Annulus mirabilis

Raworth: I’m not a serious academic; I’m a serious activist.

Kate Raworth has, in her blend of new economic thinking, served up a printed equivalent of hot cakes with her book, Doughnut Economics. The Mint asked for the recipe and wonders why it wasn’t called bagel economics.

Kate Raworth’ recently published book, Doughnut economics, seven ways to think like a 21st century economist, is a Sunday Times bestseller and long-listed for the Financial Times & McKinsey Business Book of the Year Award 2017 and it has drawn many other plaudits. It is not, as its title might suggest, a lampooning of the neo classical school of economics as Homer Simpson enjoying a good binge while pollution and poverty pile up. It’s more a smart, open-minded person’s guide to economic practices that provide everything people need to be well and good while not draining the planet of its resources.

One does not call one’s book doughnut

Why has Raworth’s publication seemingly resonated so with the book-buying public? “Well you never know, right?” she says. But she has a “theory.”

“I think the reason there’s been interest is because there is just a hunger for new economic paradigms. I think the financial crisis opened up a society-wide recognition that the old story ain’t working and we need new ones. I think the problems go far, far deeper than financial crises alone, but the crisis was the very public front door that got blown open on mainstream economics.”

Another source of its success is Raworth’s keen focus on, not just what she is saying, but how she presents it. So it’s with clear pride she says: “The only numbers in the book are the page numbers.”

In the book’s defining image – the doughnut – the hole in the middle is the pit of under provision of human needs including food, water and housing as well as education, peace and a political voice. The outer edge marks the boundary beyond which we damage our environment with climate change, pollution and other catastrophes. That leaves the bit of the doughnut we eat as the space where our needs are met and Earth’s limitations are respected.

“I think it’s about making economics human; making it accessible. A lot of people have written to me and said, ‘This just makes sense to me.’ “
So what’s her message? Why the medium? What will come out of it? The Mint asked these and other questions and, in response, Raworth demonstrated her winning communication style.

Raworth on the message

I think there’s a huge hunger so my book landed in a very receptive space. Secondly, I think one of the reasons why it’s got a lot of resonance is because it’s not about ecological economics or feminist economics or complexity economics or institutional economics. It’s attempting to bring them all together, and that was a very important part of what I was trying to do.

I really worry in the move for pluralism that we end up with lots of people with lots of different specialties. And that you have the feminists and the ecologists and the institutionalists and the complexity theorists all going off to different conferences, writing for different blogs and posts, submitting articles to different journals, and never bringing those stories together. So what I really wanted to do was see what happens when all those different ways of thinking dance on the same page, and I think a lot of people have responded to that.

I made the book very propositional. Here are seven ways to think, not here are seven critiques on what’s wrong. I think people respond positively to proposition. I love Buckminster Fuller quote: ‘You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.’ I felt it was time to build a new model that brings together the feminist and ecological and complexity and behavioural and institutional into one big picture.

And of course, you can knock it down and say you’ve missed out this and you’ve missed out that. Fantastic. Let’s build a bigger picture.

Raworth on the audience

To me, the most effective piece of advocacy I could do was to leave the security of my job and write this book precisely to do these things, to bring this together, to tell a new story. And so my strategy has been to go to places where the energy is, present it and then listen for which communities are interested.

So these are the main communities.

• school teachers and university teachers saying, ‘Okay, how do I bring this into my teaching? How can I use it?’
• businesses – from social enterprises to some major shareholder companies saying, ‘Okay, what would it look like for us to take this on?’
• cities, designers or mayors –
• saying, ‘How could I use this as a way of re-imagining the future of my city?’ and
• politicians who say, they’ve been invited to talk with several different political parties that all ask, ‘How do we bring this into a new narrative?’

Although I’ve addressed it to economists, it’s a worldview that’s already in practise in many other disciplines, like geography, like urban design. They’re already thinking like this, and the need is to bring it home into economics, which seems to be one of the last places to want to change.

Raworth on the medium

I’ve always thought by drawing. And when I first used the Doughnut – it was published in 2012 in an Oxfam discussion paper – I was gobsmacked by the reaction to it. It had this real viral effect in the community of, let’s say, sustainable development. It was there that I learned the power of pictures and I began to explore it.

I came out of working for Oxfam for a decade where you do campaigns and use image and slogans, and simplify things – you look for the core message. So I’ve had that advocate’s training, and I’m gradually discovering that if I mix hardcore economic ideas with playful humour, with everyday objects – I use hosepipes now to make supply and demand graphs – people just find it funny and memorable.

“There’s a psychological drama at the heart of our economies”

I wanted to write this book in pictures. And I had a time when I almost wanted to give up writing it. I thought: if you complete this then you get to make the videos, do the pictures and do the fun presentations.

And you know, I’ve got a silly bag – my silly bag full of toys?

Actually I’ll tell you a story. I was speaking at the Bristol Festival of Ideas a few years ago on a panel and I really wanted to show a graph. The organisers said, ‘We don’t want you to show any graphs. We want it to be very accessible.’ As if four people sitting in armchairs talking about growth was more accessible than somebody showing a picture.

I was so frustrated that I wasn’t allowed to show this graph that I thought, damn it, I’m going to take some rope with me. I’m bloody well going to make this graph on the stage.

I walked onto the stage with this little lasso of rope. And in the middle of my five minutes talk I said, ‘Do you know what’s happened with global material footprints? We think there’s decoupling going on of carbon emissions, but if we look at material footprints…’ and I leapt up, gave one end of the rope to one of the panellists – who disagreed with me. I said, ‘Right. He’s 1990 and I’m 2015 and this is what growth is doing.’ And I was pulling on ropes to make a graph on stage. The audience loved it, you know?

And I came home late and my husband was half asleep. I said it was so much fun and the ropes worked really well. And in a sleepy throwaway he said: ‘I bet by the time you finish writing your book, you’ll have an object for every chapter.’ And then I couldn’t sleep for dreaming up objects. So now, if I talk about complexity, I talk about murmuration – and I have a little knitted starling.

Raworth on being playful

I walked away from academia. I got absorbed into the excitement of exploring ideas in the world. So I don’t have the academic pride to make me think ‘One does not call one’s book doughnut.’ I’m not a serious academic; I’m a serious activist.

I teach but for me, the key is to combine playful challenge with rigorous foundations. So I can be very playful, and if someone wants to challenge it, I’ll dive right back into the economic history to show that my playfulness is built on solid study.

You want to balance being playful and being challenging with ensuring you don’t do it in a way that lets your critics dismiss what you have to say.

“I wanted to write this book in pictures.”

When I went to talk to the OECD, I was cheeky in that I took the OECD’s article 1a of their convention, which is to promote the highest sustainable rate of growth. And I put up a slide saying ‘This is OECD in 1960.’ And then I said, what if you were to re-write Article 1a of your constitution? I said the OECD should promote regenerative and distributive economies that make us thrive, whether or not they grow.

I was really surprised that actually there was openness. But that’s the role of the outsider, the invited outsider, to come and open up conversations that people want to have internally, because there are all these diverse views internally. So that’s the way I’m going about it. You don’t disrespect, but you challenge playfully.

When I presented at the World Bank in May I was aware that those in the most senior positions tend to have been carriers of the mainstream doctrine. But they were open. One very senior respondent to my presentation said: “I read this book determined to hate it, but I found myself enjoying it.”

Raworth on being serious

Doughnut economics is a recognition that the long-term health of the economy did not lie merely in measuring an ever-rising GDP but in creating regenerative systems in the economy, that work with the cycles of the living world.

I would say a Chancellor of the Exchequer using Doughnut economics would be aiming to make policies that create a more distributive economy in which the sources of wealth creation are far more widely owned and distributed, from money creation to ideas, to land and to housing.

I profoundly believe that if we’re going to change policymaking, one of the biggest changes needed is in the paradigm out of which you’re making policy. So this Chancellor would be thinking about the metrics of success of the economy in being regenerative and distributed. So let’s shift taxation from taxing firms for hiring labour to taxing firms for using virgin resources, for example. Right?

“We have to show shareholders that their long-term interests will best be served by being generative.”

When I think about distributed design alongside the ownership question, for me, it covers a range of sources of wealth creation. So there’s who owns business or enterprise, but also, who owns ideas? Are they under patent and copyright or in the Creative Commons? Who owns the power to create money? At the moment it’s largely commercial banks. There’s a whole debate about how we organise that. Who owns land and housing?
These are some of the key sources of wealth creation. So the ownership of all of those is an interesting question.

On the ownership of enterprise, I think there will be more of an ecosystem. Some people say everything needs to be a cooperative economy. I think complexity economics; evolutionary economics would say that culture of organisation design is just not a smart way to go. I think you want an ecosystem. But cooperatives or employee-owned companies or companies might have some kind of share ownership but on a very different basis from today.

The way we’re going to figure this out is by having a series of experiments and a diversity of organisational forms that can work together and see which ones succeed. So I’m really against saying that this one form is the way, because we really don’t know that and it’s very unlikely to be a single form.

Raworth on economics

To me at the moment, there’s a psychological drama at the heart of our economies, in terms of enterprise. You have an extractive mindset which asks a very 20th century question, which is, how much financial value can I extract from this?

Business, business, business. How much financial value can I extract from this? This is the extractive mindset.

But when I talk to people who are at the forefront of product redesign or enterprise redesign or urban redesign, and the people who are really thinking in a regenerative and distributive way, the kind of question they’re asking is completely different.

The question they are asking, each in their own different way, is how many benefits can we layer into the way we design this? Whether it’s a city or a product or an enterprise, what else could this do for the community? How else could this be regenerative to the living world? How else could the waste from this process be turned into food for another person? This is a really multi-dimensional layering generative mindset.

The tragedy is that those folks who can already see the design possibilities for cities, for products, for enterprises that are indeed generative, when they want finance, the vast majority of the time they have to go asking for finance from people with that old mindset, which is still saying, how much financial value can I extract from this?

And to me, that is the psychological drama; the meeting of these mindsets.

Are you going to convince the old finance mindset that it will benefit best by indeed investing in generative? I don’t think so. I think we have to create new finance that is aligned with this mindset. So we have to show shareholders that their long-term interests will best be served by being generative.

That tension’s not going to go away, and we saw it in the near takeover of Unilever in February this year. It was a kind of classic case of Unilever trying to move in a progressive multi-value direction and Kraft, Heinz, and Warren Buffett saying actually we can extract more short-term value here.

So I think we need to see new forms of finance that are just fundamentally aligned with the multi-value, generative economy. And looking at all these design opportunities for redesigning models of enterprise, redesigning finance, redesigning intellectual property in the Creative Commons, to me, this is the task of the 21st century economists.

It’s actually a design task. And this might come back to institutions.

How do we design the institutions of an economy to enable these generative possibilities to be unleashed? How do we design market commons collaborations? How do we design new enterprise forms that allow workers and those putting in finance to pursue multiple forms of value?
How do we design governments and treasuries so that they are investing in long-term transformative value? If that’s the task of being an economist, I can’t think of anything more exciting. And I really think that’s why the institution is so important.

Once economists realise that it’s the design of institutions that lock up or unleash the potential generative behaviours and regenerative and distributive design, and then it becomes a really exciting field to be working in.

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