Coming Back to Life
Asian views of spirituality, community, and place provide
a foundation
for this life-centered approach to economics
by the Asian NGO Coalition, IRED Asia,
and the People-Centered Development Forum
One of the articles in Toward A Sustainable World Order (IC#36)
Fall 1993, Page 18
Copyright (c)1993, 1996 by Context Institute | To order this issue ...
This paper was produced by the participants in the Asian NGO Regional Fellows
Program held in Baguio, Philippines, in October 1992, under the joint sponsorship
of the Asian NGO Coalition and the Institute for Development Research, with
funding from the Ford Foundation. Participants included Chandra de Fonseca
(Sri Lanka), Sunimal Femando (Sri Lanka), David Korten (US), Tony Quizon
(Philippines), Sixto Roxas (Philippines), Bishan Singh (Malaysia), and Felix
Sugirtharaj (India).
David C. Korten, who edited the following piece, can be reached at the People-Centered
Development Forum, 14 E. 17th St., Suite 5, New York, NY, 10003, tel. 212/620-7137;
fax 212/242-1901.
We in Asia have long defined our choices as between the Western capitalist
system of economic theory and practice, and the theory and practice of Marxist
socialism. It is ironic that while Marxist theory predicted the collapse
of the capitalist economic system and presented itself as the single viable
alternative to capitalist hegemony, its practice in the countries of Eastern
Europe and Eurasia has collapsed in disarray. Now flush with a sense of
victory over its fallen opponent, capitalism seems resolutely blinded to
the self-destructive consequences of its own present path.
The evidence is mounting that both Marxist socialism and free-market capitalism
have failed the majority of human society, and for strikingly similar reasons:
- They both built economic systems that celebrated the destruction of
the living systems of the Earth.
- They both ignored the social and political consequences of concentrating
economic power in unaccountable, centralizing institutions - the state in
the case of Marxism and the transnational corporation in the case of capitalism.
- Both took a narrow, economistic view of human needs.
- Both equated growth in the economic output of the firm with improved
human well-being and neglected the community as a natural economic unit.
Both used essentially the same models of national income accounting.
- Both systems were basically Western constructs, products of Western
thought and experience.
Neither system is a suitable guide for Asia, which is home to more than
half the world's people, as well as half the world's 1.2 billion people
who live in absolute poverty. Asia's economic miracle has been a miracle
only for a small fraction of Asia's peoples and holds little real promise
for the rest.
Asia faces a stark reality. The industrialism-consumerism model on which
the practice of free-market capitalism has been based has depended historically
on the ability of industrializing countries to colonize the resources of
others. The scramble for the forests, lands, and minerals of Indo-China,
Irian Jaya, and Papua New Guinea is already underway. Where will Asia turn
once these are exhausted?
Furthermore, if only China and India, with a combined population of some
2 billion people, were to heed the call of transnational capital and Western
governments to pursue the unsustainable Western economic model, they would
surely push the global ecological system into collapse long before providing
over-consuming lifestyles for even a fraction of their citizens.
Asia's hope for the future lies in an alternative model of human progress.
That model would combine efficiency of resource use with a rediscovery of
life's innate spiritual character and the inseparable spiritual connection
of every person to nature and community.
We believe that the essential elements of an alternative model are at hand.
The breakthrough in our own thinking came when we realized that what we
were looking for was not an alternative theory of development, which almost
inevitably buys into many of the assumptions of the prevailing growth model.
The alternative we sought was a theory of sustainability, which begins from
a wholly different set of premises.
Our theory of sustainability draws its premises from the critiques of the
two failed dominant systems of economic thought and practice, insights from
Asia's rich cultural and spiritual heritage, and the wisdom of indigenous
peoples. The emergent theory takes a holistic view of human needs. It at
once identifies the roots of the ecological crisis and helps us to predict
the conditions under which the dynamics of human social processes are most
likely to work toward a balanced relationship between human society and
the planet's ecology.
BONDING SPIRIT, COMMUNITY, PLACE
Our theory of sustainability is grounded in the most fundamental of insights:
that all life is an expression of a single spiritual unity and that the
spiritual growth of the individual consists of advancement toward the full,
conscious realization of this unity.
Spirituality, community, and a bonding to place or habitat are central values
that have unified the Asian cultures over centuries. This was manifest in
countless cultural norms, such as the injunction that when a tree is harvested,
two must be planted. Where nature has been scarred, it must be given time
and opportunity to heal. In these many ways, sustainability is integral
to Asia's cultural tradition.
A balanced and harmonious relationship between human communities and their
natural environment is associated with a reverence for the spiritual unity
of life and a strong bonding to community and place. Such communities almost
universally develop cultural values that maintain a sense of continuity
linking past and future generations to physical place.
HUMANITY'S SPECIAL GIFT
In addition to the gift of life shared by all of nature, the human species
was endowed with the special gift of self-awareness. With this powerful
gift, our species set out on a unique evolutionary course of social, material,
and spiritual advancement as we consciously reshaped our relationship with
the living Earth. Yet, as with all powerful abilities, this gift contained
both creative and destructive potentials.
In his book The Dream of the Earth,1 Thomas Berry refers to the dynamics
of our consumer society as the supreme pathology of all history, a pathology
in which humanity has virtually defined consumption as the highest human
purpose.2 He suggests we have lost our way due to the lack of a story that
gives meaning to our existence. This is something a dedication to consumption
can never provide. That story must give us a sense of our special role and
purpose in life's evolutionary journey.
The gift of awareness conveyed an awesome responsibility not shared by other
species. To accept responsibility for life does not imply rejecting modern
technology or returning to the lifestyles of those groups that continue
to live untouched by the modern world. We are poised to reach for new levels
of social, intellectual, and spiritual advancement far beyond the reach
of previous generations specifically because of the current potential to
meld both ancient and modern wisdom to this end.
However, to prepare the way we must replace the prevailing economics of
alienation with its antithesis, the economics of community.
THE ECONOMICS OF COMMUNITY
Moving toward a sustainable human societies involves far more than making
a few adjustments at the margins of the economy and investing in conserving
technologies. It means creating a framework of economic institutions and
management practices that anchor economic power in community and achieve
a substantial degree of equity in power relationships.
An economics of community provides the foundation for an economic practice
aimed at restoring a necessary balance in the relationships among people,
place and community. Spirituality and community - not money - define the
dominant binding ties in such an economics. The preservation of the long-term
productive potential of ecological resources receives a high priority, and
long-term returns to community take precedence over short-term returns to
the individual investor.
ENTERPRISE-BASED ACCOUNTING
The economics of alienation (see below) is deeply
imbedded in society's dominant institutional systems and procedures. This
includes the national income accounting systems by which gross national
product (GNP) - the universal proxy for national well-being - is measured.
One basic flaw of the GNP accounting system is that what it measures isn't
really national product. It is simply the aggregate product of the business
enterprises from whose accounting records it is compiled. There is no accounting
for gross natural product, or gross people's product.
The firm is not expected even to be aware of, let alone manage, the external
social and environmental costs of its production. This same externalization
is carried all the way through the aggregation process. Consequently, GNP
takes no account of such things as the loss of environmental resources or
deterioration in the educational level of the work force over time - even
though these represent clear losses to society.
The clean-up of the Exxon Valdez oil spill was counted as a net gain for
the Alaskan economy, and the insurance payments for the bombing of the World
Trade Center in New York showed up as a net gain for the economy of New
York City. Thus both were good for the economy by current accounting practice.
Furthermore, GNP includes only the income and costs reflected in the income
statements and balance sheets of business firms operating in the formal
sector. Subsistence production, household labor, and the rental value of
owner occupied dwellings are all excluded in most countries. This excludes
a substantial portion of those activities on which most of the world's people
depend for their livelihoods.
COMMUNITY-BASED ACCOUNTING
Work on an alternative system of a community-based economic accounting system
is well underway in the Philippines. This system takes the household and
the community as the primary units of analysis and aggregation. The economic
performance of firms would be addressed in subsidiary accounts that reflect
their contributions to the community and those who reside in it. This approach
represents an important step toward a practice of sustainability derived
from the theory of sustainability outlined earlier. 3
In this system the community unit defines both a citizenry and a habitat
with definable characteristics of land, water, soil cover, vegetation, marine
resources, and mineral resources. The citizens are classified by characteristics
such as age, gender, occupation, education, and income levels. Each household
is defined in terms of its bundle of economic needs, which the system compares
with actual consumption.
The community balance sheet includes its natural resource as assets. Production
processes, such as in agriculture, forestry, mining, fisheries, trade, services,
create flows between asset or stock accounts, sectors, factors of production,
and households or consumers. This provides the basis for a community-based
double-entry accounting system.
The accounts may be organized according to a hierarchy of settlements -
households comprising hamlets comprising neighborhoods comprising villages
clustered around market towns clustered around an urban center. At all levels
the community-based accounting system defines an economy that is inseparable
from its habitat and defines an essential role for local government in the
management of that economy and its underlying natural resource base.
A BASIS FOR LOCAL DECISION MAKING
Since the community-based accounting system accounts for both natural and
human capital stocks, the social and environmental costs of economic activity
are automatically internalized and highlighted. The clear cutting of a forest
is reflected immediately in the reduction of relevant asset accounts.
Both the financial gains from economic activity and the consumption of the
goods and services produced are allocated by household, so distributional
outcomes are also integral to the system. It is clear who is capturing the
returns from productive processes, what household needs are being met and
what needs are not. Resource flows into and out of the community are also
highlighted, thus providing a very different perspective on investment decisions
than do conventional methods.
Many investment projects are highly profitable to a firm or individual,
yet very costly for the community. Clear cut logging for export is a graphic
example. Logging activities can produce enormous profits for individual
firms and register positively in GNP without providing sufficient returns
to the community in the form of wages and fees to compensate for losses
from increased flooding and drought, soil loss, downstream siltation, and
the costs of replanting.
Export processing zones provide another common example. They expropriate
land, dominate local government decision making, enjoy tax holidays, demand
fully developed infrastructure that must be paid for by local taxpayers,
make priority claims on local water supplies and power generation, have
few linkages to the local economy other than hiring labor at low wages,
and contaminate local land and water supplies with their toxic wastes. The
firms may generate handsome profits that go abroad, without compensating
the community for its costs.
With a community-based accounting system, the full costs and benefits to
the community are revealed so that investment proposals may be assessed
accordingly. The community may then negotiate with outside investors and
trade interests on the basis of a community balance sheet, exactly as a
firm now decides whether to engage in a given market transaction based on
the results anticipated for its balance sheet.
Community-based accounting supports application of the principle of subsidiarity
- i.e., that each decision should be made at the lowest feasible organizational
level - and its corollary that, to the extent feasible, basic needs should
be met within smaller, more localized economic units.
This means that smaller units will seek trade with one another and with
larger units only as the exchange offers clear advantages to the community
over local production. Otherwise, the preference will be for local producers.
The community-based accounting system provides a tool for managing such
choices in the community interest. This strengthens the link between the
community's well-being and the health of its local ecosystems. It also reduces
external dependence and thereby the potential for exploitative alienation
of its resources by external interests.
The effective application of the community-based accounting system demands
broadly based community involvement. By establishing the concept of a local
economy, the relationships of human interests to place and community take
on new meaning. This in turn enhances awareness that the community's ecological
resource base is the foundation of its well-being over time. The community
becomes deeply aware of the consequences of giving free reign to footloose
capital and external trading interests seeking only to extract local value
for export. Social practice based on an economics of cooperation and ecological
stewardship is encouraged.
ACTION OF THE SPIRIT
Our dominant institutions are blinded to the deeper realities of the sustainability
crisis by their own power imperatives. So long as this remains the case
there is no prospect that they will provide the leadership we so badly need.
Informed and enlightened citizen action is our only hope.
Replacing the action of financial calculation with action of the spirit
goes right to the core of the transformational process. As that awareness
builds perhaps our most important task is to encourage one another to trust
our inner knowledge and to find the courage to act upon it. s
----------------------------------
Notes
1 Thomas Berry, The Dream of the Earth, Sierra Club Books, 1988.
2 Note that in current practice economic growth, not consumption, is the
higher goal. Consumption is only a means.
3 For further inforrnation contact Sixto K. Roxas, President, SKR Managers
and Advisors, Inc., No.59 Hillside Loop Blueridge A, Quezon City, Philippines,
tel. (63-2) 721-9096; 791-757; fax (63-2) 722-5547.
[Sidebar]
THE ECONOMICS OF ALIENATION
We believe the source of our collective social and ecological crisis can
be traced to the long historical processes by which the human species has
become increasingly alienated from community and nature. This alienation
has both intellectual and institutional roots.
Intellectually it is rooted in the Western concept of dualism, which sets
humanity apart from nature and legitimizes the view that humanity has not
only the right, but also the obligation to subdue nature to its own benefit.
The concept of separation was central to Descartes' thesis that humans have
the ability to be objective observers of reality. This simple idea unleashed
the intellectual and institutional forces that produced the remarkable scientific
and technological advances of Western society.
These advances in turn set in motion a long period of exponential growth
in the demands that human economic activity places on earth's ecosystem.
The dynamics of this growth continuously strengthened the basic illusion
that through their command of technology, humans have become the masters
of the natural world and no longer need to heed its limits. It is curious
indeed that a species that prides itself on its intelligence continues to
maintain this arrogance in the face of the mounting body of evidence that
the underlying belief is based on nothing more than a dangerous self-delusion.
Why?
MONEY
The answer may be found in the extent to which money has become the arbiter
of values and the motivating force of nearly all human institutions and
activities. The quest to endlessly replicate money has become so deeply
embedded in human values and institutions that we might easily conclude
that it is the organizing principle of public policy.
The profound implications of that quest become clear only when we recognize
that the historical process has been one of substituting money, a substanceless
artifact, for spirituality, the universal life force, as the primary source
of value, meaning, and identity in human society.
Our collective obsession with the replication of money is both cause and
consequence of our collective alienation from the reality of the spiritual
nature of all life. This alienation is the root cause of the social and
ecological crisis that now threatens our collective future.
Money serves two functions in modern society: as a medium of exchange and
as a storehouse of value. Its function as a medium of exchange is purely
utilitarian, a useful and positive institutional invention.
It is money's ability to serve as a storehouse of value, wholly divorced
from any intrinsic or instrumental values, that has made it a powerful instrument
of alienation. As money becomes the activating force of institutions, the
holder of a large store of monetary credits is increasingly able to exercise
alienating claims over the natural resources, talents, and knowledge of
others.
Financial debts are a particularly common instrument of alienation. International
debts owed by countries to commercial and multilateral banks have the alienating
power of bonding the labor and resources of future generations of one country
to the future generations of another.
The persistent processes of alienation have become a daily experience in
poor rural communities around the world. As ties to community and place
are broken, dispossessed people migrate to cities where they become dependent
on the monetary economy. Money becomes a substitute for the affiliational
ties of community and place. The accountant replaces the religious teacher
as the arbiter of value.
The greater one's relative economic power and the more seamless the global
economy, the greater the freedom enjoyed by the powerful to exercise claims
over the non-monetary resources of the poor.
Released from the constraints of place and of obligation to community, those
who control accumulated financial credits seek out ecological surpluses.
The poorer the existing claimants of those resources, the more easily the
holder of financial credits may gain control of them and shift any related
social and environmental burdens onto those unable to protest.
Under conditions of equality, however, it is difficult, if not impossible,
for one group to alienate another from their physical resource base. The
greater the inequality, the greater the freedom enjoyed by the powerful
to plunder the environmental resources of others. The greater the plunder,
the greater the displacement and further impoverishment of the weak - until
the point of social and ecological collapse.
It is neither poverty nor wealth that creates environmental destruction.
It is inequality. Equity is an essential precondition for sustainability.
EQUITY AND SUSTAINABILITY
The behaviors of both rich and poor exacerbate the sustainability crisis:
the rich by their overconsumption of resources beyond what the ecosystem
can sustain; the poor by having large families that increase the number
of human claims that future generations will make against whatever resources
remain. Each is responding to the alienation process in terms of their own
experience and the opportunities available to them.
The wealthy seek to fill their social and spiritual emptiness through consuming
the material goods that advertisers relentlessly assure them will provide
them with a sense of identity, empowerment, popularity, and meaning.
The poor seek to reduce the overwhelming sense of insecurity created by
loss of community and rights to ecological space by having children - the
one thing they can call their own and their only prospective source of care
in their hour of need.
Bringing both consumption and population levels into balance with what nature
can sustain is an essential precondition for sustainability. Both require
the elimination of gross political and economic inequality.
- by the ANGOC, IRED Asia, and the PCD Forum
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