Can the new economy be delicious ?

By Diya Nagpal

I usually prefer Chocolate Frosted or blueberry doughnuts. Because of the ideal combination of fluffy pastry and more pronounced chocolate frosting, the Chocolate Frosted doughnuts wins the top spot. Sounds scrumptious, no? But according to economist Kate Raworth, the only doughnuts that are good for us are the conceptual ones. 

Kate Raworth is an economist, working for the University of Oxford and the University of Cambridge. She is trying to shake up what economic success looks like in the 21st century. She believes that the traditional economic system is not sustainable. And somehow, it makes sense. Governments in almost every country are addicted to the fact that GDP figures are proof of success and being an undergraduate student majoring in economics, I can say that I believed that too. Surprisingly, it’s not because we have faced climate breakdowns, covid lockdown, financial crisis and there’s a need for something far richer than growth because this pursuit of growth is hitting us with crisis one by one. Gross domestic product (GDP) is the total amount of goods and services sold in an economy in a year but according to Raworth, it has become the first and foremost goal of policy making because countries believe that every solution to their set of economic problems lies in more growth. She believes that we are financially, politically, and socially addicted to growth. Financially because the whole financial system including banks, corporate organisations and agencies only want high monetary returns and in pursuit of that, they try to deliver growing sales and profits. Politically because the government wants increasing tax revenues by following ways that lead to an increase in GDP. Socially because we believe that we grow personally every time we buy something more.

Raworth recommended that we abandon the conventional categories as we begin to reassess our economic and social structures. Simply said, our economic limits must be redefined and aligned with our planetary boundaries. To do so, she believes a purposeful change away from today’s “take, manufacture, use, and throw it away” economy and toward a regenerative economy is required, in which resources are not depleted but rather reused. This is where the term “Doughnut” comes into the picture.

Raworth starts with a fundamental question: “What allows humans to thrive?” A future in where everyone has the chance to live a life of dignity, opportunity, and community and where we can all do so while keeping within the boundaries of our life-giving planet.” And in the book, she responds, “We need to get into the ‘Doughnut.'” 

The doughnut-shaped diagram is made up of two concentric circles. Critical human deprivations, such as hunger, illiteracy, social injustice, lack of political voice, gender prejudice, the absence of peace and justice, and lack of job and low income or economic disparity, are all located under the inner ring, or social foundation are drawn from globally accepted basic social standards, as specified by countries throughout the globe in the Sustainable Development Goals of 2015. The ecological ceiling, which lies beyond the outer ring, is where major planetary deterioration, such as climate change, chemical pollution, biodiversity loss, land conversion, and air pollution are situated. These are the nine life- supporting systems. There is a safe and reasonable place for everyone between the two boundaries. In the middle of the doughnut lies people that are not thriving and are left falling short on essentials of life i.e., food, housing, education etc. The ultimate objective is to satisfy the fundamental requirements of city people while also being conscious of the effects of our decisions on the environment.

Amsterdam is the first city that has formally implemented doughnut economics as a part of its financial and climatic recovery plan. The project is bringing together a syndicate of changemakers in the city. The city doughnut method relies heavily on local solutions. Therefore, Amsterdam brings together all the changemakers to have a talk on how to build housing available for different incomes and supporting the well-being of the people, keeping in mind the aspect of a sustainable environment. Doughnut economics provides a platform for people to come together and thrive. Ultimately, the day will be won by local introspection and community-led action so that we are more connected and holistic in policy making. Raworth provided some sound suggestions and beginning points which included recommendations to buy small, buy local and buy from employee-owned businesses. Smaller towns, cities, and states, she argues, may set an example for nations to follow. Instead of focusing on population increase, she proposed that we focus on population stabilisation by investing in child health, women’s health and reproductive rights, and girls’ education. Many cities are taking inspiration and following suit. Amsterdam’s learnings were all organized into the material to inspire other cities and organisations. Researchers have applied this modal to about 150 countries. It has got a lot of traction. Doughnut economics’ scope and goals align with the United Nations’ 17 Sustainable Development Goals for 2030 agenda. 

The doughnut structure, says Joshua Alpert, the Portland-based head of special projects at C40, is proving popular in communities struggling with the immediate social and economic impacts of COVID-19. Cities have the potential to be transformative actors in Raworth’s suggested shift. Cities such as Amsterdam, Brussels, Melbourne, and Berlin have joined the “doughnut effect,” leading the way for social and environmental sustainability. All of them begin with the same goal in mind: to engage in larger community consultation in order to find potential answers to their most pressing issues. To be able to sustain without GDP growth, the social, financial, and political approach to growth must be redesigned. Doughnut economics is a refreshing approach to take feasible steps to achieve what needs to be done and there is a great chance that it might turn out to be as delicious as it sounds.

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