solve all problems. We cannot stop using it. The solution now becomes the problem at some point.

The over-stressing of the earth is an example of the “tragedy-of-the-commons” problem. When access to a common resource, say the Earth, is free or less costly than the benefits one gets by using its resources, humans with access to that commons will use more and more of it until, someday, it becomes disabled. Climate change and its bad consequences is a perfect example. Classic economics has no answer to this problem. Worse, its rules say that such collapse is, more or less, inevitable. The solution that comes out of its rules is to convert the commons to private property, and let some sort of market govern its use.

In recent years, an alternative to this “solution,” which has disenfranchised most of the Earth’s peoples, was proposed by the late economist, Elinor Ostrom. Based on her work in a small alpine Swiss village and other places, she has argued that there are rules by which a commons can be utilized without destroying it. Here are her eight principles:

1. Define clear group boundaries.
2. Match rules governing use of common goods to local needs and conditions.
3. Ensure that those affected by the rules can participate in modifying the rules.
4. Make sure the rule-making rights of community members are respected by outside authorities.
5. Develop a system, carried out by community members, for monitoring members’ behavior.
6. Use graduated sanctions for rule violators.
7. Provide accessible, low-cost means for dispute resolution.
8. Build responsibility for governing the common resource in nested tiers from the lowest level up to the entire interconnected system.

I would call her system an example of upside-down economics. (Ironically, she won the Nobel prize in Economics a few year ago.) It’s a way to control, reduce, or prevent a surplus, in this case, like the classic commons example, grazable land, from spilling over and affecting some immaterial quality or object. Here it is the well-being of the local, agrarian community. It is clear from Ostrom’s work that the simplistic core of neo-classic economics cannot deal with these destructive surpluses and nor can it produce the stuff we humans really need to flourish,

Unfortunately, the issues I raise above are not limited to a small commons. They appear at national and, ultimately at global scales. Even at smaller scales the boundaries are very porous. The problems caused by the excessive use of technology are a kind of commons problem. Facebook, and similar social media, have created a connectivity commons. It is very easy to connect to friends, in theory, enhancing each linkage. But, because connections are virtually cost-less, users have been adding “friends” without limit. This connectivity commons, itself, has yet to become degraded, but the meaningfulness of “friends” has. The full context of what friendship is and takes to maintain has largely disappeared.

Something has to be done, especially in the case of relieving the stresses on the planet, but not by dealing only with the symptoms. No technological solution, even with space colonization, can compensate for the destructive forces that are loosed by any political economy now in place. It’s certainly worth trying to mitigate or retard these negatives, but not at the expense of dealing with the root issues. Ostrom’s work is a start, but only a start, toward some form of upside-down economics that has the power to turn around our current trajectory to self-destruction. Given the way we are frittering away our humanity, while we dirty our homes at the same time, who is to say that our species is any better or worse than that of the dinosaurs.

ps. In a highly ironic happening, I read, just after drafting this post, that President Trump, today, set in motion the process to withdraw from the Paris (climate change) Accord. I am sure that the reason, if offered, would be to loosen the constrains on economic growth that it imposes. Is there a better argument for some radically new kind of economics?