doughnut book.jpgIn this important book, English economist Kate Raworth sets out an optimistic, many would say idealistic, vision of a new global economy that creates a thriving balance thanks to its distributive and regenerative design.

She is searching for the “sweet spot for humanity” arguing convincingly that the time is ripe for a radical rethink of the profit-driven model that runs, and ruins, too many lives stating that “now is a great moment for unlearning and relearning the fundamentals of economics”.

Given the way the world is rapidly spiraling out of control, it is sadly a case of now or never: “Ours is the first generation to properly understand the damage we have been doing to our planetary household, and probably the last generation with the chance to do something transformative about it”.

kateRaworth recommends setting aside the pages of last century’s textbooks and writing fresh chapters based on the world as it is, not as it was. In these the main focus for the future should be on justice, fairness and human rights rather than productivity and growth.

She identifies how the vast majority of citizens are conditioned into thinking that more money and possessions will automatically bring happiness. leaving us “trapped on a treadmill of consumerism, continually searching for identity, connection and self-transformation through the things that we buy”.

She quotes Tim Jackson’s perceptive analysis of the 21st economic model that keeps the system going: “People are persuaded to spend money we don’t have on things we don’t need to make impressions that won’t last on people we don’t care about”.

By way of contrast, the New Economics Foundation has identified five simple acts that are proven to promote well-being:
– connecting to the people around us
– being active in our bodies
– taking notice of the world
– learning new skills
– giving to others

While recognizing that profit is the law of business this, Raworth maintains that this should not be pursued “at the expense of human rights, environmental standards and community”. The essence of her argument is that “It is time to re-examine the pursuit of economic growth at all costs”.

doughnut1In the non-linear, doughnut shaped economy she envisages (see diagram left), higher consideration is placed on regenerative and distributive resources that put human beings where the jam goes.

The onus is on WEIRD societies, i.e. those that are Western, educated, industrialised, rich and democratic, to take the lead and, to this end, Raworth’s thoroughly researched book should be required reading for all economics students and concerned citizens.

Her vision of shift towards people-orientated world may be dismissed as impossibly optimistic but, as the song goes, if you don’t have a dream, how are you going to make a dream come true.