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Economics for Economics for Transition:Transition:building an equitable and
resilient local economy
<Your Name here!>Transition Initiative
Ambitious agendaAmbitious agenda The current economic crisis and
its historical context (short recap)
Understanding the structure of the economic system
Understanding money and the banking system
Understanding the financial system
Responses and Alternatives
Time to understand the Time to understand the economic system that leads economic system that leads to these results…to these results…
Concept of Surplus 5 types of economic systems Inherent contradiction and
instability
Five Economic SystemsFive Economic Systems
Ancient (self-employed) system Communitarian system Slavery Feudalism Capitalism
The Inherent Instability of The Inherent Instability of CapitalismCapitalism
Two major systemic failures in the last 80 years
In the same period 11 crises (recessions)
Labor as cost vs. aggregate demand
“investing the surplus” (media control - social narrative, government)
C-corporations and the profit imperative
What can you buy with the What can you buy with the surplus?surplus? How about the best government
money can buy?
Part one
Part two
Would you like a social narrative Would you like a social narrative with your Government purchase? with your Government purchase?
Welfare queens
The poor are lazy and deserve their lot
Don’t tax the job creators (the rich)
The economic crisis is due to excessive regulations
If you criticize capitalism you are a traitor or a commie
Raising taxes will hinder economic growth
The private sector is efficient the government is not
Social Security is a Ponzi scheme
Immigrants steal our jobs
Problems with the current Problems with the current economic systemeconomic system Unstable Concentrates wealth and power Tendency towards larger entities
and reduced competition Anti-democratic Socially and environmentally
damaging Spectacularly wasteful
What way forward?What way forward? Localize and democratize
AlternativesStrategies
Defensive
Pro-active
Transformational
The Money SystemThe Money System Documentary “The Money Fix”
What is money? A short history of money
Barter
The invention of money (commonly accepted mean of exchange)
Money as debt
Problems with the current Problems with the current monetary systemmonetary system Money is created with issuance
of debt No money is created to repay
the interests on the debt Growth imperative otherwise… Scarcity and guarantee of
failures Money creation power in the
hand of private elite Fundamentally undemocratic
What way forward?What way forward? Localize and democratizeAlternatives
Free banking system
Democratic control of credit creation
Strategies Expand gift exchange economy
Commodity exchange economy Expand barter
Alternative currencies and LETS
Move your money
The Financial SystemThe Financial System
Provides investment capital to finance economic growth
Allocates investment capital The investments of today
determine the world we will live in tomorrow
The narrow lens of investing
Problems with the current Problems with the current financial systemfinancial system From capital as mean to capital
as end in itself Holding period and stock trading
Financialization of our economy Fundamentally undemocratic
Stock Trading Is About to Stock Trading Is About to Get 5.2 Milliseconds Get 5.2 Milliseconds FasterFaster
Source: Bloomberg Business Week - March 29, 2012
What way forward?What way forward? Localize and
democratizeAlternatives
Community Capital
Strategies Slow Money
Local Investing
Systemic intervention Systemic intervention pointspoints Raise awareness, education Build social capital Democratize the workplace
(workers owned cooperatives) Move capital ownership into the
hands of the community (Land Trusts, CDFI, local government ownership e.g. public utilities, etc.)
Support existing system alternatives
Responses and AlternativesResponses and Alternatives(personal)(personal)
Withdraw consent and complicity
Move your money
Turn off TV
Decolonize your mind (get your news from non-corporate media)
Build trust and resilience in the community (social capital)
Responses and AlternativesResponses and Alternatives(cultural and political)(cultural and political)
Challenge outdated social narratives
Get educated through alternative non-corporate sources
Turn off TVStop gap political intervention at
the national levelEngage with the political process
at the local level
Responses and AlternativesResponses and Alternatives(economics and finance)(economics and finance)
Move your money!Support alternatives with purchases,
employment and investments (local first!)
Sharing economy (from ownership to access/use)
Benefit Corporation as alternative legal structure
Develop and support alternative means of exchange (local currencies, time banks)
Develop gift exchange economy (Gift circles, resilience circles, pay forward, volunteering)
Joining the Great TurningJoining the Great Turning Fight the system but love the
people Allies can come from the most
unexpected places!
Keep it fun and light Make it irresistible to join your
cause!