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Humanistic Economy
by Dr. Pavel Kasyanov, Moscow, Russia

 


This paper is neither about charity and welfare works nor about introducing more humanistic details or features to the existing economy. It's about the economy of the future if it materialises - since the existing modes of economy and civilization are incompatible not only with sustainability but also with the survival of civilization itself! Of course the current economy of parasitism and exploitation theoretically may have some chance to survive somehow if it is able to reduce harmful environmental impacts and to smooth over other conflicts and contradictions but it means only that although parasitism on the Nature/Environment may be decreased significantly the exploitation of people will continue and may become more severe.

Many of the ideas and concepts stated below may sound revolutionary but please don't consider them as my appeal for immediate socio - economic revolution. If I appeal to anybody for anything it is for a mind revolution which in turn will be followed by changes in "real life": economy, politics etc.

I "invented" the term "Humanistic economy" independently (when I was invited by Dr. Michael Ellis to contribute to this Journal ) but after browsing in the English and Russian Internet I've found that of course I am not the first who has started to apply this term. However, despite unavoidable resemblance to other ideas and views there is no one fixed or commonly accepted concept of Humanistic economy since of course it's a rather new concept which is being developed by just a few (economists. What I have read about "humanistic economy" is mostly a fragmentary recommendation to correct certain economic problems.

I think it's important to create the holistic image or model of the future Humanistic economy, which would be desirable for over 95 % of the planet population. We will otherwise miss the core issues. I hope that my own view presented in this brief thesis is comprehensive and adequate.

Is the modern type of the economy the best and only possible economy? I think the majority of people and many economists would say: "no, of course the existing economy is not perfect and may be even far from perfection". Some economists would emphasize that the major problem is that the economy generates external effects, and that it doesn't properly take into consideration the interests of our future generations.
Ecological economists who are in all probability the most progressive thinkers among the economists, would mention undervaluation of Nature, ecosystems etc. Some economists will mention the far from optimal taxation systems which tax, i.e. de-stimulate some positive factors and create obstacles and disincentives for production while some negative factors are not taxed and thus are stimulated.

Liberal and neoliberal economists rebel against any subsidies and governmental involvement in and influence on the economy. Many people would mention financial and economical crises. Socialists, communists and some other outstanding thinkers such as E. Fromm, would say about tremendous disparities, about private appropriation of land and rental income as well as exploitation and about the incompatibility of the modern western style economy with the positive evolution of humankind and the maintenance of a sustainable civilization and Global existence .
My opinion is that the existing economy is getting antiquated in its cornerstone concepts and in the near future will not be able to maintain a sustainable civilization.

Of course an economic model depends on the state of people's minds, people's consciousness, and Humankind's collective karma. One can say that people's imperfections predetermine the economy's defects. Someone may conclude that consumer's preferences including their vices cause economic deficiencies and distortions and that if people were righteous the existing mode of economy would be in this case quite adequate. The Modern economy is not just a consequence, a simple result of people's consciousness, preferences, values, needs, and demands - it is now also able itself to actively and intentionally form demand, needs, values, state of mind and world outlook.
I am going to describe a very different mode of economy which is not derived from the existing economic type by means of certain improvements.

I would like to draw a framework of a constructive (not purely ideal) economy in principle free of the vices of the current economy which like tiny cracks in a stone monolith will sooner or later destroy it. Humanistic economy is the economy without the cracks of false distribution and redistribution, parasitism and exploitation potentials. I believe that educated people will support and vote for a new economic model.
An Ideal economy of course may exist in an ideal society of ideal people. Shall we wait until the society has become ideal? I think it's neither necessary nor possible: as the existing destructive economy is leading to spiritual, cultural, moral, environmental and other degradation while the new constructive (and not necessarily ideal) economy may serve to create positive development and evolution for humankind.

So, what I want to do here is not to describe the ideal economy but just to portray major principles of the positive, constructive economy which is able to people's lives and improve societies. For the beginning we need only to follow the principle of human rights and democratic procedures while the majority of people vote for transition to the new type of economy. Of course, all important components of this new economy should be comprehensively explained to the people, including providing comparison with the existing economy.

Such a new Economy serves for the good of the whole society and each person's inner well being.
It means that:

(1) The beneficiaries are all people - not the extreme minority as is now.Economy serves humans - The people do not serve the economy but improve and modify it to make it more and more in harmony in which there is direct dependence between income and public benefit in order to, meet both long-term interests of the society and short and long term interests of individuals, These interests should be well balanced between mind, body, social and environmental ones.In this situation economy is the consequence of motivation to work. People should serve each other and society both through the economy and also without any mediation of the economy. Economy is designed to improve people's lives and their personal grade of development including spiritual, mental, and soul.

1. Today people are enslaved by the economy and by a Global technocratic civilization. It is usually the higher social ranks that impose slavery on many other people.At the same time they have themselves to follow the rules which they impose on those around them and are thus limited in the creation of human values The existing form of economy promotes economic growth, technical growth and development creating technical perfection and efficiency. This is at the expense of an approaching global catastrophe based on a spiritual and global health crisis which in turn is creating global environmental or military, genetic or microbiological, or humanitarian disaster.

In the current economic view, need creates demand. The problem is not that needs create demand. The real problem is that needs are not value driven but economy driven.

This means that values do not play a part in the so called science of economics. Where there is a demand there is supply and perverse desires and voyeuristic needs are therefore easily satisfied in an economic market. This so called vicious "economy" is a symptom of how the ego has broken free from control of the basic principals relating to the common ground of consciousness, spirituality and universal intelligence as the fundamental basis of personality. Because of the supremacy of the ego we have a fragmented accessory and auxiliary world where the natural growth of the natural market (liberal economy) is interperlated with vicious market niches with an accelerated development of the "vicious economy". This is because of two factors.

Firstly the degradation of the personality and the enhancement of the ego is much more easily obtainable and seemingly enjoyable than the full development of the true self or true personality which above all requires spirituality, tenacity of purpose, strong will, inner strength, dedication, continuous effort and self improvement.

Secondly the development of egoistic drives for satisfaction and aggrandisement is vast in comparison to the narrow sector of balanced development and harmony within the self and with the environment. An analogy is it is rare to hear a virtuoso performance of Mozart compared with the many poor or bad performances.

This means that the more we satisfy basic human needs and drives the greater is the role whereby artificial and unnatural needs of humans are stimulated. These artificial or unnatural needs which are stimulated are not limited to drugs and alcohol and pornography, but also include an industry of racial discrimination, sexploitation, seamy-side movies, as well as such seemingly harmless market economic segments of the market pertaining to the sports industry, the pharmaceutical industry, the legal market, the medical system and the casino or stock markets.

In fact, the accelerated growth of this form of vicious economy is intrinsically tied to the development of a technocratic, materialistic civilization which seeks for the achievement of the highest possible level of the satisfaction needs of the majority.

Economy is meant to be subordinate to the people and properly governed to secure its subordinate role as service to the people. Nowadays public governance is neglected in favor of so called market self-regulation.

What this means is that the economy is share-held by transnational corporations, a number of the worlds largest banks and especially the Federal Reserve System of the USA.

This is neither federal nor reserve and owns almost all the US assets. The US Federal Government annually pays to the financial authorities over 400 billion USD as percentages for debts and only 2% of US citizens are 100% owners of their dwellings and cars.

One can assume that private owners of the US Federal Reserve are hundreds to thousands times richer than ordinary inhabitants of the Forbes pages which rank the richest people in the world.
In fact it is a reasonable hypothesis that this Forbes list was designed to hide those individuals who are in fact the richest ones, even though showcased billionaires are abnormally rich.

The basic function of economy should be to better serve to the good of the whole society on the one hand, and to produce necessary conditions for discovery and development of people's talents, creative abilities, spiritual and psychic potencies, in order to broaden people' consciousness. It is clear existing economic signs leaves all these tasks and issues outside the actual economy.


Consequences

Economy structures should be modified and designed to meet the needs of people in society. It is the government that should be responsible for this structural policy implementation which needs to be designed and substantiated by new research institutions. The current economy is deteriorating generally as shown by a possible global recession, global food shortages and peak oil in which there is an increasing sector to the global economic market of destructive and criminal tendencies.

It is essential that there be governance and regulation of the economy related to genuine public needs with the development of beneficial aspects and the abolition of harmful sections.

For example, long term strategies should be put in place relating to national and regional requirements aimed at enhancing the satisfaction of people's genuine needs and creating beneficial economic structures. Strategic planning should among other issues be aimed at increasing of economy sustainability, environmental safety, transition to the use of renewable natural resources instead of non-renewable, reduction and finally elimination of non-renewable resources use, improvement of geographical distribution of the economy. There also needs to be a new science of economy devoted to the understanding of population distribution, conversion of large urban conglomerations into more decentralized eco-settlements and substitution of exploitative industries into more eco and human friendly production and services.


Specific sectoral policies

Promotion of the useful/positive economy sectors and sound consumption:
clean energy, ecologically sound agriculture and food production, environmentally sound town-planning and harmonic architecture, ecologically clean construction and building material production; advanced public and environmentally sound personal transport, qualitative water supply; science, education especially based on new intellectual paradigm, including education aimed on preventative health, self care, ecological education and spiritual development, positive arts, medicine placing emphasis on organic foods, sustainable agricultural practices and cellular and herbal medicines; tourism, especially environmental, scientific and educational tourism; small business in all above and other positive sectors.


Limitation of negative aspects of economy

This includes military industry, cigarette and alcohol production. If these sectors are in private ownership it is impossible to limit the production of hazardous goods compared with the ownership being the hands of the state.


Criminal or vicious sectors

The criminal or vicious sectors such as narcotics/drugs, slave-trading, internal organs trade, pornography production, prostitution of course can not be in the state property. Possible remedies are as follows:
Education based on the new paradigm, raising spirituality;

Creation (via direct founding and through different types of incentives) of attractive jobs, businesses, fields of activities in all regions;

Criminal prosecution for those who was not affected by the above measures; however convicted people and prisoners should be re-educated again based on the new paradigm and humanistic concepts in terms of changing consciousness and trained from the professional point of view to be able to work in new sectors of the economy.


Geographical and Ecological Economy

This requires the optimization and improvement of the geographical and spatial distribution of people, settlements and means of production: primary and secondary industries, energy/power generation and transmission, agriculture, transport, communication; services, science, education entities. Optimization involves taking into consideration such criteria as climate, transportation efficiency, availability of and distances to raw materials sources and suppliers, access to goods consumers and the carrying and assimilative capacity of the environment. There needs to take place the development of new regions and places for the conversion of large urban dwellings into more decentralized eco-settlements. The development of eco-settlements should be directly financed from the states or federal, regional and local budgets or stimulated by 0 % loans, subsidies etc. Overcrowded cities create toxic conditions of environment, psychological climate, extreme deficiency of personal space, polluted energy from electromagnetic fields and pollutants in the atmosphere. They negate the possibility of enabling an individual to have solitude and the opportunity to be in contact with the pure energies of Nature.


Employment

Any country has the right to create economic conditions based on their local requirements rather than be subject to economic efficiency criteria created by world and international markets. People have the right to live. To secure this right people should be given a possibility to work and get salary at a level exceeding the respective costs of living. Doles, in fact, should be a rare commodity even if there are sufficient reserves. This is because it is not sufficient to give a dole allowance to people purely to maintain their survival. Instead money should be available to give people possibilities for their personal growth and development through interesting work, study, trainings etc. This opportunity is the basis for true human rights which is more significant than the need to balance a country's economy.


Household economy

Household economy should be valued as equal in labour and usefulness to society as the dominating/money economy. "The ability of people to create political will to enable their governments to act against globalised economic pressure is found in them being able to create greater self reliance and a sustainable lively hood in their local communities". (Hilkka Pietila, M. Sc, Basic elements of human Economy)

It is more appropriate to consider household economy in a broader context of "domesticized" life style when people will be able to work for the "external" monetary economy much shorter than now: 6 hours a day, then 5, finally 4.

If people's office work is home based due to advanced communication technology then they will be able to spend less time at their offices and have more time for other activities including interests, continual education, enhancing the household economy as well as cooking and also would include garden cultivation, growing vegetables and fruits, landscape works and repairs. Thus the simple domestic activities would be enhanced to the sustainability of the community in an eco sustainable and social way.


Transport Policy

In the scenario of a humanistic economy, will gradually force out personal cars which now are a celebration egoism, inefficiency and environmental unfriendliness. Personal transport within eco-settlements boundaries will be fuel free and enabled by the use of bicycles and similar kinds of transport. In these situations, people will be able to walk and exercise more for the benefit of their health. Public transport will also be available.


(2) humanistic economy

In a humanistic economy there is direct dependence and connection between personal income and the public benefit in the sense that the personal economy is related to the overall good of society.
No possibilities for inverse negative relationship between individual benefit and good for the society exist. Initially this principle can be introduced and secured by legislation. Later it will become a cultural norm that each person will be able to self monitor themselves that they do not have earnings that exceed the benefits for society.


Actual situation

There are many types of parasitism, exploitation and unequal wealth distribution and re-distribution associated mostly with the interest rate based banking system, private appropriation of natural resources, rentals and the monopolies created by transnational corporations.

While in some situations there is a direct correlation between personal income and products and in a lot of situations there are severe failures where profits are made a the expense of harm to people in terms of poverty and illness. The overwhelming majority of people get far less than their contribution to the GDP.

One of the world leading experts Dr. Margrit Kennedy explains in clear detail about the parasitism and exploitation caused by "interest money". She emphasize that we pay interest money only when we borrow money (though overwhelming majority of people in USA and other western countries used to borrow money to buy dwelling and cars). I placed below a couple of quotations from her work "Why Do We Need Monetary Innovation?":

"… every price we pay includes a certain amount of interest. The exact proportion varies according to the labor versus the capital costs of the goods and services we buy. This ranges from a 12 % interest component for garbage collection, (because here the share of capital costs is relatively low and the share of physical labor is particularly high) to 38% for drinking water and up to 77% in the rent for public housing (over 100 years, which is the time houses in Germany mostly last). On the average we pay about 40% interest in all the prices of our goods and services. In medieval times people paid 'the tenth' of their income or produce to the feudal landlord. In this respect they were better off than we are nowadays, where almost one half of each dollar goes to the people who own capital…"

"…there are indeed huge differences as to who profits and who pays in this system. Comparing the interest payments and income from interest in ten equal parts of 2.5 million households in Germany, this figure shows that 80% of the population pay almost twice as much as they receive, 10% receive slightly more than they pay, and the remaining 10% receive more than twice as much interest as they pay, that is the share the first 80% lose. This illustrates one of the least understood reasons why the rich get richer and the poor get poorer. In Germany, in the year 2004, this amounted to a transfer of about 1 billion € every day from those who work for their money to those can make their 'money work for them'. But have you ever seen money work? In other words, in our monetary system we allow the operation of a hidden redistribution mechanism which continually transfers money from the large majority to a small minority, creating a social polarization which no democracy can tolerate."


Practical Consequences/corollaries

a. The financial system should serve the wellbeing of society.
Interest money should be substituted by interest-free money. Interest rate credits should be liquidated, and since private banks would hardly agree to issue interest free loans it likely that traditional private banks will be replaced by the state or co-operative or private interest-free banks. National currency should not be issued by private financial entities. Minimal participation of private interests in central banks issuing money should excluded. Credits should become instruments of public governance applied for structural purposes, geographical distribution, development of priority economic directions. Insurance companies should be recreated so that they have no purpose in profit maximization.

b. Rental income from natural resource exploitation should not be appropriated by private businesses. There should be public ownership for subsurface resources and land (except for land which sustains residential houses and small business) and water (except for isolated water bodies attached to the land plots). There should be withdrawal of rental incomes by state, federal, regional and local public authorities. Instead this money should go towards enhancing wellbeing of the common good.

c. Transparency of corporate and personal incomes
It is important that we have openness as regards to corporate and incomes so that the public is not deceived as with respect to improper sequestration of funds and income.


(3) Motivation to work

The true motivation for work:

  • · to produce something of value for the society;
  • to improve one's environment, society and make people happier;
  • to manifest, to apply one's creativity, ability and skills, to reach perfection in one's skills and arts;
  • to earn as much as the equivalent of person's work goods (services) costs (salary share in the total cost/price of a product/service).

Of course, even now there are people that fully or partially follow the above principles. The overwhelming majority of people, at least in the developed countries, think about gaining as much money as possible irrespective of any other aspects/considerations. There are many people in society who through their activities selfishly acquire enormous amounts of money for themselves at the expense of harm to the society, economy, people and environment. It is important to compare consequences of a materialistic, consumer oriented society to a more spiritual, humanistic economy which is a humanistic economy.

The picture of the humanistic economy I have drawn up in many respects looks utopian. However, my task is to describe the economy which meets principles of a humanistic and fair economy. Any compromise or deviation would be unfair. Of course, I do not appeal to the violent transition to the humanistic economy but I appeal to our ability to look at a hopeless future created by the current economic reality. The simple factor is that transition to a better economic mode and humanistic economy exists and depends on our own will and understanding of knowledge about the real situation we face with its extreme distortion and disharmony.

The above principles also include the best of communist and socialist principles. However, there were a number of reasons why communism was introduced into Russia. The problems of USSR were not associated with planning or absence of competition, with wage-levelling or economic inefficiency.

Following their Russian October revolution in the inauguration of the USSR leader Vladimr Lenin, the leadership understood that their attempts out of transition to a Russian society of justice may not be successful but they knew very well the nature of the parasitic, exploitative, predatory nature of western society. The problems of USSR were not associated with planning or absence of competition, with wage-levelling or economic inefficiency They did not wish to emulate a vulgar materialism and intention to make people happy by all means.

The major points are that

  1. USSR failed because there was not enough sound conceptual basis (within Newton - Cartesian Paradigm) and hence - internal imperfections and distortions occurred provoked by the Western enemies surrounding Russia.
  2. It was partially successful attempt of actions against global parasitism and exploitation, The actions were in the right directions in many respects but also immature and indeed and Mahatmas knew this.

Since then due to scientific and philosophical maturity we, the Earth people, have a new scientific and intellectual paradigm and it is of paramount importance that this form of education and information should be promulgated.

Particularly the Russian leadership at that time understood:

(a) that there had to be a science of happiness that went beyond fulfillment of all desires and materialism and consumerism.

(b) that the USSR at the time was surrounded by economically, politically and military strong enemies (for instance, there is a reliable information that the USA planned to drop on USSR 300 atomic and thousands of conventional bombs in the 1950's). As a consequence the USSR had to spend an enormous amount of resources building up its military capability.

(c) That The Russian economy due to severe climate, low population density and long distances of costly overland transport was not competitive with the western economies even without the arms race; thus it was determined that the Russian economy would be able to grow and progress without full openness to the world markets.

I'd like to complete by quotation from Johann Wolfgang von Goethe: "None are more hopelessly enslaved than those who falsely believe they are free." To become free we need first realize how enslaved we are, why and what we can do to slip the collar. I am sure that total and even fragmentary slavery is incompatible with Humanistic economy.

DR PAVEL KASYANOV. PHD. DIP ENGINEERING (Hons), DOCTOR OF ECO SCE DIP

Dr Kasyanov is Past-President of the Russian Society for Ecological Economics (RSEE), member of the Dissertation Council of the Market Economy Institute of the Russian Academy of Science, Deputy Director General of FRECOM Ltd., former Director of the Centre for Preparation and Implementation of International Projects on Technical Assistance (Moscow).

Dr Kasyanov participated in developing a number of State documents, including Draft of the State strategy of Sustainable Development (1997), Draft of the Concept of the State Policy of natural resource use (1997), National Environmental Action Plan (for Russia).

He has over 60 publications on the issues of sustainable development, linkage between consciousness and the social need structure, environmental and ecological economics; natural resource economics; environmental policy and management. He participated in a number of international conferences, working groups and projects, organized by OECD, EEC UN, UNCTAD, UNEP, IBRD, EBRD, WWF.

Member of the working group "Natural and Other Material Resources Management" under the Presidential Commission on Powers Sharing between Federal and Regional Authorities (2001-2002); personal responsibility: reform of the forest resources management.

Dr Pavel Kasyanov and Dr Michael Ellis in 2002 presented the paper entitled Transition to a Sustainable Civilisation at the World Summit on Sustainable Development.

Dr Kasyanov has a profound interest in cosmology, philosophy, theosophy and history of the Earth and the Humanity and integrating different scientific disciplines in a united harmonic system of knowledge on the world.