Kate Raworth: Doughnut Economics [a book review]
A new model for a thriving economy and a thriving planet
Doughnut Economics was our Rebel Book Club read for April 2019.
The core argument of Kate Raworth’s Doughnut Economics is that our economies should always support human prosperity and stay within the boundaries of what our planet can cope with. This might seem simple, but it runs contrary to most existing economic models which strive for constant growth at all costs, including the suffering of people and the degradation of the earth. Raworth instead argues that we should be “agnostic about growth”.
As she sees it, our current economy and the way that we use the resources that are available to us is a ‘fundamentally flawed design’. We continually take resources from the planet, turn them into consumer goods, use them, and then dispose of them for something new. This model is the opposite of how our planet naturally functions, constantly recycling its resources to sustain life, such as oxygen, carbon, nitrogen etc.
In modern times, this ‘flawed design’ has sky-rocketed, with shopping now a legitimate hobby and pastime and material goods now seen as a measure of our worth. Raworth incorporates a great quotation from economist Tim Jackson on modern consumerism:
“We are persuaded to spend money we don’t have on things we don’t need to make impressions that won’t last on people we don’t care about.” — Tim Jackson
Of course, with consumers starting to wise up and care more about the sustainability of products, we now also have the danger of greenwashing and companies pretending to be more sustainable than they are. Take Volkswagen’s 2015 accusation of faking their emissions tests to appear carbon neutral, for instance. For Raworth, it isn’t enough for companies to do something about their sustainability, they need to be working towards a ‘generous’ model, where they are able to make revenue whilst also giving back to the earth we live on and rely on.
Raworth takes inspiration from a quotation of Buckminster Fuller:
“You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”
and offers an alternative economic model, which aims to put human prosperity and the sustainability of the planet at the heart. That model is the doughnut.
The inner circle of the doughnut represents the social foundation, and the outer circle represents the ecological ceiling. If we stay within these two circles we are in ‘the safe and just space for humanity’ where all people are catered for and we are not over shooting the bounds of the planet. If we fall outside of the inner circle then people will start to suffer, and if we fall outside of the outer circle the planet will become unable to sustain us.
As it stands, we’re outside of both circles. There are too many humans struggling to meet their basic needs, such as education, food, safe housing, etc. Equally, our planet’s ability to sustain life is being stretched with the loss of biodiversity, the threat of climate change, chemical pollution and more, all caused by human action.
One of the most interesting aspects of Doughnut Economics, to me, is Raworth’s focus on language and imagery. In creating the idea of the ‘doughnut’ she offers an alternative to the economic models that are taught in colleges and universities, and have been for decades. She is literally ‘building a new model’, as Fuller suggests. Take, for instance the classic economic model of the supply and demand curve. I’m not an economist, but it’s still an idea and an image that I’m very familiar with.
For Raworth, the graphs and models like the supply and demand curve, which litter Economics textbooks worldwide, are part of the problem. We remember key images and graphs which then become truth, a central part of economic theory that couldn’t possibly be changed. Instead of focusing on telling us why these existing models are wrong (although she does aptly do this also) in Doughnut Economics Raworth focuses on offering an alternative model, her doughnut image. If she can create a new image which will stick in our minds, she has a chance of making change happen.
“It is extraordinary what havoc a few concentric circles could unleash.” — Kate Raworth
Further than images, throughout the book Raworth also keeps returning to language, and how language can play a part in economics. She references the classic Metaphors We Live By by George Lakoff, which argues that we use language and metaphors to understand reality. One example of this, in terms of economics, is the phrase ‘onwards and upwards’. It demonstrates how we naturally associate progression with upwards movements, exactly how we assume that economic progression cannot be separated from growth. Can we not thrive without striving for constant growth?
Our understanding of economies and prosperity are entangled with metaphors like this. To change the way we view our economies, we will also need to change the language and terms that we use. For Raworth, this means moving away from viewing the economy as a machine with inputs and outputs, and towards the economy as an organism — a complex, dynamic system.
Would I recommend Doughnut Economics?
Yes, definitely!I’ve explained one tiny element of Doughnut Economics in this review — there’s much more to learn.
What’s the best fact from the book?
The best new fact I learnt from reading Doughnut Economics was actually about the popular board game Monopoly.
Monopoly began life in 1903 with inventor Elizabeth Magie. She created a board game with two different sets of rules, to demonstrate different economic models. The rules were as follows:
- Prosperity. In this version of the game all players played as a team, and when any player landed on a new property all players gained money. The game was won when the player who started with the least money doubled their money.
- Monopolist. Each player plays as an individual, aiming to land on high-interest properties and take rent from other players. The game would end when one player bankrupted the rest.
When the game was sold to a developer the first set of rules was ignored, and it became the capitalist Monopoly game we know today.
The Rebel Read
The Rebel Book Club has tackled filthy lucre on a few occasions, including Kate Raworth’s take on a more human economy in Doughnut Economics, the 48th Rebel Read in April 2019.
