POLITICO: Political Turmoil Imminent as Mainstream Economics Faces Impending Disappearance

Joe Swinson, director of Partners for a New Economy, agrees with the former UK Prime Minister Liz Truss that economic legitimacy is a real issue. However, Truss’s prescription of tax cuts for the wealthy and encouragement of casino banking failed. Swinson warns that returning to austerity or avoiding boldness will not solve the UK’s issues. The country needs rapid economic growth to catch up with the challenges of the 21st century and improve people’s lives. The roots of Britain’s political turmoil go back two decades when many people and places were left behind despite the economy’s apparent boom. Grievances were masked for a while, but the financial crisis hit hard, and austerity became the norm.

The result of this economic model is a society less resilient, making it easy for far-right divisive tactics and immigrant scapegoating. The rise of extreme polarization and populism is not unique to Britain, as Brazil, France, Germany, India, Italy, Sweden, and the United States all experience it. To move forward, we must focus on the future and end our obsession with GDP as a proxy for progress. We need to value the abundance of nature, the growth of young people’s skills and self-esteem, and our collective curiosity and creativity more than GDP growth.

The pandemic has taught us that while we need economic stability, we must also rethink it. As we leave the Holocene epoch and enter the Anthropocene epoch, shocks such as floods, fires, droughts, storms, and pandemics will occur more frequently. Economics is ignorant of the vital role of the environment in our economy, and the current model ignores climate change’s impacts and ecological warning signs.

Ecological literacy needs to be essential to economics, assessing the risks of ecological disasters to financial assets and the financial system’s significant risks to our planet. Economics must also show some humility. Fortunately, many avenues lead to a future where our economic system can play a positive role in regenerating the planet and nurturing its people, managing natural resources, valuing care work, and future generations.

Reframing the fundamental question of what economic policy is for, designing an economy that works within social infrastructure accessible to all, and the ecological ceiling of planetary boundaries is critical. Challenging orthodoxy and vested interests is difficult, but our actions can help find a better path to a decent economy.

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