Hybrid Economics

Talk on Hybrid Economics by  Randy Hayes

Given at “Techno-Utopianism and the Fate of the Earth” Conference hosted by International Forum on Globalization (October 26th 2014)


It is a real pleasure and a joy to introduce our next speaker, a great friend and comrade of mine, Randy Hayes. Those who were fortunate to hear Ralph Nader speak– if you think you’re the smartest guy in the room, you’re not once Ralph Nader gets into that room, trust me. Ralph talked about the need for leadership, and I don’t think anybody reflects the fulfillment of that more than Randy Hayes. Randy has been a major leader if the environmental movement for decades. He created the Rainforest Action Network, the amazing organization that is today, he’s currently a consultant with the World’s Future Council, I’m honored that I’ve been able to co-found Foundation Earth with him–a new organization that’s already having a big impact on the environmental movement and that actually funded the Pre-Conference in San Francisco, many of the people that presented here are people without which this conference would have never happened.

Before that though, Randy worked in government, he was actually the green tsar. I think it was the Director of Sustainability for the city of Oakland when Jerry Brown was mayor there. Randy was also President of the San Francisco Commission on Environment for 5 years. So, he’s seen it from both sides. He also has been arrested, I think in 12 countries. Randy is known as one of the great strategic activists of our time, but I think what most people don’t know, and I know him so well, no one researches, does his homework, studies, and reads more about the environment and energy issues than Randy Hayes. He’s not just a great activist, he’s one of the great thinkers of our movement. If there was an award for most fun to hang with in the environmental movement, there is no doubt who would get that award, Randy Hayes.



I always try to wear a tie when I get arrested, just to forewarn you, the night’s young. It’s really good to be here with all of you, at the inaugural “FRED Talks.” Thank you, Tom Butler, for the parable yesterday, but also for designating these “FRED Talks.” For those of you who weren’t here yesterday, it stands for: “Facing the Reality of Extinction and Doom.” Fortunately, not all things are extinction and doom, at least not yet. In fact, if you listen really carefully, you can hear the simple, clear sound of appropriate technology. Mr. Timekeeper, the Tibetan bells.

Now, I thought it was about 8 minutes, but it turns out I have a little more time than that, so in about 18 minutes, I was tasked to convey something to you, useful, hopefully, about an economic model for deep, long-term sustainability. Can a true-cost economy help retain us in the holocene? Well…20, 40, 60…Mr. Timekeeper, remember that conversation we had earlier about the relativity of the time, 2 hours?

Well, now for my talk. In conclusion, high finance industrial casino capitalism is fundamentally unreformable. And there are ten reasons to back up that assertion, therefore it must be true. However, there’s really no coherent alternative method for deep, long-term sustainability that has any wind in its sail right now. If you think about any other economic -isms, be it Marxism, or Socialism, or Communism, or Capitalism, none of them gave a sh*t about nature, and they still don’t for the most part, I would contend. I hear you, Q&A will come up. So I think it does behoove us to buy some time until someone comes up and put a little more wind in the sail of some of these alternative economic -isms.

In terms of those 10 reasons for why Capitalism is fundamentally unreformable, I’ll run through them quickly. Capitalism erodes and corrupts democracy. Capitalism is bottom feeding.—pitting counties, and states, and countries against each other. It drives off accountability. Capitalism’s values are vastly insufficient. One example, it doesn’t take care of things like child labor laws. It fails to help the poor, the model has really underserved about 3 billion people across the planet. Capitalism has a stability problem, a debt accumulation problem, and it’s highly subsidized. Global capitalism undercuts local economies, as we heard from so many speakers, its undercuts diversity and it fosters homogenization. It destroys nature’s very life support systems, which is dangerous.

Well, fortunately the economic model for deep, long-term sustainability is not rocket science, I think it’s actually relatively simple and straight-forward in many respects. You think about the land and the sea and its capacity for self-renewal, this is the model for a healthy economy. You can read about it in Andy’s book, Salmon Economics. It operates on daily solar income, it efficiently recycles its nutrients, and more importantly there’s no phony bookkeeping. Phony book-keeping is when you hide something important. But there’s no phony bookkeeping in an Alpine meadow. There’s no phony bookkeeping in a salt marsh. There’s no phony bookkeeping in a tropical rainforest. But you can find a lot of phony bookkeeping in that high-finance, industrial, casino economy. They’re using phony bookkeeping to hide so many of their deeply harmful impacts against the planet’s life support systems. In fact, I think a simple name for the current system that we have is “Cheater Economics.” The more you cheat the system, the more you cheat the Earth and the future, and the entire web of life, including us humans, the more profitable you are in the short-term. We have to confront cheater economics. So we ask ourselves, “What are the ingredients for change, what are the qualities of the economic model for deep, long-term sustainability?”

Let’s start with he Jerry Mander, he provides an excellent list, where he talks about the ingredients of change. We start with the primacy of scale, not large scale, but small scale, not global, but local. The qualities go on with slower, and less, and bottom-up, and shared, and community-owned, and microeconomic, and collaborative, and less trade, and less energy, and small business.

At Foundation Earth, we published an essay on a true cost economy where we go into the 12 key principles guiding a holistic true-cost economy, which you can find on our website. But it starts with the interdependence principle that we just talked about, where societal recognition is that nature nourishes all things, and that that’s a far higher value than human self-interest. It goes on to the responsibility principle, where we think each generation should leave less and less of an ecological footprint despite the population size or the consumption rates or the technology choices. In whatever mix of those three elements, we still need to leave the subsequent generation with less and less of an ecological footprint. Every human has the duty to protect the diversity of the whole.

The carrying capacity principle simply says free markets are not free from ecological limits, as Juan Shanativo often argues. The true cost principle, when pollution externalities are internalized, means the price you pay for the goods and services actually creates a situation in which the ecologically cleanest is the financially cheapest. When you have the ecologically cleanest as the financially cheapest, we might be able to build a movement, we could really get a lot of people on our side. Don’t you think that a toxic tomato should cost more than a tomato? We label our food ‘organic food’ and ‘food,’ that’s a little bit wrong. It’s ’food’ and ‘toxic food,’ and shouldn’t toxic cotton cost more than organic cotton? I think so.

There’s a few more principles, the non-commodification of nature principle, which we heard about from the indigenous people’s panel, the precautionary principle, which has come up a number of times, the compassionate local self-reliance principle. Think of continental networks of bioregional economies. The compassionate part has to do with each bioregion that seeks, over time, to continue to maximize its self-reliance, not just the basic stuff of food, clothing, and shelter, but the comfort items of life as well. And the compassionate part is to be there to help your neighbor, whether your neighbor is the next watershed or across the planet, and primarily to help them become more self-reliant. I think the primary commodities, the things that we ought to treat globally, are art, culture, and ideas, not the stuff of our lifestyles.

Another principle is the public governance principle, and the ecological or biospheric literacy principle, where wild nature operating according to its own laws becomes our principal teacher. The closed loop principle is important, an economy needs essentially to be a zero waste, closed loop, sustainable consumption and production system. There’s the beginnings of that in Europe with some of the Take Back Factories that they have.

The feedback principle is the 12th principle, and that’s simply something that I learned from Frichoff Caper. Every living system must have accurate feedback loops to be self-correcting. Our feedback loops will be things like the Happiness Index and the Genuine Progress Indicator and things like that. But there’s another key aspect of the economic model for deep, long-term sustainability that’s probably the most important aspect, at least in my mind, and that’s just simply technology policy itself. Consider this quote from Jared Diamond who wrote “Guns, Germs, and Steel, and Collapse.”  He knows something about the collapse of civilizations. He said, “all of our current environmental problems are unanticipated, harmful consequences of existing technology.” Not some of them, he said all of them. And then he goes on to say that, “there is no basis for believing that technology will miraculously stop causing new, unanticipated problems while it is solving the problems that it previously produced.”

People say things like, “climate change is a problem.” Bill McKibben said that to us yesterday. I want to challenge that for a moment. What is climate change? In the simple sense, climate change is the global warming from the burning of fossil fuels and deforestation. But another way to think about climate change is that it’s really the symptom of a much deeper and more dangerous problem.

Let’s go back to the 1700’s. That’s actually when Andy Kimbrell and I first met. We were in London, as I recall, and we didn’t use much energy.We burned a little bit of wood, and life was pretty good. Then all of the sudden, Andy starts digging out coal from the hillside. Then he invents the steam engine, and we think, “Hey, that’s pretty cool! That’s making life easier.” Then time rolled by and it was the 1800’s, and Andy and I went into this sleazy bar and we met these two other characters, Doug Tomkins and Wes Jackson. Doug was all excited because he discovered oil and gas, and Wes, being the clever guy that he is, was all excited because he had invented some process that he was going to name the W J Process, but he ended up calling it the Haber-Bosch process. And we thought, “Wow! This is pretty wonderful.” It just all seemed like a good idea at the time, and we didn’t realize there was going to be a terrible price to pay for these energy technology choices that we were making back then, that it was going to shred literally the web of life itself and start to superheat the planet that we live on. It’s not climate change, we’re turning the blue sky into a toxic furnace, this is dangerous stuff. We need a plan for this, and part of the plan, it strikes me, is the technology policy for a nation-state.

Michael Hughsmann mentioned yesterday that he thought Sweden had the beginning of it, but it was really lacking a lot. So perhaps what we need is an Unanticipated Consequences Act of 2015, where we would register our technologies, and authorize them, and report on them and have 5 year National Assessment Reports to try to figure out the unanticipated consequences early on so that we can make some adjustments early on. I’m hoping someone in the audience will just write the Unanticipated Consequences Act of 2015 and bring it on down to Washington DC to the Foundation Earth offices and we’ll start shopping it around. If we can’t get it through the US Congress, we’ll send it over to Iceland or to the German Green Party or something. We’ve got to start making things happen. So a key point here really is: if you misidentify the nature of the problem, you’re quite likely to misidentify the better nature of the right solutions.

In conclusion, we need to ask ourselves, “Can we ecologize industrial capitalism?” Well, no, we kind of covered that, right? But we damn well better plea for damage control so that we can buy some time, and actually believe that that can be done.

If you think about the global economy from an ecological perspective, to me there are two major things that it fails greatly at. One, is about carrying capacity, there are institutions to ratchet economic activity down around carrying capacity limits, that’s atmospheric global carrying capacity, or continental, or bioregional. We have to come up with these institutions. I you think about the cap and trade program around global warming, if they had called it cap and reduce, which is what it is, people would have got that you put a ceiling on it and would have started to ratchet it down. It might have been more salable. The second thing that the global economic system fails at is that there’s not way to internalize those negative pollution externalities. But it’s not really about internalizing them in the sense of price. It’s about eradicating them so that they don’t exist in the first place. We have to come up with a system in which the market signals tell the ecological truth. I believe what we’re going to find is that history will record industrial civilization over the last couple of hundred years as the real bubble economy. Why? Because it does not tell the ecological truth, and it uses phony book-keeping.

Now Wes may argue that’s not actually the past 200 years of industrial civilization, that perhaps it goes back 7 or 10,000 years to agriculture, but we’ll fight that one out.

Industrial civilization simply does not abide by the immutable principles of ecology as we’ve heard in so many different panels. There are key steps to do damage control on the existing model, and one of them Foundation Earth did quite a detailed report on called, “Mandatory Corporate Ecological Impact Disclosure, A Working Paper.” But this is really about how the Securities and Exchange Commission could require—voluntary codes of conduct are not getting the job done, we won a lot of those battles at the Rainforest Action Network, they did not create the great ecological U-turn. But this is about mandatory corporate ecological impact disclosure, and that includes even the entire supply chains for all the corporations around the world. Fundamental to any new economy that thinks it’s a better economy is excellent transparency, particularly of ecological impacts, but particularly in terms of the great cycles of the planet, the biosphere’s life support systems. We don’t trust the corporations to do this reporting, so we’ve come up with a strategy, like a certified public accountant, but these would be certified ecological auditors, and the data would be pubicly available to the world. Again, you can get this on our website.

In conclusion, yet again…Bill McKibben is my friend, I know Bill McKibben, and I actually really believe Bill McKibben is a heroic person. But I also believe that he gets part of his message wrong, and that’s that stopping the use of fossil fuel and climate change are the most important issue of our time. Well, the biosphere’s life support systems, according to one scientific framework, the Planetary Boundaries, has 9 slices of the pie, 9 key aspects. And they can calculate a safe operating zone for each of those 9 aspects of the planet’s life support system. 3 of those 9 are off the chart, and one of them is, in fact climate change, but it’s also the nitrogen cycle, and the phosphorous cycle of the planet that are just off the chart. But the one that’s most off the cliff actually turns out to be biodiversity loss. The main point here is that if you lose any one of those 9, you lose it all. To me, the most important message is that we have to be responsible to the whole. Each of us in this room today, the entirety of humanity—that’s the message that we’ve got to get out.

In final conclusion, it’s become very clear to me that $60 was just not enough to buy more time from the Timekeeper, and so I shall leave by beseeching you to keep thinking and learning. Thank you so much for coming to this teach-in. Keep speaking out about the ecological truth. Nature needs us to be the great ecological truth tellers for the planet. Keep leading society to live in synch with nature’s way, the way we heard from Vandana Shiva and many of the native speakers from that panel. With all of that, we’ll have an Earth that is abundant with bird song, and we’ll have oceans once again teeming with whales and their symphonic songs. So thank you all very much.