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Lighting the Way to a New Economy

The keynote address I delivered to the Business Alliance for Local Living Economies (BALLE) in Charleston, NC on May 22, 2010 on the theme “Lighting the Way to a New Economy.”
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David Korten speaking, staff photoWhat a delight to be here in beautiful, sunny, historic Charleston for this amazing BALLE conference Lighting the Way to a New Economy.

Congratulations to  Michelle Long for putting together a fantastic new BALLE leadership team with a clear plan to carry forward our mission to catalyze, strengthen and connect networks of locally owned independent businesses dedicated to building strong Local Living Economies. Our Conference theme, and my focus this morning, is on the BALLE vision that our mission serves. Listen carefully. This is serious. We seek:

Within a generation, a global system of human-scale, interconnected Local Living Economies that function in harmony with local ecosystems, meet the basic needs of all people, support just and democratic societies, and foster joyful community life.

You may notice that this is a bit different from the greed-driven, money-centered, unjust, unsustainable, undemocratic, and predatory Wall Street ruled economic system we now have, which is why I’m so proud of being part of this organization.

As you know from your own experience, the work we are doing together is incredibly exciting and fun. It brings us into association with the world’s most thoughtful, creative, loving, and generous people. Present company is a great example. It is also serious work, because the institutions of the old economy threaten our viability as a species. It is profoundly spiritual work, because it is about re-establishing our connection to community and Earth.

The actualization of our BALLE vision requires a profound transformation of cultural values, institutional power, and our ways of living. We must shift the economic system’s defining value from money to life, its locus of decision-making power from global corporations and financial markets to local people and communities, and its defining purpose from growing profligate consumption for the few to supporting healthy, joyful living for everyone.

Our future depends on displacing this defective Old Economy system with a New Economy that self organizes toward ecological balance, equitable distribution, and living democracy.

Ours is not your standard Chamber of Commerce agenda. BALLE means business, but we are business with a difference. We launched BALLE in 2001 around four big ideas:

  1. First, business exists to serve the community. We believe that a healthy economy is comprised of living enterprises in the business of contributing to the creation of living community wealth. A living enterprise treats profit as a means and a reward—not a defining purpose.
  2. Second, we believe that ownership matters. Ownership is power and the self-defined interests of those who own the enterprise will determine its purpose. Local owners who have a direct engagement in the enterprise as employees, customers, suppliers, and members of the community it serves are living owners who naturally seek a living return, which includes the benefits of living in a vibrant caring community with a healthy ecosystem.
    By contrast, absentee owners whose only gain from the enterprise is financial generally have a very different perspective, which is why there is little, if any, place for publicly traded corporations in a living economy—or in BALLE. Our next speaker, Marjorie Kelly pointed out in her seminal book The Divine Right of Capital the anomaly of the assumption that a publicly traded corporation should be managed for the sole benefit of absentee owners who contribute virtually nothing to its success.
  3. Third, we believe the individual living enterprise is most likely to prosper and contribute to community wealth building when it functions as part of a local living economy comprised of like-minded living enterprises that function together as a cooperative system.
  4. Fourth, we believe economic transformation is best advanced through a process of emergence and displacement—a concept from forest ecology. We are building the new living economy from the bottom up through citizen action to give people new choices as to where they shop, work, and invest that better align with their true values, aspirations, and well-being. In so doing, we unleash the creative life energy of the community and accelerate the transition from old to new economic values and old to new economic institutions and relationships. That is the theory, and we see it affirmed by what is happening in BALLE communities everywhere every day.

The values and institutions of the Old Economy drive it to self-organize toward accelerating economic instability, environmental destruction, concentration of wealth, and political corruption. Our future depends on displacing this defective Old Economy system with a New Economy system defined by new values and institutions that self organizes toward ecological balance, equitable distribution, and living democracy.

To achieve Ecological Balance requires that we reduce aggregate human consumption to bring our species into balance with Earth’s biosphere. To reduce aggregate consumption while meeting the material needs of all the world’s people, we need a more Equitable Distribution of Earth’s real living wealth, which in turn can be achieved and maintained only through Living Democracy, a process of active bottom up popular economic and political participation that goes far beyond the ballot box.

It is clear that no single organization is going to achieve such an audaciously ambitious agenda on its own. The good news is we are not alone. There are far more organizations contributing to this agenda than I could possibly name. Those with which BALLE is developing cooperative associations include the New Economy Working Group, the New Economy Network, Transitions Towns, YES! Magazine, Green America, the American Sustainable Business Council, B-Corp, the Institute for Policy Studies, the New Rules Project of the Institute for Local Self-Reliance, the American Independent Business Association, and Business for Shared Prosperity. Each of these organizations is making its distinctive contribution to the larger vision.

The larger change strategy to which we are all contributing has three primary elements: first, change the cultural stories that frame our understanding of the nature and purpose of the economy and its defining institutions. Second, create a new economic reality from the bottom up. And third, change the rules of the game to support ecological balance, equitable distribution, and living democracy rather than environmental destruction, wealth concentration, and political corruption. Let’s take each of these elements one at a time.

I give a lot of attention to changing cultural stories in my role as board chair of YES! Magazine, because changing the culture’s defining stories is central to our YES! mission. We have observed that every transformational social movement begins with an idea that spreads through a conversation to challenge a prevailing cultural story and ultimately displace it with a new story of unrealized possibility. The civil rights movement changed the story on race. The environmental movement changed the story about the human relationship to nature. The women’s movement changed the story on gender. Economic transformation depends in part on changing the prevailing stories about the nature of wealth, the purpose of the economy, and the possibilities of our human nature.

Financial Reform Now, photo by Kate Thomas / SEIUFix the Economy, Not Wall Street
Why regulate a broken system when we can build a better one?

BALLE contributes to changing the economic story by creating a new economic reality of bioregional living economies from the bottom up. Creating the new reality is our primary work. Communities that sustain themselves within the means of their regional ecosystems have no need for war to expropriate the resources of their neighbors and have significant incentive to maintain the health and vitality of their natural systems. The work includes reorienting land-use patterns and transportation systems to reduce auto dependence by concentrating population in walkable, energy-efficient, multi-strata communities; retrofitting buildings for energy efficiency; and rebuilding local productive capacities based on closed-loop production and consumption systems that reduce long-distance shipping, eliminate waste, increase energy efficiency and build local self-reliance in the production of food, energy, and other basic essentials.

As BALLE networks live the New Economy into being, we change the story in a very material way, while simultaneously creating a political base to support the third element of the strategy, changing the rules of the economic game.

Current law and public policies at local, national, and global levels consistently favor the Wall Street economy over the Main Street economy. Changing the rules to favor Main Street will require effective political mobilization, a process to which responsible businesses contribute important moral authority. As BALLE, we so far have studiously avoided political engagement for very good reasons that I support. Our issues, however, are ultimately political issues relating to the distribution of power between Wall Street and Main Street. Eventually we will have to come to terms with that reality by engaging the politics of policy change. We must begin informing ourselves on the defining New Economy policy issues.

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