What purpose does the economy serve? And what purpose should it serve?
As such, it is obvious that the economy should ensure the livelihoods of people.
If we take the idea seriously that all people have equal rights, our economy should ensure the livelihoods of all people and not just a few.
“All people” includes future generations. The conditions for their livelihoods should then also be maintained by our present economic activities.
We can only preserve the conditions for our present and future living if we preserve the ecosystems of the earth including their vast biological diversity. Beyond this, we have an ethical obligation with respect to the other living beings on this planet. Therefore, our economy should always preserve the integrity of ecosystems and biological diversity.
Unfortunately, our present economy does not meet these very basic requirements. An economy that did this would be an economy of abundance of life. But how can such an economy be brought to life? We need change that takes account of how living systems function, and how they can be changed without “interrupting service.” That is systemic change.
Systemic change, like a concert performance requires many instruments. A piano or a violin alone are not enough. It is also not good enough if everybody simply starts playing or thinks that his instrument is more important than all the others. It is vital that people play together.
A functioning economy of abundance of life requires many instruments – but it must not be defined or directed by any one of its instruments.
For example, the “market” is a category of instruments that can play a useful role to support the abundance of life, provided they are appropriately designed. Therefore, an economy of abundance of life would be an economy with markets, but not a market economy. Likewise, an economy of abundance of life would recognize the important role of self-provisioning, but it would not be a subsistence or self-provisioning economy.
I introduce the instruments of an economy of abundance of life that I consider most important on the following pages:
- definition and measurement of abundance of life,
- reformed property rights and duties, to ensure that property is used in alignment with the common good (as the German constitution demands),
- reformed financial system that serves the real economy,
- introduction of a self-determined service for the common good, to enable all people to secure a place in society compatible with human dignity,
- improved democratic procedures in economy and politics.
Institutional changes of this type cannot happen without a thoroughgoing transformation of values. This also has to be pursued consciously.
Some of these change require a long time to be implemented. In the short to medium term, a social-ecological full employment initiative could set us on a good path.