Impact of global warming on validity of triple bottom line reporting

(2008)

The triple bottom line (TBL) process involves identifying, assessing and reporting an organisation’s activities in terms of their impact on the environment, society, and the economy (Elkington 1980).  TBL covers ‘planet, people and profit’ (de Gruchy 2006).  In TBL it is important to use environmental, social and economic parameters when it comes to measuring an organisation’s activities and impacts.  Only by understanding and acting in relation to all three of these parameters, can an organisation enhance its short and long term interests, thereby creating greater opportunities and reducing risks.  Accordingly, a TBL approach ensures the organisation’s success.

That success (or failure) must now take place in the era of global warming.  Global warming can be defined as “the observed increase in the average temperature of the Earth’s atmosphere and oceans in recent decades and its projected continuation” (Effects-of-Global-Warming.com 2007).

TBL bolstered by reporting indicators

To support the ‘three pillars’ of TBL and to ensure they are viable and useful, a range of related concepts come into play which need to be considered by an organisation.  These include corporate governance, corporate ethics, corporate social responsibility or corporate citizenship, and importantly sustainability or sustainable development. All of these are best achieved through cooperative endeavours, but a socio-economic system based on cooperative principles requires a fundamental change in business psychology TBL is a step in the right direction.

Sustainable development is that which seeks to meet the needs of the present generation without compromising the ability of future generations to meet their own needs (WCED 1987).  Sustainability reporting will always include a forward-looking and holistic approach (de Gruchy 2006).  This is evident  (GRI 2006:1) in the Sustainability Reporting Guidelines (Guidelines) issued by the Global Reporting Initiative (GRI), which is the leading approach in this area, aiming at a worldwide framework for sustainability reporting.

Part of these Guidelines oblige organisations to report on how they aim to contribute in the future to the improvement (or deterioration) of environmental developments and trends at the local, regional or global level (GRI 2006:1, 11).  This concept is often articulated in terms of limits on resource use and pollution levels (GRI 2006:1, 11).  Clearly, with the advent and recognition of global warming, the impetus and ability to reduce greenhouse gas emissions, which is a major cause of global warming, as well as ozone-depleting substances and other significant air emissions, are measures to take into account in sustainability reporting.

To assist in reporting of measured outcomes, the Guidelines include the Environment Performance Indicators (GRI 2006:1 28; GRI 2006:2), the aspects of which are structured to reflect the inputs (e.g. energy), outputs (e.g. emissions), and modes of impact that an organisation has on the environment (GRI 2006:2 3).  In this regard, indicator EN16 (GRI 2006:2 22) deals with total direct and indirect greenhouse gas emissions by weight, and generally sets out methodologies for use of data and making calculations on this matter for sustainability reporting purposes.  Direct emissions are those owned or controlled by the organisation.  Indirect emissions are those resulting from activities of the organisation but are generated at sources owned or controlled by another organisation.  Indirect emissions are also further covered by indicator EN17 (GRI 2006:2 24).

This type of reporting should assist in an understanding of, and positively change, an organisation’s practices thereby leading to significant reductions in emissions.  Indicator EN18 (GRI 2006:2 25) then deals with reporting on the setting and monitoring of reduction targets.  All of indicators EN16, 17 and 18 of the Guidelines seem to support the United Nations Framework Convention on Climate Change (UNFCC) to protect the climate system for present and future generations and the subsequent Kyoto Protocol to limit and reduce greenhouse gas emissions in order to promote sustainable development.

While the Guidelines and their environmental performance indicators are fairly general, it should be remembered that these and related initiatives such as greenhouse gas accounting and reporting practices are still evolving (WRI & WBCSD 2004).  Since TBL was espoused the concept of public environmental reporting has emerged and evolved from the United Nations Conference on Environment and Development held in Rio de Janeiro in 1992, followed by the GRI’s Guidelines.  The basic principles and aspects of methodology have been established through a collaborative process involving stakeholders from a wide range of environmental, technical and accounting disciplines.  This has lead to an even more developed corporate accounting and reporting standard for greenhouse gas emissions called The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (WRI & WBCSD 2004).  Linked to this is The Greenhouse Gas Protocol: The GHG Protocol for Project Accounting which is a guide for quantifying reductions from greenhouse gas mitigation projects (WRI & WBCSD 2005).

These documents seek to help organisations represent a faithful, true and fair account of their greenhouse gas emissions and reductions, while ensuring consistency and transparency (WRI & WBCSD 2004 3, 6; WRI & WBCSD 2005 5).  This goal is in line with generally accepted accounting principles.  Accordingly, the validity of TBL has been bolstered by these initiatives, as the point has been reached whereby certain practical components of implementing TBL (in relation to a particular environmental matter) have been integrated into the mainstream accounting framework.  From that perspective it can hardly be said that TBL has rendered itself invalid since the recognition of global warming as an important and high priority environmental and socio-economic phenomena that has to be grappled with.

In Australia, the Federal Government has also produced its Triple Bottom Line Reporting in Australia: A Guide to Reporting Against Environmental Indicators (Environment Australia 2003).  Similarly, this Guide calls for transparency and accountability concerning environmental impacts produced by organisations, and states that non-financial disclosure is likewise important, not just financial disclosure (Environment Australia 2003 6).  The Guide contains simple methodologies to enable organisations to measure performance against environmental performance indicators.  These methodologies are either developed or widely used or adapted to Australia (Environment Australia 2003 11).  Again this shows that serious consideration is given to the validity, and to both the substance and form, of TBL reporting in terms of a particular country’s circumstances and requirements.  This demonstrates that TBL is a flexible mechanism.  Such flexibility makes it dynamic, allowing it to evolve over time and withstand the passage of time.

TBL and economic modelling

To ensure robust outcomes, TBL has to be applied to particular environmental impacts.  In regard to the impact of greenhouse gas emissions (the major cause of global warming) or their reductions, economic modelling can be used to try to verify results in some kind of ‘real’ terms.   Economic modelling has been developed to produce two basic approaches to calculating the value of incremental emissions reductions.  These are the ‘direct damage estimation’ and the ‘cost of abatement’ methods (Koomey & Krause 1997 6).   The results of these methods can be used for reporting purposes and to give some semblance of economic worth to reduction programs.

The direct damage estimation method involves calculating damages that can be definitively linked to emissions of a particular pollutant (Hohmeyer 1988; Ottinger et al. 1990).  This is done in dollar terms, e.g. human health and environmental effects, but it is extremely difficult to do.   Mainly, it is difficult because practically it has to be applied to a region and regional forecasts of climate change are even less certain than global predictions, yet regional forecasts are necessary to estimate the damages (Koomey 1990 4).  Once that is known, organisations can assess the necessity to reduce the relevant pollutants.

The cost of abatement (or revealed preferences) method involves assessing the use of cost of pollution controls that are imposed by regulatory decisions (e.g. mandated by regulators).  This is a proxy for the true externality costs imposed by a pollutant (Chernick & Caverhill 1989; Marcus 1989).  This method is simpler and takes the marginal mitigation costs incurred solely to reduce emissions of a single pollutant.  This assumes there are no other benefits to a pollution reduction investment.  Therefore, such proxy approaches present difficulties since many global warming mitigation measures have multiple benefits (Krause & Koomey 1989) which can make it difficult to assess where the benefits actually lay.  Also many such measures await detailed, consistent tabulation.

Nevertheless, progress in the building and acceptance of this type of economic modelling, as an aid to assessing impacts or reductions of greenhouse gas emissions, and thereby the impact or alleviation of global warming, are important for reporting purposes.  They provide pragmatic tools for the mathematical synthesis of the best, currently available data for the purpose of informing a healthy policy decision by an organisation.  Even if the tools are not yet the most robust, they still assist in building a TBL compliance culture, and so do not derogate (at all) from the validity of TBL reporting.

Attention of business to TBL

The necessity for useful environmental performance indicators, reporting methodologies and economic modelling that have and continue to be developed and improved, can only assist a business, or any organisation, in better determining its social responsibility in a world that is now undergoing global warming.  It is essential to have these tools so that TBL reporting can move through into management thinking and management systems and all the processes of an organisation.  This will then impact on what products are produced, and how an organisation produces its products.  In turn, there are flow-on effects on the actual day-to-day reality of consumers in the way they behave.  For example, what sort of light bulb (energy efficient) to use, what sort of car (fuel efficient) to purchase, or what sort of toilet (full-flush or half-flush facility) to use, and so on.

Accordingly, TBL assists an organisation in its aim of corporate social responsibility, which requires that an organisation not only abide by the law, but also abide to product and other standards, codes and requirements, as well as a good sense of ethics in being a good corporate citizen.  Unless an organisation has good TBL tools it is more difficult to cement organisational commitment towards the outcomes that are desired by the imposition of environmental reporting and environmental aspirations.

Viable and workable TBL tools assist an organisation to perform towards a higher standard than that which is required by the law.  Such tools help an organisation to develop a framework for social responsibility and commitment, demonstrate to stakeholders that the organisation is guided by principles of social responsibility, and to accept accountability for not measuring up to any of the organisation’s social responsibilities (de Gruchy 2006).  They are important in transforming strategy into action.  The impact of global warming must surely have heightened the need for an organisation to develop and understand its social responsibilities, and that is surely assisted by a range of TBL tools for TBL reporting.

Attention of government to TBL

As TBL represents a balance between ecological, social and economic elements, it does rest on the philosophy that profits are not the only measure of the success of an organisation.  This may pose some problems for organisations, and particularly businesses, in implementing TBL reporting and of seeking to fulfil social obligations inherent in a TBL compliance culture.  But to ensure environmental sustainability (now absolutely necessary since the advent of global warming), which is inherently an integrated outcome, organisations and businesses will have little option but to adopt TBL and sustainability policies and processes.  This means they will have to measure their activities and impacts against environmental performance indicators and monitor progress over time.

For businesses and organisations to move towards a more comprehensive TBL approach there will have to be legislative and other pressures from government.  This requires governments to adopt a TBL perspective, which can be done by governments (RTSA 2004 3):

  • adopting ‘user pays’ principles in providing services that have pollution impacts, unless there are clearly defined Community Service Obligations (CSOs) that need to be satisfied;
  • moving towards a ‘polluter pays’ principle that applies to producers and consumers generally;
  • ensuring better integration of National Competition Policy (NCP) principles with Ecologically Sustainable Development (ESO) principles; and
  • seeking a reduction of imported oil inputs and greenhouse gas emissions, e.g. by a carbon trading scheme.

Bringing this together requires governments to understand TBL reporting and to regulate for the imposition of environmental performance indicators and use of methodologies that are needed for TBL reporting.  This has to be done within a solid policy framework.

Conclusion

The impact of global warming on the validity of TBL reporting has been such that it has more than ever heightened the need for thorough environmental reporting indicators, methodologies, economic modelling and reporting tools (the suite of TBL tools) consistent with the TBL approach.  While a good number of businesses and organisations and, of course, the community and its consumers, have generally woken up to the impact of negative externalities caused by the production of goods and services on the environment – which has been reinforced by the advent of global warming – it is still essential that governments give more attention as to how to implement the TBL approach in our society and to make it part of our socio-economic consciousness.

In order for businesses and organisations to comply, mandatory or legislative steps will need to be taken because TBL represents a balance between ecological, social and economic elements.  In that sense it looks at total welfare, in which profits are not the only measure of success.  Consequently, organisations and businesses will have to understand that a TBL approach is ultimately better for them, just as it is better for society as a whole.  This understanding has certainly increased since the advent of global warming, which has resulted in the need to develop a suite of good TBL tools.  This also proves the continuation of the validity of the TBL approach.

BIBLIOGRAPHY

Chernick, P & Caverhill, E (1989) The Valuation of Externalities From Energy Production, Delivery, and Use: Fall 1989 Update. A Report by PLC, Inc. to the Boston Gas Co.

de Gruchy, R (2006) Corporate governance and the triple bottom line, paper presented to the inaugural Australian Women Lawyers Conference – Celebrating Excellence, Sydney, 29-30 September 2006 (Chief Executive Officer, Australian Government Solicitor).

Effects-of-Global-Warming.com (2007) A Global Warming Primer,

http://www.effects-of-global-warming.com/warming.html

Elkington, J (1980) The Ecology of Tomorrow’s World: Industry’s Environment, London, Associated Business Press, 1980.

Environment Australia – Department of Environment and Heritage (2003) Triple Bottom Line Reporting in Australia: A Guide to Reporting Against Environmental Indicators, http://www.environment.gov.au/settlements/industry/finance/publications/indicators/pubs/indicators.pdf

Global Reporting Initiative (2000-2006) Sustainability Reporting Guidelines, Version 3.0, Amsterdam,

http://www.globalreporting.org/NR/rdonlyres/ED9E9B36-AB54-4DE1-BFF2-5F735235CA44/0/G3_GuidelinesENU.pdf

Global Reporting Initiative (2000-2006) Environment Performance Indicators, Version 3.0, Amsterdam,

http://www.globalreporting.org/NR/rdonlyres/F9BECDB8-95BE-4636-9F63-F8D9121900D4/0/G3_IP_Environment.pdf

Hohmeyer, O (1988) Social Costs of Energy Consumption: External Effects of

Electricity Generation in the Federal Republic of Germany, Berlin: Springer-Verlag.

Koomey, J (1990) The Environmental Value of Reducing Greenhouse Gas Emissions, Testimony before the California Energy Commission Hearings on the 1990 Electricity Report, Docket 88-ER-8, Energy and Resources Group, University of CA: Berkeley, http://enduse.lbl.gov/Info/CECtest.pdf

Koomey, J & Krause, F (1997) Introduction to Environmental Externality Costs, published in the ‘CRC Handbook on Energy Efficiency’, Energy Analysis Program, Lawrence Berkeley Laboratory, Berkeley, CA 94720, http://enduse.lbl.gov/info/Externalities.pdf

Krause, F & Koomey, J (1989) Unit Costs of Carbon Savings From Urban Trees, Rural Trees, and Electricity Demand-Side Resources, presented at Conference on Urban Heat Islands in Berkeley, California.

Marcus, WB (1989) Prepared Testimony of William B. Marcus on Marginal Cost and Revenue Allocation, San Francisco, CA: California Public Utilities Commission.

Ottinger, RL; Wooley, DR; Robinson, NA; Hodas, DR; Babb, SE; Buchanan, SC; Chernick, PL; Caverhill, E; Krupnick, A; Harrington, W; Radin, S; & Fritsche, U (1990) Environmental Costs of Electricity; New York, NY: Oceana Publications, Inc., for the Pace University Center for Environmental and Legal Studies.

Railway Technical Society of Australasia (RTSA) (2004), Submission to the Productivity Commission re National Competition Policy May 2004, Summary of submission to the Productivity Commission’s Inquiry re National Competition Policy from the Railway Technical Society of Australasia, http://www.pc.gov.au/__data/assets/pdf_file/0014/46301/sub007.pdf

United Nations (1992) United Nations Framework Convention on Climate Change, http://unfccc.int/resource/docs/convkp/conveng.pdf

United Nations (1997) Kyoto Protocol to the United Nations Framework Convention on Climate Change, http://unfccc.int/resource/docs/convkp/kpeng.pdf

World Commission on Environment and Development (WCED) (1987) Our Common Future, http://www.worldinbalance.net/agreements/1987-brundtland.html; http://www.worldinbalance.net/pdf/1987-brundtland.pdf

World Resources Institute (WRI) & World Business Council for Sustainable Development (WBCSD) (2004) The Greenhouse Gas Protocol (GHG) Initiative – A corporate accounting and reporting standard (Revised edition), http://www.wri.org/publication/greenhouse-gas-protocol-corporate-accounting-and-reporting-standard-revised-edition#; http://pdf.wri.org/ghg_protocol_2004.pdf; http://www.ghgprotocol.org/files/ghg-protocol-revised.pdf

World Resources Institute (WRI) & World Business Council for Sustainable Development (WBCSD) (2005) The Greenhouse Gas Protocol: The GHG Protocol for Project Accounting http://www.ghgprotocol.org/files/ghg_project_protocol.pdf

 

 

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Features of the PROUT Economy

PROUT (Progressive Utilization Theory) is based on values and social objectives that enhance the welfare of all. The PROUT economic system aims to bring about equilibrium and equipoise in all aspects of socio-economic life, and so advance the integrated progress of human society. Summarized below are some distinguishing features of the PROUT economy.

Socio-economic Units

Regional socio-economic units should be formed on the basis of common geographic, cultural, social and economic factors. Socio-economic units having an affinity across regions can be grouped into a federated political state. While the political administration of government would lie with the federation and its departments and agencies, self-determination over cultural, social and economic aspects of life would lie within the socio-economic units. This results in decentralised management of the economy in which regional and block level planning boards are responsible for development projects and programs based on economic priorities and analysis relevant to the area, and carried out by enterprises in the socio-economic unit.

Three-tiered Economy

The economy is to be organized into three types of enterprises: key industries, cooperatives and small private businesses. Except for a few key industries and for small private businesses, production and distribution activities, and supply of goods and services to consumers, are to be organized under cooperatives as the main form of economic enterprise.

Cooperatives

Cooperative enterprises will form the core of the economy. Various forms of cooperatives would deal with production activities, distribution logistics, and point of supply of goods and services to consumers. These cooperatives would be organized, owned, managed and controlled by their workers and shareholders. Cooperatives increase worker motivation and job satisfaction because they give workers control of their enterprise, a sense of community and a stake in its profits. Here workers refers to all human inputs, such as labour that engages directly in production, entrepreneurial, management and advisory abilities, and skills required to ensure compliance with accepted standards and health and safety regulations.

Where cooperatives have access to the necessary inputs of production — skilled labour and technical advisers, capital, entrepreneurship and competent management, and have safe work practices and places — they out-perform private enterprises. Cooperatives are controlled by their worker and/or shareholder members on the basis of one member, one vote. All members would hold a voting interest in the cooperative, in turn giving them a financial stake in the enterprise.

Key industries

Strategic or large-scale industries, such as critical infrastructure and networks, utilities, industries extracting important raw materials, natural resources and the like, would be designated as key industries. Key industries would be managed by appointed boards of the immediate government of the area or as local government autonomous entities, acting in the public interest, but their internal workings can be managed similar to a cooperative.

Key industries would operate on a no profit, no loss basis. The state would not subsidize their operation, and the cost of all inputs required should not be greater than the price to be charged for outputs. Nor would the state extract profits or dividends, as key industries are holders of public resources which already belong collectively to the citizens. The intent being that the true cost of production by key industries is known and minimized, with the downstream effect that costs of inputs to cooperative enterprises have a proper basis. In turn, prices of goods and services to consumers are affordable. With improved efficiencies over time prices become less so that the purchasing capacity of the people is increased.

Small private businesses

Small businesses can be privately owned. These private enterprises would not be involved with producing or distributing staple or essential commodities. They must maintain adjustment with the cooperative sector to ensure a balanced economy, so that if they become too large they should be converted into cooperative enterprises. Small private businesses may deal with non-essential goods and services, luxuries, as well as everyday activities such as cafes, repairs, maintenance, hairdressing, etc.

Economic Planning

Economic planning and coordination may take place at various levels, e.g. local/block, regional, state and federal government levels; but, so far as is practical, planning authority should reside mainly at the local level. The basic unit of planning for most purposes would be a local area called a block. Block boundaries would not be determined on the basis of political considerations, but on the basis of geographic factors, socio-economic requirements, common economic problems, and common aspirations of the people.

If planning is undertaken primarily on the block level, it will have the following benefits:

  • 1st, planners can understand the problems of the area.
  • 2nd, local leadership can solve problems according to their own priorities.
  • 3rd, planning will be more practical and give quicker results.
  • 4th, local enterprises and associations can play an active role in mobilizing human and material resources.
  • 5th, unemployment can be more easily prevented.
  • 6th, a balanced economy can be established more readily.

Block level planning involves considering in particular the following four factors in relation to cooperatives, key industries, small private businesses and consumers of the area concerned:

  1. Cost of production. Unit costs of production need to be carefully determined, and the cost of producing a particular commodity should be minimized and not exceed its market value (the price at which it can be sold). Every economic enterprise must be economically viable.
  2. The economy should be organized in such a way that it continuously increases its productivity. There should be maximum production according to the collective need, full utilization of raw materials to develop commodities, and no under-utilization of any production unit (e.g. plant and equipment, facilities, biological and non-biological inputs). Capital needs be properly invested and reinvested (rolled over), and not hoarded or squandered in unproductive ways.
  3. Purchasing capacity. A major objective of planning is to increase the purchasing capacity of every person. For this, there must be:
  • (a) easy availability of the minimum requirements of life (food, clothes, housing, education, medical care) and other common goods and services according to local demand;

  • (b) stable prices (and control of inflation);

  • (c) periodic increases in wages and salaries (resulting from increased productivity); and

  • (d) steady increase in collective wealth, such as that comprised in common infrastructure like roads, electricity generation grids and back-bone communication systems.
  1. Collective necessity. Planners need to determine the current collective needs and projected future needs of communities in a socio-economic zone, as well as current and future availability of resources and environmental conditions, and form their development plans accordingly. Most importance should be given to production of the minimum requirements of life, but the requirements of both meritorious people and those with special needs should not be neglected. Additional common amenities, like transportation, communications, lighting, refrigeration, heating and so on should be maximized across society so that everyone can access them and be provided with the related goods and services.

Economic Decentralization

PROUT’s model of development decentralizes economic power in regional socio-economic units and the communities and enterprises that exist within them. This ensures the welfare of local people, who can be defined as those who have merged their individual socio-economic interests with the interests of the socio-economic unit in which they reside. This approach will foster economic equity, allow for production and provision of ample consumer goods and services, guarantee minimum necessities of life and common amenities for all, and help to nurture and protect the environment.

Decentralized economic development should follow five basic principles:

  1. Resources of a region should be controlled and utilized by local people. Where practical, local enterprises should process raw materials, using these processed materials to produce refined, secondary or finished products, rather than exporting unprocessed resources. The advantages of local control and use of resources include:
  • 1st, a local economy based on locally-controlled industries that make use of local resources can be planned in a way that assures economic security for its people, and through local production and trading the circulation of money remains in the local economy;
  • 2nd, excessive reliance on import of raw materials leads to drainage of capital, whereas there are greater benefits if capital is invested to extract the local area’s own raw materials or to produce synthetic equivalents (if there are insufficient natural raw materials) thereby reducing dependency on outside raw materials, and so create industries in the local area;
  • 3rd, local investment in extraction of raw materials, and their processing and refinement, means the economy is not dependent on export of raw materials which are vulnerable to price fluctuations from commodity gluts, changes in sourcing of raw materials, product substitution, and changing external markets;
  • 4th, local economies that process their raw materials (rather than export them) gain the added value that comes from the processing and refinement stages and from the manufacture of finished goods, as well as the service industries that support these stages of production.
  1. Production should be based on consumption needs, not profit motive. The motive for economic activity should be to meet consumer needs and consumption, not maximize profits. In a consumption-based economy, not only will local people have their material and other basic needs met, but there will be more circulation of money in the local economy, stimulating production, jobs, and purchasing capacity. In an economy motivated by consumption required goods and services are available, affordable, of good quality, and diversified in design for local requirements and tastes, so that human needs are properly met.
  2. Production and distribution should be organized primarily through cooperatives. By their nature, cooperatives equitably distribute wealth and decentralize economic power. Because cooperatives tend to serve local needs, there is less uncertainty about product supply and demand. For example, uncertainties of supply due to disruptions, capacity or lead-time and uncertainties of demand due to quantity, timing or product mix are minimized as local needs are more readily known and better analysed. The economic stability created by cooperatives gives local people greater economic security.
  3. Local people should be employed in and control local economic enterprises. Local people are best qualified to guide the development of local enterprises and determine their own economic well-being; outside interests should not interfere with local economies. Local enterprises should provide full employment for local people, train and develop their skills and expertise, and utilize them accordingly in cooperatives and economic and social activities.
  4. Essential commodities should be produced by local enterprises. Local production of staple foods and supply of water, standard building materials and housing, common clothing items, required educational books and materials as well as facilities, basic medicines and health care, and local supply of general everyday consumer goods and related services, prevents dependency on outside economies for essential commodities and needs. If essential commodities are locally produced and sold, the local economy will be stimulated and prosper, capital will remain circulating in the local economy, and economic self-determination will be strengthened. With the increasing demand for local commodities, large-scale, medium-scale and small-scale enterprises will all flourish.

Commerce

Producers of essential commodities should be formed into producer cooperatives, and should also arrange for the distribution and point of sale of these essential commodities through consumer cooperatives; rather than through commodity traders, middlemen or government agencies. This reduces the possibility of manipulation of supply and prices, speculation and bureaucratic inefficiency in the marketing of essential commodities that are necessary for all consumers to obtain.

There should be a free flow of information about consumer products. The decentralization of production, distribution and selling will also reduce the opportunity for mass advertising campaigns that are designed simply to manipulate consumer demand, such as those carried out today based on commodity hegemony by centralised corporate empires.

Money and Capitalization of Enterprises

The value of money is in its use, so its continual circulation is a necessary part of commerce and should not become stagnant. Currencies in use should be backed by bullion in sufficient proportion. This helps ensure price stability and prevents inflation arising from over expanding the money supply. It also acts as a check on excessive deficit spending by governments, again helping to prevent inflation.

Investment capital would be generated mainly at the local and regional levels. Banks should be structured as cooperatives and may provide loans to other cooperatives. Capital for large projects by cooperatives can come primarily from cooperative bank loans and cooperative shareholdings. New key industries can be financed from development bank loans and government loans. Smaller projects can be capitalized through cooperatives or by owners of small private businesses. Bonds may also be issued by cooperatives or cooperative federations.

Global Trade

Global (international) trade is to be conducted in a manner that avoids large trade deficits and drainage of capital. This can be accomplished through barter trade using international clearing houses for goods to facilitate barter trade. In this way, through mutual exchange of commodities in foreign trade, no net loss should occur between trading partners.

Foreign trade in raw materials should be avoided, unless there is a plentiful surplus in a region; otherwise, only locally processed products should be sold outside a region. This will ensure that the value added during the processing and refinement of resources will go mainly to the local economy. Local enterprises can conduct foreign trade on this basis, so long as they follow the regulatory trade policies established by the government administration.

Regional economies should be self-sufficient in the production of essential commodities. If need be, only locally produced essential commodities would be protected from competition against cheaper imported varieties produced in other regions, with protection reduced over time. Except for this type of protection from foreign competition, there should be free trade.

Incentives for Labour

For the prosperity of society, incentives are essential to motivate workers to develop and use their full productive capacities. At the same time, rewards should not be so large as to create unnecessary disparity in the society. Minimum and maximum income levels should be set.

The minimum level should be adequate to ensure purchase of the minimum necessities of life and common amenities according to the prevailing standard. The maximum income level should balance society’s need to maintain high worker motivation with its need to distribute wealth equitably. Over time, the minimum and maximum income levels would rise, giving greater purchasing capacity, and the range between the minimum and maximum incomes would be dynamically adjusted so as to balance worker motivation on the one hand with economic equity on the other hand.

Taxation

Significant sources of government revenue would be taxes at the point of production and taxes on profits. Production taxes will apply to all enterprises (key industries, cooperatives and small private businesses). Taxes on profits will apply to cooperatives and small private businesses, but not key industries because they operate on a no profit, no loss basis.

For key industries, production taxes can act as either a resource tax or an eco-tax when extracting natural resources. A resource tax captures the recognised price element of depletion or loss of the natural resource, and an eco-tax captures the recognised externalized costs of production brought about by the extraction (e.g. pollution and other forms of environmental disruption), factoring them into the true cost of production. The effect of such taxes on key industries are basically passed on to subsequent purchasers (namely cooperatives) in prices charged for processed or refined raw materials, and the tax element is then accounted for to the government administration. An appropriate percentage of the aggregate amount collected can be used for environmental restoration or similar work. This recognises that ecosystems and their resources belong to the earth and all its inhabitants (humans, animals and plants) and that industries have an obligation to take care of and restore the environment.

For cooperatives and small private businesses, production taxes can be imposed in connection with the use of factors of production, such as land and attached fixed assets, and use of other physical spaces such as on waters and rivers, in the atmosphere and the electromagnetic spectrum, as well as on labour and capital. Production taxes also include licence fees and payments for permission to perform some productive activity.

Another form is taxes on products which can be imposed proportionally to the quantity or value of goods produced and sold. The same applies to provision of services. Taxes on products can include value added taxes (also called goods and services taxes) and excises and duties (where necessary). However, there should not be taxes on essential commodities, as such taxes have greater impact on those with less disposable income and therefore increase economic disparity.

Income taxes imposed on individuals would not be used as they encourage a black economy where earnings go unreported and are more expensive to administer. However, to reign in excessive earnings that contravene the cap on maximum income, a wealth tax can be imposed.

Progress – Moving Towards a Higher State

by Craig Walter (31 January 2011) and added to and edited by Dharmadeva (21 April 2014)

The accepted ‘generic’ meaning of the word ‘progress’ is contained in dictionaries and is denoted, ‘to move towards a higher or better state’. While this meaning is understood, this is not strictly true calling for a possible amendment to our dictionaries or additional qualification. When we delve into progress from the perspective of physics and the second law of thermodynamics then ‘progress’ on the physical plane is cancelled out by the duality of positive and negative factors. This happens on all levels. The old axiom, ‘there is no such thing as a free lunch,’ applies.

Development on the mental plane also has a negative condition that cancels out the claim of ‘progress.’ The accumulation of knowledge by individuals is also thought of as progress, that is however, eroded by our short lifespans and the limits of our relative knowledge.  In addition, stress of the mind is compounded by the increasing drive for knowledge and expertise resulting in mental clash and a stiffening of ones arteries particularly if intellectually inclined and involved in intense academic pursuits. This has a big impact on the nervous system setting in motion the reaction to mental actions. Such clash can easily lead to metal disturbance as the result of leading an imbalanced lifestyle or using various substances to overlay the tension and has consequences.

In this conjecture we are referring to ‘advancement’ or movement from ‘A’ to ‘B’. So what you might say!

While humans enjoy creating fantasies and illusions that help us escape the hum-drum of daily existence it matters a great deal how we use certain symbols of language. The notion of progress has an important bearing on economics and what is happening to our planet. Currently, use of words such a ‘progress’ is a mixed metaphor that re-enforces a closed perception of our world and impacts on the way we view other cultures.

Political systems are fashioned after teachings that see progress in material terms while not taking into account the costs to the environment and social aspects such as psychic health. This is becoming apparent due to ‘carbon taxes’ being issued to counter global warming that appears to be running at a much faster pace than climate change caused by evolution barring an extreme clash such as a large asteroid or pole shift that has occurred several times in the past.

Longer term consequences are emerging such as ozone depletion due to industrial processes. Somewhere in our economic equations that make profit as the only goal, indirect costs are frequently left out and is often sidelined into the lap of society to deal with at a later juncture. The power of technology such as the media only serves to bolster those with power and control when changes are required to ensure the greater good and survival.

Meanwhile, nature seeks balance one way or another that should give us a clue in our collective wisdom about applying some principles in economic development with an all-round approach. As much as we like to educate our children for a better life and future, it seems that human endeavour remains firmly in the grip of exploitation and the grip of unnecessary hostilities and wars.  Where is the ‘progress’, one may ask?

In Australia various indigenous clans lived near the coastal regions. By and large their lifestyles were idyllic. They had abundant fishing and rich cultural ceremonies with meaning of purpose. They believed that life was a transformation through cycles and a spiritual journey that closely parallels the teachings of Tantric practices in India that ‘seek union’ with God. They understood that a human life span was short and told stories of the ‘spirit’ or ‘soul’ as depicted by today’s religions.

Indigenous cultures did not have to pay taxes, follow a nine-to-five drudgery and earn money so that they could afford a car to get to work so as to earn money. They wore basic clothing but then again did not have to farm sheep and apply chemicals to the land that ended up in waterways as pollution. Our industrial processes require large amounts of energy that has a cost to the environment. We have gone from the horse to automobiles for transportation. In societies of millions of people the impact on resource use, energy requirements, pollution and accidents has been considerable. When all costs and factors are taken into consideration the gains are cancelled out by the negative aspects.

Many things we do out of convenience or because it is directly cost effective but completely ignore other costs that are cloaked by commercial social engineering in the name of progress. Milk cartons are a case in point. Milk bottles were reused many times before being recycled for meltdown and only involved several basic chemicals. Whereas milk cartons use many chemicals in their manufacture and it is suggested that plastic linings cause molecular infusion into liquids or food. There is a case that the cost in bottles was actually cheaper than milk cartons that provide more profit to the developers. Carton use also removed local jobs.

And what about the environment? Around our lakes and seas, plastic waste is to be found everywhere – it is an eyesore and hardly denotes progress. A vast array of plastic products is causing a vortex accumulation of junk in our oceans. Carbon dioxide pollution in our air is causing the seas to acidify as the parts per million go from around 275 ppm several decades ago to around 375 ppm or more today – see http://350.org/about/science/.

Many people do not want to pay carbon taxes because they know that countries like China use coal exported from their country. They do not want to subsidize coal industries while countries like China remain unaccountable. Ironically, the measures required to counter pollution are neutralized by a public impasse under democratic systems. The impasse is brought about by social classes who do not want change that seeks a balance environmentally or minimizes the negative costs.

Above Earth are thousands of satellites that are essential in communications and commerce. If this network is assailed by meteors or magnetic storms the super technology network may be rendered useless. The probability may be small, but if it occurred, what becomes of the so-called progress we have made? We have not planned for such a scenario because current economic systems are unable to abide by rational choices seeking dynamic equilibrium in the interests of all.

Our immense vulnerability may become apparent if a giant earthquake or another polar shift severs the Internet cables under the oceans. It’s not that there is no wisdom about these factors, it is really about social control and those with power but no vision.

Modern societies have complex systems of pipe work and cabling that require maintenance and upgrade. This is ongoing. The same applies to electricity grids and other networks.  If money is diverted away from public works to save banks or businesses that caused financial losses in the first place, then this wastage causes breakdowns in money flow towards infrastructure re-building with serious repercussions for society as a whole.

Giant car companies are massaging the public psyche about electric cars that use fuel cells or cadmium batteries based on fairly rare and expensive metals. The French have developed air cars that are cheap to run and don’t require exotic metals for power systems. Although, when compressed air gets cold it loses it efficiency. Even then, the French know that public transportation and bicycle ways would be a far better use of resources as a priority. What we see is there are positives and negatives in technological development.

In hindsight the demands on resources such as oil, copper and platinum is a type of technological imperialism that requires hard-nosed governments to implement policies to exploit other countries and communities without fair compensation. This leads to conflict and war and has been going on for a long time. Increasingly the distribution of wealth gets worse despite powerful productions systems only working at 60% of their capacity. Real wealth cannot be based upon ever increasing credit (debt). Clearly something is very wrong despite the images of abundance being promulgated in advanced societies.

The social disparity brought about by skewed wealth distribution results in more people resorting to anti-social and criminal behaviour. The anti-social side of economic systems results in vast resources being used to combat black markets and illicit trade networks (e.g. drug running). Wealthy people have to create enclaves to protect themselves and their families. While material possessions may adorn one’s life we observe an increasing unease or disturbance in emotional and mental health in western culture.

The more people use their minds for mental work the greater the impact on nervous systems and physiology. Many people stare at computer terminals all day long and live more sedentary lifestyles as a result. Health problems of eyes and good vision are emerging. Obesity is rampant.  To address the lack of physical exertion a workout at the gym is required.

There are better choices that can be made but they are not being made. The current ethos puts profit before collective welfare and works against the progressive utilization of appropriate technology.

So it can be seen that progress on the physical and mental planes is correctly speaking about advancement and movement from A to B. The next state is about spiritual development and its relationship to progress. While many religious denominations might see spirituality as adhering to a belief system based on a dualistic religious outlook, this is not the essence of spirituality. Rather, spiritual progress is defined in mysticism as involving the effort to span the gap between the finite and infinite – it is the transcendental dimension within human experience.  This is often discovered in moments in which the individual questions the meaning of personal existence and attempts understand their own self within a broader nature of being or the Cosmos. This involves some psycho-spiritual effort or practices.

Where development is towards psycho-spiritual welfare it is called progress. Human existence is trifarious, that is, it has physical, mental and spiritual aspects. Real progress should be psycho-spiritually motivated so as to elevate human existence and share that inspiration collectively.

The notion of God being a separate entity capable of hearing prayers sits at odds with the quest for mystical expansion or expansion of the mind to realise the nature of consciousness or soul. Although religious traditions include religious order such as the Jesuits with mystical leanings, the common place practice of most Christian religions is praying to God and adhering to moral tenets. While Catholic religious practice can involve a devotional outlook that is in accordance with mystical practices, it to parts ways when seeking union with God (Yoga), which is more than merely relating to God.

The artificial distinction drawn by various religious orders between their outlook and the mystical path is predominantly about religious authority maintaining doctrine over their followers and derived from history by the intellectual value class – such outlook is usually expressed as organised religion. In this regard, the spiritual practices of Christianity and that of Eastern traditions have an essential departure point.

One seeks union with God such as the ‘drop merging with the ocean’ analogy and the other seeks to know God primarily through worship and moral adherence. That is not to say that the mystical tradition of achieving oneness with God (liberation and perfection) do not follow moral precepts as well. To be meaningful, they must do so in order to aid spiritual progress and, of course, the society.

The practices of Eastern Yoga (as it is sometime referred to), when it comes to moral practices or the code of Yama and Niyama, also have some parallelism to the Ten Commandments of Christianity. However, the opposition of various religions to the mystical quest of merging with the ‘Infinite’ is most likely based upon the differences in understanding spirituality influenced by the sway of the religious, intellectual class.  Over the decades that opposition appears to have become less.

Since the inherent state of physics involves duality and the negative and positive factors result in cancellation in terms of progress then what does constitute progress? As already hinted it is spiritual development that is the realm of progress and is an aspect of evolution in its own rights. Various intellectuals would argue this is nothing more than a theoretical notion without foundation especially when it comes to belief in God.

Dogmas have set up a boundary to belief and exploration that prevents further expansion in outlook and the meaning and experience of love culturally and individually. But with the expansion of human outlook and acceptance, such dogmas must give way to more universalistic ways of seeing the world and creation.  Also, socio-economic systems based on a materialistic world view work for an established minority and suppresses the majority without moving together. This is evident when basic necessities of life are not provided to all people, and at the same time there is massive hoarding of wealth by a few.  Social freedom is largely dependent on economic freedom.  Economic freedom must ultimately be based on the sense of a common inheritance of the world for the benefit of all persons, not for a few.  That also, has an inherent spirituality about it.

Prominent intellectuals and outspoken atheists of today regard spirituality as nothing more than an emotional state intrinsic to ourselves. There is a paradox in this. That paradox includes the atheists who ‘thank God’ for being an atheist. It is also involves a failure to accept diversity in culture and the innate human aspirations for transcendental understanding. From their perspective belief in God is the ultimate dogma directly associated with the persistent dogmas of religion promulgated over the centuries. Fundamentally, though this perspective is based on a very limited understanding of spirituality and the fixation of ‘God’ being something to do with religion and its dualistic sentiments, which is a kind of denial of the interconnectedness of all things and all consciousness.

So, an anti-dogma outlook is necessary also in regard to atheism and this will be a social service in its own right and lead to a rationalistic world view which aligns with scientific inquiry in many field of endeavour, rather than confining understanding of the world and consciousness to a materialistic notion that also has its limitations or boundaries. The formations of planets and solar systems all involve a nucleus at the material level such as our sun. Everything revolves around a nucleus as seen in the macro and micro cycles of evolution.

Similarly, spiritual endeavour involves moving around a nucleus of devotion, finding a centre of love within oneself and its application to humanity.  This can also be found in Christian traditions of worshiping that singular nucleus of faith or the ‘Supreme Father’, coupled with the creative principle of ‘Mother Nature’ or the qualifying principle of creation which gives rise to this expressed universe out of the infinite consciousness behind all things. Spiritual practices such a meditation, contemplation and devotional aspects of Yoga thus share some similarities with the worship practices of various religious congregations, in that there is a nucleus that is desired to be understood and felt internally – it may also be called finding God or merging with the Supreme Mind.

Moving closer to that nucleus is the goal of devotional spirituality. After all, if this Nucleus is available on an experiential level – one simply needs to develop the internal sentiment of developing love for all creation, practice it and acknowledge the singular source of that divine sentiment, and surrender internally to that flow.  This can be achieved through various internal spiritual practices, not through measurable external activities.  Indeed, we are on an evolutionary journey of the soul-mind or ‘atman’.

Spiritual aspirants see this as a gift from God to the devotee. Since by definition everything comes from God, then in return there is only one thing we can give God, which is our hearts. This is expressed by social service to the world – rendering selfless service to all creation. This approach treats the world, indeed the universe, as one integrated whole to which all beings belong.  Consequently, we all have a common Cosmic inheritance which has to be taken care of – socially, economically, culturally, environmentally, and this care happens on the three levels of existence being physical, mental and spiritual. This is integral to the spiritual journey. The spiritual journey is the only progress and is movement from the crude towards the subtle aspects of life.

Progress then, as explored in this essay, is moving towards a higher state, the spiritual state. It has no negative condition. By bringing spiritual outlook and values without dogma into our cultural, social and economic lives we can create better ways of developing our future. This is no idle dream but a practical requirement.

The River that became a Person – Giving Rights to Nature

by Michael Towsey and Dieter Dambiec

On 5 August 2014 a deed of settlement[1] (Deed) was signed between the Crown in right of New Zealand and the Whanganui Iwi (Tribe) under which the Whanganui River in the north island of New Zealand is declared a legal person with rights and interests[2]. The name of the legal person is “Te Awa Tupua” which is described in the Deed as “an indivisible and living whole comprising the Whanganui River from the mountains to the sea, incorporating its tributaries and all its physical and metaphysical elements”[3].

In the parlance of lawyers, the Whanganui River acquired legal standing before the courts and for other legal matters that affect it. In the Deed the River also has a set of intrinsic values[4] (Tupua te Kawa) which represents the essence of Te Awa Tupua (the legal person). In particular, the values of Te Awa Tupua are that it supports and sustains life and natural resources and the health and wellbeing of the people of the River, and it is a spiritual entity – a living whole that is indivisible incorporating all its physical and metaphysical elements.  Te Awa Tupua also has a human face (Te Pou Tupua) to exercise rights, powers and duties on behalf of and in the name of Te Awa Tupua and in its interests consistent with its values.

How is it possible, you may ask, for a river to become a person? And what kinds of rights does a river have? This question is a familiar one for animal rights activists, and can also be approached from that perspective.

Activists argue that animals have rights by virtue of their sentience[5], that is, their ability to perceive, feel and experience subjectively, including both pleasure and pain. At least all vertebrates, they argue, are sentient. Although even invertebrate animals with some kind of nerve structure also have ability to sense their environment and respond through use of some organ of their body.  Note that sentience is distinct from rationality.

Various animal welfare organisations around the world have declared that animals have five rights[6]:

  1. Freedom from hunger and thirst;
  2. Freedom from pain, injury, disease;
  3. Freedom from discomfort;
  4. Freedom from fear and distress;
  5. Freedom to express normal behaviour.

Note that number 5 goes beyond absence of harm. It implies that each animal has the right to express its species nature.

However, for animal rights activists, providing only for the welfare of animals is not enough. What is really needed is that sentient animals be regarded as legal persons having legal rights and standing before the law.  This could be done either individually or collectively.

In a recent case (December 2014[7]) in the New York State Supreme Court (Appellate Division), an animal rights group brought habeas corpus proceedings against a man keeping a pet chimpanzee in a cage. The group argued that the chimp was an “autonomous self-determining being”[8] and was being held captive against his will. Presiding Justice Karen Peters (as part of the five-judge panel) rejected this argument and allowed the man to keep the chimp. The court considered that apes have a “lackadaisical approach to civic life”[9] and therefore do not qualify for human rights. “Legal personhood”, she wrote, “has consistently been defined in terms of both rights and duties.”[10]

In short, no responsibility, no rights. Except that children and the mentally ill have human rights even though they cannot exercise full responsibility. And entities such as corporations, universities and nation states are legal persons even though they are not sentient. Indeed there is a ground swell of resentment against corporations having the status of legal persons because their single-minded pursuit of profit encourages them to behave with pathological irresponsibility.

In another recent case (again in December 2014[11]) in Argentina, concerning an orang-utan in a zoo, the opposite conclusion was reached to that of the New York court.  The Argentinian court recognised the ape as a “non-human person” unlawfully deprived of her freedom.  Accordingly, she should be freed and transferred to a sanctuary.

Just what does it mean for an entity to be a “person” and holder of legal rights? There are at least five consequences:

  1. The rights are defined, although this can be very general, such as a corporation having the legal capacity and powers of an individual as well as other commercial powers, or in the case of the Whanganui River its legal personhood (Te Awa Tupua) simply has the rights, powers, duties and liabilities of a legal person.
  2. A body of laws and procedures exists (and likely continues to develop) pertaining to those rights.
  3. Legal proceedings must be in the entity’s own name, not that of another human (although human representatives are required in the case of inanimate legal persons).
  4. When granting legal relief, the court considers the harm done or potential harm to the entity, and in some cases this can include economic loss.
  5. Relief is given or awarded to the “legal person”.

At this point we should note that there is nothing to stop trees from having legal standing, e.g. if the legislature so desired, and indeed as far back as 1972 legal scholar Christopher Stone made just such a proposal[12]. There are two motivations to extend legal rights beyond individual humans, animals and indeed plants to include natural objects such as forests, rivers, catchments etc. These are:

  1. The welfare of human beings, animals and plants is inextricably linked to the health of the ecosystems in which they live. In this regard, there is little point endowing an animal with rights and then destroying its habitat. The recognition that life on Earth is indivisible encourages a belief in the rights of natural entities – such is the case with the Whanganui River having the status of a legal person.
  2. Triple Bottom Line Accounting (TBA), now known as Integrate Reporting (IR), has failed to live up to its promise of making governments and corporations accountable for damage done to society and nature. Free-market obsessed developed countries have co-opted TBA/IR to engage in pollution offsetting – a corporation may burn coal if it plants trees; developers may destroy one habitat if they rehabilitate another. Endowing a forest with rights protects it prior to economic considerations. Or in the case of a river, such as the Whanganui River, the intrinsic value of it being a source of health and wellbeing has priority and is recognised as part of its legal personhood, as are its spiritual, metaphysical and physical aspects.

In 2008, Ecuador became the first nation in the world to grant rights to nature (Pacha Mama) when its citizens approved a new constitution that included such rights[13]. In the Ecuadorian Constitution nature in all its forms has the right to exist, maintain and regenerate its vital cycles, structure, functions and evolutionary processes, and to be restored.  The people generally have the legal authority to call upon public authorities to enforce these rights on behalf of ecosystems. In a 2011 constitutional case, the Provincial Court of Loja ruled in favour of the immediate protection and  legal tutelage of the rights of nature[14], particularly for the Vilcabamba River, granting an injunction against the Provincial Government from carrying out road-widening works along the River, as no remediation and rehabilitation plans or environmental permits were evident.

In 2012[15], Bolivia passed[16] the world’s first law recognising Mother Earth as sacred.  It is based on the earlier “short law”[17] under which Mother Earth is considered a “dynamic living system comprising an indivisible community of all living systems and living organisms, interrelated, interdependent and complementary”[18], and as a sacred entity having the following rights:[19] to life, to the diversity of life, to water, to clean air, to equilibrium, to restoration, and to pollution-free living. This includes the right to maintain vital cycles of water, nutrients and energy without human alteration. The law emphasises that humans should relate to Mother Earth in a manner that is deeply respectful and not merely as an inanimate resource that has to be managed.

On a similar basis, in New Zealand, the Whanganui River is recognized as an “indivisible and living whole from the mountains to the sea”[20].  No one owns the River, as it is a being (Te Awa Tupua) of itself[21].  Any person utilising the River should seek to protect and promote the River’s “health and wellbeing”[22], and for resource consent purposes recognise its human face (Te Pou Tupua) as a possible “affected person”[23].  The concept has similarities in ancient Roman Law to that of the usufruct (the right to enjoy but not damage or waste) and to P R Sarkar’s principle of collective property set out in the Progressive Utilization Theory (PROUT) in which people have usufructuary rights, but no one has the right to misuse collective property[24].

For indigenous peoples, such as the New Zealand Maori, the sacredness of Mother Nature is not a legal fiction. They already recognise Her expression of the natural world as having some kind of sentience, with the Earth being a holistic breathing, living organism that can respond to what is being done to it.  Though that recognition is subtle and subjective it is an essential understanding for external or objective balance in pursuing the affairs of life and society.

These examples demonstrate that people around planet Earth are gradually embracing a realisation of what the Indian philosopher, Prabhat Ranjan Sarkar, calls Neohumanism[25]. Neohumanism is the synthesis of two great civilising traditions, European humanism and the South Asian spiritual tradition. Neohumanism recognises natural entities as having two kinds of value, existential value and utility value. Europe’s last 3000-4000 year history can be understood as the struggle to accept and extend the embrace of existential value to ever widening circles of people. The inexorable trend to grant rights to animals and plants and even to Mother Earth is likewise a momentous step, for it recognises that the non-human world has existential value, which is intrinsic and not derivative of utility to humans. The planet is moving beyond humanism.

Does this mean that TBA/IR is obsolete? Certainly not! Our approach to the sacredness of Mother Earth must be practical. TBA/IR gives us an objective understanding of our impact on the planet and permits us to make adjustments accordingly. In the language of Neohumanism, subjective approach through objective adjustment.  Together, in balance there is equilibrium.

Two helpful books to read:

  • Six Capitals by Jane Gleeson-White, Allen & Unwin, 2014,

https://www.allenandunwin.com/default.aspx?page=94&book=9781743319161

Liberation of Intellect: Neohumanism by Prabhat Ranjan Sarkar, Ananda Marga Publications, 1982,

http://anandamargabooks.com/portfolio/neohumanism-in-a-nutshell-volume-1/gallery/social-philosophy/

http://anandamargabooks.com/portfolio/neohumanism-in-a-nutshell-volume-2/gallery/social-philosophy/

 Footnotes

[1] The Deed is entitled RURUKU WHAKATUPUA – TE MANA O TE AWA TUPUA: http://nz01.terabyte.co.nz/ots/DocumentLibrary/140805RurukuWhakatupua-TeManaOTeAwaTupua.pdf. The settlement legislation for the Deed is to be introduced in 2015 and enacted sometime in 2015-16 by the New Zealand Parliament.

[2] Clauses 2.2 and 2.3 of the Deed.

[3] Clause 2.1 of the Deed.

[4] Clauses 2.6 and 2.7 of the Deed.

[5] See: https://www.voiceless.org.au/the-issues/animal-sentience.

[6] Developed from the UK Government Report of the Technical Committee to Enquire into the Welfare of Animals Kept under Intensive Livestock Husbandry Systems in 1965 chaired by Professor Roger Brambell and adopted by World Organisation for Animal Health and Royal Society for the Prevention of Cruelty to Animals and other organisations.  See: http://msue.anr.msu.edu/news/an_animal_welfare_history_lesson_on_the_five_freedoms.

[7] http://www.nonhumanrightsproject.org/wp-content/uploads/2014/12/Appellate-Decision-in-Tommy-Case-12-4-14.pdf.

[8] http://www.nytimes.com/2014/12/05/nyregion/chimps-dont-have-same-rights-as-humans-court-says.html?_r=0.

[9] http://www.nytimes.com/2014/12/05/nyregion/chimps-dont-have-same-rights-as-humans-court-says.html?_r=0.

[10] Page 4 of the Court’s decision.

[11] http://www.reuters.com/article/2014/12/21/us-argentina-orangutan-idUSKBN0JZ0Q620141221.

[12] Stone, Christopher D. (1972), ‘Should Trees Have Standing? – Toward Legal Rights for Natural Objects’, Southern California Law Review 45: 450–87. See also: Stone, Christopher D. (2010), Should Trees Have Standing? Law, Morality, and the Environment (3rd ed.), Oxford University Press.

[13] See particularly, Title II: Rights, Chapter seven: Rights of nature, Articles 71, 72, 73 and 74, and also Title VI: Development Structure, Chapter one: General principles, Articles 275 (third paragraph), 276.4 and 277.1. Download the Constitution of the Republic of Ecuador at: http://pdba.georgetown.edu/Constitutions/Ecuador/english08.html.

[14] Constitutional Injunction 11121-2011-0010.  See: http://therightsofnature.org/first-ron-case-ecuador/.

[15] The Framework Law on Mother Earth and Integral Development for Living Well has been in effect since 15 October 2012; http://www.lexivox.org/norms/BO-L-N300.xhtml; http://www.ipsnews.net/2014/05/bolivias-mother-earth-law-hard-implement/.

[16] http://www.huffingtonpost.com/peter-neill/law-of-mother-earth-a-vis_b_6180446.html; http://www.theguardian.com/environment/2011/apr/10/bolivia-enshrines-natural-worlds-rights.

[17] Law of the Rights of Mother Earth.

[18] See Article 3 (Mother Earth) in Law of the Rights of Mother Earth.  Download the Law at: http://www.worldfuturefund.org/Projects/Indicators/motherearthbolivia.html and https://makanaka.wordpress.com/2011/06/06/the-law-of-mother-earth-by-bolivia/.

[19] See Article 7 (Rights of Mother Earth) in the Law of the Rights of Mother Earth.

[20] Part 2 of the Deed.

[21] However, the river bed will be vested in Te Awa Tupua (at least, for the present, that part of the river bed owned by the Crown).

[22] Clause 1.3.4 of the Deed.

[23] Clauses 9.5.2 and 9.10.1 of the Deed.

[24] Sarkar P.R. (1962), Chapter 5, Purport to verse 5-12 in Ananda Sutram, Ananda Marga Publications.

[25] Sarkar P.R. (1981-82), The Liberation of Intellect: Neohumanism, Ananda Marga Publications.

Debate: ‘Concealed Hand of Adam Smith’

At:
http://proutfilms.com/books/CHoAS/

http://proutfilms.com/prout-writing-5/

For many years you may have been hearing economists refer to a ‘modern version of the invisible hand’ as if they are merely extending the original argument of Adam Smith. The fact is that Adam Smith’s ‘invisible hand’ was always a fairy tale based on religious, ivory-tower speculation about the world. When Smith talked about ‘an invisible hand’, he meant ‘Providence’ (or God).

In 1759, Smith introduced the concept of an invisible hand in his book, “The Theory of Moral Sentiments”. The concept of ‘an invisible hand’ is found in Paragraph 10 of Part IV Chapter 1. (Part IV consists of only one chapter/section.)

Below is reproduced the entire Paragraph 10 with its preceding Paragraph 9 for further context. A careful reading reveals that what Smith describes has nothing to do with market forces. Smith talks about two things: (1) the ‘contemptible’ greed of a rapacious elite and (2) the physical capacity of a human belly. In psychological and economic terms, what Smith writes is arrant nonsense. He posits that unfeeling wealthy landlords produce huge fields of grain only because their eyes are bigger than their stomachs. Smith then asserts that those greedy landlords have no alternative but to distribute what they cannot eat to others (rather than maximizing their personal profit based on supply and demand, even if that means letting grains rot in silos).

As said above, what we read below is just religious, ivory-tower speculation. It has little or no relation to what actually happens in real life. In real life, the distribution of wealth is not at all “nearly the same distribution… which would have been made, had the earth been divided into equal portions among all its inhabitants”, not even in respect to the “necessaries of life” which Smith was specifically talking about. But when we go beyond the necessities of life – addressed by PROUT within a broader dimension of ‘people’s economy’ – then the distribution of wealth becomes even less balanced.

It is interesting to note that Adam Smith contemplates, albeit inadequately, some subjects that modern capitalist economists like to sweep under the carpet. Smith talks about “the sentiment of approbation”. Indeed, that is the very subject of Part IV of “The Theory of Moral Sentiments”. This “sentiment of approbation” is precisely what PROUT stresses when it comes to law (or property rights). According to PROUT, accumulation of wealth should be determined by the ‘approval of society’.

It is also interesting to note that Adam Smith recognizes the critical importance of distribution in economics. Smith also understood that ‘justice’ in respect to distribution means that everyone must receive the “necessaries of life”. In other words, Smith recognized that distributive justice means a more equal distribution. Of course, Smith’s economic analysis is incomplete. The goods and services produced by any economy go well beyond the mere necessities of life. Economies also produce many amenities (in PROUT, ‘atiriktam’), and over time those amenities tend to become recognized as part of the current minimum requirements for all (a broader concept than the necessities of life).

Modern capitalist economists have managed to develop some elements of what PROUT classifies as ‘commercial economy’. Unfortunately, however, they have lost sight of even the little bit of humanity that Adam Smith showed in his recognition of the importance of ‘people’s economy’ and the need for distributive justice. Modern capitalist economists promote the slogan that everyone should be ‘free to choose’ as a means to make the wealthy elite ‘free to exploit’.


Part IV

Of the Effect of Utility upon the Sentiment of Approbation

Consisting of One Section

Chap. I Of the beauty which the appearance of Utility bestows upon all the productions of art, and of the extensive influence of this species of Beauty

IV.I.9

But though this splenetic philosophy, which in time of sickness or low spirits is familiar to every man, thus entirely depreciates those great objects of human desire, when in better health and in better humour, we never fail to regard them under a more agreeable aspect. Our imagination, which in pain and sorrow seems to be confined and cooped up within our own persons, in times of ease and prosperity expands itself to every thing around us. We are then charmed with the beauty of that accommodation which reigns in the palaces and oeconomy of the great; and admire how every thing is adapted to promote their ease, to prevent their wants, to gratify their wishes, and to amuse and entertain their most frivolous desires. If we consider the real satisfaction which all these things are capable of affording, by itself and separated from the beauty of that arrangement which is fitted to promote it, it will always appear in the highest degree contemptible and trifling. But we rarely view it in this abstract and philosophical light. We naturally confound it in our imagination with the order, the regular and harmonious movement of the system, the machine or oeconomy by means of which it is produced. The pleasures of wealth and greatness, when considered in this complex view, strike the imagination as something grand and beautiful and noble, of which the attainment is well worth all the toil and anxiety which we are so apt to bestow upon it.

IV.I.10

And it is well that nature imposes upon us in this manner. It is this deception which rouses and keeps in continual motion the industry of mankind. It is this which first prompted them to cultivate the ground, to build houses, to found cities and commonwealths, and to invent and improve all the sciences and arts, which ennoble and embellish human life; which have entirely changed the whole face of the globe, have turned the rude forests of nature into agreeable and fertile plains, and made the trackless and barren ocean a new fund of subsistence, and the great high road of communication to the different nations of the earth. The earth by these labours of mankind has been obliged to redouble her natural fertility, and to maintain a greater multitude of inhabitants. It is to no purpose, that the proud and unfeeling landlord views his extensive fields, and without a thought for the wants of his brethren, in imagination consumes himself the whole harvest that grows upon them. The homely and vulgar proverb, that the eye is larger than the belly, never was more fully verified than with regard to him. The capacity of his stomach bears no proportion to the immensity of his desires, and will receive no more than that of the meanest peasant. The rest he is obliged to distribute among those, who prepare, in the nicest manner, that little which he himself makes use of, among those who fit up the palace in which this little is to be consumed, among those who provide and keep in order all the different baubles and trinkets, which are employed in the oeconomy of greatness; all of whom thus derive from his luxury and caprice, that share of the necessaries of life, which they would in vain have expected from his humanity or his justice. The produce of the soil maintains at all times nearly that number of inhabitants which it is capable of maintaining. The rich only select from the heap what is most precious and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species. When Providence divided the earth among a few lordly masters, it neither forgot nor abandoned those who seemed to have been left out in the partition. These last too enjoy their share of all that it produces. In what constitutes the real happiness of human life, they are in no respect inferior to those who would seem so much above them. In ease of body and peace of mind, all the different ranks of life are nearly upon a level, and the beggar, who suns himself by the side of the highway, possesses that security which kings are fighting for.

http://tinyurl.com/3n2myt

Cooperatives in Australian town of Maleny, Queensland illustrate the diversity of the cooperative movement

by Jake Karlyle

Examples of small-scale cooperative enterpriseMaleny, situated 100 kilometres north of Brisbane on Australia’s Sunshine Coast, is surrounded by lush tropical vegetation, has stunning views of the Glass House Mountains, and overlooks the Pacific Ocean. It has about 7,000 people. Maleny has a long history of cooperative enterprise, beginning on 3 May 1903, when settlers started the first dairy cooperative in the region.

By the 21st century, Maleny has around 17 cooperatives that work in all areas of community life including a consumer’s coop, a cooperative bank, a cooperative club, a worker’s coop, a cashless trading coop, a cooperative radio station, a cooperative film society, four environmental coops, and several community settlement coops.

What is a cooperative?

Cooperatives are formed when a group of like-minded individuals join together to accomplish something that each, acting alone, could not achieve. Successful coops cannot be imposed on a community; they have to grow from the energy and commitment of the local people.

Coops integrate economic and social objectives. Unlike the private sector, which tends to concentrate wealth and power in the hands of a few, coops spread wealth and power to each member equally. Unlike government, which tends to be remote and unresponsive to those it should serve, coops are driven by their members and reflect their needs.

Cooperatives have a competitive advantage over both private and public enterprises: the members own the coop, so they are more likely to buy the coop’s goods or use its services. They also decide how to spend the coop’s profits.

Maple Street Cooperative

Maple Street Cooperative opened its doors on January 14th 1980, nearly a year after a small group of people met to discuss how to satisfy their need for whole-foods. Today it operates an organic health food retail outlet in the main street of Maleny, is open 7 days a week, and has 450 active members. It is a consumers’ cooperative and sells to its members and to the public.

The coop’s policy is organic first, then local, then Australian. It does not stock products that contain genetically modified material, nor products from companies seen to exploit people or the environment. Any profits go back into the coop, to expand its services and develop its infrastructure, or into community activities.

At first labour in the coop was voluntary, but as the coop prospered, the number of paid workers increased. The coop employs around 11 part time staff and one full time manager.

During its 22 years, it has on occasion had no business plan, operated at a loss, made poor investment decisions, lacked experienced financial management, and had to spend a lot of time and energy resolving differences of opinion among the members.

However, it gradually evolved a formula for success. It now has a sound strategic and financial plan, regularly makes a profit, cultivates the support of both the members and the community at large, and ensures that the staff and management are honest, dedicated and competent.

Maleny Credit Union

The Maleny Credit Union started in 1984 when several local people had the idea of setting up an ethical financial institution to foster regional financial autonomy. Initially it was staffed by volunteers and worked from rented rooms. On the first day of operations, local people deposited more than Aus$50,000.

Today the Credit Union has more than 6000 members, 14 paid staff, and $15 million in assets, and owns its premises. It is one of only a handful of financial institutions in the country that operates on cooperative principles.

Over the years the Credit Union has given out many small loans to local people who would not be eligible for loans from major banks. In this and other ways, it contributes substantially to the local community and leads its development.

The Credit Union’s ethical activities include, among other things:

  • allocating 10% of its profits to its Community Grants Scheme,
  • establishing a tax-deductible Charitable Fund,
  • paying an ‘eco-tax’ to Barung Landcare based on every ream of paper used,
  • lending only to local people and projects to keep money circulating within the region,
  • providing loans for environmentally and socially beneficial projects.

Since it was established, it has reinvested over $50 million back into the local community.

Like the Maple Street Coop, in its early years the Credit Union had periods of difficulty. However, improved planning and financial management overcame these problems. Today it is successful, largely because it developed the right balance of financial expertise and cooperative spirit.

The Up Front Club

Late in 1993, a group of Maleny residents formed a cooperative club where they could eat, drink, relax and socialize. Today it is a place where the food is wholesome and inexpensive, the coffee is great, and local musicians and entertainers can gain exposure.

Initially it was under-capitalized, so although it had over 1,000 members, each year it sustained a loss. In the year 2000, three directors took over the voluntary management of the Club, enabling it to remain in existence.

At about that time, the Club turned a corner when some 100 members attended a special general meeting, talked of what the Club meant to them, and committed to regular voluntary work so that it could stay open. Soon after that, for the first time the Club posted an operating profit.

Over the years the Club has showcased a wide range of local talent, hosting everything from classical evenings to CD nights for teenagers. For many, it is the cultural centre of the Maleny community.

Local Energy Transfer System

Maleny has one of Australia’s most successful LETS schemes. LETS began in Canada in 1982, and was launched in Maleny in 1987. There are now over 200 LETS schemes in Australia.

LETS functions as a cashless trading coop. Members trade their skills and provide services to each other without the use of money. In Maleny members trade their products and services in the local currency, the Bunya, named after the native pine nut, and people with little or no cash can participate in the economy.

Environmental cooperatives

Maleny has 3 environmental coops.  They are:

  • Maleny Wastebusters, a recycling coop, encourages people to reduce, reuse and recycle; to sort their rubbish; and to avoid buying poor quality and over packaged items. It employs 20 local people, and its slogan is: “Waste not, want not”.
  • Barung Landcare is dedicated to empowering landholders in the local area to take ownership of environmental problems and their solutions. It provides a range of environmental services and hosts the annual ‘From Chainsaw to Fine Furniture Wood’ Expo, which promotes the sustainable harvesting of native timber. It also runs a successful nursery that propagates local native plant species.
  • Booroobin Bush Magic runs a rainforest nursery, while the Green Hills Fund works to re-forest the Maleny hinterland.

Community settlement cooperatives

These include:

  • Crystal Waters, the first Permaculture village in Australia, which incorporates 83 private residential lots, a village commercial centre, visitor’s accommodation area, and over 500 acres of common land.
  • Manduka which is situated on over 150 acres of land outside Maleny. Its 18 adults and 6 children believe in living simply, sharing resources, reaching agreement through consensus, and managing their land in an ecologically sustainable way.
  • Prout Community which is situated on over 50 acres of land, and is home to 5 families and the Ananda Marga River School, which has over 100 students, from Kindergarten to grade seven. The curriculum emphasizes experiential and whole brain learning, creativity, ecology, arts and music, all with a child centred approach.
  • Cedarton Foresters is situated on 200 acres of land outside Maleny. It contains 22 private residential lots and is home to 40 people. The community’s main aim is the rehabilitation of the land.

Other cooperatives in Maleny

Other cooperatives in Maleny include:

  • Maleny Film Society (MFS);
  • Family and Community Empowerment (FACE);
  • Maleny Neighbourhood Centre;
  • Local Economic and Enterprise Development Cooperative; and
  • Hinterland Community Radio, a cooperative radio station.

Building successful cooperatives

The experience of the Maleny cooperatives shows that building successful cooperative enterprises involves several steps.

  • Fulfil a need. No matter how good the idea, if there is not a community need, the enterprise will not succeed.
  • Establish a founding group. Usually a few committed people develop the initial idea. A small team tends to provide the leadership.
  • Commit to a vision. Commit to the ideals and values implicit in cooperative enterprises, and try to ensure that both the members and the management are honest, dedicated and competent.
  • Conduct a feasibility study. To evaluate whether or not the perceived need is feasible, conduct a feasibility study.
  • Set out clear aims and objectives. This will help direct everything from the founding group’s initial focus to promotional strategies and budgetary processes.
  • Develop a sound business plan. The enterprise will require capital, have to manage its finances efficiently, and have to make decisions about loan repayments and profit allocation.
  • Ensure the support and involvement of the members. The members own the enterprise; at every step, their support and involvement is essential.
  • Establish a location. Establish a physical location for the operation of the enterprise, preferably in the centre of the community.
  • Get skilled management. Bring in to the enterprise people who have the necessary management, business, financial, legal and accounting skills.
  • Continue education and training. Ideally, the members will have the skills, particularly the communication and interpersonal skills, to run the enterprise. If not, they will either have to develop such skills themselves or bring in new members who have them.

The golden rules for beginning a community economic strategy are clear:

  • start small, with the skills and resources available within the community;
  • make use of role models, those with experience in community development, wherever possible; and
  • make sure the enterprise involves as many people as possible.

Community benefits

Cooperatives bring people together, encourage them to use their diverse skills and talents, and often provide them with the opportunity to develop new capabilities. They create a sense of belonging, build close relationships among different types of people, and empower them to make decisions to develop their community.

Working together, a community is able to accomplish much more than if the various individuals go their separate ways. This is because economically, cooperatives produce various types of goods locally, provide a range of local services, create employment, circulate money within the community, and make the community economically self-reliant.

In essence, successful cooperative enterprises transform a community by establishing economic democracy. Thus, cooperative enterprise is the socio-economic system of the future. In Maleny, that future is unfolding before us right now.

Published by Prout Community Settlement Cooperative, PO Box 177, Maleny, 4552, Australia.

 

Differing views on Venezuela and Chavez

Venezuela

The question arises did Venezuela really introduce a cooperative system or is this Newspeak for nostalgic leanings to a Marxist-Leninist system? Are these cooperatives directly controlled by the people? It appears the apparatchik lean over them and control the money supply. So it is dubious if these are coops or pseudo coops. It looks like they may be pseudo coops, because of the control of money supply by the political party in power. The matter needs to be thoroughly examined. Real coops need to be rooted in economic democracy – which is about decentralised economic power.

With so much wealth from oil, surely it would have been not so hard to really give the cooperative ownership to the people and their communities. It appears it did not happen.

What is wrong in Venezuela is not so difficult to understand. Simply stated, it adopted an outdated Marxist-Leninist socio-economic approach, despite the fall of communism since over 2 decades ago. This was a fatal error of Chavez. He did not consider the importance of the middle class and providing them with the necessary amenities and incentives to fulfil their potential.

It was admirable that Chavez lifted living standards to some extent. However, the correct approach, and it was do-able in Venezuela (given its wealth from oil) would have been to balance the economy and attain an equilibrium. How?

1. A constitutional guarantee that all persons have the right to obtain their minimum requirements of life, namely food, clothing, housing, education, health care, by providing employment so that people attain sufficient purchasing power to acquire these basic necessities of life.

2. After that, the economic principle is that surplus wealth be distributed in 2 streams:
i. to meet common amenities that everyone requires above their minimum necessities (e.g. essential goods like refrigerators) or to meet universal service obligations such as electricity, communications, transport; and
ii. to provide special amenities or incentives on a merit basis to suit and enable persons to render service to society or apply their skills and knowledge for social good or that are necessary for research and development or innovation.

Venezuela has gazillions of petro-dollars coming in. But the kleptocrats, Chavez and Maduro, have made it so the people can’t get toilet paper. Where are the large gains in living standards? It is the government’s mismanagement and corruption that has bled Venezuela’s wealth away whilst leaving the population impoverished – making $1, $2 or even $5 dollars a day doesn’t make you rich. Maduro and his regime have to realize that they need to alter the course of the ‘Bolivarian revolution’ so that it works for the Venezuelan people as a whole.

Let us consider oil production in Venezuela. The top oil producers in the world, according to the International Energy Agency, producing around 64% of world supply, are:
* Saudi Arabia 13 %,
* Russia 13 %,
* United States 9 %,
* China 5%,
* Iran 4 %,
* Canada 4 %,
* United Arab Emirates 4 %,
* Venezuela 4 %,
* Kuwait 4 % and
* Iraq 4 %.
There are other producers around the world for the remaining 36%.

Of the top producers some of them have created a cartel, i.e. OPEC (Organization of the Petroleum Exporting Countries), in other words they have economically centralised power. OPEC’s founding members are 5 countries namely Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. These countries were later joined by Qatar, Indonesia, Libya, United Arab Emirates, Algeria, Nigeria, Ecuador, Gabon and Angola. But later Gabon terminated its membership and Indonesia suspended its membership. Ecuador also suspended its membership temporarily, but not now. Currently, OPEC has a total of 12 member countries.

Venezuela is a founding member of OPEC. It can easily create lasting fiscal stimulus for the country and resource security through its oil resources and their downstream processing industries, even more than the USA. Yet Venezuela imports gasoline, and loses money on PDVSA – Petróleos de Venezuela, S.A. – the state-run oil company. PDVSA makes US$6 billion+ in losses per year. That is not how a key industry should be running – the obligation to the people is to run on a no profit no loss basis.

Why the losses and inefficiencies? Due to:
– restrictions on domestic prices and extremely cheap prices to consumers (stimulating use of motor vehicles, congestion and pollution),
– free oil giveaways to political allies, e.g. Cuba,
– pricing and marketing restrictions (cartel conduct) by OPEC membership, and
– most importantly, crumbling or non-existent infrastructure for advanced extraction and refining of oil.

The first 2 are not as significant as the latter 2, and can have economic benefits if properly applied. The latter 2 result in monopolisation (economic centralization) and inability to diversify the economy to make it more self-sufficient. But these losses and inefficiencies should not happen when there is so much wealth latent in Venezuela’s oil resources. These oil reserves and the extraction and post extraction industries are a boon for Venezuela, but potential is being lost and squandered.

The key industry sector of oil (a public resource), and its secondary industries (to be run as cooperatives), need to be revamped and heavily invested in. This requires reform of the state-owned enterprise of PDVSA so it operates properly as a key extracting industry. Also, domestic refinery facilities and capacity needs to be invested in (so as to reduce reliance on importing finished fuels) and this industry activity needs to move towards cooperative ownership. Secondary and downstream industries need to be built up in the country.

There are also large subsidies on gasoline in the country, making it cheap, leaving a carbon footprint, and potentially having negative effects on building other transport infrastructure besides roads for cars (i.e. there is maladjustment in infrastructure spending and development). These large subsidies do not make much sense, although some subsidisation may be warranted to give people common amenities of transportation, but the whole transport infrastructure diversity needs to be considered. The subsidies make not much sense given the importation of expensive refined gasoline by Venezuela.

Thus the fundamental problem lies in lack of industrialisation of the oil extraction industry and lack of secondary industries for carrying out refinement processes. Why import refined products (gasoline) when you can do it yourself. But this is not possible under a Marxist-Leninist style outlook which produces State capitalism (and economic centralization) and tends towards totally inefficient industry and production. That is the core of the matter.

Individual or group capitalism (corporate capitalism) is also not the solution. A system of recognising oil as a key industry held on trust for the public, and with refinement and other downstream industries being based on a cooperative model, operating in a market economy, is what is required.

What kind of world do we want?

What kind of world do we want?

To envision our future, it is vitally important to ask: what kind of world do we want? What are the alternative socio-economic models that promote the welfare and development of every person, physically, mentally, and spiritually. What models address fundamental factors like guarantee of minimum necessities of life to all, right to jobs, structure of the economy such as a three-tiered economy (small-scale private enterprises, cooperatives, and large-scale publicly owned key industries), food sovereignty and sustainable agriculture, proper utilization of natural and human resources, and economic democracy. And what model promotes an ecological perspective that sees all facets of this created world as one integral entity.

New paradigm

Every human being should have the opportunity to fully develop and constructively express their physical, mental and spiritual potentials. Current economic systems of development are unable to provide this opportunity. They cannot even ensure the peace, equity, sustainability, basic necessities and social unity required for basic human existence. No amount of reform within a capitalist (or State capitalist – communist) system can change this, as their limitations stem from their fundamental values. Rather than focus on criticizing the defects of the dominant paradigm of development – essentially the centralized capitalist economy where most wealth is vested in the hands of a few – the emphasize should be on developing a universalistic outlook so that people can act for the good of all, being within their collective communities and to enhance their individual development, at all levels of existence (not just the material plane). For this we need an empowering vision that provides a constructive means to build a truly sustainable and abundant future.

Based on a universal humanist outlook, or rather new humanism (neohumanism), that values the welfare of all living beings, the fundamental social objective becomes that all people must have reasonable opportunities and the right (along with responsibilities) – individually and collectively – to develop and progressively utilize their physical, mental and spiritual potentialities, while sustainably coexisting with the other living beings of the Earth. This is the real Principle of Social Equality.  Policies and implementation of solutions in the economic, social, cultural and political spheres of life have to adhere to this principle.

Conditions for social transformation

Many people recognize the need for a new paradigm of development required on this planet, but cannot envision how the leviathan global economy, with its allied state power, can be replaced. While this undertaking seems daunting, the inevitable alternative to the continuation of greed-driven, unsustainable growth is collapse. Reforms that ameliorate the excesses of the global economy are not sufficient; they can only slow, but not stem, the tide. Examples of ‘excesses’ include mass accumulations of wealth in the hands of a few (via the centralized capitalist economy), mass pollution of environments, mass destruction of flora and fauna for animal-based food industries, mass ill-health such as the obesity crisis, and so on.  Deep solutions, based on new values and new approaches, are necessary. We need a viable means for transitioning to a sustainable and life-promoting society, placing emphasis on providing people with their minimum necessities of life, along with a positive outlook of hope, vision and empowerment.

While recognizing that humanity faces unprecedented problems, and that significant disruptions in social life are now upon us, there does exist a positive outlook on humanity’s future. It sees the difficulties of the present forcing shifts of consciousness and creating conditions for the rapid emergence of a universal humanity, able to work together to develop the rich potentialities of the human species that have been long suppressed by an excessively materialist culture. Let’s open a path through the darkness of the present to this new stage of human existence and to provide a socio-economic paradigm in which humanity’s emerging new consciousness and unity can take root in fertile soil and flourish. Let’s seeks to open a cleared vista, without dogma-created impediments, to the comprehensive fulfillment of human potentialities.

Social progress

Collective social progress is imperative for a healthy society. Social progress refers to the continued betterment of humanity through meeting its basic needs, then increasing its living standards, including by developing infrastructure to ensure further progress and the creation of opportunities that allow each individual to reach their highest potential. This differs greatly from today’s idea of social progress, which is viewed through a lens of profit, greed and control. But there is another factor that influences our institutions and our subsequent worldview. That is the influence that philosophy has over society and is key to understanding humanity’s current trajectory.

Our advancements in technology and integrated knowledge are tools that can assist us in co-creating an age of prosperity and peace for all. However, for a happy living we need resources – physical, psychic & spiritual – and a clear understanding of how to best utilize these and to rationally distribute them so that everyone can express and reach their best potential.  Really, resources are owned by all – there is ‘Cosmic ownership’ of all these resources – and so it follows that fundamentally there is a ‘cosmic inheritance’ by all living beings. Given that is the case there has to be maximum and progressive utilization and rational distribution of resources (and their potentialities) in society in the interest of the good and happiness of all. When resources are handled in such a manner, then the existential and developmental needs of all human beings can be fulfilled. And combined with ethical governance under moral leadership peace, security and unity in human society can be established. Everyone can be protected from all forms of exploitation, and justice can be given to one and all promoting social progress.

PROgressive Utilization Theory – PROUT

In support of these fundamentals the theory of PROUT proposes a political system for good governance of society, and an economic system to assure fulfilment of everyone’s existential wellbeing as well as their utility value. PROUT is an acronym for Progressive Utilization Theory (PRO-U-T) and it stands for progressive utilization of all resources individual, collective and universal for human welfare and also for the betterment of animals, plants and the environment as a whole. PROUT is a socio-economic philosophy that synthesizes the physical, mental and spiritual dimensions of human nature. By their maximum utilization and through the rational distribution of resources (starting at the point of potentialities) we can achieve a truly progressive human society.

The central message of PROUT is that it must free human beings from mundane problems so that all will have increasing opportunities for intellectual and spiritual liberation. Shrii Prabhat Rainjan Sarkar (the propounder of PROUT) observed, “Economics today is a theoretical extravaganza. It should be made more practical.” He was of the view that economics must be a precise, practical science and should be properly developed for the welfare of all. PR Sarkar was a philosopher, social reformer, and spiritual teacher dedicated to the task of planetary transformation. Through his actions and teachings he inspired people to develop themselves to their fullest, and to assume greater responsibility for humanity’s welfare.

PROUT is an alternative to the outmoded capitalist and socialist/communist socio-economic paradigms. Neither of these approaches have adequately met the physical, mental and spiritual needs of humanity. PROUT seeks a harmonious balance between economic growth, social development, environmental sustainability, and between individual and collective interests. Combining the wisdom of spirituality with a universal outlook and self-reliance within communities, PROUTist thinkers and activists are creating a new civilizational discourse and planting the seeds for a new way of living.

A few basic tenets of PROUT

Spirituality and progress
Each human being is on an evolutionary path in the course of which they strive for realizing a higher consciousness. True progress is movement that leads to self-realization and spiritual qualities such as compassion and love for all beings. Material or intellectual gains do not necessarily constitute progress unless they contribute to deeper, spiritual well-being. The progressive orientation of society is maintained by making continual adjustments in the use of physical resources and mental potentialities in accordance with spiritual and neo-humanistic values. Human beings are encouraged to construct economic and social institutions to facilitate the attainment of our highest potentialities.

Economic democracy
Political democracy and economic democracy have to develop together. People must advocate for economic democracy based on local economic planning, cooperatively managed businesses, local governmental control of key natural resources and key industries (a type of public trust), and socially agreed upon limits on the individual accumulation of wealth. By decentralizing the economy and making sure decision-making is in the hands of local people, we can ensure the adequate availability of food, shelter, clothing, health care and education for all. A decentralized economy can better ensure that the ecological systems of the earth are not exploited beyond their capacity to renew themselves. Environmental stewardship is a requisite for people who are dependent upon these systems for their own survival and well-being.

Basic necessities guaranteed to all
The basic necessities of life must be a constitutional birth right of all members of society. People cannot attain their highest human potential if they lack food, shelter, clothing, health care and education. Meaningful employment with a living wage must be planned to ensure adequate purchasing power for all basic necessities. The standard of guaranteed minimum necessities should advance with increases in the economy’s productive capacity.

Leadership
For a benevolent society, it is essential that leaders are morally principled and dedicated to serving society as part of their personal progress. Authority should not be centered in the hands of individuals, but should be expressed through collective leadership. The viability of political democracy rests on an electorate possessing three factors:

  1. Education,
  2. Socio-economic consciousness,
  3. Ethical integrity.

Freedom
Individuals should have complete freedom to acquire and express their ideas, creative potential and inner aspirations. Such intellectual and spiritual freedom will strengthen the collectivity. Restrictions should only be placed on actions clearly detrimental to the welfare of others. Constraints need to be placed on the accumulation of physical wealth, as excessive accumulation by a few results in the deprivation of many.

Cultural diversity
In the spirit of universal fellowship, the protection and cultivation of local culture, traditions, language and historical heritage are necessary, but must be in accord with cardinal human values, such as love for all and furthering the development of humanity as a whole. For social justice and a healthy social order, individual and cultural diversity must be accepted and encouraged.

Women’s rights
We have to accept the struggle for liberation against all forms of violence and exploitation used to suppress women. Here the goal is coordinated cooperation, with equal rights between men and women. As well, to seek the economic and social empowerment of women throughout the world, expression of culture and leadership, including spiritual.

Science and technology
Scientific knowledge and technology are potential assets to humanity. Through their proper use, the physical hardships of life decrease and knowledge is gained about the secrets of life. Time is freed for cultural, intellectual and spiritual pursuits. However, the development and utilization of scientific knowledge must come under the guidance of neohumanist values and ethical leadership. Without this, technology is often abused by profiteers and the power-hungry, resulting in destruction and exploitation.

Global constitution
PROUT supports the creation of a world governance system having a global bill of rights, global constitution and common penal code in order to guarantee the fundamental rights of all individuals and populations within nations and territories of the world, and to settle regional and international disputes. As the global economy becomes decentralized, it will be advantageous to also have a global political system so that common standards of law-making, application of laws and dispute resolution is achieved.

What is PROUT?

What is PROUT?

PROUT is an acronym for PROgressive Utilization Theory, a socio-economic philosophy that synthesizes the physical, mental and spiritual dimensions of human nature. The objective of PROUT is to provide guidance for the evolution of a truly progressive human society.

PROUT is an alternative to the outmoded capitalist and communist/collectivist socio-economic paradigms. Neither of these approaches has adequately met the physical, mental and spiritual needs of humanity.

Combining the wisdom of spirituality with a universal outlook, and the principle of social equality with economic democracy, PROUTist thinkers and activists are creating a new civilizational discourse and planting the seeds for a new way of social living.

A few basic tenets of PROUT are:

  • Spirituality and Progress

The evolutionary path of human beings has been to continually raise our consciousness and so we have a yearning to realize our higher consciousness. True progress is movement that leads to self-realization (knowing internally that individual consciousness is one with Universal Consciousness) and expressing our spiritual qualities such as compassion and love for all beings. Material and intellectual developments make life easier and expand our awareness, but can have both positive and negative effects and so do not necessarily constitute progress unless they contribute to human welfare by enabling deeper spiritual well-being.

The progressive orientation of society is maintained by making continual adjustments in the use of physical resources, mental capabilities and spiritual potentialities based on principles of distribution and utilization that promote happiness and welfare, in accordance with neo-humanist values. These are value based on spirituality that promote love for, and the welfare of, all entities in the universe. Human beings should endeavour to build their social relations and institutions to facilitate the attainment of our highest potentialities based on such principles and values.

  • Economic Democracy

Political democracy and economic democracy are mutually reinforcing. Social welfare requires a harmonious balance between economic growth, social development and environmental sustainability, and between individual and collective interests.

The enhance the economic welfare of all people, economic democracy is required based on local economic planning, local governmental management of natural resources and key industries, cooperatively managed economic enterprises for most of the economy (with a residual small businesses sector), and socially agreed upon limits on the individual accumulation of wealth.

By decentralizing the economy and making sure decision-making is in the hands of local people through socio-economic boards, we can ensure the adequate availability of food, clothing, shelter, health care and education for all. A decentralized economy can better ensure that the ecological systems of the Earth are not exploited beyond their capacity to renew themselves. Environmental stewardship and responsibility is a requisite, as all people are dependent upon the ecological systems of the world for their own survival and well-being.

  • Basic Necessities Guaranteed to All

The basic necessities of life must be a constitutional birth right of all members of society. People cannot attain their highest human potential if they lack food, clothing, shelter, health care and education. Meaningful employment with a living wage is fundamental to economic planning to ensure adequate purchasing capacity for all the basic necessities of life.

In addition, people must have enough to also obtain common amenities such as transportation and communication. Proper provision should also be made so that people can participate usefully in society through access to special amenities and incentives so as to render greater social service.

The standard of guaranteed minimum necessities should advance with increases in the economy’s productive capacity. The same applies in relation to common and special amenities and the provision of other incentives.

  • Leadership

For a benevolent society, it is essential that leaders are morally principled and dedicated to serving society as part of their personal progress. Authority should not be centred in the hands of individuals, but should be expressed through collective leadership.

The viability of political democracy rests on an electorate possessing three factors: • education; • socio-economic and political consciousness; • ethical integrity (or moral consciousness).

  • Freedom

Individuals should have full freedom to acquire and express their intellectual pursuits, ideas, creative potential and inner aspirations. They should have full freedom of spiritual pursuits and practices. Such intellectual and spiritual freedom will strengthen the collective well-being of society. Restrictions should only be placed on actions clearly detrimental to the welfare of others.

Constraints need to be placed on the accumulation of physical wealth, as excessive accumulation by a few results in the deprivation of many. It leads to scarcity, centralization of economic power and disempowerment in economic, social and cultural affairs. Everyone’s economic, social and cultural rights must be protected and fulfilled.

  • Cultural Diversity

In the spirit of universal fellowship, people must have guaranteed rights to develop and express their local, ethnic and indigenous cultures, languages, customs and traditions. Social harmony also requires racial equality and coordinated cooperation among different ethnic groups.

The true spirit of social fusion lies in establishing unity in diversity. For social justice and a healthy social order, individual and cultural diversity must be accepted and encouraged. Practices should not be detrimental to the welfare of others.

  • Women’s Rights

The struggle against all forms of violence and exploitation used to suppress women is to be supported, as also movements for social equality and the fight against inequality based on sexual differences. The value of women in human society, including value of labour and contributions generally, is equal to that of men in both individual and collective life.

Society should have a coordinated, cooperative leadership between males and females. There must be equal rights for women and men, with equal opportunities offered to each and all. This means the political, economic, social and cultural empowerment of women throughout the world.

  • Science and Technology

Scientific knowledge and technology are assets to humanity, for our common benefit. Through their proper use the physical hardships of life decrease and knowledge is gained about the secrets of life and the universe. Time is freed for cultural, mental and spiritual pursuits.

However, the utilization of scientific knowledge and development of technology should be under the guidance of neo-humanist values and requires ethical leadership, so that discoveries and innovations are used for the welfare of all. That is, cultivation of science and development of civilization go together. Without this, technology is often abused by profiteers and the power-hungry, resulting in exploitation and various kinds of destruction.

  • World Government

The formation of a world governance system should be gradually developed and supported, having a global bill of rights and global constitution which, among other things, guarantees fundamental human rights and freedoms including the minimum necessities of life for all individuals and communities. There should be a common penal code for the entire world. Nations should settle regional and international disputes based on a global legal system.

A global political system has the advantages of free movement of people, lessening of people’s fears and tensions, less bloodshed, and less military expenditure.

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