A new report provides the European Union with a blueprint for redesigning its economy in a way that enhances the wellbeing of humanity and nature. Two of the authors, Nick Meynen and Katy Wiese, explain what is at stake.

As light at the end of the terrible COVID tunnel begins to burn brighter, this global pandemic should remind us all of the unprecedented interconnectedness of humanity. But while some would call the modern world a village, life on the manor is very different from life in the fields. 

One persistent myth is the idea that political and economic decisions must necessarily involve a trade-off between people and nature, or society and the environment. Oxfam Germany and the European Environmental Bureau, with support from the Climate of Change project, joined forces to expose this false dichotomy, in a new report titled ‘Towards a wellbeing economy that serves people and nature‘.

The economy depends on people, and people depend on nature. Mining, deforestation, biodiversity loss, climate chaos and pandemics are all interlinked and intertwined with human rights, or rather the lack thereof in our overstretched supply chains. 

The exponential growth of extraction, trade and production has brought us to the brink. However, the underlying socioeconomic weaknesses exposed by the pandemic also give us a rare opportunity to heal and to thrive. We desperately need an economy that is fit for the most crowded, connected and nature-stressed century in the history of humankind.  

A socially and ecologically just economy can only be reached by tackling the root causes of the crisis. Our report identified these structural issues as longstanding injustices between and within countries; spiraling social, economic and political inequality and associated concentration of power; and the rich world’s fixation and structural dependency on economic growth.  

Although Europe is not the only wealthy or exploitative part of the world, our report focuses on the European economy and its role and responsibilities globally and locally, because we are Europeans, and justice begins at home.  

Long legacy 

Despite decades of efforts to forge an international family of nations united in equality, Europe’s current economic system is still interwoven with the long legacy of colonialism and the slave trade. Structures influenced by this unequal historical relationship include so-called free trade deals and investor-state dispute tribunals skewed in favour of western corporations.  

This is reflected in our oversized global footprint: production and consumption in Europe still uses up a disproportionate share of the world’s natural resources. If everyone lived like Europeans, 2.8 planets would be needed. Moreover, the process through which Europe accrues this surplus too often comes at the expense of rights and the denial of opportunities in more economically disadvantaged countries.  

Over roughly the same period of time, global inequality tripled. To better understand the links between economic, social and political inequality, as well as the cost shifting of environmental and social costs onto other continents, it is important to look at wealth distribution: roughly 1% of the world’s population controls over 45% of its wealth.

As most of the world’s richest individuals have attained their position through the ownership of large corporations, corporate and individual wealth – and influence – are intimately linked. We are in a situation where the already extremely rich and powerful can disproportionately shape political rules, which due to their influence, are designed in a way as to ensure that they benefit even more in financial terms. To put this in context, a group of scientists have warned that extreme affluence is trashing the planet: the consumption of the super-rich has significantly contributed to environmental crises, and much of the solution lies in their hands due to their political clout. 

Leaky pipeline 

The global economy today resembles a massive pipeline: we put more and more new resources in at one end and then try to deal with, or ignore, the toxic waste that spews out of the other end.  

Europe, like other rich economies, has mastered the art of putting both the entry and exit points of this pipeline outside its borders. One necessary solution is to transform our linear economy into a circular one. However, we cannot bend this massive and still growing pipeline economy into a circle if the pipe is two to six times too thick.  

The misguided aim of non-stop economic growth persists not only because decision-makers and large portions of the public are unable to imagine any alternative, but also because the European economy is structurally dependent on endless expansion – thereby trapping ourselves in a downward ecological and social spiral.  

This can be illustrated by looking at the structural dependence of job creation and retention on productivity growth and of social security systems on income tax revenues. On the one hand, governments need revenues from taxes and economic activities to pay for public services. On the other hand, given that state revenues are largely dependent on labour taxes, any changes in employment or economic output directly affects social revenues.

To make things even worse, the idea that we are able to grow our economies while reducing environmental pressures (known as green growth or ‘decoupling’) is misleading wishful thinking at best, but more akin to a dangerous fairytale. Empirical evidence shows that this kind of decoupling is not achievable to the scale and at the speed required. Europe’s fixation and dependency on growth has to end and the good news is prosperity without growth is possible. 

Growing up 

We need economies that make us thrive within the boundaries of the natural world, with or without growth. We need a socially and ecologically just economy that provides a good and dignified life for everyone, leaves no-one behind and enhances gender, environmental, social and global justice.  

As it turns out, the brightest minds in science and economics, as well as in communities and civil society, have not just identified the problem but are also proposing and implementing solutions. Many of them just haven’t received the attention and respect they deserve. In our report, we touch on examples of the contours of a wellbeing economy in a number of selected sectors that really matter: food, clothes, buildings and the digital world. 

We also need world leaders who not only redistribute wealth after it has been accrued and concentrated, but who create more equal distribution of wellbeing and access to power and decision-making.  

A wellbeing economy embraces people and the reliance of their wellbeing on the health of nature. What needs to grow is a restoration of the systems that make prosperity possible: from our human immunity to nature’s immune systems, as expressed through biodiversity, soils, watersheds, minerals, climate stability and so much more.  

We cannot return to a growth economy which destroys ecosystems. We must grow an economy that is in tune with ecology. 

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Nick Meynen is the EEB’s senior policy officer for environmental and economic justice. Katy Wiese is the EEB’s associate policy officer for environmental and economic justice. This article first appeared in Social Europe on 22 April 2021.

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