I finished this book in February 2024. I recommend this book 5/10.
Why you should read this book:
You should read this book if you are looking for a book to make you understand why the rich become richer, and how the system is broken. It is a book about how our culture focuses on growth as an indicator of success, regardless if it means we are depleting the Earth's resources.
Get your copy here.
🚀 The book in three sentences
Today's economy is based on old, siloed, single-minded theories.
GDP and growth should include resources, such as minerals, power resources, and other environmental effects.
Taxing or demurrage money is a bandage. We need a culture shift where growth is not the goal, but human living and balance are.
🎨 Impressions
This is a good book for someone like me who doesn't know much about economics. It gives an interesting view of how GDP, growth, and shareholder satisfaction have no concerns about minerals and power usage effects worldwide. How wealthy countries are shipping recyclables to other countries but keeping their cuts and profits.
📝 My notes and thoughts
P35. One person who was willing to risk political suicide was the visionary system thinker Donella Meadows—and she didn't mince her words. 'Growth is one of the stupidest purposes ever invented by any culture,' she declared in the late 1990s; 'we've got to have enough.' In response to the constant call for more growth, she argued, we should always ask: 'growth of what, and why, and for whom, and who pays the cost, and how long can it last, and what's the cost to the planet, and how much is enough?' For decades, mainstream economists dismissed her views as foolishly radical, but they actually echo those of Kuznets, the hallowed creator of national income itself. "Distinctions must be kept in mind.' he advised back in the 1960s, 'between the shot and the long term...Objectives should be explicit: goals for "more" growth should specify more growth of what and for what.
P38. Map of the Doughnut
P41. More extraordinarily, scientists suggest that, if undisturbed, the Holocene's benevolent conditions would be likely to continue for another 50,000 years due to the unusually circular orbit that Earth is currently making of the sun—a phenomenon so rare that it last happened 400,000 years ago. This is certainly something to sit back and ponder. Here we are on the only known living planet, born into its most hospitable era, which, thanks to the odd way we happen to be circling the sun right now, is set to run and run. We would have to be crazy to kick ourselves out of the Holocene's sweet spot, but that is, of course, exactly what we have been doing.
P42. Take, for example, what happens when hillsides are deforested. Land conversion of this kind is likely to accelerate biodiversity loss, weaken the freshwater cycle, and exacerbate climate change—and these impacts, in turn, put increased stress on remaining forests. Furthermore, the loss of forests and secure water supplies may leave local communities more vulnerable to outbreaks of disease and to lower food production, resulting in children dropping out of school. And when kids drop out of school, poverty in all its forms can have knock-on effects for generations.
P49. Food consumption is deeply skewed, too. Around 13 percent of people worldwide are malnourished. How much food would it take to meet their caloric needs? Just 3 percent of the global food supply. To put that in context, 30-50 percent of the world's food gets lost post-harvest, wasted in global supply chains, or scraped off dinner plates and into kitchen bins. Hunger could, in effect, be ended with just 10 percent of the food that never gets eaten. From these examples, it is clear that getting into the Doughnut calls for a far more equitable distribution of humanity's use of resources.
P69. A 2014 survey of 15,000 mothers in the United States calculated that if women were paid the going hourly rate for each of their roles—switching between housekeeper and daycare teacher to van driver to cleaner—then stay-at-home mums would earn around $120,000 each year. Even mothers who do head out to work each day would earn an extra $70,000 on top of their actual wages, given all the unpaid care they also provide at home. Why does it matter that this core economy should be visible in economics? Because the household provision of care is essential for human well-being, and productivity in the paid economy depends directly upon it. It matters because when—in the name of austerity and public sector savings—governments cut budgets for children's daycare centers, community services, parental leave, and youth clubs, the need for caregivers doesn't disappear; it just gets pushed back into the home. The pressure, particularly on women's time, can force them out of work and increase social stress and vulnerability.
P89. Stand back and take a look at how people actually behave, however, and that assumption starts to look flimsy. Along with being self-regarding, we are also other-regarding. We help strangers with heavy luggage, hold doors open for each other, share food and drink, give money to charity, and donate blood—even body parts—to people we will never meet. Toddlers just 14 months old will help others by handing them out-of-reach objects, and children as young as three will share their treats with others. Of course, children and adults alike often struggle to share—but the striking fact is that we share at all. Homo sapiens, it turns out, is the most cooperative species on the planet, outperforming ants, hyenas, and even the naked mole-rat when it comes to living alongside those who are beyond our next of kin.
P94. The outcome? Across all eight experimental groups, each song's popularity was partly determined by its quality (as rated independently by those in the control group): the 'best' songs rarely did poorly, and the 'worst' rarely did well. But a good deal of each song's popularity was also due to social influence: the participants preferred songs that they knew others liked. And the more promptly that other participants's ratings were displayed on the website, the more likely it was for a 'smash hit' to emerge within each group—but, fascinatingly, the harder it became to predict which song the hit would turn out to be. This kind of herd behavior can be highly contagious and highly uncertain. And, it explains the unpredictability not only of the next chart-topping song but also of next summer's fashion craze—not to mention the 'animal spirits' driving boom and bust in stock markets—revealing the strength of social networks in shaping our preferences, purchases, and actions.
P103. Ten children's day-nurseries all introduced a small fine for parents who were more than 10 minutes late collecting their children at the end of the day. The parental response? Rather than arriving more promptly, twice as many parents started arriving late. Introducing a monetary fine effectively wiped out and feelings of guilt and was interpreted as a market price for overtime care. Three months later, when the experiment ended and the fine was removed, the number of late pick-ups rose higher still: the price had gone, but the guilt hadn't come back.
P105. Nudges can have a big effect for a small cost, and digital technology makes smart nudging easier and cheaper than ever before. Take prescription medicines, for example; people often forget to take them regularly, undermining both their own health and possibly the drug's long-term efficacy too. In the UK, where an estimated £300 million is spent annually on unused prescription medicines, researchers found that a simple text message reminder significantly increased the proportion of patients who were taking their medicines on time. A similar experiment among people living with HIV/AIDS in Kenya found that a weekly text message likewise led to 25 percent more of them strongly adhering to their course of antiretrovirals. No money was sent, just a simple text. Environmental nudges can be effective, too. 'We have long showers, leave appliances turned on, and throw away rubbish as part of daily routines that involve little thought,' says Pelle Hansen, chair of the Danish Nudging Network. Basic nudges can easily be designed into buildings to offset these habits—using automated taps, shower timers, and motion-activated lighting—delivering substantial cuts in water and energy use. They work in public places, too. In the streets of Copenhagen, Hansen and his students handed out sweets to passers-by and documented how many of the wrappers ended up on the pavement, in bins, or in other people's bike baskets. They then painted green footprints leading up to the rubbish bins and found that littering fell by 46 percent. No need for fines or rewards to encourage compliance: the little green footprints artfully amplified an existing social norm.
P125. Like Newton, we all pay a high price when we don't understand the dynamic systems on which our lives and livelihoods depend. That certainly became clear in the wake of the 2008 financial crash, which famously prompted the Queen to ask, 'Why did no one see it coming?' Before it happened, the equilibrium thinking underpinning mainstream economic theory had lulled the past majority of economic analysts into paying scant attention to the banking sector—both its structure and its behavior. Incredible though it now seems, many major financial institutions—from the Bank of England and the European Central Bank to the US Federal Reserve—were using macroeconomic models in which private banks played no role at all, an omission that turned out to be a fatal error. As economist Steve Keen—one of the few who did see a crash coming—pithily put it, 'Trying to analyze capitalism while leaving out banks, debt, and money is like trying to analyze birds while ignoring that they have wings. Good luck.'
P135. In their book, The Gardens of Democracy, Eric Liu and Nick Hanauer argue that moving from 'machine brain' to 'garden brain' thinking calls for a simultaneous shift away from believing that things will self-regulate to realizing that things need stewarding. 'To be a gardener is not to let nature take its course; it is to tend,' they write. 'Gardeners don't make plants grow, but they do create what should and shouldn't be in the garden.' That is why economic gardeners must throw themselves into nurturing, selecting, reporting, grafting, pruning, and weeding the plants as they grow and mature.
P140. Twenty years ago, the answer was easy to guess: almost all of them lived in the world's poorest countries, classified by the World Bank as low-income, with a GDP per person of less than $1,000 per year. As a result, tackling global poverty was seen to be a matter of channeling global aid into those low-income countries. But today, the answer has changed, and at first, it seems counter-intuitive: three-quarters of the world's poorest people now live in middle-income countries. Not because they have moved but because their nations have become better off overall, and so have been reclassified by the World Bank as middle-income. Many of those countries, however—including the largest, such as China, India, Indonesia, and Nigeria—are becoming more unequal, which explains how they can simultaneously be home to most of the world's poorest people.
P151. Good section on:
P151. Who owns the land?
P154. Who makes your money?
P160. Who owns your labor?
P162. Who will own the robots?
P165. Who owns the ideas?
P188. Take coffee beans as a simple example: less than 1 percent of every bean ends up in a cup of coffee, and the leftover coffee grounds are rich in cellulose, lignin, nitrogen, and sugars. It would be foolish to throw such organic treasure straight onto a compost heap or, far worse, into a rubbish bin, but this happens in homes, offices, and coffee shops worldwide. Coffee grounds, it turns out, are an ideal medium for growing mushrooms, and then can be used as feed for cattle, chickens, and pigs, and so are returned to the soil as manure. From the humble coffee bean, imagine scaling that principle up to all food, crops, and timber and scaling it out to every home, farm, firm, and institution: it would start to transform our last-century forestry and food industries into regenerative ones that reap value from and then regenerate the living systems on which they depend.
P196. In the Togolese capital of Lomé, architect Sénamé Agbodjinou and colleagues set up Woelab in 2012, a 'low-high tech' workshop making its own design of open-source 3D printers using the components parts of defund computers, printers, and scanners that have been dumbed in West Africa. 'We wanted to make our 3D printers from the resources we have on hand—and electronics waste is now practically our primary material available in Africa,' says Agbodjinou. The project is exploring the most useful local applications for 3D printing. 'Doctors have told us that when a little piece of equipment breaks, it takes at least two months for the replacement parts to come from Europe or the United States,' he explains. 'With the technology—if we can master it—we can create these parts, repair the equipment faster, and perhaps help to save a life.
P233. These ideas sound outlandish and impracticable on first hearing, but they have proven very practical in the past. Paper-based demurrage was successfully used in city-scale complementary currencies in 1930s Germany and Austria to reinvigorate the local economy, and it was almost introduced across the United States in 1933. But in each case, the national government shut the initiative down, evidently threatened by its bottom-up success and the loss of state control over the power to create money. Keynes, however, was impressed by Gesell—who he called 'an unduly neglected prophet'—and was drawn to his proposal because of its proven ability to reboot spending in the economy, the priority of the Depression era.
P245. So many of the transformative ideas originate in other fields of thought, such as psychology, ecology, physics, history, Earth-systems science, geography, architecture, sociology, and complexity science. Economic theory would be wise to embrace what those other perspectives have to offer. In the dance of the intellects, it is time for economics to step back from soloing in the limelight and join the troupe instead. Less Lord of the Dance and more maypole dance, more actively interweaving its theories with insights arising in other disciplines.