So the problem begins right on day one, when I give talks about durned economics to groups of students are in midlife executives, I'll often say, what's the first diagram you remember learning in economics? And it's the same the world over supply and demand. That's Kate Raworth.
She calls herself a renegade economist. A few years ago, she sat down and drew a new economics chart in the shape of a doughnut. Her chart includes the whole picture, not just of what we buy and sell, but the parts of our lives that mainstream economics often leaves out or oversimplifies. For example, here's how she looks at the story about Vietnamese farming communities.
There are parts of rural Vietnam where they're famous for their rice paddy fields and these households aren't particularly well-off. And so somebody had an idea like, hey, let's have them come and having homestay tourists. You get to stay with the family, you get to be that great. And it did well. And it expands and it expands.
That's good, right? I mean, growth means everyone is better off. And now it's expanded to the point that those families are utterly dependent upon the income from the whole status. And actually they're not really doing the farming. So they're sort of having to just try and maintain it. So it still looks good. So it almost becomes a mirage of what it is that people are coming to visit. That real thing has been lost in the sheer fact of their arrival in numbers.
The literal and figurative soil beneath their feet has been neglected and discarded. The substrate of these people's lives has become just slightly and subtly more shaky. But they have a new economic foundation, so they seem to be getting by.
And then covid hits and the visitors have gone and their economy is stripped out because what they had come to depend on is gone.
And this isn't just happening in rural Vietnam. Maybe it's happened in your town or city or on your block. Properties were transformed into Airbnb units almost overnight, and then the feeling of that place changed. There were fewer people to care about the schools or the potholes and the parks where the noise they're making above your head and maybe a few people made more money. The tourism economy grew, but then the model collapsed with covid, at least for a little while.
People prioritized short term growth without thinking about the whole system. So parts of that system disappeared. And technology is what makes this rapid shift possible. But Kate is asking us to notice those shifts and think bigger as we get all this economic efficiency. Is there something else that we're losing and are we really adequately meeting people's needs? In Kate's book, Don't Economics Seven Ways to Think Like a 21st century economist, she lays out a model and gives us a guide for going from a 20th century paradigm to an evolved 21st century, one that will address our existential scale problems.
I'm Tristan Harris and I'm Azer asking and this is your undivided attention. I'm just so excited to have you on the podcast. Welcome to your undivided attention. Oh, big pleasure. I reckon you're a renegade technologist. And here we go. Let's go.
Maybe we should start with your background just to introduce you to many of our listeners and how you became a renegade economist.
OK, so I'm 50 years old. So I was a teenager in the 1980s and having grown up in the 80s and seen famine in Ethiopia and a hole in the ozone layer and the Exxon Valdez spilling its oil all over Alaska, I thought, well, I want to learn the language of public policy. I want to be able to tackle these things. So I skipped off to university to study economics and was quickly disillusioned and frustrated because it didn't tackle the things I cared about.
They were there in the margins. I studied economics for four years, actually, but then eventually walked away from the discipline because I found myself whenever I met somebody I never wanted to stick my hand out, say hello, I'm an economist because, you know, I just don't want to own that. So I became a generalist. I have no sense of disciplinary identity and worked with U.N. and worked with Oxfam and became a mother of twins immersed in the unpaid care economy.
So had these twin babies in 2008 and suddenly the world's financial markets collapsed. And I'm hearing on the radio all these economists saying, you know, we need to rewrite economics to reflect financial realities in this crisis. And I just thought, well, I'll be damned if we're only going to rewrite economics for that, because we need to rewrite economics for decades to reflect the ecological crises we face of climate change and to reflect the social crisis of people whose interests and needs full out of the bottom of economics because they're not reflected in the market.
So that was what brought me back towards economics, seeing that there was this moment, somebody once said to me, oh, you're a renegade economist, and he put the word renegade in front of it.
I can go with that. And it draws people in. It's a renegade economist, then. Yeah, well, let me tell you what needs to be rewritten. So I find myself coming back towards economics. I drew this diagram of the doughnut in 2012. Just a very simple picture. Looks a bit like a doughnut. And it went boom. It just it went viral almost overnight. And I was fascinated by the power of this picture. And that made me realize there's a power in pictures, there's a power metaphor, and this is an opportunity to start rewriting economics.
So I sat down and I read all the economics texts that I've never been told. So I started reading about ecological economics and feminist economics and behavioral economics and complexity economics and thought, what happens if I make all these ideas dance together on the same page? And it came out as doughnut economics.
Many of our listeners maybe would question why are we on a podcast that normally talks about the interaction of technology and society suddenly talking and focus purely on economics? And I think it's important to make a quick parallel to the work that you're doing in the film. You know, the social dilemma. The inventor of the like button, Justin Rosenstein, says at the end of the film, you know, this really isn't just a technology problem. It is an economic problem.
And he says, I think very clearly that so long as a whale is worth more dead than alive in a tree is worth more as two by fours than as a living tree. We humans, we're the whale. We're the tree. Now we are the thing that is being strip mined into dead slabs of predictable human behavior instead of the living, breathing consciousness or choice making. If there is such a thing as free will, whatever extent to free will we might have is worth more when it's not free and is instead a predictable dead slab of human behavior.
Then if it is a living, breathing citizen or a healthy growing child, that child is worth more if she is addicted, narcissistic, polarized and disinformed. Because that means that this business model of monetizing, commodifying and polluting the attention commons is successful. So I think that insight that the film is actually making a point that there is a problem with our core economic logic. And I think the question is what is that problem? And I think that when we identify that, I think it's similar.
I suppose from what I've read and love about your work, what was the core thing that when you're noticing what was wrong or inadequate about economics, what were kind of the places that your attention was looking?
So the problem begins right on day one when I give talks about doughnut economics to groups of students or in midlife executives, I'll often say, what's the first diagram you remember learning in economics? And it's the same the world over supply and demand. Right. So the question is, what do we put at the center of our attention on day one? Because what we place there becomes central and we build everything around it. So when we start with welcome to economics, here's the market.
So many things have already happened, right? Number one, we've said, well, the economy is of course, it's all about markets and we've stuck supply and demand there with this little crisscross of tools. And at the point of the criss-Cross is price, and so we've put price there as the metric of our concern. So the economy is the market, the markets, our starting point price is the metric of our concern. So many ramifications of this one.
Anything that falls outside the market contract in economic language gets called an externality. So a car driver decides to buy some petrol and puts it in the car and is driving to work. There's a negative externality hitting the cyclist who's breathing in the fumes of all that petrol, not part of the contract. That's an externality. But here in the 21st century, we've got this absurd situation that our economic activity is causing the death of the living planet. And economists saying that's an environmental externality.
Well, your intent I have to go up and say this. There's something profoundly wrong with theories if we're dismissing or just happy to label the death of the living planet as an externality. So that's one consequence. But the other one is just simply that we start with markets. And when I talk about this and debate this with mainstream economics professors, they look at me quizzically or they think I'm being totally radical. Where else do you want to start?
I mean, of course, we start there. It's a great theory. It's OK. Do you know where we want to start? Right. Let's step right back. The word economics comes from ancient Greek. It's to Greek words e cross, and it means the art of household management. Oh, and if you start that, OK, welcome to the art of household management. What would you think you'd want to know first on day one of household management?
We probably want to know about the household. Right. Well, let's start by learning about this Planetree household of ours, how she works. Let's learn. We have a carbon cycle and we really, really need a stable climate. We have a hydrological cycle and we need our lakes and rivers recharging with fresh water. We have biodiversity in a web of life and we're part of it. We should know that.
So we need to learn about the cycles of the living world if we're going to have any chance of managing and engaging with them. And by the way, we should probably learn about Earth's inhabitants, all other living creatures and humanity. And let's learn about humanity as we actually know ourselves to be in the 21st century, not as some very early economists decided to imagine us because it fit really neatly into their models. So day one, whether you walk into a lecture room and you're told welcome to economics, his supply and demand, or you walk in, you say here the fundamentals of planetary health.
Here are the fundamentals of human thriving. Let's design systems that enable that you right from that first day are on a completely different course. You'll have different world view. You'll use different theories, different metaphors, and you will come to different conclusions. So where we put our attention right at the beginning has these profound impacts on what you're saying is how it's been. We focus on markets and therefore the tree is a market object. It's the two by fours.
We focus on the whale as well. What can that be cashed in for? Right. We desperately need to move away from that and start with the living whole and ask ourselves how markets can be in service to life as well as the state in service to life, because there's not just the market out there as well as the unpaid work of the household, the care and the commons.
So let's look at the full set of economic ways of providing. Right. We've got markets and the state and the household and the commons, and now we've just got amazing conceptual toys to play with all the different kinds of economic interactions you could create to these.
It's so much richer and wiser than starting with the market alone.
Yeah, I'd love for you to talk a little bit more about metaphors and what is the language that we've been using in economics that maybe hit or occluded what real issues were at stake there again in economics, because it typically starts with welcome to economics.
Here's the market then who humanity is. Will we show up?
As this character known as rational economic man is little independent self interest, quite ego driven, calculating character with dollars in his hands looking for the bargains. That's the sort of stereotype of rational man. But he's either shopping or working. He's a consumer or producer. And so we're there in that market relation. And yes, we all do go shopping sometimes and we work for money. So we all have that market relationship, but it's just a tiny fraction of who we are.
So other economic identities in relation to the state, we might be a voter, a public servant, a protester, a resident of a city. And those are really important state relationships we play. And sometimes the most important thing you can do on a Saturday is go on a protest march. We are also in the household, right. You might be a parent, a partner, a relative, a child, a neighbour, a member of the PTA.
A local school and we are commoners, so we are people who create community garden on the corner block with our neighbors, we steward, we create, we share, we lend things to people. Now, just imagine an apartment building in a fabulous city. What economic identity is that building filled with? If people live there in that city, they're going to be there partly in their market identities. I'm off to work on a Monday morning, like a shopping on Saturday, but I'm also there weaving throughout that.
I'm coming home to cook dinner for the family because I'm a parent and I'm doing that unpaid care. And I'm going to be part of the PTA at 8:00 tonight. So I need to get that done because I'm also in the community and I have a relationship to the state. So actually I go to the town meetings because I really care about what happens to the future. Now, when those houses start to be rented out to tourists who want to come and visit this fabulous place, they will leave many of those identities at home.
I mean, their kids might come with them, but they're not there doing the cooking and the school and they're there as tourists that they're consuming and spending money, which might be really valuable to that city.
But it's also a very thin version of the full richness of economic identities. So when there's a protest happening in the city, people in that building won't go because they're tourists and they're not part of it. They won't be there at the PTA. They won't be there helping setting up a food bank when the community really needs it. They're not on the WhatsApp group saying, hey, is everybody OK? So we thin out the economic identities that show up when we marchetti's the spaces that were originally intended to be homes.
And I just think it's really important to name all of these relationships. One exercise I love doing with people is showing them, look, you have roles in the market, let's label them labor all the different ways you engage in the market, shopping and working labor, all your relationships to the state as voter and resident and public servant and protest.
Think of all your relationships in the household and all your relationships in the community and realize suddenly that you actually weave in and out of them seamlessly. And it's a rich tapestry that makes your life. And of course you're always under time, pressure moving from one to the other, and you're having to make tough decisions about where to put your attention. But that is what makes life and community and richness and politics with a small P. that local politics of being part of a place.
And when we monetize that and just say no, just replace that rich identity with the market relation, it is Thind. And to me, that's sort of the way I think about theoretically what sits underneath. You're talking about communities losing schools because people aren't showing up in that multiplicity of identities. So we need city planners to think about how many Airbnb units can be here. I know in Amsterdam there are certain blocks of cities. You know what? We're just banning Airbnb because it's ruing the community of our block.
We're not against anybody making an extra bit of money, but it's having big knock on effects on the rest of us. And by the way, we're not going to call them externalities because that ain't external. That's showing up in my life about people coming in and out of this building. And I don't know who they are. I don't feel safe. And it feels like my kids are safe. So it's really important to take account of this full range of our economic identities, recognize their interdependence, and then design spaces that bring them into balance.
And I say that word with real intention because I think balance is a key concept, right? Twentieth century economics predicated on endless growth. And you hear it in politicians speeches and you see it in economic models. Do this sell off two by fours. Chilwell sell it, we'll get growth, we get income increase increment and we get GDP growth as if that was a good shape of progress forward and up forever. And actually I think the secret is to shift from the idea that success, losing endless growth to success lies in balance.
And I've thought about it very much from the point of view of finding a balance that enables us to meet all human needs within the means of the living planet. But I can see brilliant opportunity and I'd love to riff with you on it about what's the balance in our use of digital technologies. Where do we find that point where it's engaging? It's useful, it's where I feel we belong, but without getting addicted, drawn, depressed, thrown off course by it.
So where do we find that balance and what kind of structures and ownership and designs would enable us to be in balance with the phenomenal power of these technologies?
So if we take this to the digital world, according to the logic of the attention economy, we're either an attention consumer, we're just an eyeball. You're used to the attention economy is the fact that you're an alive eyeball who can be sold for something else or you're an attention producer.
Every time you post a video that says this is a funny cat video or here's my friend who died, you're producing information that is attracting the other eyeballs and we're arranging this sort of attention marketplace. We have an infinite, abundant source of information that's getting published. We have a finite amount of attention to consume it. We have an infinite growth paradigm living on a finite substrate of human attention.
It'd be great to go back to the moment where you decided to draw the donut and where based on these problems.
You see that coming about, because I see you saying there's something about balance and I think we haven't fully introduced what the doughnut is yet for people, great.
So I think pictures are really, really powerful. We spend so much of our time analyzing the world through words which we we analyze as they go in.
We don't know what did you what did he mean by that? And often we think a picture is a nice little illustration on the side, but actually pictures seeping through our eyes and go straight into our visual cortex in the back of our heads and literally can sit there. So when we say, you know, oh, it's in the back of my mind. Yeah. If it's a picture, it is. And it might be sitting there shaping how you think shaping what's at the center of your vision and what's on the periphery, just as supply and demand does from day one.
And I realize these economic diagrams had been sitting in the back of my mind quietly, wordlessly shaping what I thought the economy was, what's in the middle of it and what's outside of it. And I started looking at alternative kinds of economics diagrams like the work of Herman Daly, who you could say is the founding father of ecological economics.
And the great revolutionary thing that Herman Daly did basically is draw a little square and say that's the economy and draw a circle around it and say that that is the living planet. That's his revolution.
And it's such a radical move that it's not ever actually been fully and well, it's not even at all been incorporated into mainstream economics because it just pulled the carpet from under everything. So that's the core of ecological economics to recognize the economy sits within the living world. I was really excited by this concept when I first came across it, but it hadn't been quantified or it was it was a circle of square. Yeah, that makes sense to me. But what do you do with that?
And I walked away from economics and then found myself coming back to Oxfam after having twins immersed in the unpaid care economy and immersed in life, actually immersed in the richness of being a mother full time, which is hard and the community. And suddenly coming back into my job at Oxfam and this was in 2009, and somebody saying, oh, look, here's some big new ideas that have been happening in the world. And one of the pictures they showed me, it was a green circle and radiating out of the edges of this green circle, these big red raised like danger zone raise.
And what the green circles showed was it would have been made by some of the world's leading earth system scientists. And they said, you know what, we think planet Earth has a set of life supporting systems on which we depend to keep this unique, delicately balanced living planet in balance. And these include having a stable climate and fertile soil and abundant biodiversity and recharging fresh water and an ozone layer overhead.
And if we go beyond the limit of pressure that we can safely put on any of these, we actually risk tipping this planet out of balance. And by the way, we are way over those danger zones already on climate of excess fertilizer use on converting too much land, biodiversity loss. So I was really physically impacted by this picture because I thought that is Herman Daley's idea. He said the economy has to exist within the planet. And look, it's overshooting the planet.
It's pushing beyond it. And I was sitting in this big open plan office in Oxfam and there were people over there who were fundraising for a famine that was just starting in the Sahel of Africa. There were people on the other side who were campaigning for health and education for kids worldwide. So I thought, well, hang on, if there's an outer limit of pressure that we can put as we use Earth's resources, there's an inner limit to that.
If any person falls below that inner limit, having enough food or access to education or housing or clothing, then there's a deprivation of human well-being. So if there's an outer limit, there's an inner limit. So I sit in staring at this picture and I picked up my pen and I drew a circle inside their circle and said the hole in the middle of that circle is a place you don't want to be. We're not using enough of Earth's land to grow enough food for everybody.
We're not converting enough timber into building houses. So hang on. Oh, this is this is tricky. Now, we've got to use Earth resources to meet people's needs, but not so much that we tip this planet out of balance. And so the circle suddenly looks like a doughnut. So think of a doughnut with a hole in the middle and the hole in the middle is a place where people are falling short on the essentials of life.
It's where people don't have the resources they need for food and health care, education, housing, energy, transport networks, being poor communication networks. Right. That is a really, really valuable tool in poor people's lives. Political voice, social equity.
So we want to leave nobody in the hole in the middle of the doughnut, everybody over the social foundations so everyone can live life, dignity and community and opportunity. Great. But don't use Earth's resources so much that we begin to push beyond this ecological ceiling. We begin to push the boundaries and the limits of what can sustain. We use so much fertiliser it doesn't actually get taken up by the plants it leaches out through the soil in. Lakes and rivers and creates these dead zones, killers of aquatic life, we emit so much carbon dioxide through meeting our energy and all sorts of needs that we call climate change, we break down the stability of the climate.
We break down the web of life through biodiversity loss. We create a hole in the ozone layer. So these nine planetary boundaries are what make this unique living planet work. They're actually the boundaries of the Holocene, which is state the planet has been in for the last 11000 years, and not coincidentally, the era in which humanity began practicing agriculture because we had stable seasons. You knew that the rains would come so you can plant seeds and trust that there will be your food.
It's the air of the planet in which all human civilizations across every culture have risen up and thrived and survived, and we would be crazy to kick ourselves out of it. So the goal, in the simplest of terms, is to meet the needs of all people within the means of the living planet. And suddenly the shape of progress is no longer that 20th century mantra of growth, growth, growth. It's clearly on a different metric, its balance, its balance of meeting human needs within planetary boundaries.
And that changes everything.
I mean, I think we all agree that metaphor is incredibly important because it enables us at the level of our own lives, our own bodies, our own understanding, our own experience in the world. We use metaphor to explain big things that are hard, and we talk about the metaphorically all the time to each other.
It's so embedded in our language you don't notice it most of the time. I think the big metaphorical opportunity of this century, if we humanity, 10 billion of us on this planet are going to thrive with and as part of this planet is to connect what we all deeply understand about bodily health, planetary health. So every kid I have a 12 year old twins now. Right. Every child in school, my kids at school are learning about the human body and we all learn about the human body.
We got two lungs and heart, but we got all these systems. So we've got a respiratory system and it needs a certain amount of oxygen, but not too much. If we only breathe oxygen, that will kill us. We've got a muscular system and we need to strengthen our muscles. But you never want to put too much strain on that skeletal system, but don't put a strain on that. The bone, a nervous system. We've got a temperature regulatory system.
And if our temperatures rise too much, that kills us. But if our temperature falls too much, that kills us. By the way, it's a pretty narrow band. So we understand absolutely at the level of human body, life and thriving lies in balance. And our bodies are brilliant at continually balancing us. But we spend half our day doing this, oh, I'm hungry or I'm full. I'm a bit cold. Can you win on that hot with that switch constantly adjusting that makes us stay alive.
So we get that. Now, if we can take that from the human body and the understanding that health lies in balance and we can take that to the planet. Saying, you know what? Planet Earth has a series of fundamental systems on which our well-being depends.
And if we push any one of them too far, we also kick our planetary system out of health into death and decline. So I really think this sense of health, human health, the planetary health and the sense of balance is well-being. It sounds so simple to say in these words, but I really think it's profound. And if we can start to hear that come through in the speeches of politicians who therefore would stop saying, well, you know, the economy is growing and that necessarily is a good thing in the human body.
If I tell you my friend went to the doctor and he told her she had a growth that is nothing to celebrate with, deeply and quietly understand that that is a profound problem because we know that the human body is a complex, dynamic adaptive system alive. And if there's something in it, one thing in it that decides out of its own interests to grow indefinitely, to maximize itself, optimize itself within this complex living hole that is a threat to the life of the whole.
And we do everything we can to remove that. If it grows and optimizes itself for itself, anything, then it destroys the wider fabric and the ecosystem that made this complex society or this complex body or this complex planet alive and thrive, its complexity that makes life beautiful and it makes life work and things that pursue their one goal for themselves at the cost of everything else, destroy it. And the muscle point.
You also have a bottom of the doughnut where if you don't exercise those muscles, then you actually atrophy them. And I think it's important that this notion of too much, too little exists everywhere in the world. See how you get antifragile if you don't stress, you know, your immune system or occasionally have, you know, pathogens coming in, you're not actually developing and strengthening your immune system. So we don't just want to choke off these sort of negative stimulus's.
We need that right balance. And I think when it comes to technology, oftentimes the goal is convenience is don't think we don't have to choose. But does it all for you. And I think there's a balance there if you think about making.
So easy that people don't have to think you actually atrophy their own critical thinking capacity, a standard example of this is just if you rely on GPS in your phone for navigation, you cease to be able to navigate when you don't have your GPS. That's right.
So this often gets turned into a polarity of either let's have Google Maps and then it does just sort of erase our own natural capacity for knowing and orienting where we are or let's not have Google Maps.
And everyone should really be aware of where all the maps are and whether they're looking body location is. And I think it's like, no, that's a polarity weighted. To say that it's a question is what is this healthy balance?
Where how do we simultaneously make it easier to navigate while also deepening your own intrinsic wisdom and capacity to navigate on your own? So how do we give people things that also have them exercising the muscles that they would want and need, which are the life support organs? It reminds me that apparently a lot of our meat is actually mechanically chewed by a mechanical like chewer type thing before it goes to use so that we make it even easier for it to go down.
And I just think when we make things so kind of curiosity, when we have everything be so easy and so too simple of a story so that we can get that information, communication to be as smooth as possible, we're mechanically chewing down the information so it goes down easier, but we're actually losing people's ability to question more deeply. How would I know that to be true? Could I test if the opposite is true, can I steal all the different opposing arguments?
We're actually changing and not strengthening the muscles that we need.
That's one thing I hear you saying is how do we strengthen all these internal life support systems so that they get stronger, more resilient, not as vulnerable to fragility in the sense of that the increasing ghost towns, whether it's the ghost town of the Vietnam city that has the rice paddies or the ghost town of our children who are operating in ghost personalities, who are more concerned with the number of likes and followers that they have than their own intrinsic self worth and having that be exercised in their own independent.
Right. But the second thing you said, which is that there's no organ in our body that is maximizing for its own self-interest. The liver isn't trying to outcompete and spread over the stomach and everything else. And if it does, we call that obviously cancer. And so it's obvious that whatever new economic or even digital paradigm that we would have has to operate.
I think in what you call this sort of dynamic complexity and also has to be aware of self reinforcing feedback loops. And so I think across the board, you know, we want people's attention. We need a minimal amount of people's attention. If I'm a digital product or service, I need some minimal relationship with you so that you feel loyal, you enjoy the relationship. You'll come back at some point. But if I sort of maximize engagement like Facebook or Twitter or something, maximizing usage, watch time, auto play, et cetera, I'm overshooting into addiction, into isolation and alienation.
We need technology that is aware of the life system that it is embedded and whether it's literally that that technology is embedded in the sleep hours of a child that we don't want to be hijacking the 12 p.m. to 6:00 a.m. range of when we can ban that kind of that can be outside the donut and say that's over extracting those those parts of the attention economy are like national parks.
We don't allow you to monetize that or even we tax that versus how do we make sure that we're in alignment with the ergonomics of what makes the society work in a life well lived and including each of those societal organs instead of a heart, liver and a spleen. We have social trust. We have relationships, we have school boards. We have shared truth and shared meaning making. We have mindfulness and consciousness. We have critical thinking. We need those kinds of organs to be operational.
One of the critiques will sometimes hear of the social dilemma is that if it was just the ad based business model, then what about WhatsApp? WhatsApp doesn't use ads to power itself, and yet it still causes sort of hate mobs in India, the sort of viral nature of how disinformation missed, missed viral misinformation in Brazil.
Exactly. And I think that you have to sort of take the step back and it really becomes, again, economic logic that's driving the structure of the apps where the VC based business model is. We'll give you some money. You need to grow at all costs. Figure out ways of making your apps viral information spread and viral, and then you'll 10x one hundred extra your users and that's when you get more money. So it's essentially optimizing for infinite exponential growth based economies.
It's optimizing for vitality. It's optimizing us for vitality. It's a cancerous business model, sort of propagating cancerous ness throughout our social world.
So on the subject of growth, I'm going to turn to the wisest woman I know who is Donella Meadows, one of the authors of the Limits to Growth report published in 1972, which although people wanted to say it was nonsense and it had been debunked, actually our economies are tracking the scenarios that they were deeply worried about. So here she goes.
Growth is one of the stupidest purposes ever invented by any culture we've got to have. And enough. And in response to the call for more growth, she would always say USQUE 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? So those questions just have to always come in. Why are you pursuing growth? Why growth? So certainly one place would be to start with that recognition that we have.
Multiply the economic identities. Yes, we are consumers and producers. Yes. And you may be labor or you may be capital or indeed you may be the product if you are getting it for free.
We also are residents of cities and nations and voters and protesters and public servants. And within the household we are parents and carers and partners and relatives and children caring for each other in those webs of relationships. And we are commoners creating and sharing and stewarding. So starting point. We need digital technologies that respect the importance of our ability as humans in social and reciprocal relations to each other to have those relationships. So then I want to come to the to the crux of this for me.
Whenever I think about a product, we dealt with companies that don't an economic action. Let me say, what would it mean to do all business in the donut? And they want to show you that product. Look, it's made from sustainable materials and we buy in living wage supply chains and we say, you know what? We can talk all we like about the design of your product. But if we really want to know what your company can do and be in the world, we want to talk about the design of your company.
I call it corporate psychotherapy.
You know, someone goes to psychotherapy, etc. I have relationships with some really difficult people in my life. And you need just help me sort them out. Well, if you have enough psychotherapy, the psychotherapist will say, hey, perhaps it's not them. Perhaps you need to look within and you'll find that some of this is in you. So companies need to do that and not say, well, we have all these difficult relationships with the world and our competitors and supply chains.
Why don't you reflect in and look at the design of your organization and you'll probably find a few answers to what it is that you do in the world of what you have the capacity to be or do. So there are these five design traits, and I get these from a brilliant thinker, Comadre Kelly, who is a design of next generation enterprise.
And I offer these design traits to anybody who's thinking about a company that they work for or whose products they're using or that they're thinking of working for or leaving, because I think these five traits really help us be detected about what an enterprise can be or do in the world. And they are number one purpose. What purpose are you here to serve? Why does your company even exist? What is it in service to? Is it in service just to itself?
Oh, we want to be the biggest four by four sales company in Europe. What we want to be the biggest digital provider, and that's just a self serving purpose. Smart and 21st century companies actually exist in service of what we call a living purpose. You know what the world needs to sequester carbon. So we've set up an enterprise using business as a vehicle. To do that, communities need to be connected to make change in their neighborhood. We've set up an app as a tool for them to do that.
We're in service of somebody else's bigger purpose. So purpose No. One second networks. Who are you networking with? Your allies, your suppliers, your customers and your relationships with them. And how do you build in them your purpose and how do you make sure they share your values? Who do you see as competitors that actually could be allies in bringing about transformation? Third, how are you governed? Who has voice in decision making? What are the principles and the rules and the practices and the metrics by which you judge your success?
And how do you incentivize people who work in your company? And really is this aligned? Let's just check back. Is this aligned with your purpose or actually people in you know, sometimes you the CEO speaks this wonderful world we purpose and then you talk to middle managers and they're actually just incentivized on the next quarterly report. So the real risk isn't there. Now, let's go deeper. Let's go down to the real stuff. As in any psychotherapy, the most profound stuff lies deeper.
So we're going down here to ownership. How is your company owned?
Because whether it's owned by its employees or by the state or by a founding entrepreneur, by venture capital or by shareholders or by family, all of these design possibilities have profound consequences for what lies deepest, which is, of course, the one and only finance and what finance is demanding and expecting and how it expects to take its return. That's to me, it just explains everything. If we have companies, digital companies that are owned by venture capital that we know perfectly well what finance finances.
I want ten times out in ten years. So do whatever you have to do grow, grow, grow, grow. So I get my payout and that entirely drives the purpose of the enterprise. So whatever it says on the website, our purposes is, no, it's not. It's delivering the financial returns for the owners because of how it's owned and therefore governed and therefore network. So I think you can see in a very simple way, you can see two very different kinds of companies in the world.
One. The one, the 20th century one, and I think a lot of today's tech, the way it's owned, is determining what finance demands and that is its real purpose. And everything else about it is transformed to align with that. And that is what I got when I saw the central bank. Yes. Now I'm understanding how this tech is designed and gaming me and gaming my kids and catching our attention and monetizing it, because, of course, the way it's owned and designed, it's to deliver finance and that is its ultimate purpose, even though it doesn't have you on the website.
And then there are very different companies that really do start with that purpose. And they say, therefore, if our purpose is to connect community, we have to make sure that we bring in community members who support that. And we only use suppliers and connect with other organizations that support that. We have to govern ourselves in a way that puts the community. And you know what? We have to be owned in a way that ensures that the role that money plays here is money is in service to our community purpose.
We have to recognize the design of enterprise is fundamental and put it in service of humanity and in service of life.
In your book, you specify seven interventions to go from the kind of current 20th century economic paradigm to the twenty first century.
So in the before world, we measured GDP. We measure according to one sort of economic output in the after world.
We measure how we're doing in the doughnut. How are we above the baseline meeting the social foundation but not overshooting into pollution, etc..
In the before world, we have self-contained markets and economies, whereas in the after world we have embedded markets and economies that realize they're embedded inside of some larger system. The third thing is we have rational economic man and then we lead to socially adaptable humans. Then we have a world from mechanical equilibrium to dynamic complexity. That one's probably a little bit more complex to explain. What I wanted to do is actually link this up, though, with the technology.
Well, let me just skip to that one.
That also is interesting is the notion that let's fix the pollution with more growth. So in other words, externalities.
If we keep dumping pollution or waste in the environment, well, the market will eventually see that as a problem. And someone will come up with a waste management company or a carbon capture company or a forest grow trees company to capture carbon and will clean up the pollution with even more economic growth.
So we'll just grow our way out of the pollution into cleaning it up as opposed to in your twenty first century don't an economics model. We have a regenerative by design. It's not regenerative because we profit from the pollution and profit from the problem and then we profit later from a more solutions of cleaning it up. We actually make it regenerative by design. And think about the parallel here is it's more profitable for our health and food industry to have us get sick with diabetes and then sell us a subscription plan to diabetes cures for the rest of a lifetime then to have never given us diabetes in the first place.
And the same thing here, it's like technology companies have an incentive to addict you and then sell you new devices to manage your addiction to technology. New extra products like a light phone, to be a lighter phone and sell you new solutions, which is more profitable than actually fixing it in the first place. It's more profitable to invent ways to go to Mars than to fix the planet that we're already on. Right. So now I'm taking these on.
The last one that you have here is the notion that we have a growth addicted economy.
I just think it's like this heroin addict who's sitting there just addicted to more and more growth, to a growth agnostic economy, an economy that doesn't care about growth.
And so for each one of these few things we've outlined, I think we could actually do a little riffing here on what would a donut attention economics or a digital economics look like.
So in the before world, if we had measured GDP in the before world, in technology, we have measure engagement. So we have sort of measuring my own ego. How much are people using my product? Are they using it a lot? How much time spent do they have? And then the after instead of measuring the donut, we'd have something close to that, like measuring the doughnut of what is the minimum viable sort of benefit that we can provide for the least cost least time in someone's life, but not overshooting into addiction and depolarization, into shortening attention spans, into worsening mental health and to depression and to breakdown of truth into conspiracy, thinking none of that.
Those are the new social planetary boundaries that we've overshot that that difference. How we would do that is we would disallow applications from measuring their sort of engagement, GDP, their time spent, GDP.
That can no longer be the currency of success, which is also what you're saying.
GDP should not be the primary measurement economy. I believe New Zealand has actually recently said they're going to measure their well-being and the growth sort of wellbeing as opposed to their GDP. And then I know in Amsterdam, people have adopted your don't economics framework at a city level saying, hey, we're not going to measure our economic output. We're going to measure our scorecard on the data.
Is that right? Well, they're still probably have a track of the GDP of the city, but they're saying of our vision and our purpose and our. The metrics against which we judge our success, are we bringing Amsterdam into the DNA, are we creating a thriving place for people here while living within planetary boundaries? So, yeah, they've adopted that.
And so this would be a world where, let's say Facebook or Twitter or tick tock literally just are not measuring the time that people spend or how frequently people use it, because we almost want there to be a division between church and state, just like in a newspaper where you don't want your prophet to come directly from the perversion of the original purpose of news and journalism in the Fourth Estate, which is to keep the society in check into to report honestly on the facts.
If there's a business relationship between Harkavy most in The New York Times and then there's some kind of recall with Mazda cars and The New York Times can't report on it, there's not a clean separation of church and state, and we need there to be a separation of church and state between Twitter and WhatsApp and Facebook and Tic-Tac not caring about how much they addict your children. So it's not about how much your kids feel. It's about making sure that every application is disinterested.
So how would you design that?
There's one key example here from utilities in California where PG&E con Ed, they have an incentive, of course, to get you as a consumer to use as much energy as possible because that's how they maximize their their profit.
So because they're a public utility, the way it works, though, is use and the amount of energy and above that threshold, you're actually charged double. And so you're like, OK, well, that's fine. That means PG&E is going to make twice the amount of money. They're really incentive. But any of that money that they make over their threshold, PG&E doesn't get the money. And you can imagine that for Facebook or Twitter or for Tip-Top or any of these other sites where there's some amount of attention that we say is OK, actually, they're really wonderful studies like momentum that these great sets of graphs that shows people's regret over time.
And there's some amount of time that people use Facebook and they're happy about it and they go over that and they start to regret it in retrospect. So you you draw that line and say anything above that amount is actually extractive attention, economy at work. All of that money being made should be taxed and then reinvested back into safe alternative regenerative digital infrastructure.
So you've gone past the attention planetary boundary as soon as you're hitting subjective regret, collective subjective regret. I think we still have this page up on the human technology website. People can check out app ratings and you'll see the study. And so that's like saying, hey, we want to tax the sort of regret attention economy, but we could also tax the sleep extraction regrette economy, which is to say, let's take all users under the age of, I don't know, 18 and any usage between midnight and 7:00 in the morning is essentially funding sleeplessness and loneliness and alienation.
So it's the the alienation, attention economy.
And we want to not just tax that, but have all the money that might have previously been made in that economy and fund the the renewal of the soil in those in those children in various social programs and ways that they can change their products. And I think we can start drawing some of these lines in the sand. And these are creative economic ideas. We don't know exactly. But the thing is here. But the point is, how do we actually live within the boundaries of finite human lives that are getting massively over extracted, whether that is our political systems, because the attendant economy is also living on within the substrate of each country's politics and because it is so overextraction into the outrage planetary boundary, it's moved way off from getting attention and getting outrage, which is the extreme form of getting attention that it's generated extreme amounts of polarization.
Now, each political side and every nation on earth has a news feed of infinite evidence of the hypocrisy and outrage and caricatures of the other side that would make them maximally angry, which means it's debase the quality of the intrinsic relationships in that society. Because one of the things our dear friend Eli Pariser, author of The Filter Bubble, would say is that the thing that keeps you from being polarized when someone says something you disagree with is the fact that you have a relationship with them.
You know, they're a good person. So if they say something that you disagree with, you still give them a moment to talk about it. But when you debase the relationships that people have, then the extreme speech is immediately viewed with cynicism and more anger and more mob. So I think that that's definitely one example. But, Kate, do you have any thoughts about any tweaks to that model we might propose?
Yeah, no, it's fascinating. So in the Netherlands, there's an organization set up called Online, which if I translate that, it means neighborhood online. And it was set up in the little neighborhood in Amsterdam. It's a cooperatively owned platform. People could say, oh, that's like Facebook. Yeah, that's like next door saying, no, it's not at all because it was designed as a co-op and it's owned by that community and therefore it is entirely in service to that community and it works for them and it doesn't try to grab their attention and make them come back all the time because it's designed to serve their needs in the community, manage it in government and discuss it.
So it makes all the difference with the Facebook model. It's owned by owners who. Want to finance return, we're accepting that we're accepting is owned by people who want a financial return and they're driving for that financial time and therefore, because that's its actual functional purpose, we're having to place boundaries.
And you're designing in some boundaries that are very clever on limit, on time or if it's used between these hours, in which case kids aren't losing sleep, those boundaries kick in and there's a taxation or there's a doubling price and it's taken off and reinvested somewhere else. So you're creating these boundaries to protect because the internal fundamental design of the entity, the company, is to try to pursue endless growth. And so you're stopping it. You're capping it.
And I'm just really interested to know the difference between that and something like Hobbit's Online, which is owned as a co-op designed to be fit for the community's purpose, whether that also does it try to drive growth or it was never designed for that. So it balances more naturally. And one example I gave, I know that if you join habits online, you have to put a real photograph of yourself in your real name because you won't be rude to people because this is a local thing and you might bump into them in the shop.
And like you say, it stops people from being inflammatory and makes them listen because they're actually a real human being you might have to encounter. And so they that's part of the design to keep it simple, to keep it engaged in human. So I'm just really interested in the difference between an entity that is owned and therefore purposed to pursue that goal versus one that we accept that the way its own means, it's actually really its purpose is to maximize finance and therefore we need to put in these boundaries to stop it.
And of course, both of these kinds of entities exist in the world side by side. And the socially owned ones struggle because the financially driven, corporately owned ones have a massive budget and that ferocious desire to crush them and override them. So they tend to dominate. But what do you think about that?
What about if you said actually part of the center of human technology or part of the design of human technology is to transform who owns it and therefore how it's financed and to make sure that ownership and finance are in service to the goal? And you could put in a mission lock so you could design that enterprise with a mission lock so that even if it grows and there's some very nice kind of social brands that grow, grow, grow, and then they get sold and they become quite commercial, then they started out as a really good brand and now it's just been completely commercialized.
Could you put a mission lock into the design of a company so that it would always hold that purpose and that in its own board meetings there'll be an inbuilt check on what is the purpose with serving? Well, why are you doing that with the OP? You're deviating away from the Papasso, so that's a self organizing system as opposed to one that's trying to grow forever and therefore having the power to limit to other examples that you probably know of some companies that sit on both sides of that fence.
And what do you see as the difference between them if it's a brilliant provocation? And one of the challenges is that there isn't a clean pack, there isn't a blueprint that let you say, hey, I want to make a company that works like that, that's beholden to the company or to the communities that it serves. There's an easy path to say, I want to make a C corp. There's a now an easier path if you want to make a benefit corporate B corp that has at least a double bottom line and is just beholden to its stakeholders.
And Mozilla tried to solve this by having a for profit corporation that is completely owned by non profit. And all the people are inside of the for profit. They're allowed to make money, but the non profit has sort of a golden share. It's the sole owner. And so it's that governance up here which controls and binds what the the for profit can do. And I think a little more generally, one of the things I loved about starting at the top of purpose, the bottom of the stack is finance.
And the realization that if you build a company whose financial model is shaky or doesn't like, you actually serve your purpose, then the purpose is merely cosmetic. It's virtual. It's something that sells its marketing, but it's not the real thing. And I think one of the most powerful things designers can do, listeners of this podcast can do, project managers can do is especially when you're interviewing at companies, ask the question about how they make money, where the finance comes from and those hard questions.
You know, Facebook did a study where they asked users to rate whether content was good for the world or bad for the world.
This is really important, is not what is good for the user, but good for the world.
With this content that you saw actually a net positive for everyone or Bestival, and they discovered that you can actually turn the dials and show more content that people view is good for the world. And that deeply tones down the sort of the polarized rhetoric and the outrage rhetoric. And what they discovered is that it wasn't good for the bottom line. It didn't have the same kind of engagement metrics they did. And so they didn't really implement it. So here's a case where purpose is completely subverted.
Finance and there no matter how good your design, if you're inside of a company, you will hit the glass ceiling of the business model. And so I think those sorts of questions of where is your finance, what is your ownership? Are some of the most transformative questions that listeners can be asking of their leadership? Again and again and again and again.
Yes. And if anybody really wants to pick it up and running their own company so it don't Economic Action Lab and our website is just done. Economics dot org. There's a tool that we've made is called When Business Meets the Donor and it just runs through his doughnut, his different ways that companies can respond. And here is that set of five traits we call sign board of five design traits. And it really invites people to sit down in their company, say, well, let's let's talk this through, because I've done it with companies behind closed doors.
And second, guys, just be honest, where do you think your company is and you want the extractive side of purpose? Are you in a generative side of purpose? Are you owned in a financial extractive way or you owned in a way that enables you to be generous and people are really honest that I could tell they were having a conversation they'd never had before.
And there's that little bit of looking around like, oh, we will talk about this then. Is this this is on the table now. I think it's brilliant advice. You know, when you're interviewing for company, ask them how they're owned and what that therefore means finance is demanding and how that influences the ability to pursue the stated purpose.
And could you give me an example where you've put purpose before? Finance, please, in my interview, I'm actually interviewing you right now.
That's a great idea. Well, in another parallel from your work is the idea that growth will clean it up again.
So here actually is a parallel to in Facebook world APIC on Facebook. This is true of as Google, YouTube, Tic-Tac, etc. the same thing. There's this notion of how do we solve hate speech? We have all this extremist hate speech, etc. and the current model as well. We'll just get enough training data so we can solve hate speech, which is having more hate speech on there. Then we'll eventually build a model that can classify it and then we can eventually start building the AI tools that can classify it.
But this is still growing off the back of the problem to later create the solution.
We really need something that is regenerative or non polarizing by design versus trying to clear up polarization after the fact to where that comes from in economics, because it's become a very deep assumption amongst a certain generation of economists my age, my generation, and it's because it's got a long tail of bad empiricism behind it. So in the early 1990s, a bunch of economists started looking at what was happening to pollution over time in economies as they grew. And they said, look, we've only got local air and water pollution data, so we've only got that stuff.
But what we're seeing is that as economies get richer first, that air and water pollution increases, but then it decreases. So we've got this upside down. U shaped like a hill, it goes up, but then it comes down the other side. And when you draw this, it whispers out this promise, which is growth will behave like a well-trained child and clean up after itself. Except they don't. And it won't because it turns out now with hindsight, we've got more data and the little line where they said, well, we've only got local air and water pollution data, OK, it seems to clear up.
And one of the reasons is because as places get richer, they deindustrialized. And so the industry that used to be in your city has gone somewhere else and now you buy that stuff. And so you're still consuming more stuff, but it's being produced somewhere else in someone else's locality. But then now we've got data on carbon dioxide emissions. We've got data on global Matear footprint. We can measure a far bigger imprint. And when you take that into account, that curve does not bend down.
In fact, it just almost stays in lockstep with as GDP increases global resource use, an impact increases. And you have to have very significant intervention to even to try and stop bending it. And no government in the world has yet managed to show us that they can have rising GDP and falling material footprint on the planet. But the long tail of belief and the idea that will growth will clean up after itself still has traction amongst policymakers in kind of economic narratives and has to be quashed.
And that's why I wrote this chapter saying no growth will not clean up after yourself. That is a myth has been debunked. We need to create economies that are by design, regenerative. So we start with cycles of the living world and say, how do we create industries that recognize that waste from one process becomes food for the next? That we must use resources far more carefully and more collectively and more creatively and slowly. And that means we need the right to repair.
Now we're back onto technology. We need the right to repair our phones and not just to have them repaired by that company, but to be able to open them ourselves and be part of that repair. And that's why Fairphone, a Dutch company, was set up to show that you could actually have a modular designed phone that actually brought its minerals through supply chains that didn't depend upon slave labor and really exploited labor conditions. And they're showing that you can have.
Click open design and model of this video on YouTube that tells you how to fix the battery, how to replace the camera, how to upgrade. So we need to create designs that enable us to live within a secure system. And it has huge implications for our behavior and the presumption that when you buy a phone, you should expect that phone to last for seven years, that we should only be replacing our phones once every seven years. So buy wisely and buy one that can be upgraded.
How much of this had to do with blind spots in the paradigm of the people who created these systems? So when you talk about the white men from colonialist countries, I think people might hear that as dog whistling and saying, oh no, I just think it's all about white men is a problem.
But you actually really do a beautiful job of outlining what was the blind spot of some of the early economic thinkers, including Adam Smith, that didn't see some of the systems that were actually beneath their feet, enabling them and enabling the economic systems that they were envisioning for everyone else. Because I think there's some parallels there to the tech industry where you have certain technologies. You know, in this case, many of them were white men. But I think we can just say they were people with a limited perspective.
Mostly we're talking 20 to 30 year old engineering minded, computer science oriented, problem solving, structured, logic oriented thinkers. And there's some parallels in the people that have created these systems and what they didn't see in their increasingly godlike powers that are now costing us.
Amazing. OK, I'll tell you about the economists and you tell me about the technologists. So we all have blind spots. Obviously, we're all the product of our circumstance, our privilege, our experience, our life, our identity and who people see us to be. And that shapes what we get to see in the world. So no one sees everything. But then let's go back to remembering that we also have these multiple economic identities. We could be a consumer producer.
You might be a laborer or a capitalist. You could be again, you have a role in relationship to the state, whether it's a voter or a public servant or a protester. You're in the household parent part and a relative child in that unpaid caring work, or you're a commoner engaging with your community. Now, who writes economics is going to change economics depending on which kinds of those relationships they hold.
And economics was written as if through history, most Western society disciplines were written by men and it was written by white men from yes, empire countries, colonial countries. And all of these things have consequences. So Adam Smith wrote this famous book called The Wealth of Nations 1776. And in it he points out the power of markets. And he was right. Markets are an incredibly powerful mechanism for coordinating the wants and needs of millions of people who never need talk or meet because the price signal is being sent to the market and so people will supply or demand it.
Yeah, he's absolutely right. It's an amazing distributed system for supplying information. And he wrote this line in his book, which says It is not from the benevolence of the butcher, the brewer and the baker that we should expect our dinner, but from their regard to their own interest. So they're not being kind to you, making your bread and your beef and your beer, they're doing it because you're sending a market signal you're going to buy. It's that their own interest is reflected in markets.
So there's a wonderful line about, you know, the butcher, the Baroon, the baker who produced your dinner. Well, Adam Smith, when he wrote this book, he hadn't married and he didn't have kids. He was living at home with his mum, Margaret Douglas.
So it's just the most amusing, the Adam sitting there, you know, early evening penning this line.
And I love to think of his mum, but Adam then is on the table and he just carries on writing totally forgets the benevolence of his mum who bought his dinner, cooked it, served it, probably cleared it, cleaned it away, washed up after him and Adam went back and said, oh, yes, this market's ready, supply dinner. So he did not notice the unpeg carrying economy around him that supplied his dinner. If he had noticed it in that moment, he could have invented feminist economics two hundred and fifty years earlier and we'd have had the cash economy written in by Adam himself.
But he didn't because of his role in society, because we took for granted, like most of us. Right. We take for granted these House relationships now.
David Ricardo, another great famous founding economist, he was very concerned when he was looking at the agricultural economy in the in England, which was a part he thought, we're going to run out of land and we're going to therefore run out the capacity to grow food.
So land is the scarce fact when he got very interested in land and land productivity.
And then, well, suddenly there's look overseas, there's land everywhere, and we can actually go and acquire and we can colonize. And the idea that land becomes available elsewhere. Oh, no, no, no, no. It's no longer the limiting factor.
It must be labour. And he shifted his attention from conservative of land is the scarce factor to labour. And that is why we still talk about the importance of labour productivity late raising labour productivity, even though in many countries there's millions of people are unemployed and actually environment resources are being massively. The youth, they are the scarce fact, but we're stuck in 19th century economics, so who we are shapes what we can see. And when any one of us sits down says, oh, yeah, here's my grand theory, we are going to have blind spots.
And that's why economics is going to be so enriched by having people from diverse backgrounds, different races, different histories, different colonial experiences, women, men, ages, because we will see things that others don't see. So Amartya Sen, who I think is one of the most brilliant economists of the 20th century, a child born in Bengal, he didn't write his economics about markets. He started with the entitlements of human beings because he had come from a place where they'd been farming.
And he asked, you know, what are the fundamentals, entitlements and the the capabilities that a person needs to live a good life. By the way, that's very similar to the social foundation. So we started out with human needs and he transformed economics through that. When women come into economics, they start with the household economy. But they say, let's call it the core economy because it is core to our existence where we begin every day. So suddenly it's enriched by feminist economists.
So everything is shaped by our own experience. And we so wise to collaborate with people who are different from ourselves to help us see all in the round. And that's why economics is getting so much better by having this diversity. Now, you tell me what you think of the consequences for technologies that are invented by probably single, deeply techno motivated young men living high income lifestyles in a fast moving pace.
Well, I'll let Tristan answer that, but just wanted to add one little piece of flavor, which is that even in machine learning, even in AI research, the models that always win are the ensemble models because every model of the world is wrong but useful to the world from its own unique vantage point.
The world is complex. You have to do some kind of dimensionality reduction, doing some kind of approximation. And so you want to take an ensemble of all of them so that the errors cancel out, which is why diversity matters in plurality matters. Yes, Tristan. Right.
You know, I think I love your line about about Adam Smith, specifically he and his mother and not seeing the caring economy. I think I really got introduced to feminist economics about a decade ago. And Nancy Folbre is paper on the sharing economy and for the Kids, which is the title of one of her books, Who Pays for the Kids?
Who Pays for the Kids?
Yeah. And the idea that we had an unpaid caring economy, that actually was was it bigger technically or I did some huge chunk of the GDP asking me if.
Yes, yeah. All the all the mums picking kids up from school and the housework they do and the cooking and the care steps.
If you actually said, well, if we price at market rates, it's phenomenal. It's at least as big as the social sector that is paid through hospitals and education. So it's massive, massive contribution. But because it's invisible, it's left out of GDP, it gets squashed, it gets exploited, and we massively undervalue it. But it's actually the nurture that sits on know. So I love thinking about labour. Comes to work in the morning. Right.
Labour shows up for work. Well, who got that labour fresh and ready?
Who laundered Labour's clothes?
Who who nurtured labour when when they were ill and made sure they ate well and were ready for work. So Labour's pops in the factory door in the morning. Hey presto! But it's reproduced overnight by typically the house wife, the mother who is not in the productive economy where we're making widgets in a factory. She's in the reproductive economy that is preparing Labour to go into the factory day after day after day and raising the next generation of kids to be good, good citizens, good workers prepared for that workforce.
But her wage is totally unremunerated. The money goes into her husband's hands, let's put it in very 1950s terms. And then you go into household tensions between who's got the money and who's doing all the work.
Now, it's beautiful. I mean, it's so profound when you realise and I can read for me reading that paper the first time, just understanding just how massive the caring economy is, especially when you actually quantify in size it up and that the architect of our modern economics seems so, so much as the father of that system, Adam Smith, could himself be so blind to the very thing that was around him. So it's really about having a kind of not just skin in the game, but a soul in the game, a first person subjective experience in the game, because I am fighting for the things that I have directly experienced in my empathy is represented directly in the kinds of products that we make.
And I just think that as a as a consistent philosophical principle is so important in making sure that we get this right. I love for you to talk a little bit about that with what's happening with Amsterdam or any other examples you can point to of where things are moving in the direction, what it would take generally. Let's not play false optimism here, because I think we're both critical optimists that we derive our optimism from how bad we see each of these issues being.
But then also to think about what if a technology company saying we are going to be the first attention donut or the first digital donut tech platform, meaning we're not going to optimize for engagement, we are growth agnostic. We are not going to clean up the problems afterwards. We're going to be regenerative by design. We're. Is extracted by design and what that would look like. Yeah, well, so our own economics in 2017, it was published in 2017 and I spent two years going around giving talks about it and talking about what you could do possibly.
And then I just think after two years, OK, enough talking, who actually wants to do this? And I was listening to who comes up to me and after talking says, you know, I'm doing this. I can see. And it was it's teachers who say I'm bringing this into the classroom. I know it's not the curriculum, but this is what the students should be learning. So I'm teaching this and that's in schools and universities. It's community organizers who are saying, OK, we've declared a climate emergency in our town, but now what we have to be for something and we want to use this, it's businesses and enterprises that say, well, what would it mean to do business in the dunovant?
You show me this donut. What would it mean? What I have to do to get my company that its cities and places right from day one. When I drew the donut back in 2012, people wanted to downscale it. Can we do a donut for here, for this town, for this nation, for its region, for the city, for the street, and it's even governments. I wrote down economics intentionally ignoring government because I thought if I try and make this appeal to governments, I will self censor.
I will be practical and incremental and feasible and doable. So I'm just going to forget the governments because I want to go for big, long vision. And what's amazed me is even just in the last three years, the number of governments that have actually picked it up and engage with the ideas you mentioned earlier, New Zealand, I know just in Dehradun, has read down economics. And she said it's reinforcing what I already believe in. It makes sense to me that she has this wellbeing economy, budget in the nation, you know, the shifting from endless growth to thriving.
So I believe giving rights to the true nature and the nature of giving nature at their own right. So it's not about we are top down saying we're going to protect this national park. They're actually giving nature its own right to speak for itself in certain ways.
That's right. The Whanganui River has its own rights to be respected and to be able to regenerate and thrive as a living body.
So, first of all, let's celebrate the fact that there are people in so many professions, from architects, town planners to teachers to business leaders to community organizers who say, I want to do this, this makes sense. And actually, it was when I started being contacted by people in all these completely different fields, you think, aha, tapping into paradigm changing and the fact that we're having a conversation. You work on the design of digital tech and I we must be talking paradigm change because we're meeting above our disciplines and our expert areas and we're meeting in that space of bigger ideas.
That to me is really exciting. It tells me the world and people everywhere want that change and they get it. Second, people then actually start doing it. So you, the city of Amsterdam said, well, we've already decided we want to become a circular economy and we're having an energy transition and we want to be a flexible place. We can't have three strategies. Doing these things completely separately makes no sense.
So when they saw the doing that, they're like, ah ha ha ha.
This actually visualizes what we were gesticulating towards, what we were trying to express. But here it is. And yeah, we want to do this. We want to make this the goal. So they've adopted it as their model. In fact, fascinating to me. They published their city Do Not Report where we drew a picture of the state of Amsterdam today through the lenses of the donut. It's not pretty. It wouldn't be pretty and any high income city because people are in deprivation and they're massively in overshoot.
But they published that in April of twenty twenty the month in which they had their highest covid infection. Why? Because they said, yes, we are in emergency. But as we emerge from this emergency, who do we want to become? Where do we want to start going? What's our purpose? Let's put purpose at the top of the city's vision and we want to pivot towards this. So they've done that now. They've actually inspired other places.
So six weeks after Amsterdam published that sort of Copenhagen how to vote, which was a massive majority voting, say, let's draw up our own plan of what it would mean to have a financial economic plan for Copenhagen to do this. It's popping up in Brussels and Cambridge and Berlin and Costa Rica and Colombia, in Malaysia, in India, in Barbados. There are change makers there who are picking these ideas up. Now, we've created an economic section, Labora, small team of seven people.
Half of us have never met because we've created the team during lockdown and we're distributed and we're using the brilliant network technologies. Right. Let's use these tools. But we a little team and we've created an organization that says we want to put our ideas in the Commons. We're not interested in selling consultancy services. So we've thought very carefully about what the doughnut is. It's a commons tool or public good. So let's make it freely available to people. So here's the tool we've put in the Creative Commons and we publish how we did.
Amsterdam's portrait is the methodology. You can use it. We're not trying to sell you anything. So again, but going back to those different economic identities, we're not trying to be a market actor. We're in the Commons. But we know that market actors, people who are consultants or businesses or textbook writers. Pick it up and yes, you can you can incorporate into your work, so we're building a way of enabling ideas to spread with integrity and balancing the integrity and openness.
And that's why so many cities and places can pick it up and start doing it simultaneously because they find change makers there who make it happen. And for me, this is one of the most important ways, surely, that ideas have to be able to spread in the 21st century. So that goes back to human technology. What kind of technologies will be in support of that? Certainly Creative Commons licensing is a really great example, and that's a legal technology, isn't it, that allows a digital objects to spread.
We need more and more designs that enable things to spread with integrity so that we know we're not stuck in old intellectual property models. But we can share and create and understand and feel safe in the way we share ideas, because the speed and scale of transformation that's required right now is so fast and so universal. I mean, worldwide, we have to allow ideas out into the world and be picked up and put into practice where they are. So we're thrilled to see what's happening in cities and places.
Now, you said what if a company, a digital company wants to do this? Well, I would come right out with my signboard of five design traits. You want to talk about living in the OC media companies that sit down?
Yeah, you can show me your purpose on your website and we can talk about all your networks and your relationships with suppliers and how your governance that really matters. I want to know how your owned and therefore how you're financed and what that finance is demanding because that determines what you will do with the profits you make, whether you reinvest them, whether you put them into R&D or whether you pay them out to your owners or whether you actually pay them down your supply chains as living wages to the people who actually did the work that generates the value you've captured.
So it's a real internal look at yourself. And we do this with the cities. Actually, the first thing that city of Amsterdam said to us when they said we want to adopt the donor, they said, well, we just take a look at our own organizations. We realize that we're working in silos. We're not equipped to do this. Can we do a workshop? So we sat with the city of Amsterdam, said, write, what's your purpose?
Amsterdam. They've got a beautiful purpose to be a thriving, inclusive, regenerative city for all residents while respecting planetary boundaries. I mean, how different would the world be if every city in the world had adopted that is their purpose. But then align your relationship with your citizens and your public procurement with that, align the way you govern yourselves in the way you relate to your residents, align the way the cities owned, who owns the land and the housing, who owns the data, who owns the businesses that are in this city, who owns the utilities?
And then how is the city financed? You know, a lot of cities, a lot of the money that the city has is revenue is coming from car parking charges. Well, what are you going to do now if we're going to get a lot of the cars out of cities and replace that with, like transit, you're going to have to find a new source of revenue and you have to find source of revenue that don't game you and come to own you and totally pervert your purpose.
So cities need to be redesigned along these, as do companies and even an individual household sit down to. Right. If we want to live in the donut, what is our purpose? What do we think is a thriving life for us as a family? And what are the networks, where do we buy electricity? Why do we save our money in the bank? Why do we do our shopping? What communities are we part of? Do we contribute to the community at all?
Are we part of the commons? How do we govern ourselves as a family? My family, we start having family meetings and it's great the kids love it. Yeah, we want to bring this the family meeting. Let's actually listen and rebalance the roles and relationships in our family and then think about how we own how how is the house we lived in owned? What assets do we own and where have we invested them and what company have we given the right to use them to invest and make their own returns with investing that in?
So what's our finance and service?
So I would invite even families to sit down and have these conversations and transform themselves and take delight in giving up the stuff that we already knew we wanted to let go of bringing in a move. Your electricity can't move your bank account and actually change the way your your family has unpaid caring work done. Why should Mom always do the washing up in the laundry? That's a really outdated assumption. Let's rejig this work so there's so much we can do at every level and each one of us is phenomenally influential.
You know, I was went sort of giving a talk in a big town hall and a young young woman came up to me and she said, I really wanted to ask you a question, but I'm only seventeen. And I said, never say that again. You are so powerful. Do you know that you can talk to 17 year old girls in a way that people of my generation have no chance? You have so much influence amongst your peers and so does a mom at the school gates.
And so does the newest graduate employee in a company. Dare to put up your hand and ask the CEO a question? I've heard CEOs tremble at the questions from the newest graduates because they realize this is the next generation coming at them and they don't know the answers to their questions. So we are all very, very powerful in the networks of which were a part. And that means we can influence our peers. But, you know, the research shows that how are people most influenced by stats they read in the papers?
They're most influenced by what they think their peers are doing and what's becoming normal amongst people who they think are like themselves. So we all change each other when we make those changes. Our own personal behavior choices do matter, but I'm going to go back to where you put the emphasis, I agree it's the design of the technologies and what they're designed to do and the purpose networks, ownership and governance that they are in service of and their finance. That is always going to be where I put my attention as a detective.
And that, I think, is the ultimate redesign job for the 21st century of the institutions that we live by and the architecture of those institutions because they have to be in service to thriving for the global financial system, to town planning, to all the technology companies and Silicon Valley. We need to redesign them rather than let them redesign us. My honest thing here, the questions that I long term have about this is, you know, game theory and the war, like tribes outcompete peaceful tribes, the extractive tribes outcompete the sustainable tribes.
How do we deal with multipolar traps in the sense of tragedy to come, all these kinds of kinds of things? I hate seeing it this way, but this is like my my honest, deep fear about the game theory and how it plays out.
So who we tell ourselves we are shapes who we become. And when economics professors teach rational economic man and tell students, well, is this character is self-interested and competitive, calculating over time those students more value self-interest and competition than altruism and collaboration. So the models that we create for ourselves are performative. And all I would say is as I as I hear you saying that and telling yourself we're caught in this game theory, that that in some way becomes performative on your view of the world and therefore what you must do.
And you might be right, but I just can't go there. So I'm just going to say maybe that's happening.
And there's just something else which is happening, which is a whole network of people worldwide who are talking about regenerative design, collaboration and symbiosis and reciprocity and putting these values and seeing these values and seeing where they are in action and noticing that and seeing how we can build them and making that happen. And so these are both true and both happening. And I suppose it's a choice. Where do I want to put my energy? Do I want to focus on and describe the really destructive thing I see and make it really very visible?
And then does that make more people cynically participating in a cynical way?
Or do I want to put my attention on making visible the possible of design, which is what's happening in nature?
And again, back to metaphor. It's beautifully available to us because that is exactly what nature does. The mycelium roots under trees, the trees that share the moisture they collect from the air, how the soil nurtures them, the symbiosis between species. So it's all around us and we find it beautiful when we see it. That's why we love nature. So that metaphor is sitting there waiting for us to say, OK, how do we nurture that part of human nature?
It's all in there. Having raised twins now for over a decade, I see the competition. I see the collaboration. Amazingly, the day that my kids played Pandemic, the collaborative board game, it seems too ironic these days, right, because we've lived it, but a collaborative work and we work as a team to rid the world of disease so that everyone survives.
The day they played Pandemic and their first experience of playing a collaborative game, they cooperated in a way I have never seen them cooperate, folks. They're quite combative between the very different people. And they cooperated. They cooperated not just during that game for about a week after.
It was astonishing. So the games we designed shape how we interact and they shape our relationships. So to hell with Monopoly. And why the heck do people give it to their children for Christmas? You're telling them extract from others until you're the only one left in the game. It's the most disgusting version of human interaction.
And it wasn't even designed to be like that. It was. Elizabeth Magee designed the landlord's game in nineteen eighty three to show us what happens when you have an extractive economy.
It's horrible. And there was another set of rules. I said, now do the collaborative version and look, everybody survives and nobody's made homeless.
They strip the collaborative rules out just so the extractive game and we give it to our kids for Christmas like we want to turn them into extractive, monopolistic capitalist. Why would you do that? Your kids give them pandemic, give them Hanabi, give them Castle panic and they collaborate and they come out as rich people who've learned to work as a team together and to look forward and collaborate and teamwork. That is a life skill. So the models we create, the games we create shape who we become.
And I'll just say let's put our attention on what is possible rather than the vortex we see ourselves dragged into. I mean, it's teamwork, right? Big teamwork. We need people in all of these places. But the mind of Tristan and Azar are so important they can't be only caught up in seeing the devastating dangers of that game. How puzzle see the other game and build the human technology that actually brings it to life. I'm reminded of the line, whether you think you can or you think you can't.
You're probably right. Right. And we can change the paradigm of what it is we see. So I'm going to give you one last quote from the brilliant Donella Meadows. So she talks about intervening in systems. She says, don't fiddle around tweaking with the tax rate or just like with tiny little design, you want to go up, up, up in terms of influence and you want to come in at the level of the actual paradigm that we're engaging with.
And she says people who have managed to intervene in systems at the level of paradigm have hit a leverage point that totally transforms systems. Now, you could say paradigms are harder to change than anything else about a system, but there's nothing physical or expensive or even slow in the process of paradigm change in a single individual. It can happen in a millisecond. All it takes is a click in the mind, falling of scales from the eyes, a new way of seeing.
So how do you change paradigms? You keep pointing at the anomalies and failures in the old paradigm. You keep speaking and acting loudly and with assurance from the new one. You insert people with a new paradigm in places of public visibility and power. You don't waste time with reactionaries. Rather, you work with the active change agents and with a vast middle ground of people who are open minded. And that's what we do at an economics action lab. We just put out these two rings.
It looks like a doughnut, and some people say, well, so what?
And other people go, Oh my goodness, that is the idea I've been waiting for. I'm totally empowered now. I'm in action, I'm off and I go. And we find those people and we start working with them. And those are change makers in action. And that's what gives me energy and the sense of possibility of transforming the work that I see so many people doing it and in action, putting into practice in their own places and where they live.
And so we can bring up a web of a different kind of economy and make that transformation happen.
I totally agree. And that's why we are hopeful, because I think in that MM. Framework, it is ultimately about people who are holding the new paradigm, increasingly having access to the levers of power. And the more we see, as you've seen, just people reacting to your framework and we see people reacting to the social dilemma and hundreds of millions of people from around the world in one hundred and ninety countries in 30 languages responding and saying, you have this paradigm that we were in wasn't working.
And what we really need is to be projecting loudly and clearly from the new paradigm. OK, thank you so much.
Pleasure. And I'm hoping this is just the beginning of I know.
I feel like we're just scratching the surface. Thank you so much. It's been such a pleasure. Pleasure.
That was totally fun. Your undivided attention is produced by the Center for Humane Technology. Our executive producer is Danny Kaddoumi and our associate producer is Natalie Jones. Nor al-Samarrai help with the fact checking original music and sound design by Rhiannon and Holiday and a special thanks to the whole Center for Humane Technology team for making this podcast possible. A very special thanks goes to our generous lead supporters at the Center for Humane Technology, including the Omidyar Network, Craig Newmark Philanthropies Foundation and the Patrick Jane McGovern Foundation, among many others.