How to pick an economic approach that really adds up

Assessing doughnut economics, Paul Williams asks what’s the economy for and who does it really serve?

Paul Williams

Paul Williams, the CEO of Bible Society, worked for over a decade in business in London and then as an academic theologian in Canada.

a round table with empty chairs is seen from above. An orange is the only item on it.

Meina Yin on Unsplash.

“Anyone can see that our economic system is broken.”

This is the conclusion of Kate Raworth, author of Doughnut Economics, and her assessment has garnered positive endorsements from figures as diverse as George Monbiot, Andrew Marr and Sir David Attenborough.

Yet to judge by the discussion surrounding the Chancellor’s Autumn Statement, our political class is not included in this broad perspective that Raworth claims. In what is widely understood as the early skirmishes of an election campaign, anticipating the moment when the country’s voters have another opportunity to indicate the direction of travel they hope for, the focus is on who will be better or worse off by this or that tax cut or benefit change. If anything is broken it is not the economic system but something like ‘the government’s economic management’ (Labour) or ‘public sector productivity’ (Conservative).

If you are worried, as Raworth is, by “relentless financial crises,” “extreme inequalities in wealth” and “remorseless pressure on the environment” then it seems that both the government and the opposition believe that the solution is more economic growth, albeit with some barely discernible differences in fiscal and regulatory policy.

Our contemporary political discourse is dominated, regardless of party, by the mainstream economic paradigm in which the market generates economic growth and the state functions to keep things on track by taxing and redistributing some of the surplus to those who for whatever reason didn’t do as well as others in the process. It also provides some additional incentives to business and other organisations to act in the public interest, for instance by subsidising green energy or taxing fossil fuels. Both parties, it seems, support this approach. The difference between them concerns how best the state manages the economy to get the most out of it, how the resulting surplus is distributed, and what kind of further incentives are needed.

Visualising doughnut economics

An economics diagram in the shape of a doughnut.

Source: Doughnut Economics Action Lab.

For Raworth, on the other hand, the first thing to ditch is the assumption that economic growth is the right goal to pursue. The ‘doughnut’ of doughnut economics is an alternative to GDP as a measure of progress. It name is derived from the visual depiction of the idea of an economy that operates in the space within two limits – ensuring the human rights of each person on the one hand, and staying within the means of the planet on the other. This concept refuses to conceptualise the economy as a closed system in distinction from the social and environmental systems on which it depends.

Raworth also wants to shift the emphasis away from the individual rational chooser of economic theory toward a more social understanding of human flourishing. And in direct contrast to the mainstream paradigm sketched above, in which the market’s job is to deliver economic wealth and the state’s job is to worry about distribution and regulation, Raworth wants an economic system designed from the outset to ensure a more equal distribution and to actively regenerate the environment.

The economic system itself is like an engine that can be put to whatever purpose you want. It generates wealth and wealth can be put to all kinds of uses, good or bad.

How might we evaluate this? Nobody disagrees that financial crises, extreme inequality and environmental damage occur and are bad. A good number of mainstream economists find Raworth’s aims laudable and worth pursuing, because we do need a better measure of success and improved models of human behaviour and ways to incorporate and limit externalities like carbon emissions. Yet they also find her analysis of economics a caricature, as many of the developments in economics over the last few decades seem to be ignored.

For her harshest critics, Raworth fails to give due credit to our current economic system for the incredible reduction in global poverty that it has already enabled, provides very little by way of actionable policy ideas, and is full of erudite but wishful thinking.

Yet the popularity of Doughnut Economics reflects a deep sense amongst many of us (some mainstream economists included) that something is seriously wrong, alongside an instinctive identification with the kind of values and changes that Raworth seeks.

The vital question is: what is our economy for? If we can get a better sense of what purpose we want the economy to serve, it may prove easier to identify whether it is achieving that, or is in some sense ‘broken.’

But to ask this question is immediately to step away from the mainstream paradigm that dominates our public discourse in framing the economy. For mainstream economics, questions of purpose are ethical questions and those questions are explicitly left to the actors within the economic system and the state acting on their behalf. The economic system itself is like an engine that can be put to whatever purpose you want. It generates wealth and wealth can be put to all kinds of uses, good or bad.

These ancient texts suggest that our mainstream paradigm is seriously adrift if it imagines that our economic system is morally neutral.

For many people the idea that the economy itself can be separated from ethical questions will automatically raise an alarm. Certainly, for Christians it ought to. The Bible firmly resists the idea that wealth and its generation is morally neutral. Even the most superficial reading of the Scripture alerts to the inherently spiritual and moral quality of economic activity. Fruitful work is part of what it means to be made in the image of God in the garden of Eden. The product of work is offered to God in worship. The Law is full of commands to deal justly, use fair weights and measures, consider health and safety in the building of a house, and give yourself, your family and your animals a rest (to name but a few). Jesus tells us that you cannot serve both God and money. The pictures of the New Creation in both Old and New Testaments include economic imagery – The Old Testament book of Micah envisions an end to war with everyone living “under their own vine and fig tree” (a vision of peace and economic flourishing) and the New Testament book of Revelation depicts the product of human work being offered up in worship before the throne of God.

Overall the Bible sees the economic, social and environmental dimensions of life as interwoven and interconnected. Take the Sabbath, for instance. It is not only workers who get (or are commanded to take) a Sabbath once a week. The command extends to the whole community - and even to animals. Every seven years, the Sabbath Year provides a rest for the land and for those struggling with debt – the land must be fallow and allowed to regenerate, and all outstanding debts cancelled. Sabbath and Jubilee are deeply intertwined (the Jubilee was effectively a sabbath of sabbaths, taking place after seven sabbath years) and the Jubilee was the theological paradigm chosen by Jesus to explain his own mission and ministry. Quoting the prophet Isaiah, he said:

“The Spirit of the Lord is on me, because he has anointed me to proclaim good news to the poor. He has sent me to proclaim freedom for the captives, recovery of sight for the blind, to set the oppressed free, to proclaim the year of the Lord’s favour.”

These ancient texts suggest that our mainstream paradigm is seriously adrift if it imagines that our economic system is morally neutral. And Raworth is closely aligned with the biblical vision insofar as she insists on the importance of an economy that exists not for its own sake, in some independent sphere, but explicitly to enable people, communities and creation to flourish together. We need to ask what our economy is for. And this is as good an answer as you might find.

Article

Culture

Film & TV

Psychology

4 September 2024

5 min read

Who’s missing from Inside Out’s internal family?

Where Riley’s writers could go next.

Henna Cundill

Henna is a researcher with the Centre for Autism and Theology at the University of Aberdeen.

Cartoon characters of emotions at a control desk.

Inside Riley's head.

Disney.

Once upon a time a man got angry. Then he got angry at himself for the fact that he got angry, which of course didn’t help. As the Buddhist monk Thich Nhat Hanh would say, “If we become angry at our anger, then we will have two angers at the same time.” Similarly, there was an occasion when he got really nervous that he might make a mess of giving a speech, and his nerves became so overwhelming that he delivered the speech badly. A self-fulfilling prophecy, one might say.

These are not my examples; they are examples given by psychologist Richard Schwartz in his introduction to Internal Family Systems (IFS). This therapy (sometimes also called “parts therapy”) is a form of self-analysis in which participants learn to resist supressing or controlling their difficult thoughts or emotions, the different “parts” of their inner world, and instead adopt a posture of curiosity towards each of them. This posture allows people to be in a beneficial relationship to their emotional lives, rather than being ruled by them.

Fundamentally, the relationship that emerges is one of compassion, understanding that our thoughts and emotions have a job to do, even the uncomfortable or shameful ones. So, anxiety, for example, guards us from committing social faux pas, whilst joy helps us to keep hold of a sense that life is ultimately worth the living, no matter how hard things get. Even sadness and grief, as much as we fear being overtaken by such emotions, have an important role to play, for example by helping us to define what things and people are most valuable and important to us.

For those who haven’t seen the Inside Out films, the writers cleverly take this idea of the “internal family” of emotions and create five relatable characters that embody them – Joy, Fear, Sadness, Anger and Disgust. In the first film, we see how these characters interact inside the head of a little girl called Riley. They are helping her to hang on to her sense of self despite the upheaval she experiences in her outside world, when her family relocate to a new city, and she must settle in to a new home and school. In the sequel, we rejoin Riley as she enters the turmoil of puberty, and the five initial characters are abruptly forced to work alongside some new arrivals – the “teenage” crew of emotions: Anxiety, Ennui, Envy, and… the biggie… Embarrassment.

This Self is transpersonal – it exceeds the boundaries of who we each are as an individual person and connects us to something large.

Get email updates

When he first developed IFS in the 1980s, Richard Schwartz was, by his own confession, a committed atheist, with what he describes as “a distain for religion”. Schwartz writes of the frustration he felt at that time when several Christians got excited about IFS in its early stages of development. His peer, Robert Harris, even went so far as to publish a book that set out a Christian version of the therapy. Initially, Schwartz felt the biggie – embarrassment – that his therapy was being taken up by Christians. However, as time went on, and as much as Schwartz tried to push aside the spiritual dimension of IFS, he increasingly found that spirituality could not be eliminated from the picture:

“As I used the model with clients through the eighties and nineties, increasingly they began having what can only be described as spiritual experiences. These vicarious encounters with the mystical profoundly affected my own spirituality and I became interested in Buddhism, Hinduism, Taoism, shamanism, Kabala – everything but Christianity.”

Over time, Schwartz’s antipathy to the relationship between IFS and Christianity began to wane. He saw how much he had been working on the basis of prejudice, limiting his own exploration of Christian ideas in response to some unhelpful encounters he’d had with a few heavy-handed fundamentalists. He made deliberate moves to engage with Christian dialogue partners across the breadth of the tradition and began to see how congruent IFS was with the teaching of Jesus. The posture of curious compassion towards oppressive and uncomfortable emotions that Schwartz was encouraging his clients to adopt was mirrored perfectly in the attitude that Jesus advocated towards “enemies” in the outside world: do not judge, instead seek to engage them with kindness, and work towards their healing.

In recent decades, Schwartz has come to rethink IFS as an integration of psychology and spirituality, rather than as a form of psychotherapy. He speaks of “spirituality” as an innate essence at the core of each person, which he calls the “Self”, and acknowledges that many of his more religious students prefer to think of this essence as “the soul” or “Atman” (the eternal self within Hinduism). And, whilst he still describes himself as fundamentally agnostic and is wary of making his own definitive religious commitments, he has come to agree that this Self is transpersonal – it exceeds the boundaries of who we each are as an individual person and connects us to something larger.

Screenwriting for a popular audience of all-faiths-and-none, it is perhaps unsurprising that the makers of Inside Out have thus far eschewed the deep and fascinating spirituality of IFS. Riley’s “sense of self” is at the centre of both films, but the way it is depicted implies that it is something that only comes into being at birth and exists entirely to regulate Riley’s engagement with the outside world. So far, there has been no exploration of more existential questions such as faith and eternity. However, the concept of the film is so brilliant, and for a complex idea it is so well executed, that I am sure we can look forward to many more Inside Out films to come. If that is the case, then just as Schwartz found himself going on an unexpected journey of spiritual exploration, the writers of Riley’s may well find themselves doing the same. I, for one, look forward to finding out what Riley discovers.