By Derek Paul
Professor Emeritus, University of Toronto
A paper presented at the 2015 meeting of the Canadian Peace Research Association; minor correction and reordering 30 January 2017
The achievement of Norman Alcock’s sixth goal for peace research, the elimination of the war system, will require the replacement of the neoliberal economic system by an ecological system. This will be necessary not only for demilitarization and the abolition of war, but principally to address climate change and the dying ocean. The reasons neoliberal economics cannot be a basis for a war-free world are outlined as well as the necessary paradigm change for operating an ecological economic system. The characteristics of the new system are listed. A second requirement to fulfill Alcock’s sixth goal, namely, the prevention of tyranny, is underlined as a subject for peace research.
In 1986, Norman Alcock, wrote to me in response to a letter I had written asking about the goals of peace research and the extent to which they had been achieved. His answer was so succinct and comprehensive that I included it in a tribute to him after his death in 20071. He enumerated the goals as follows:
- a compilation of war/peace facts, which could be used for the support for the disarmament/arms control position;
- scientific theories of the causes of war;
- the legitimation of peace as a valid subject of study;
- stimulation of the war/peace debate;
- help for decision makers through alternative direction;
- elimination of the war system by showing its absurdity.
Alcock saw the first five of these goals as having been achieved, leaving the sixth to be fulfilled: the abolition of war. World leaders have not learned enough to eliminate war and armed conflict from the planet, though the number of wars has decreased since the time of Norman Alcock’s letter. Nevertheless, fighting goes on, within or between countries, so that we live in a world having increasing numbers of refugees, now numbered in millions. As well, the death toll and destruction of homes and infrastructure are immense.
Two factors play central roles in those armed struggles: 1) the desire to conquer or suppress, often coupled to greed, with its counter-action of self-preservation and 2) the profitability of arms manufacture and trade. Alcock’s sixth goal cannot simply be achieved through the actions of a few benign governments, because they exist within a world that
- subscribes to an economic system that requires the arms industry, and
- has no system for keeping would-be tyrants in check before they acquire power, or for removing tyrants from power without excessive violence.
This paper underlines two principal lines of peace research on the vital matters, a) and b).
None of my work, so far, has addressed b), above, but I have started on some work in the field of ecological economics, because it alone would appear to be the answer to a), above.
There is furthermore, an even stronger reason to adopt a new economic system, namely the threat of climate change. That threat is also driven by the present, neoliberal economic system, which has the characteristic of maximizing consumption, that is, extraction of resources and their throughput ending in pollution. The pollution can be in air, on land, fresh water or in the ocean. Today the greatest threat is the dying ocean, and the death agent is excessive carbon dioxide absorption from the atmosphere.
But even without the threat of climate change, a new economic system would be required because neoliberal economics requires militarization to maximize economic activity as presently measured. It does this by ignoring the ecological needs of the planet, paying no attention to the commons, and employing a banking system based upon usury, all of which leads to a need for economic growth. It measures its success success through a financial index, the GDP, that indicates an aggregate of spending within the economy, regardless of whether real wealth was generated, and which ignores depreciation of assets, decline in resources etc. But the GDP does include services, and military production, armed services being an essential ingredient in that total. Furthermore, it is irrelevant to the total whether the military services are acting constructively or destructively, as the destruction caused elsewhere is not subtracted from any economic total!
The military and military industries also provide large numbers of jobs, including many that are highly technical, at the frontiers of knowledge; and the fact that more jobs could be provided for the same money in other fields, for example, restoring the commons, is conveniently overlooked. Restoring the commons doesn’t produce short-term profit, even though it increases real wealth.
Thus demilitarization and the vital matter of addressing climate change both require a change of economic basis, and this means a change of outlook or paradigm.
The need for change of paradigm
My colleague Phyllis Creighton and I wrote on this subject a decade ago,2 so here I give the briefest description of the old paradigm that needs to be replaced, which has underlain the neoliberal economy for over three centuries. It evolved in the 17^th^ century, and was based partly on biblical writing, for example, the Book of Genesis, which states that humankind has dominance over every living thing and, elsewhere, that growth is good. One needs to remember that even the great thinkers of that century took the Bible literally, including the stories of creation. Thus there grew a paradigm in which the human race stood apart from other living species and was in control; and that growth of population and material wealth were good per se. This requires in the long term that resources be unlimited and that the Earth could absorb pollution from an ever-growing population. Finally, it was thought that scientific and technological progress were good per se, an assumption that was strongly challenged in the late 17 th century by the Anabaptists, but the unquestioning faith in technology has persisted to this day.
The new paradigm that we need today must accept that we are part of Nature and must learn to live within its parameters, so as to preserve species, ourselves included, living species being to a large extent interdependent. Because the human race has lived far beyond it means (currently 50 percent beyond), in terms of preservation of planetary resources and species, the new paradigm would require that we also preserve primary resources as far as possible3, and maximize recycling, factors that are essential to an ecological economy (see below). Education systems everywhere will need to introduce these concepts.
Further required changes
The second set of necessary changes has to do with money and its place in the system of economics. The banking system was designed to serve the rich, and preserve their position in human society4, and continues this way to this day. Also, the current economic system is money-dominated, to the point that people confuse money with real wealth. The system in fact operates to obscure that difference. In the field of investment, there are now many financial products one can invest in, and make millions doing it, in which the stocks themselves do not directly represent any real wealth5. The new economic system must concentrate on real wealth, which will have to include restoring or improving the commons, and will use money as a means of enabling such progress, rather than having money multiply itself in the third economy. A useful introduction to assessing wealth can be obtained by studying NRTEE’s work (c. 1999-2013) on the development of resource indices, in which they recognized three types of capital: natural capital, built capital and human capital. Their measures were in natural units, none being converted to units of money6.
Further comments on economic systems and sustainability
Once the distinction between money and real wealth is grasped, it becomes easy to see why a new economy is necessary and why the neoliberal economy cannot bring the human race to a sustainable future.
Consider the USA today, its deteriorating resource wealth, its environmental crises (recently the decline of the bee population), and its financial crises. After the 2008 crisis, new money was poured into the economy, but much of this found its way into Greer’s “third economy,” playing little role in the first and second economies, which is where real wealth is created and where people were suffering hardship. Furthermore, little if any of the new money poured into the economy went into restoring the commons, such as improving the quality of soil, air or water, in forest or field or Great Lakes and rivers. Yet the Mississippi river carries enough pollutants into the Gulf that it had a decade ago created the world’s largest ocean dead zone, amounting to 48,000 square km7. Cleaning up the Mississippi-Missouri basin so that the watercourse was unpolluted as it enters the Gulf, is a wonderful example of a wealth-creating scheme, as it would re-create, in the long term, a wealthy fishing area in a considerable area of ocean, as well as providing benefits to the users of those waterways. Another most important channel for wealth creation lies in the application of biochar to improving farmland and forest.
The neoliberal economy cannot deal routinely with these problems, because it looks at monetary investments, and these must produce profit in a system based upon usury. Restoring or improving the commons is not regarded as profit, because it doesn’t pay dividends in the short term; but it does increase wealth. By contrast, the arms industry produces massive profit and keeps many people employed; but one could keep even more people employed by adopting wealth creating strategies.
An ecological economic system would address first what needs to be done and then examine whether the resources to do it were available in the domains of natural, built and human capital. Its priorities would be based upon resource usage and conservation, and the relative benefits of different resource expenditures. If the human capital is available and the other resources are available for a desired project, then money can be created as required.
Characteristics of an ecological economic system
These are still under debate in this field of study. Here I give only my current list:
- assessment and measurement of wealth in terms of resources – natural, built and human capital – and accounting both nationally and by corporations in these terms
- use of new indices to replace GDP in terms of the above, a)
- an end to fossil-fuel burning
- minimum extraction of primary resources, including trees, and maximum recycling
- adoption by industries of Extended Producer Responsibility
- an end of planned obsolescence
- controls on advertising; perhaps a transformation of that industry
- encouragement of benefit corporations and perhaps global standardization of their legal basis; and encouragement of other ecologically benign enterprises
- establishment of publicly owned banks (or regional treasuries) in all single- currency areas
- maintenance as far as practicable of full employment
- restoring the Commons
- greatly reduced social inequities
- establishment of population policies in all regions.
Items i), j), and k) may not be found in any parallel lists up to the present but these are vitally important. Publication of this slate of items with full justification of the separate points is a work in progress.
The achievement of Alcock’s sixth goal for peace research will require the replacement of the neoliberal economic system by an ecological system. This will be necessary not only for demilitarization and the abolition of war, but principally to address climate change and the dying ocean. The task of addressing climate change is so great8 that it will require much, perhaps all of the human talent now employed in the arms industry and its research laboratories. Transformation to an ecological economic system is already happening gradually, but some of its requirements will be difficult to fulfil. The change lies in human hearts as much or more than it lies in human organization and technology. A first step is the paradigm change.
- A full text is available in his obituary in the Bulletin of Science for Peace, summer 2007, Norman Alcock, 1918-2007: Grieving, Remembering and Celebrating. The Bulletin is available on the website of Science for Peace: www.scienceforpeace.ca/. Norman Alcock and his wife Pat founded the Canadian Peace Research Institute in 1960. It was closed in 1981.
- Derek Paul and Phyllis Creighton, “A Holistic Paradigm for the 21 st Century,” presented at the Fourth Interdisciplinary Conference on the Evolution of World Order, 13-15 October 2004) updated 2008. This paper is available on the website www.pugwashgroup.ca/ under the category MEMBERS: articles.
- Some modern industries, while not necessarily challenging the present economic system, have adopted policies that maximize recycling, thus achieving part of the necessary economic change.
- The first chapter in Economics Unmasked, by Philip Smith and Manfred Max-Neef (Green Books, 2011) presents a splendid historical perspective on banking.
- Author John Michael Greer, in his book, The wealth of Nature: Economics as if survival mattered, describes the money economy as divisible into three segments, of which the first two comprise the activities dealing with natural wealth and real production. The third economy deals with speculative financial products such as derivatives, which may be important to investors but, when used as a basis for short-term gains (gambling), result in a huge distortion of the economy, since much of the total economic activity then takes place in that unproductive sector.
- NRTEE’s report on Environment and Sustainability: Indicators for Canada can be found at neia.org/wp-content/uploads/2013/04/sustainable-development-indicators.pdf
- Alanna Mitchell, Sea Sick: The Global Ocean in Crisis, McClelland and Stewart 2009.
- Wilfred Candler, Derek Paul and Judy Lumb, “Necessary Action to Address Climate Change” Quaker Eco-Bulletin, July-August 2014. Available on request: firstname.lastname@example.org