September 19, 2017

Solution to planetary strife

Edward Goldsmith reveals his solutions to Simon Retallack, for The Beaver (LSE), 27th February 1996


If the environment and our social structures are being degraded it is because they cannot sustain the present impact of our economic activities. We have no alternative but to reduce that impact and that means we have to move our society in exactly the opposite direction from the one we are moving in today. Instead of creating a globalised economy, we want to build a community-based, localised economy, which is managed by much smaller companies, catering for a very much smaller, local or regional market. Smaller companies are also rooted in one place and are therefore much more interested in local activities. Large corporations just move around the world looking for cheap labour and lax environmental laws. This economy will only work if it is community based and if the community has the power to run itself.

The problem is that the big corporations—which the Government represents and whose interests it defends ferociously—will not allow the economy to localise. They are taking over power completely and are no longer controllable, they do what they like because they are stateless. They have also become enormous. Fifty of the hundred biggest economies in the world are corporate as opposed to national. But supposing this problem of the opposition of the big companies could be circumvented, the first objective is to ensure a fairly smooth transition to a new type of society.

The first thing to do is to is try fiscal measures. Energy consumption could be drastically reduced, and this in itself would be a solution multiplier. For instance, using existing technology, energy consumption could be reduced by 60 per cent worldwide. This would dramatically reduce emissions of ‘green-house’ gasses and therefore partly solve the global warming problem. It would eliminate acid rain which is destroying our forests. Cars would have to be banned from the cities and thus air pollution would be reduced, massively increasing the health of those who live there. It would greatly reduce our dependence on a very unstable area of the world which is the Middle East. It would dramatically reduce costs to industry and it would provide an enormous source of jobs, because a main source of employment is energy conservation, which is very labour intensive. And the sort of energy saving devices that would be used are very decentralised, so it would help us get back towards a local economy.

Another possible way of achieving this is by protecting our economies through the use of tariff barriers. But protection is only a device to try to achieve a more localised society, it is not a strategy. But we could start off by getting out of this global economy; get out of GATT and the Maastricht agreement.

Even if we cannot persuade the big corporations and governments to allow this to happen, and there is no sign that we will, it will probably happen by itself. The most important thing about the global economy is that it is going to marginalise two-thirds of the planet. It is going to push hundreds of millions of Chinese and Vietnamese off their land and into the slums. Take that fact into account and think about the fact that we are now undergoing a new revolution based on the computer. We are re-engineering our companies so as to lose 70 per cent of employees. So basically the global economy will be able to function using 30 per cent of the work force. It is going to marginalise the great bulk of humanity, which is going to be unemployed, or very underemployed with part-time jobs and short-term contracts. These people will not be able to feed them-selves, because the welfare state will be dismantled.

These marginalised people are going to revolt against the corporations. Why should people tolerate corporations that pollute their rivers and land, use up all local resources, to provide only a few specialised jobs, and produce goods that only the elite can afford? If everybody is unemployed or is on a starvation wage, they are not going to be able to buy anything. So if they cannot buy things, these structures will all go bust. Computers are poor consumers. Also, how are these big corporations going to get finance, because one of the main sources of finance today is pension funds, and if people are given starvation wages and they do not have pensions any more, where is the money going to come from? Secondly, they are going to be revolting against government. There is going to be a civil war in France pretty soon. Mr Chirac is in a situation in which he has got to chose between being competitive, by putting people on starvation wages and dismantling the very elaborate welfare state, a course which the French rejected by all going on strike, or going bankrupt. It could very easily lead to open revolution.

We are reaching the stage when it is not going to make much sense to all the marginalised people in the world to see that the more growth there is, the more unemployment we get. Because in order to grow you have to globalise, introduce free-trade and re-engineer companies, and if you do that you are going to put more and more people out of work. One of the things they are going to do is revolt. Another thing they are going to do is to reorganise themselves into local economies. They have to if they are going to survive. They cannot avoid it. If all the people in your street suddenly find that they do not have jobs, what are they going to do? They will have to organise themselves in order to survive.

The other possibility is that a political party will be set up to represent the interests of the bulk of the people who have been marginalised. And this party, provided that the marginalised people vote sensibly, if they vote at all, could easily come to power. It has not yet happened here because the English suffer from one serious disease; they believe in economics. They only think in economic terms, there is no mention of society or of the environment—they do not exist. As far as I am concerned, modern economics should be written from scratch, because its very foundations are completely wrong. It sees economic processes occurring in a void. And the politicians buy it.

Most politicians argue that further economic development is the only way to raise the standard of living of the poor. Yet the main cause of poverty in the world today is economic development which is now reaching its logical conclusion, its final stage. It is economic development at a global level run by huge stateless corporations that, so long as this process continues, is going to be the main source of poverty, impoverishment and marginalisation.

How can politicians dare say that the poor will be rich with economic development, when they know very well that this country can only attract foreign capital upon which we depend to develop, by having the cheapest labour in Europe? Now if we were to put up the price of labour, what would happen? Industries would move elsewhere. That is what is happening in Malaysia today, where the price of labour is going up and companies are moving elsewhere; to Vietnam and China. It is happening now in France, which corporations are leaving to set up in Tunisia and Vietnam, because the labour costs were too high. So how can people here get high incomes in these conditions. The whole strategy of the Government is to keep them poor, to slash the price of labour in this country so as to attract foreign capital. So how can you reconcile that with the statement that the development policies of the Government are going to make them rich?

Nonetheless, we are going to have to give people some hope of a better future. We need to point out that it is by recreating a community based, localised economy, which is as self-sufficient as possible, that is going to be the best way of maximising their prospects. We have also got to look at prosperity in terms of other things as well, not just in terms of the possession of a car, but in terms of people’s health—if your heart has packed up, what is the point of having a big car or a television set? It is also a way of maximising cooperation among people, it is a way to give meaning to peoples’ lives. Working with their families and community makes sense. That will cut down crime. They will also be able to feed themselves, because they will not be able to depend upon importing food from abroad. We have got to look at the other advantages.

What is certain is that we just cannot depend upon professional politicians, or solutions at a global level. Governments are not interested in solving the world’s problems. They are moved by short-term political and economic goals. And as soon as you deal with these problems at a global level, it is going to fall out of the hands of local people, and into the hands of big institutions, which are corrupt and totally unconcerned with solving real problems, and are dominated by the big companies.

Real participatory government at a community level is the real answer. The public certainly needs to be better informed about this, perhaps by having thousands and thousands of small community papers, each one with a small circulation. At the moment the message is not getting across. People have been inculcated with a very different world view. Knowledge has got to be reorganised. If the devil wanted to make sure that earthlings could not make sense of the world in which they lived he could not do better than provide knowledge in these water-tight compartments we call disciplines. Knowledge as it is serves above all to rationalise today’s policies, i.e. economic development. That is what it is all about. It is propaganda. We are taught things that are totally false. Modern economics has to be burnt—it is all rubbish from beginning to end.

We do have to change the mindset of a lot of people, but it can happen quickly. In their hearts, a lot of people know this is so.

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