THE ECONOMIC MODEL IN 2030
Potential Options and a Preferred Future
Report of a Futures Workshop – 7TH September 2012
Introduction
Claiming Our Future was launched at a large deliberative event in October 2010. It was a response to a sense of impotence and invisibility across the organizations in civil society demanding alternatives to austerity policies. It was a search for a different future to that offered by the dominance of these austerity policies
Claiming Our Future developed its potential as a shared cross sectoral space within which civil society organizations can explore and share alternatives to the current responses to the crisis. It offers potential for shared messaging and an empowered voice for civil society organizations. It has the potential to be a space for shared endeavour for civil society organizations working to a shared narrative about our current circumstances.
This futures workshop reflects a new dimension to the potential of Claiming Our Future – a potential to establish a shared vision of the future across diverse civil society organisations, to identify the elements that might shape this future and to explore the foundations already established for this future. This potential allows for shared understanding of the different perspectives across civil society organisations, for the emergence of shared perspectives on the future, and for new insights into our present predicament and how best to respond to this.
The Strategic Question for the Futures Workshop
The strategic question is a statement representing the problem that is to be examined. It was defined as:
What will be the economic model in 2030 to serve a society based on equality, environmental sustainability, participation, accountability and solidarity?
The Driving Forces for Change
The driving forces for change were considered at global, regional (EU), and national (Ireland) level. The main continuities, major trends and most important change processes were identified across a range of different fields. The most serious problems, new factors, possible discontinuities and the main sources of inspiration and hope were examined. Issues and trends were then identified in each of the following five fields:
1. Social and Demographic
- The trend is for growth in the global population and decline in the regional population. Migration will be a continuing phenomenon. There will be issues for Ireland in an ageing society in relation to retirement and health costs.
- The trend for the societal landscape will reflect tensions around migration and the effects of long-term unemployment. There will be increased religious diversity and a possible rise of the Christian right. Education will either reflect change or bring change.
- There is hope in the re-rise of community over individualism, in the positive resolution of an increased participation in politics over a possible alienation from politics, in the emergence of a right-left divide rather than civil unrest and in the battle for equality rather than increasing inequality.
- There are choices in the diverging trends that are evident. Will population rise or fall, will citizens be engaged or alienated, will the EU become more integrated or disintegrate, will tax rises or service cuts dominate policy, and will society choose division or solidarity?
2. Economic
- The key trends are for a rebalancing between regions (global), resource depletion (global, regional and national), climate change (global, regional and national), inequality (global, regional and national), MNC power (global and regional), protectionism (regional and national), austerity policies (regional and national), and the low tax economy (national).
- There is hope at a national level in the wider public debate on the economy, civil opposition to austerity, new local economy models and a new confrontation with choice.
- Climate change, resource depletion and a multi-polar world are inevitable challenges we are confronted with. There are choices in relation to protectionism, austerity policies and the low tax economy.
- Stagnation, reduced public services, the compromising of redistribution, dependence, climate change, localism and conflict would be the result of continuity in current trends.
- Change would involve a new role for the regional level, balance within the region and regional redistribution. It would involve stronger and resilient local economies with new sectors emerging serving well-being and green technology. It would involve complexity given the nature of the choices we are faced with.
3. Governance
- At a global level the trend is for a multi-polar world with uncertainty in global governance and skepticism about global institutions. A narrow economic imperative is being prioritized, the MNCs hold power with inadequate regulation and there is a lack of financial transparency. There is hope, however, in the rise of global civil society.
- The regional level is the main driver for Ireland. The trend is towards disintegration at this level. There are problems in a lack of capacity for Ireland to influence democracy at this level.
- The trends at national level include a lack of accountability, clientelism, the whip system in the Dail, gender inequality in politics and a highly centralized system of democracy. There are opportunities in Seanad reform, local government reform and the Constitutional Convention, but hope is limited.
- At all levels the imperative of the economic over the social is set to continue. Uncertainty at the global level will lead to greater emphasis on the national level and on national economic interests. Economic and financial interests will have primacy over all other issues with limited evidence that these interests can be regulated. This will be at the expense of global governance. There will be less accountability and transparency at this level and capacity to rise to the challenge of regulating the financial sector or tackling the issue of who will bear the cost of risk.
- It is not clear that governance at any level will be able to respond to issues of environment and society. Lack of governance in relation to the environment will lead to significant negative effects on society.
4. Environmental
- Climate change, population growth, the consumption model of the ‘northern’ economies, and the influence of the BRIC economies are the main global trends of importance. There is the ongoing failure of multi-lateralism to deliver progress, in particular on environmental issues.
- At a regional level the euro zone crisis dominates. The focus on sustained growth continues over any project for economic sustainability. There is, however, a legal framework of environmental targets at EU level.
- Ireland remains one of the highest per capita emitters and it is hard to get to the core of what is happening on sustainability. There are the issues of ‘fracking’ and the influence of the private sector, the framework for sustainable development, the climate change Bill and the limited media space for environmental issues.
- The prospects at global level encompass the collapse of multi-lateralism with the failure of Rio +20, free trade agreements, the market taking care of climate change, and wars, in particular, resource wars.
- At EU level corporate capture will reduce the dynamic for change. The diminished agency of the nation state will be evident. Prospects at national level encompass greater wealth inequality, dismantling of the welfare state, rise in policing, and deregulation. Continued austerity, economic depression and the fall out of climate change will be features.
- Local initiative offers hope and demonstrates the potential for change. This includes local currencies and increased community engagement. There is hope in a growing questioning culture, the focus on GDP and its weaknesses, and the potential for job creation and reduced resource consumption to be in harmony. A massive climate event in the ‘north’ could be needed to generate enough pressure for change.
5. Technological
- Smaller cheaper devices and a tension between patented products and open choice are the trends. There are problems with the increased use of natural resources, increased exposure to advertising, invasion of privacy and the promotion of individualism.
- There are risks of two-tier development at global, regional and national levels and of systems that are vulnerable to break down. There is hope in the awareness of the problems and in a technology that could be enabling, empowering and creative.
- Continuity involves technological innovation based on growth, borrowing and the neo-liberal model with markets sustaining the level of innovation. Things will get smaller, faster and more accessible. Discontinuities based on some irreversible shock such as peak oil, food insecurity or climate change will result in less technology, supply chain breakdown and forced localization.
- There is hope where discontinuities lead to more innovation and in the focus on community and environmental sustainability.
Pivotal Uncertainties
Pivotal uncertainties are the issues that will shape different scenarios for the future. They are pivotal in that the way they turn out may have strong direct consequences for the future. While they are likely to have a direct impact their outcome is uncertain.
Eight pivotal uncertainties were identified from the preceding analysis:
1. The response to climate change with uncertainties focused on technological focus to responding to risk, developing energy solutions, resource depletion, technological innovation, the geo-political dynamic and confluence of events.
2. EU integration or disintegration with uncertainties focused on level of accountability in EU governance, degree of EU integration and the governance models pursued, and capacity to govern the Euro crisis.
3. Neo-liberal dominance with uncertainties focused on role of the state and public funding, low tax economy, austerity, coherence of debate on tax and public services, privatization of knowledge and technology
4. Social values dominance with uncertainties focused on level of solidarity in society, inequality, increasing democratization, the contribution of civil society and the occurrence of some paradigm changing shock.
5. Prospects for multi-lateralism with uncertainties focused on the make up of international leadership, the source of power in a multi-polar world, global legislative change, the BRICs and protectionism.
6. Global collapse with uncertainties focused on food insecurity, water scarcity, diminishing returns of technological innovation, lack of critical infrastructure, sustaining complex systems, capacity to withstand shocks, resource depletion, disease pandemic, and resilience.
7. Civil unrest and war with uncertainties focused on civil war, resource wars, and civil conflict.
8. The role of global finance with uncertainties focused on the role of financial capital, the regulation of global finance and currency issues.
Two uncertainties with the highest level of impact and the greatest uncertainty of outcome were used to frame the scenarios for the future:
|
Dominance of the Neo-Liberal Model | | Global Fragmentation———————-+——————-Multi-Lateral Integration | | Social/Environmental Values Dominance |
Scenario One – Dominance of Neo Liberal Model & Global Fragmentation
The Low Fares State
- Multi-lateral organizations and agreements collapse. There is free trade between individual countries. Wars are more predominant. The market reigns supreme and it is expected that the planet will adjust. Economic growth will be pursued with no limits to resource extraction.
- Ireland will be a country of wealth inequality and deprivation. Public services will have collapsed. Policing will be reinforced and any opposition will be jailed. Austerity and economic depression will be the reality. Deregulation will be the order of the day.
- On the other hand local currencies will develop and there will be increased community engagement.
Scenario Two – Dominance of Neo-Liberal Model & Multi lateral Integration
Extreme BAU - Business As Usual – Being Absolutely Unsustainable
- The dominance of the IMF and the World Bank will grow. The BRICs will increase their influence. A federalized EU will emerge. Social Europe will be dismantled. There will be a technocratic response to the crisis.
- The economy will be designed to service the global 1%. Resource use will be untrammeled. The welfare state will be undermined. Society will be increasingly divided. Environmental and financial regulation will be weakened.
- The Troika will rule Ireland. There will be increased foreign direct investment. There will be a fossil fuel boom with fracking. Green food will be further developed.
- Resource depletion and climate change will bring us to the point of irreversibility. Migration will increase. There will be issues of legitimacy and an awakening of civil society.
Scenario Three – Social/Environmental Values Dominance & Global Fragmentation
Anarcho-Primitivist Cuba Without the Sun
- Global disintegration, European fragmentation and the collapse of the Euro leave Ireland isolated and insular.
- The disintegration of the current system will lead to the construction of a new economy in Ireland. There will be de-industrialisation. The focus will be on education, culture, food growing and socially useful work. There will be more physical labour and less trade, more making things and less focus on finance.
- Equality, social solidarity and democracy will be prized. Imagination and knowledge will be more evident. There will be more leisure. Ireland will be more resilient to shocks including climate change. Only basic needs will be met. People will die earlier due to limited technology.
Scenario Four - Social/Environmental Values Dominance & Multi Lateral Integration
The Phoenix
- Power will be ceded to a democratic and social EU. However decentralization and subsidiarity will be key features of this.
- The economy will be at the service of society and in balance with the environment. Indigenous enterprises will replace MNCs. The state and publicly funded services will be central to balance market dominance. Resilient and self-supporting local economies will predominate. The income gap will be reduced and adequate minimum incomes made available. Equality will be achieved.
- The cost of energy will go up. A new tax model will be in place. There will be a cap on the size of companies. A new politics will emerge. All policies will be assessed for their impact on equality and the environment. A cultural shift will be evident where values of equality, environmental sustainability and participation predominate.
- This future will emerge out of crisis, collapse and conflict. It will be based on a blueprint developed over this period of crisis. It will take time to emerge.
Policy Themes and Action Agendas
What can be done now to create that better future?
Action for Equality
- Improve income distribution and close the income gap using flat rate pay increases, taxation or an income cap.
- Raise taxation to an EU average and introduce basic income.
- Develop the role of civil society, organize workers and build community solidarity.
- Develop a more rounded understanding of well-being and build the care economy
Action for Environmental Sustainability
- Limit advertising to change consumption patterns.
- Combat resource exploitation, develop the green economy and expand renewable energy sources.
- Civil society action to win hearts and minds for environmental sustainability.
Action for Participation
- Develop local economies and cooperatives as a means of enhancing economic participation.
- Shorten the working week and afford time for participation and support and reward voluntary engagement.
- Build democratic movements in society and increase support for civil society organisations.
Action for Accountability
- Pursue political reform that involves decentralization, empowered civil society and citizen participation.
- Develop a register of lobbyists and support civil society.
- Enhance corporate and government accountability, develop freedom of information, and enhance independent media.
Action for Solidarity
- Conduct environmental and equality impact assessments on key decisions.
- Build community togetherness and form communities that look after one another.