New-Economy Movement

The idea that we need a “new economy”—that the entire economic system must be radically restructured if critical social and environmental goals are to be met—runs directly counter to the American creed that capitalism as we know it is the best, and only possible, option.

Especially after the recent financial crisis, many new-economy organizations have been getting much more support, and the term is entering into public discourse more and more.

Although precisely what “changing the system” means is a matter of considerable debate, certain key points are clear: the movement seeks an economy that is increasingly green and socially responsible, and one that is based on rethinking the nature of ownership and the growth paradigm that guides conventional policies.

There is a new emphasis on businesses “whose priorities are broader than those that typically flow from the corporate emphasis on the bottom line.”

  • Worker-owned cooperatives — egalitarian, often green.
  • Social enterprises that use profits for “environmental, social, or community-serving goals.”
  • Urban agricultural efforts.
  • Employee ownership plans.
  • B corporations — registering as this status “allows a company to subordinate profits to social and environmental goals” without fear of being sued by stockholders.
  • Business Alliance for Local Living Economies (BALLE) — works to strengthen new-economy networks, “with the ambitious long-term goal of developing a global system of interconnected local communities that function in harmony with their ecosystems.”

The New Economics Initiative (NEI) is one of several organizations that have begun to “deal systematically with fundamental problems of vision, theory and longer-term strategy.”

 One shared effort is attempting to develop detailed indicators of sustainable economic activity. As many scholars have demonstrated, the gross national product indicator is profoundly misleading: for instance, both work that generates pollution and work that cleans it up are registered as positive in the GNP, although the net real-world economic gain is zero, and there is a huge waste of labor on both sides of the effort.

The New Economy Working Group is working to develop “detailed designs for state and local banks in support of new-economy institutional development.”

Challenges to the movement:

  1. Many new-economy advocates concerned about global warming and resource limits hold that conventionally defined economic growth must be slowed or even reversed.
  2. Many new-economy advocates hold progressive views on most issues of concerns to labor. Still, the ultimate goal of reducing growth is incompatible with the interests of most labor leaders.
  3. The traditional organizations spend most of their time trying to put out fires in Washington, Speth notes, and have little capacity to stand back and consider deeper strategic issues—particularly if they involve movement building and challenges to the current orthodoxy.

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Alperovitz, Gar. “The New-Economy Movement.” The Nation. 25 May 2011.

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