Challenging Economic Assumptions Driving Climate Change

People and institutions act within a framework of assumptions about the world, how it works, and what is right and wrong. Such assumptions, absorbed unconsciously throughout life, are constantly reinforced and generally unquestioned. Where these in fact do not conform to reality and become obstacles to change, it is necessary as a first step to question such assumptions. This is the challenge faced by the economy and business today.

Modern neoliberal economic thinking is founded on the assumption that people are fundamentally selfish and aggressive, so we accept as normal that markets and politics are powered by ego, greed, apathy and violence, and that our society values wealth, power and fame. This reflects the animal nature of man. Animals have no free will, but are constrained within their ecosystems. When humans give free rein to their animal nature, they have no natural limits and become worse than animals, as demonstrated by our violence, wars, and multiple forms of inhumanity and exploitation.

The economy measures success as wealth, whether personal wealth or national wealth measured as GDP. At the corporate level it is profit, return on capital and stock market valuation that generate this wealth. While we condemn individual behaviour that is so greedy, selfish and aggressive that it injures others, we do not see as easily how these values are incorporated in our institutions, particularly modern corporations. Many of the dominant corporations today are greed institutionalized, ready to do anything to maximise profits, with the ends justifying any means. And as institutions, they have little conscience, moral framework or sense of humanity to restrain them. They are behind climate change, biodiversity loss, massive pollution, human exploitation, extremes of poverty and wealth, the arms race, and most of the other ills we have failed to control.

Normally it is government that should ensure the common good of all, but corporate lobbies and corruption now control most governments, and there is no global governance for non-state entities like corporations. All the efforts at multilateral cooperation among states to address human rights and environmental sustainability fail in implementation because they have no influence over those with the real power today in the economic system.

Selfishness is behind the consumer society, where businesses cultivate endless wants and even addictions in the search for profits, regardless of the human and environmental costs. Think of the alcohol and tobacco industries, the arms industry, junk food and many other sectors that take no responsibility for the impact of their production. One recent example is COVID-19 vaccine development captured as corporate intellectual property to be sold to the wealthy for extravagant profit while depriving the poor of protection and extending the pandemic.

This is not a new problem. Black racism has its roots in the transatlantic slave trade beginning over 400 years ago. Colonisation was driven by the entrepreneurial search for wealth by conquest, but exploiting the rich soils of the new world required cheap labour, and Africa was the nearest source. Governments supported these new entrepreneurs by passing laws defining blacks as property rather than human beings to facilitate their exploitation, legalising and justifying slavery, and laying the foundation for modern racism. Today exploitation takes other forms, but the consequences are equally immoral.

To address this problem, we must question the basic economic assumptions about human nature. Drawing on all faith traditions and many other philosophical sources, we can identify universal values by which to judge such basic assumptions. There is wide consensus across many faith traditions that human reality includes a non-material or spiritual dimension, at least in potential. We can and should rise above our animal reality. This requires education, and especially education to higher values like honesty, integrity, trustworthiness and generosity. We also have a capacity for social values such as moderation, justice, love, reason, sacrifice and service to the common good. These are the values upon which civilisations have been built, and they are now needed today more than ever. They can provide a framework of values for our rapidly evolving world society, physically united but still far from accepting the oneness of humankind. This rejection of our unity in diversity is at the root of today’s crises.

The opposite of selfishness is acceptance of the oneness of humanity, that every human being is a trust of the whole, and that suffering anywhere in the world causes all of us to suffer. True happiness comes from living a virtuous life, refining one’s character and contributing to the advancement of civilisation through one’s profession and acts of service. Business competition can be replaced by cooperation and reciprocity, with innovation motivated by service to the common good, and by wide consultation on the best use of discoveries for the advancement of society as a whole. A market can work best with an honest consultation between buyers and sellers about a just price between cost and need. The economic system can still generate wealth, but with the aim of making everyone wealthy.

Where wealth is the measure of economic success, power is its political equivalent. Political leaders driven by a desire for power and fame are similarly selfish and aggressive. Clearly the concept of power as a means of domination, with the accompanying notions of contest, contention, division and superiority, are behind the failure of governments today to serve the common good. We need systems of governance that empower everyone to contribute, consulting on needs and searching for solutions that provide for the wellbeing of all and the sustainability of the environment upon which we all depend, free from the battles of ego that define politics today.

We must transform those economic and financial institutions that are the embodiment of greed and selfishness which are inherent in their legal charters and stock markets that give absolute priority to profit and return on investment. Economic entities such as corporations need revised legal charters that define a social purpose to do good and avoid harm, with profit only one measure of efficiency among others. Governments also need to provide a framework of law and regulation that defines the common interest to be respected, including at the global level.

New non-financial measures and systems of accounting are needed to define progress and motivate positive action. They could guide us to restore climate stability and productive ecosystems and prevent pollution. They could define a society able to meet the basic material needs of all with proper nutrition and good health, to provide meaningful work and access to education, to encourage knowledge, science, art and culture, all by fostering the values and spiritual capital that would be the measures of an ever-advancing civilisation.

Redrafting corporate charters should not be so difficult if there is the political and social will. Admittedly there are sectors of the economy with no social purpose that would disappear. Changing the ground rules by which businesses operate from selfishness to service would transform corporations from the root of the problem to part of the solution. The lobbies and vested interests that block transformation today would vanish, and make possible the acceleration in positive action that is needed to save us before it is too late.

Source: https://globalgovernanceforum.org/challenging-economic-assumptions/