As President Elect Donald Trump recruits staff, the prospects of an economy running clean seem further away than ever. There are some rays of hope, however.
Newsletter OCTOBER 2016 Vol. 4 Issue 2
Sweden special: dressed up for the 2030 celebrations but no carriage to take her there
Scrabbling to take the lead in defossilization, Sweden released ambitious plans to be fossil neutral 2030.Flagship Ericsson sheds employees and factories and announces sharp profit shortfalls. As Ericsson’s shares tumble Signals advises corporate strategists to study Sweden. Can high-tech companies really be located in countries like Sweden that place the social contract high on the agenda? Or is it the other way round – can policy strategists craft alternatives that make the country a good place for Hi-tech corporations whilst maintaining the social contract? And defossilizing at the same time?
If Sweden cannot de fossilise, have a liberal economy and keep the social contract, who can?
Having removed fossil fuel dependency from electricity generation, Sweden was convinced that all that was left was transport and that many alternative ways of transporting their goods could be found within the timeframe. That was until researchers reminded them of the almost 100% dependency of food provision on diesel. Having created one of the most urbanised countries in Europe (85%) Swedes are struggling to envision a way forward to, in the cold climate with mostly poor soils, provide food security without industrial agriculture and a highly centralised and transport-dependent food logistics network.
Sweden’s social direction has stranded
The Nobel Prize in Economics was , some say, created as a counter-weight to the pragmatic social democratic approach of honouring the social contract whatever the situation. Economists must be gloating that the social democratic model is failing and not finding a replacement.
(Apart from the beggars filling the streets, the population of non-registered citizens soaring and handicapped people dying after their care and assistance is withdrawn Signals heard that a university lecturer, who left her work due to illness, is now begging regularly to make ends meet.)
House speculation as economic engine has left many behind
Countries like Sweden, that have enjoyed home ownership as a money-creator for their banks and as a source of retirement income for themselves, are dangerously close to the bubble bursting. For policy makers we advise listening to debt forgiveness as serious economists like Steve Keen propose serious fiscal reform.
Current policy, of keeping interest rates low and allowing deductions for interest payment, is fuelling still further housing price rises. As the thousands of Ericsson employees hit unemployment we can expect it will produce an oversupply of mortgaged houses, causing a price dip if not a burst bubble.
Be aware of the alternatives
Alternatives to houses as piggy-banks are sprouting up. From the tiny house movement to the Permanent Real Estate Cooperative. Signals encourages social entrepreneurs and social enterprises to consider this route.
THERE IS NO B PLAN
Most corporate strategists who read Signals will readily admit that there is no B plan if fossil fuel is taken out of the equation. There is no strategy that can cope. The onus is on government policy to provide a transition path for businesses that risk having to ditch much of their equipment, supply chains and processes. Lobbying is what is needed along with serious dialogue.
Fossil vulnerability plan and a circular opportunity plan – soonest
For your organisation to get on top of this volatile situation, analysis of fossil vulnerability should be carried out. When you have done that, a full analysis of the potential of finding resources from the circular economy to run your operations is a priority.
TSSEF simulated the ecological alternative
The Swedish Sustainable Economy held a simulation to address just that question earlier last year. The results speak for themselves: only by applying a framework of large enough fees and dividends can the market be nudged to change.
Finally, when war seem on the cards for all, why not Invest in Peace?
Signals of war
Signals show tensions rising and divisions growing. Time to Invest in Peace. Is it possible?
- Date: 5 th April 16:00 – 17:00 CET
- Host: Initiatives of Change http://iofc.org
- Theme: how to invest in Peace
- Objectives: An overview of possibilities to invest in other ways, at personal ´, community and policy level.
- Sign up: Free
- Access: you will need a web link (coming soon on this page)
Environmental Fiscal Reform: looking back in 2015
A look back at what has been happening during the first half of the year in EFR: the economic system’s downsides are revealing themselves as environmental pressures rise. The case for environmental fiscal reform has never been stronger.
Newsletter MARCH 2015 Vol. 1 Issue 2
The environment is sending a bill. We are still paying for the wrong things.
The recent update to Planetary Boundaries (link) underlines that four of nine environmental boundaries have been crossed by human activity. Environmental degradation is affecting economies badly. At the same time, they are performing poorly on equitable distribution and food and housing security. Inclusion, too is becoming a challenge. The term Environmental Fiscal Reform, which first appeared in the early 2000s, appears more frequently amid signs that the economic system itself is coming under pressure. In the run-up to the climate talks in Paris later this year, business leaders and environmentalists alike are asking for serious reforms.
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Newsletter JANUARY 2015 Vol. 3 Issue 1
Environmental Fiscal Reform Special Edition
FOR BUSINESS TO SERVE HUMANITY THE POLICY FRAMEWORK THAT SURROUNDS IT MUST BE FIT FOR PURPOSE. CURRENT PERFORMANCE SUGGESTS THAT THE ECONOMIC SYSTEM BADLY NEEDS REFORMING. IT IS DRIVING HUMAN BEHAVIOUR TO EXTRACT FROM NATURE BEYOND NATURAL LIMITS. IT IS TRANSFERRING WEALTH UPWARDS AND IN GENERAL CREATING A LUSTRELESS SOCIETY. ECONOMIC FISCAL REFORM IS THE TERM BEING USED TO DESCRIBE THE CHANGE.
Signals of blatant dissatisfaction with economic policy and the functioning of the economic system have been increasing recently. The term Environmental Fiscal Reform, which first appeared in the early 2000s, appears more frequently amid signs that the economic system itself is coming under pressure. Fiscal reform is about what governments do with the taxes they collect. The guidance they are given from mainstream economists is seriously under doubt. In the run-up to the climate talks in Paris later this year, business leaders and environmentalists alike are asking for serious reforms.
This edition of signals produced in cooperation with the Swedish Sustainable Economy Foundation.
Big data + Big networks= Big changes
AS THE WORLD BECOMES EVER MORE CONNECTED, AS PEOPLE NETWORK AND AS QUALITY OF DATA IMPROVES IS IT POSSIBLE THAT THE COLLECTIVE CONSCIOUSNESS OF HUMANITY WILL TAKE A STEP BACK AND START TO GRASP ANOTHER REALITY? THERE ARE SIGNALS THAT THIS MAY BE ABOUT TO HAPPEN.
Signals: from being seen as nothing more than an advanced adding machine, the computer and the digitization it makes possible have offered multi dimensions of new possibilities. But is the “killer app” yet to be invented? Are we just not still digitizing last-century business models? Is society only just waking up to the possibilities its wireless, networked, big data society offers? Signals show that mobile devices connected to big data can indeed mean significant changes to how we farm, and that just by looking at big data we can start to grasp insights previously out of reach. The consequences are huge, and present a real challenge to policy makers and leaders as well as opportunities to entrepreneurs.
The links below point to big data being collected and used, and big networks forming in ways that will challenge the fundamentals of how we manage society and run our businesses. The wise leader would do well to follow these signals.
Monsanto has recently acquired a giant within big data, and is providing farmers with a mobile app that combines data from weather forecasts with modeling microclimate conditions to show when and where to plant. Fields in the US have been mapped to a 10 by 10 meter resolution. A crop chemical company becomes a big data company too.
A new start-up is launching a series of satellites so small they take a fraction of the energy of conventional satellites to launch. Using an open interface people can create their own applications using the data to deliver a wide range of services – some we have not even thought of yet. Viewing the planet in this way can open up completely new ways to take care of the Earth.
Maybe the shift in understanding started with the photos of the Earth from space. What had been a theory back in the 1500s we could see with our own eyes that one planet, we have one planet, and that’s all we have.
After years of sifting through data, modelling and following actual trends scientists are confident that human activity is affecting the climate system. Had we not had big data and the big netwrok of scientists involved we had probably never come to this conclusion. We have reached a point where all of us feel responsibility for the planet, the arguments are logical and persuasive.
Modelling human networks
Data crunching capability makes it possible to see who is talking to whom about various subjects, even giving us the ability to study human behavior online. This links goes to the TED talk of Nicholas Christakis
Indeed, there is a possibility that number-crunching economists will be able to sift through terabytes of historical data to challenge even the most cherished beliefs about human nature and economics. This is what Thomas Piketty did.
The blog on stephenhinton.org argues that by using big data to create an overall picture, people can form an understanding by stepping back and considering what they have seen, and then go on to form large networks to create the change they want to see
Alternative economic policy think tanks like the Swedish Sustainable Economy Foundation are saying that as everything in the economy is digitized, and information about sales, unemployment, benefit costs etc is available real-time, it might be better to steer the economy based on how it is actually performing rather than using monetary measure points alone.
They are proposing a real-time monitoring of the economy connected to flexible steering mechanisms and a good deal of room to maneuver to market forces. The Foundation believes market forces need to be given clear boundaries within which to operate, but be left alone to solve problems.
Arrange a simulation session to learn more about how big data on real performance, rather than relying on money measurements alone, can create the circular, high performing economy.
To illustrate their principles, the Foundation TSSEF is offering, together with Stephen Hinton Consulting, to run a simulation set up as a management game. They promise everyone will gain at least one or two insights from simulating the economy.
Contact us to discuss simulations of economic policy or how we can facilitate dialogues around how to handle big data big network issues and opportunities in your organization.
Time is running out to design organisations that function in an oil constrained world
THIS TIME, FALLING OIL PRICES ARE NOT AN INVITATION TO PARTY ON CHEAP ENERGY. THEY ARE A SIGNAL TO INCREASE THE PACE OF TRANSITION TO RENEWABLE ENERGY SOCIETY.
Signals: Falling oil prices could be a sign that a recession is on its way. And in a recession it can be hard to find the investment capital to do what needs to be done before the recession eases: invest in the new, renewable economy. Ironic. When times are good, everyone wants to invest in fossil fuels. When times are bad investing in renewables is out of the question. This has to change. And governments and economists want to move the change along with carbon taxes. Whole business models must change. At the right time, of course.
Climate change will force us to ditch old paradigms. Enterprise will go on even if capitalism doesn’t.
REPORTER AND AUTHOR NAOMI KLEIN RELEASES HER BOOK This Changes Everything: Capitalism vs. the Climate NAMING THAT CHERISHED PARADIGMS ARE BREAKING AS CLIMATE CHANGE ADVANCES AND THE PERFORMANCE OF CAPITALISM LOOKS EVER MORE SHODDY AS A WAY TO PROVIDE ESSENTIALS TO HUMANITY
Signals: Sooner or later the things we have been ignoring, brushing under the carpet, get named by brave individuals. Once a voice with enough authority and context gives it a name, it has to be dealt with. Naomi Klein, a brilliant reporter and sharp mind does just this in her new book.As she states clearly: Capitalism, since it was unshackled by the deregulation of the 1980s, has widened the gap between rich and poor. The top 3% held 55% of all wealth last year, up from 45% in 1989. The bottom 90% controlled 24.7% of wealth, according to statistics released this month by the Federal Reserve. The book represents a new wave of signals – bringing leaders, policy makers, thinkers and householders to confront cherished beliefs.