The Economics of Kindness Part 1

Guy DaunceyApril 2017

PART ONE

FOUR THEMES1.What is an Economy?2.Business, Banking,

Money3.Nature and Climate

4.Poverty and InequalityI am still developing this presentation:

much is omitted due to the constraints of a public presentation. – Guy Dauncey

1.What is an Economy?

What is the Economy? The Neo-Classical View

What is the Economy? The Neo-Classical View

Self Interest Homo Economicus

Rational, Self-Interested

Homo Economicus

The Economics of Self-Interest

Milton Friedman

“The world runs on individuals pursuing their

self interests. The great achievements of civilization have not come from government

bureaux.”

The 19th Century Economy: A Stable, Complex Machine

Economics: A science, Just like physics

The 20th Century Economy: A Stable, More Complex

Machine

The 21st Century Economy: A Stable, Hyper-Complex

Machine

The Economics of Self-Interest

“If any civilizationis to survive, it is the morality of altruism that men have to reject.”

Ayn Rand

Guy Dauncey 2013 www.earthfuture.com


GDP =GrossDepletion of the Planet


GrossDepletion of the Planet

Why?

To raise cattle, to make hamburgers

Guy Dauncey 2015www.earthfuture.com

Guy Dauncey 2013 www.earthfuture.com Chris Jordan

Guy Dauncey 2011www.earthfuture.com Smithore Dreamstime.com

CLIMATE CRISIS

December 2016

The last time the world was 3C warmer,

the sea level was 25 metres higher.

The Guardian, March 22, 2016

Vancouver 2 Metres Sea-Level Rise

Vancouver 20 Metres Sea-Level Rise

So if we’re not all rational and self-interested, what is our human

nature?

Sweet and Kind?

Or not so much?

Kind

Loving

Gossipy

Passionate

Selfish

Angry

Rational

Risk-TakerJealous

Mean

Visionary

Nurturing

The Economics of Kindness

%


%


David Sloan WilsonBiologist & anthropologist

“Selfishness beats altruism within groups.

Altruistic groups beat selfish groups. Everything else is commentary.”


Homo Economicus

Homo Amicus?

So What is the Economy? Let’s try again

The Eight Dimensions of the Real Economy


Ecological

Wealth


Ecological

Wealth

IndividualAgency


Ecological

Wealth

Trust


Ecological

Wealth

Trust

Future

Faith

in the


Ecological

Wealth

Trust

Future

Faith

in the

Cultural wealth


Ecological

Wealth

Trust

Future

Faith

in the

Cultural wealth

Communitywealth


Ecological

Wealth

Trust

Future

Faith

in the

Cultural wealth

Communitywealth

Publicwealth


Ecological

Wealth

Trust

Future

Faith

in the

Cultural wealth

Communitywealth

Publicwealth

Privatewealth

Guy Dauncey, 2017

Ecological

Wealth

Trust

Future

Faith

in the

Cultural wealth

Communitywealth

Publicwealth

Privatewealth

The Real Economy: A complex adaptive system

made up interdependent humansin a dynamic living world

- Kate Haworth, The Doughnut Economy

Genuine Progress Indicator

Gross Domestic Product (GDP)

Today’s economy is divisive and degenerative by default.

Tomorrow’s economy must be distributive and regenerative by design

- Kate Raworth

Doughnut Economics: 7 Ways to Think Like a 21st Century Economist

We need NEW

GOALSfor our

economy

Full employment, jobs for all?Reduced inequality, social

prosperity?Increased happiness and

wellbeing?Harmony with nature?

COHESIVE CONSENSUS 0 = no resistance. 10 = complete resistanceLowest score = least shared resistance= most

cohesive

2. Business, Banking, Money

Typical locally-owned small businessCommitted to the community

Relationships matter

Typical large corporate businessCommitted to its owners and

shareholdersProfit maximization matters

1. Articulate a powerful vision2. Ideas are only as good as their execution3. World-changing innovation can come from anywhere4. Operate with integrity5. Build great products6. Have confidence7. Disturb the comfortable8. Know how to persevere9. Continuous learning is a priority10. Network and connect

Elon Musk’s Ten Rules for Business Success

• Recycle more money in the local economy• Conduct themselves more reliably,

accountably • Generate a stronger sense of local

identity • Owners and staff engage in more civic

activity • Give more to local charities

Compared to large corporations,

locally-owned businesses…

Green Business Certification

Green Business Certification

Jill Doucette

Benefit Corporations

Social Business

Benefit Corporations

Benefit Corporations in VancouverAquatic Informatics

Aroundsquare LtdBig Room Inc.Brix Media Co.

Climate Smart Business, Inc.Ethical Bean Coffee

Fairware Promotional Products.Flipside Creative

HootsuiteJunxion Strategy

Kent Employment LawLeverage Lab

Light Trail ConsultingLunapads

Mills Office Productivity

PyrrhaRealize Strategies

Recollective ConsultingRenewal Funds

RTOWNSaul Good Gift Co

Save On MeatsSES ConsultingSMAK Food Inc

soulpepperSPUD

Sustainability Television

Yulu Public Relations Inc.

An Economy for the Common Good

“Our economic system is upside down. Money has become a self-purpose rather than a means for what really matters: a

good life for all.” – Christian Felber

CO-OPERATIVE OWNERSHIP

Patrons and owners of the George and Dragon Pub,

Yorkshire, now a cooperative

One of 582 owners of ATX Taxi Coop

Austin, Texas

Mondragon, Spain

*

Network of 100 cooperative businesses

Philosophy of participation and solidarity

75,000

Mondragon wage ratios 1:3 to 1:9US Corporate CEOs 1:350*

(*Harvard Business School Study)

The 150 employee-owners of Chandos Construction

$400 million annual turnoverCertified B-Corporation

Recognized as one of Alberta’s Top Employers 2017

Employee Stock Ownership Plan (ESOP)

A Cooperative Economy

StrengthenEntrepreneurialism

Mentoring and Support for Business and Coop Start-Ups

Including Women, Youth, First Nations, Minorities

www.startupcommunities.ca

Train New Entrepreneurs

We need youth enterprise initiatives in all schools

Since their 2012 launch• 85,000 members, 400 business support providers• Mentored 20,000 entrepreneurs• Worked with 5,000 startup businesses• Facilitated development of 25+ entrepreneur co-working

spaces• Launched 20 startup community hubs across Canada• Mobilized $25m in investment and in-kind resources

Emilia Romagna, Italy• Population 4.4 million• $$$, top ten European regions• 32% self-employed• 76% work in small business with 4-5 workers• Italy’s 4th largest exporter• 400,000 enterprises• 7,500 cooperatives• Strong tradition of reciprocity, regional economy mutual support, financed by 0.4% levy on sales •Regional credit system with close ties to local enterprises• Lowest unemployment• Highest rate of citizen satisfaction in Italy

Businesses Cooperating Together

Elinor Ostrom

Elinor Ostrom’s Eight Principles for

Managing the Commons

Triodos, HollandThe World’s Greenest Bank

Social Banking

Vancity Credit Union

520,000 members$20 billion in assets

$5.5 million returned to members last year

Public Banking

40% of the banks in the world are Public Banks

AlgeriaAustriaBrazil

BulgariaCaribbean

ChileChina

ColombiaCosta RicaDenmark

Egypt

FinlandFrance

GermanyHollandHungary

IndiaJapan

MacedoniaMexico

New ZealandNorway

PolandRussia

SloveniaSouth Korea

SpainSweden

SwitzerlandSyria

Taiwan

Mission “to deliver quality, sound financial services that promote agriculture,

commerce and industry in North Dakota.”

“More profitable than Goldman Sachs, has a better credit rating than JP Morgan and Chase, and hasn’t seen profit growth

drop since 2003.

Meet the Bank of North Dakota,

the U.S.’s lone state-owned bank.

Return on equity (…) is 18.56%, about 70%

higher than at Goldman Sachs and J.P. Morgan.”

November 19, 2014

Re-instate the pre-1974 powers of the publicly owned Bank of Canada

to create money for positive public purposes

Responsible Investing

Socially responsible investing has outperformed the S&P 500 since 1992. (First Affirmative Financial Network)

Socially responsible investing has outperformed the S&P 500 since 1992. (First Affirmative Financial Network)

Canada Responsible Investment

Associationwww.riacanada.ca

Where can I find a socially responsible investment

advisor?

USASocial Investment

Forumwww.ussif.org

The ProposalThat over time, every business

and every bank becomes a Social Business



PHASE 1: 2017-2022. Encouraged as a goal. Praise and

Awards.




Awards.PHASE 2: 2022-2032. Tax incentives. Public purchasing privileges and bid

requirements




Awards.PHASE 2: 2022-2032. Tax incentives. Public purchasing privileges and bid

requirements PHASE 3: By 2032. All businesses must adopt social charter as a legal licensing

requirement, including annual certification.

“The process by which banks create money is so simple that the mind is repelled.”

- John Kenneth Galbraith

A. Is it printed by Central Banks, reflecting the quantity of gold in reserves?

B. Is it created by Central Banks out of social trust (aka “thin air”)?

C. Is it created by Private Banks based on their fractional reserves?

D. Is it created by Private Banks out of social trust (aka “thin air”)?

Public TRUST…

Public TRUST…Allows money creation…

Public TRUST…Allows money creation…Allows banking…

The Bank of Gandalf can create money out of thin air because of social trust.

Is this a smart redesign of a

complex problem?

Or a major loss of personal and social

trust?

Quantitative Easing

Quantitative Easing

$12.3 trillion globally$3.7 trillion in the US$110 billion in Canada

QUANTITATIVE EASING

QUANTITATIVE EASING

Quantitative Easing inflates housing prices

PEOPLE’S QUANTITATIVE

EASING

Useful innovation, speculative bubble, or tax-evasion scheme?

Guy DaunceyApril 2017

PART TWO

3. Nature and ClimateSee PART TWO

The Economics of Kindness Part 1

Economy & Finance