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A New Economic System, A New Society

By John Scales Avery

22 August, 2015


We need a new economic system, a new society, a new social contract, a new way of life. Here are the great tasks that history has given to our generation:

We must achieve a steady-state economic system

A steady-state economic system is necessary because neither population growth nor economic growth can continue indefinitely on a finite earth. No one can maintain that exponential industrial growth is sustainable in the long run except by refusing to look more than a short distance into the future.

Of course, it is necessary to distinguish between industrial growth, and growth of culture and knowledge, which can and should continue to grow. Qualitative improvements in human society are possible and desirable, but resource-using and pollution-producing industrial growth is reaching its limits, both because of ecological constraints and because of the exhaustion of petroleum, natural gas and other non-renewable resources, such as metals. The threat of catastrophic climate change makes it imperative for us to stop using fossil fuels within very few decades.

We discussed Nicholas Georgescu-Roegen 's reasons for viewing our present economic system as unidirectional and entropic: Low-entropy resources are converted into high-entropy waste, a unidirectional process. By contrast, to be sustainable in the long run, a process must be cyclic, like the growth and regeneration of a forest.

Georgescu-Roegen's list of disiderata remains valid today: We need drastic cuts in weapons production, thereby releasing productive forces for more constructive purposes. We need immediate aid to underdeveloped countries and gradual decrease in population to a level that can be maintained by organic agriculture. We also need avoidance, and strict regulation if necessary, of wasteful energy use. Finally, we need to abandon our attachment to extravagant gadgetry and fashion, and we must cure ourselves of workaholic habits by re-balancing the time spent on work and leisure.

Today, the distinguished economist Herman Daly (a student of Georgescu-Roegen) continues to write perceptive aricles and books documenting the need for a steady-state enconomy. Among his books, the following are noteworthy: “Steady-State Economics” (1977); “For the Common Good” (1989, with John B. Cobb, Jr.); “Valuing the Earth” (1993, with Kenneth Townsend); “Beyond Growth” (1996); “Ecological Economics and the Ecology of Economics” (1999); “Local Politica of Global Sustainability” (2000, with Thomas Prugh and Robert Costanza), and “Ecological Economics: Principles and Applications” (2003, with Joshua Farley. Prof. Daly is a recipiant of the Right Livelihood Award, which is sometimes called the Alternative Nobel Prize.






We must restore democracy

It is obvious, almost by definition, that excessive governmental secrecy and true democracy are incompatible. If the people of a country have no idea what their government is doing, they cannot possibly have the influence on decisions that the word “democracy” implies.

Governmental secrecy is not something new. Secret diplomacy contributed to the outbreak of World War I, and the secret Sykes-Picot agreement later contributed to the bitterness of conflicts in the Middle East. However, in recent years, governmental secrecy has grown enormously.

The revelations of Edward Snowden have shown that the number of people involved in secret operations of the United States government is now as large as the entire population of Norway: roughly 5 million. The influence of this dark side of government has become so great that no president is able to resist it.

Many modern governments have become very expert in manipulating public opinion through mass media. They only allow the public to hear a version of the “news” that has been handed down by powerholders. Of course, people can turn to the alternative media that are available on the Internet. But on the whole, the vision of the world presented on television screens and in major newspapers is the “truth” that is accepted by the majority of the public, and it is this picture of events that influences political decisions. Censorship of the news by the power elite is a form of secrecy, since it withholds information that is needed for a democracy to function properly.

The frantic efforts of President Obama to capture and punish whistleblower Edward Snowden indicate that the secrets that the US government is trying to hide are by no means limited to the massive electronic spying operations that Snowdon revealed.

Snowden has already said most of what he has to say. Nevertheless, Washington was willing to break international law and the rules of diplomatic immunity by forcing its European allies to ground the plane of Bolivian President Evo Morales following a rumor that Snowden was on board. This was not done to prevent Snowden from saying more, but with the intention of making a gruesome example of him, as a warning to other whistleblowers.

Furthermore, President Obama has initiated an enormous Stasi-like program called “Insider Threats”, which forces millions of federal employees, in a wide variety of agencies, to spy on each other and to report anything that looks like a move towards whistleblowing.

According to an article written by Marisa Taylor and Jonathan S. Landay of the McLatchy Washington Bureau, ``...It extends beyond the US national security bureaucracies to most federal departments and agencies nationwide, including the Peace Corps, the Social Security Administration, and the Education and Agriculture Departments."

Apparently the US government has very many secrets to hide, and very many potential whistleblowers that it fears. But who are they? Who are the potential whistleblowers who must be forced into terrified silence by the examples made of Edward Snowden, Bradley Manning and Julian Assange?

Are these potential whistleblowers CIA agents who have stories to tell about dirty wars and assassinations in Latin America? Are they people who know the details about how John and Robert Kennedy were shot? Are they people who know how Martin Luther King Jr. was killed? Are they the New York firemen who heard a series of explosions as the buildings of the World Trade Center collapsed? Are they the people in New York who collected samples of the dust that was collected from the falling buildings; dust that was shown by chemical analysis to contain nanothermite, a powerful heat-producing compound that could have melted the steel structures of the buildings? Are they the CIA insiders who could give evidence that the US government knew well in advance of the planned 9/11 attacks, and made them worse than they otherwise would have been by planting explosives in the World Trade Center buildings? Are they people who know Obama's own secrets?

Whoever these potential whistlelblowers are, it is clear that Obama fears them, and that the US government has many secrets. But if it has many secrets, then the present government of the United States cannot be a democracy.

In a democracy, the power of judging and controlling governmental policy is supposed to be in the hands of the people. It is completely clear that if the people do not know what their government is doing, then they cannot judge or control governmental policy, and democracy has been abolished. There has always been a glaring contradiction between democracy and secret branches of the government, such as the CIA, which conducts its assassinations and its dirty wars in South America without any public knowledge or control.

The gross, wholesale electronic spying on citizens revealed by Snowdon seems to be specifically aimed at eliminating democracy. It is aimed at instilling universal fear and conformity, fear of blackmail and fear of being out of step, so that the public will not dare to oppose whatever the government does, no matter how criminal or unconstitutional.

The Magna Carta is trashed. No one dares to speak up. Habeus Corpus is trashed. No one dares to speak up. The United Nations Charter is trashed. No one dares to speak up. The Universal Declaration of Human Rights is trashed. No one dares to speak up. The Fourth Amendment to the US Constitution is trashed. No one dares to speak up. The President claims the right to kill both US and foreign citizens, at his own whim. No one dares to speak up.

George Orwell, you should be living today! We need your voice today! After Snowden's revelations, the sale of Orwell's “1984” soared. It is now on the bestseller list. Sadly, Orwell's distopian prophesy has proved to be accurate in every detail.

We must restore democracy wherever it has been replaced by oligarchy. When we do so, we will free ourselves from many evils, including excessive economic inequality, violation of civil rights, and the suffering produced by perpetual wars.

We must decrease economic inequality

In his Apostolic Exhortation, “Evangelii Gaudium”, Pope Francis said: “In our time humanity is experiencing a turning-point in its history, as we can see from the advances being made in so many fields. We can only praise the steps being taken to improve people’s welfare in areas such as health care, education and communications. At the same time we have to remember that the majority of our contemporaries are barely living from day to day, with dire consequences. A number of diseases are spreading. The hearts of many people are gripped by fear and desperation, even in the so-called rich countries. The joy of living frequently fades, lack of respect for others and violence are on the rise, and inequality is increasingly evident. It is a struggle to live and, often, to live with precious little dignity.”

“This epochal change has been set in motion by the enormous qualitative, quantitative, rapid and cumulative advances occuring in the sciences and in technology, and by their instant application in different areas of nature and of life. We are in an age of knowledge and information, which has led to new and often anonymous kinds of power.”

“Just as the commandment 'Thou shalt not kill' sets a clear limit in order to safeguard the value of human life, today we also have to say 'thou shalt not' to an economy of exclusion and inequality. Such an economy kills. How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points? This is a case of exclusion. Can we continue to stand by when food is thrown away while people are starving? This is a case of inequality. Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.”

“In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting.”

In a recent speech, Senator Bernie Sanders quoted Pope Francis extensively and added: “We have a situation today, Mr. President, incredible as it may sound, where the wealthiest 85 people in the world own more wealth than the bottom half of the world's population.”




The social epidemologist Prof. Richhard Wilkinson, has documented the ways in which societies with less economic inequality do better than more unequal societies in a number of areas, including increased rates of life expectancy, mathematical performance, literacy, trust, social mobility, together with decreased rates of infant mortality, homicides, imprisonment, teenage births, obesity and mental illness, including drug and alcohol addiction.



We must also remember that according to the economist John A. Hobson, the basic problem that led to imperialism was an excessively unequal distribution of incomes in the industrialized countries. The result of this unequal distribution was that neither the rich nor the poor could buy back the total output of their society. The incomes of the poor were insufficient, and rich were too few in number.

We must break the power of corporate greed

When the United Nations was established in 1945, the purpose of the organization was to abolish the institution of war. This goal was built into many of the articles of the UN Charter. Accordingly, throughout the world, many War Departments were renamed and became Departments of Defense. But the very name is a lie. In an age of nuclear threats and counter-threats, populations are by no means protected. Ordinary citizens are just hostages in a game for power and money. It is all about greed.

Why is war continually threatened? Why is Russia threatened? Why is war with Iran threatened? Why fan the flames of conflict with China? Is it to “protect” civilians? Absolutely not! In a thermonuclear war, hundreds of millions of civilians would die horribly everywhere in the world, also in neutral countries. What is really being protected are the profits of arms manufacturers. As long as there are tensions; as long as there is a threat of war, military budgets are safe; and the profits of arms makers are safe. The people in several “democracies”, for example the United States, do not rule at the moment. Greed rules.

As Institute Professor Noam Chomsky of MIT has pointed out, greed and lack of ethics are built into the structure of corporations. By law, the Chief Executive Officer of a corporation must be entirely motivated by the colective greed of the stockholders. He must maximize profits. Nothing must count except the bottom line. If the CEO abandons this single-minded chase after corporate profits for ethical reasons, or for the sake of humanity or the biosphere or the future, he (or she) must, by law, be fired and replaced.

Occasionally, for the sake of their public image, corporations seem to do something for other motives than their own bottom line, but it is usually window dressing. For example, Shell claims to be supporting research on renewable energy. Perhaps there is indeed a small renewable energy laboratory somewhere in that vast corporation; but the real interest of the organization is somewhere else. Shell is sending equipment on a large scale to drill for more and more environment-destroying oil in the Arctic.




We must leave fossil fuels in the ground

The threat of catastrophic climate change requires prompt and dedicated action by the global community. Unless we very quickly make the transition from fossil fuels to 100% renewable energy, we will reach a tipping point after which uncontrollable feedback loops could take over, leading to a human-caused 6th geological extinction event. This might even be comparable to the Permian-Triassic event, during which 96% of all marine species and 70% of terrestrial vertebrates became extinct.

New hope that such a catastrophe for human civilization and the biosphere can be avoided comes from two recently-released documents: The Encyclical “Laudato Si' ” by Pope Francis, and the statistics on the rate of growth of renewable energy newly released by the Earth Policy Institute.

Arctic sea-ice is melting at an increasingly rapid rate, because of several feedback loops. One of these feedback loops, called the albedo effect, is due to the fact that white snow-covered sea-ice in the Arctic reflects sunlight, while dark water absorbs it, raising the temperature and leading to more melting.

Another feedback loop is due to the fact that rising temperatures mean that more water is evaporated. The water vapor in the atmosphere acts like a greenhouse gas, and raises the temperature still further.

If we consider long-term effects, by far the most dangerous of the feedback loops is the melting of methane hydrate crystals and the release of methane into the atmosphere, where its effects as a greenhouse gas are roughly twenty times great as those of CO2.

When organic matter is carried into the oceans by rivers, it decays to form methane. The methane then combines with water to form hydrate crystals, which are stable at the temperatures which currently exist on ocean floors. However, if the temperature rises, the crystals become unstable, and methane gas bubbles up to the surface.

The worrying thing about methane hydrate deposits on ocean floors is the enormous amount of carbon involved: roughly 10,000 gagatons. To put this huge amount into perspective, we can remember that the total amount in world CO2 emissions since 1751 has been only 337 gigatons.

Despite the worrying nature of the threats that we are facing, there are reasons for hope. One of the greatest of these is the beautiful, profound and powerful encyclical that has just been released by Pope Francis.
Pope Francis tells us that the dictates of today's economists are not sacred: In the future, if we are to survive, economics must be given both a social conscience and an ecological conscience. Nor are private property and profits sacred. They must be subordinated to the common good, and the preservation of our global commons.

Less focus on material goods need not make us less happy. The quality of our lives can be increased, not decreased, if we give up our restless chase after power and wealth, and derive more of our pleasures from art, music and literature, and from conversations with our families and friends,

Another reason for hope can be found in the extremely high present rate of growth of renewable energy, and in the remarkable properties of exponential growth. According to figures recently released by the Earth Policy Institute, http://www.earth-policy.org/books/tgt, the global installed photovoltaic capacity is currently able to deliver 242,000 megawatts, and it is increasing at the rate of 27.8% per year. Wind energy can now deliver 370,000 megawatts, and it is increasing at the rate of roughly 20% per year.
Because of the astonishing properties of exponential growth, we can calculate that if these growth rates are maintained, renewable energy can give us 24.8 terawatts within only 15 years! This is far more than the world's present use of all forms of energy.
All of us must still work with dedication to provide the political will needed to avoid catastrophic climate change. However, the strong and friendly voice of Pope Francis, and the remarkable rate of growth of renewable energy can guide our work, and can give us hope and courage.

The award-winning author and activist Naomi Klein has emphasized that the climate crisis changes everything. Environmentalists and antiwar activists must unite! We need a new economic system! The people of the world don't want climate change; they want system change!











We must stabilize and ultimately reduce the global population

According to the World Resources Institute and the United Nations Environment Programme, “It is estimated that since World War II, 1.2 billion hectares...[of agricultural land] has suffered at least moderate degradation as a result of human activity. This is a vast area, roughly the size of China and India combined.” This area is 27% of the total area currently devoted to agriculture 5 . The report goes on to say that the degradation is greatest in Africa.

David Pimental and his associates at Cornell University pointed out in 1995 that “Because of erosion-associated loss of productivity and population growth, the per capita food supply has been reduced over the past 10 years and continues to fall. The Food and Agricultural Organization reports that the per capita production of grains which make up 80% of the world’s food supply, has been declining since 1984.”

Pimental et al. add that “Not only is the availability of cropland per capita decreasing as the world population grows, but arable land is being lost due to excessive pressure on the environment. For instance, during the past 40 years nearly one-third of the world’s cropland (1.5 billion hectares) has been abandoned because of soil erosion and degradation. Most of the replacement has come from marginal land made available by removing forests. Agriculture accounts for 80% of the annual deforestation.”

The phrase “developing countries” is more than a euphemism; it expresses the hope that with the help of a transfer of technology from the industrialized nations, all parts of the world can achieve prosperity. An important factor that prevents the achievement of worldwide prosperity is population growth.

In the words of Dr. Halfdan Mahler, former Director General of the World Health Organization, “Country after country has seen painfully achieved increases in total output, food production, health and educational facilities and employment opportunities reduced or nullified by excessive population growth.”

The growth of population is linked to excessive urbanization, infrastructure failures and unemployment. In rural districts in the developing countries, family farms are often divided among a growing number of heirs until they can no longer be subdivided. Those family members who are no longer needed on the land have no alternative except migration to overcrowded cities, where the infrastructure is unable to cope so many new arrivals. Often the new migrants are forced to live in excrement-filled makeshift slums, where dysentery, hepatitis and typhoid are endemic, and where the conditions for human life sink to the lowest imaginable level. In Brazil, such shanty towns are called “favelas”.

If modern farming methods are introduced in rural areas while population growth continues, the exodus to cities is aggravated, since modern techniques are less labor-intensive and favor large farms. In cities, the development of adequate infrastructure requires time, and it becomes a hopeless task if populations are growing rapidly. Thus, population stabilization is a necessary first step for development.

It can be observed that birth rates fall as countries develop. However, development is sometimes blocked by the same high birth rates that economic progress might have prevented. In this situation (known as the “demographic trap”), economic gains disappear immediately because of the demands of an exploding population.

For countries caught in the demographic trap, government birth control programs are especially important, because one cannot rely on improved social conditions to slow birth rates. Since health and lowered birth rates should be linked, it is appropriate that family-planning should be an important part of programs for public health and economic development.

A recent study conducted by Robert F. Lapham of Demographic Health Surveys and W. Parker Maudlin of the Rockefeller Foundation has shown that the use of birth control is correlated both with socio-economic setting and with the existence of strong family-planning programs. The implication of this study is that even in the absence of increased living standards, family planning programs can be successful, provided they have strong governmen support.

Education of women and higher status for women are vitally important measures, not only for their own sake, but also because in many countries these social reforms have proved to be the key to lower birth rates. As Sir Partha Dasgupta of Cambridge University has pointed out, the changes needed to break the cycle of overpopulation and poverty are all desirable in themselves. Besides education and higher status for women, they include state-provided social security for old people, provision of water supplies near to dwellings, provision of health services to all, abolition of child labor and general economic development. The money required to make these desirable changes is a tiny fraction of the amount that is currently wasted on war.

In order to avoid a catastrophic future famine, it is vitally important that all of the countries of the world should quickly pass through a demographic transition from a situation characterized by high birth rates and high death rates to a new equilibrium, where low death rates are balanced by low birth rates.

We must eliminate the institution of war

The problem of achieving internal peace over a large geographical area is not insoluble. It has already been solved. There exist today many nations or regions within each of which there is internal peace, and some of these are so large that they are almost worlds in themselves. One thinks of China, India, Brazil, Australia, the Russian Federation, the United States, and the European Union. Many of these enormous societies contain a variety of ethnic groups, a variety of religions and a variety of languages, as well as striking contrasts between wealth and poverty. If these great land areas have been forged into peaceful and cooperative societies, cannot the same methods of government be applied globally?

But what are the methods that nations use to achieve internal peace? Firstly, every true government needs to have the power to make and enforce laws that are binding on individual citizens. Secondly the power of taxation is a necessity. Thirdly, within their own territories, almost all nations have more military power than any of their subunits. For example, the US Army is more powerful than the State Militia of Illinois.

This unbalance of power contributes to the stability of the Federal Government of the United States. When the FBI wanted to arrest Al Capone, it did not have to bomb Chicago. Agents just went into the city and arrested the gangster. Even if Capone had been enormously popular in Illinois, the the government of the state would have realized in advance that it had no chance of resisting the US Federal Government, and it still would have allowed the “Feds” to make their arrest. Similar considerations hold for almost all nations within which there is internal peace. It is true that there are some nations within which subnational groups have more power than the national government, but these are frequently characterized by civil wars.

Of the large land areas within which internal peace has been achieved, the European Union differs from the others because its member states still maintain powerful armies. The EU forms a realistic model for what can be achieved globally in the near future by reforming and strengthening the United Nations. In the distant future, however, we can imagine a time when a world federal authority will have much more power than any of its member states, and when national armies will have only the size needed to maintain local order.

Today there is a pressing need to enlarge the size of the political unit from the nation-state to the entire world. The need to do so results from the terrible dangers of modern weapons and from global economic interdependence. The progress of science has created this need, but science has also given us the means to enlarge the political unit: Our almost miraculous modern communications media, if properly used, have the power to weld all of humankind into a single supportive and cooperative society.

It is useful to consider the analogy between the institution of war and the institution of slavery. We might be tempted to say, “There has always been war, throughout human history; and war will always continue to exist.” As an antidote to this kind of pessimism, we can think of slavery, which, like war, has existed throughout most of recorded history. The cultures of ancient Egypt, Greece and Rome were all based on slavery, and, in more recent times, millions of Africans were captured and forced into a life of slavery in the New World and the Middle East. Slavery was as much an accepted and established institution as war is today. Many people made large profits from slavery, just as arms manufacturers today make enormous profits. Nevertheless, despite the weight of vested interests, legal slavery has now been abolished throughout most of the world.

Today we look with horror at drawings of slave ships, where human beings were packed together like cordwood, and we are amazed that such cruelty could have been possible. Can we not hope for a time when our descendants, reading descriptions of the wars of our own time, will be equally amazed that such cruelty and stupidity could have been possible? If we use them constructively, the vast resources now wasted on war can initiate a new era of happiness and prosperity for the family of man. It is within our power to let this happen. The example of the men and women who worked to rid the world of slavery can give us courage as we strive for a time when war will exist only as a dark memory fading into the past.

New ethics to match new technology

Modern science has, for the first time in history, offered humankind the possibility of a life of comfort, free from hunger and cold, and free from the constant threat of death through infectious disease. At the same time, science has given humans the power to obliterate their civilization with nuclear weapons, or to make the earth uninhabitable through overpopulation and pollution. The question of which of these paths we choose is literally a matter of life or death for ourselves and our children.

Will we use the discoveries of modern science constructively, and thus choose the path leading towards life? Or will we use science to produce more and more lethal weapons, which sooner or later, through a technical or human failure, may result in a catastrophic nuclear war? Will we thoughtlessly destroy our beautiful planet through unlimited growth of population and industry? The choice among these alternatives is ours to make. We live at a critical moment of history, a moment of crisis for civilization.

No one living today asked to be born at such a moment, but by an accident of birth, history has given us an enormous responsibility, and two daunting tasks: If civilization is to survive, we must not only stabilize the global population but also, even more importantly, we must eliminate the institution of war. We face these difficult tasks with an inherited emotional nature that has not changed much during the last 40,000 years. Furthermore, we face the challenges of the 21st century with an international political system based on the anachronistic concept of the absolutely sovereign nation-state. However, the human brain has shown itself to be capable of solving even the most profound and complex problems. The mind that has seen into the heart of the atom must not fail when confronted with paradoxes of the human heart.

We must replace the old world of international anarchy, chronic war and institutionalized injustice, by a new world of law. The United Nations Charter, the Universal Declaration of Human Rights and the International Criminal Court are steps in the right direction, but these institutions need to be greatly strengthened and reformed.

We also need a new global ethic, where loyalty to one’s family and nation is supplemented by a higher loyalty to humanity as a whole. The Nobel laureate biochemist Albert Szent-Györgyi once wrote:

“The story of man consists of two parts, divided by the appearance of modern science.... In the first period, man lived in the world in which his species was born and to which his senses were adapted. In the second, man stepped into a new, cosmic world to which he was a complete stranger.... The forces at man’s disposal were no longer terrestrial forces, of human dimension, but were cosmic forces, the forces which shaped the universe. The few hundred Fahrenheit degrees of our flimsy terrestrial fires were exchanged for the ten million degrees of the atomic reactions which heat the sun.”

“This is but a beginning, with endless possibilities in both directions; a building of a human life of undreamt of wealth and dignity, or a sudden end in utmost misery. Man lives in a new cosmic world for which he was not made. His survival depends on how well and how fast he can adapt himself to it, rebuilding all his ideas, all his social and political institutions.”

“...Modern science has abolished time and distance as factors separating nations. On our shrunken globe today, there is room for one group only: the family of man.”


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John Avery received a B.Sc. in theoretical physics from MIT and an M.Sc. from the University of Chicago. He later studied theoretical chemistry at the University of London, and was awarded a Ph.D. there in 1965. He is now Lektor Emeritus, Associate Professor, at the Department of Chemistry, University of Copenhagen. Fellowships, memberships in societies: Since 1990 he has been the Contact Person in Denmark for Pugwash Conferences on Science and World Affairs. In 1995, this group received the Nobel Peace Prize for their efforts. He was the Member of the Danish Peace Commission of 1998. Technical Advisor, World Health Organization, Regional Office for Europe (1988- 1997). Chairman of the Danish Peace Academy, April 2004.http://www.fredsakademiet.dk/ordbog/aord/a220.htm. He can be reached at avery.john.s@gmail.com

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