Trade Off: Financial system supply-chain cross contagion – a study in global systemic collapse


This study considers the relationship between a global systemic banking, monetary and solvency crisis and its implications for the real-time flow of goods and services in the globalised economy. It outlines how contagion in the financial system could set off semi-autonomous contagion in supply-chains globally, even where buyers and sellers are linked by solvency, sound money and bank intermediation. The cross-contagion between the financial system and trade/production networks is mutually reinforcing.

It is argued that in order to understand systemic risk in the globalised economy, account must be taken of how growing complexity (interconnectedness, interdependence and the speed of processes), the de-localisation of production and concentration within key pillars of the globalised economy have magnified global vulnerability and opened up the possibility of a rapid and large-scale collapse. ‘Collapse’ in this sense means the irreversible loss of socio-economic complexity which fundamentally transforms the nature of the economy. These crucial issues have not been recognised by policy-makers nor are they reflected in economic thinking or modelling.

This study draws upon simple ideas drawn from ecology, systems dynamics, and the study of complex networks to frame the discussion of the globalised economy. Real-life events such as United Kingdom fuel blockades (2000) and the Japanese Tsunami (2011) are used to shed light on modern trade vulnerability.

Degrowth Conference Budapest, 2016 – Non-Monetary Degrowth is Strategically Significant

Presentation by Anitra Nelson

Even for many radical adherents of degrowth, money is a common-sense — not simply capitalist — tool, so alternative currencies and banks abound. This paper argues against this common-sense logic, as follows. The most direct and efficient form of degrowth requires as-local-as-is-feasible production focusing on people’s basic needs, implying that future distribution is decided simultaneously with collectively agreeing on productive goals and ways of achieving them. Say, each person contributes a number of hours to collective production as a community obligation and, in return, has their basic needs met. Decision-making focuses on bio-physical, environmental and social measures and values; complex bio-physical and social efficiency is paramount in limiting throughput in production and associated exchanges. As a result, money has no place in degrowth, where grassroots political decision-making replaces production for trade and market exchanges. Similarly, so-called ‘alternative’ currencies that serve functions of legal tender or the ‘universal equivalent’ on which capitalism depends, are redundant. In non-monetary degrowth, reward for work is the security of having life-long basic needs met with continuous input in making decisions on both local production and the terms of exchange (compacts) with as-local-as-feasible neighbour-producers. There is personal, but no private, property: the entire Earth is commons with clear, efficient and universal principles and terms for commoning. Such a vision suggests that advancing specifically non-monetary degrowth — consciously breaking with monetary production and exchange — is of crucial strategic significance.

Degrowth Conference Budapest, 2016 – How to stop monetary growth pressure?

Presentation by Mark Joób

Generally, there is not enough awareness of the central role the monetary system plays with regard to sustainability. One of the main reasons is that for several decades economics has been dominated by a monetary theory that gives a false description of the monetary system and the role of money in the economy. Assuming that money on the macroeconomic level is basically neutral, traditional monetary theory does not recognize the negative impacts of the current money and banking system on society and the environment.

In reality, money created as debt carries interest and thereby contributes to a twofold growth pressure on the monetary system and on the real economy. Debtors need more money than they have borrowed because they also have to pay interest on their loans. In addition, business on the whole cannot be profitable unless the quantity of money continuously increases. This leads to the dynamics of growth which is a core characteristic of our economic system. The increase in the quantity of interest-bearing money exerts a monetary growth pressure on the real economy and the growth of the real economy simultaneously exerts an anti-deflationary growth pressure on the money supply. The growth of the real economy, which is to a great extent forced by the monetary system, involves an excessive exploitation of natural resources and is a hindrance to sustainable development. Financial indebtedness thus leads to ecological indebtedness towards nature, which impoverishes mankind.

Closing the green finance gap – A systems perspective

Meeting its climate policy objectives requires the UK to rapidly decarbonise its energy sector. This demands high levels of investments into low carbon energy infrastructure, which are currently not undertaken at required scale, leading to a green finance gap. We explore (1) key investment barriers, (2) a theoretical framework for investigation and (3) possible solutions, drawing on a review of academic literature and policy reports, and interviews conducted with financial investors and experts. Our study confirms that policy uncertainty and short-termism in the financial system are the two main investment barriers. Our results show that identified barriers form a complex system characterised by path-dependency, lock-in and non-linearity. We recommend the adoption of systems theory as an analytical framework to inform the related policy debate and propose the expansion or development of sustainable investment vehicles as a useful near-term solution while preparing a long-term policy intervention based on a systems perspective.

Environmental Innovation and Societal Transitions, vol. 34, March 2020, pp. 26-60

Faire l’économie de la haine. Essais sur la censure

Point de haine de l’économie là où on nous fait aimer l’argent, à tout prix. Point de haine de l’économie, mais une économie de la haine. Le programme: faire l’économie de la haine. Haïr sans qu’il n’y paraisse. Ainsi s’investit-on dans l’asservissement à l’argent. Sous les données, sous les calculs et sous la spéculation : des crimes, du sang, du vol et des morts, mais assourdis par ce savoir économique et ses prérogatives légales. Car l’argent fait écran: faut-il délocaliser des usines, licencier du personnel, polluer des rivières, contourner le fisc, soutenir des dictatures ou armer des chefs de guerre pour que le prix d’une action monte en Bourse? Cette culture de l’argent nous autorise précisément à faire l’économie de ces questions, sur le mode de l’autocensure. Alain Deneault tire un à un les fils de cette censure diffuse, pour s’émanciper du filtre marchand qui codifie le social.

Post-Growth Conference, Brussels 2018 – Workshop Sustainable Fiscal Consolidation

Chair : Philippe Lamberts, MEP (Greens/EFA)
Panellists: Elisabeth Hege (IDDRI, Governance and financing of sustainable development), Gaël Giraud (French Development Agency, senior economist), Marco Buti (European Commission, Director General of DG EcFin)

Post-Growth Conference, Brussels 2018 – Workshop Sustainable Finance

Chair: Kathleen Van Brempt (S&D)
Panellists: Martin Spolc (DG EcFin, Capital Markets Union, Head of Unit), Rens van Tilburg (University Utrecht, NL and Director of the Sustainable Finance Lab), Yannis Dafermos (Department of Accounting, Economics and Finance, University of the West of England, Bristol, UK)

Post-Growth Conference, Brussels 2018 – Workshop Economic Models

Chair: Alojz Peterle, MEP (EPP)
Panellists: Simone d’Alessandro (University of Pisa), Daniel Mügge (Universiteit van Amsterdam, Professor of Political Arithmetic), Bjorn Döhring (European Commission, Head of Unit for Economic situation, forecasts, business and consumer surveys), Arthur Turrell (Co-Author of “An Interdisciplinary Model for Macroeconomics” (Oxford Review of Economic Policy, Jan.2018)), Nicole Dewandre (European Commission, Joint Research Centre)

From ecological macroeconomics to a theory of endogenous money for a finite planet

This paper takes stock of the achievements and gaps of the emerging field of ecological macroeconomics, which has brought insights from specific schools of macroeconomics—most notably post-Keynesian—to ecological economics, with a strong emphasis on the endogeneity of money. Ecological macroeconomics has proposed fiscal, monetary and prudential reforms to boost ‘green’ investments, and developed new modeling frameworks to explore the interactions between the financial, macroeconomic and biophysical spheres. While these proposals open a broader range of possibilities to engage in a socio-ecological transition than those offered by the current paradigm of a financialized global economy, they paradoxically suffer from similar limitations. By placing much faith in ‘green’ investments, they impose a vision of the transition that presents strong technical and institutional limitations. The field also fails to revisit its own understanding of macroeconomics and of specific phenomena—e.g. financial instability—through a biophysical lens, in spite of increasing transdisciplinary evidence supporting this approach. We suggest overcoming these limitations through institutionalist perspectives that understand money as a language through which value is created and legitimized. Those perspectives seem essential to re-embed the governance of money within a worldview that acknowledges the finiteness and incommensurable values of Earth’s life support systems.

movum – Heft 8: Finanzpolitik

Heft 8 des Magazins movum zum Thema Finanzpolitik

Kurzbeschreibung: Die Preise sollen die ökologische Wahrheit sagen. Aber auch die massive Ungleichverteilung der Vermögen und Einkommen ruft nach einer anderen Finanzpolitik. Helfen Ökosteuern, Niedrigzinsen oder Subventionsabbau?

Das Heft als PDF

Blockaden des Wandels überwinden – Warum der Staat systematisch das Falsche subventioniert und wie sich das ändern kann

Angesichts von Klimachaos, globalen Finanzkrisen und Massenarmut brauchen wir, darüber sind sich immer mehr Menschen einig, eine tiefgreifende sozial-ökologische Transformation, die alle Gesellschaftsbereiche erfasst. Es gibt längst eine kaum überschaubare Fülle von Konzepten und Praktiken für diesen Wandel, von der Genossenschafts- bis zur Commonsbewegung, von der Solidarischen Ökonomie bis zur Gemeinwohlökonomie. Manche Konzepte und Initiativen sind noch im Stadium des Ausprobierens, andere sind seit vielen Jahren und Jahrzehnten in der Praxis erprobt. Doch meistens kommen diese Ansätze über gesellschaftliche Nischen kaum hinaus. Warum ist das so? Sind sie nicht tauglich für eine größere Transformation? Zu klein, zu lokal, zu sehr auf ein kleinen Kreis von Idealisten beschränkt? Ökonomisch nicht tragfähig?

Enough Is Enough – Building a Sustainable Economy in a World of Finite Resources

Enough Is Enough lays out a visionary but realistic alternative to the perpetual pursuit of economic growth—an economy where the goal is enough, not more. Based on the best-selling book by Rob Dietz and Dan O’Neill, the film explores specific strategies to fix the financial system, reduce inequality, create jobs, and more. Drawing on the expertise of Tim Jackson, Kate Pickett, Andrew Simms, Natalie Bennett, and Ben Dyson, Enough Is Enough is the primer for achieving genuine prosperity and a hopeful future for all.

Enough Is Enough – Building a Sustainable Economy in a World of Finite Resources

It’s time for a new kind of economy

We’re overusing the earth’s finite resources, and yet excessive consumption is failing to improve our lives. In Enough Is Enough, Rob Dietz and Dan O’Neill lay out a visionary but realistic alternative to the perpetual pursuit of economic growth — an economy where the goal is enough, not more.

They explore specific strategies to conserve natural resources, stabilize population, reduce inequality, fix the financial system, create jobs, and more—all with the aim of maximizing long-term well-being instead of short-term profits. Filled with fresh ideas and surprising optimism, Enough Is Enough is the blueprint for achieving genuine prosperity and a hopeful future for all.

ISBN: 9780415820950 (Paperback) / 9780415820936 (Hardback)

Zwickmühle Kapitalismus – Auswüchse und Auswege

Es muss sich was ändern! Spätestens seit der aktuellen Finanzkrise spüren wir es alle: Mit diesem System stimmt etwas nicht. Anhand klarer Zahlen und verblüffender Fakten gibt Klaus Simon einen sehr verständlichen Überblick, wie der globale Finanzmarkt-Kapitalismus abläuft – und warum er auf Dauer nicht funktioniert.

Es besteht dringend Handlungsbedarf, doch Sozial- und Finanzmarkt-Reformen laufen unter den Bedingungen der Globalisierung ins Leere. Schlimmer noch: Auch ökologische Reformen scheitern am Wachstumszwang im kapitalistischen System. Das Fazit liegt auf der Hand: Der Kapitalismus ist den anstehenden Herausforderungen nicht gewachsen.

Doch Simon kritisiert nicht nur: Er zeigt, wie eine nachhaltige, zukunftsfähige Ökonomie aussehen kann, ohne gewaltsame Umsturzversuche oder Diktaturen. Damit gibt er der sympathischen Utopie einer Neuordnung „von unten“ Raum.
(Beschreibung des Verlags)


ISBN 978-3-8288-3257-2