The Central Covenants of Successful Economies

05 Apr 2011 in Commonwealth, Gift Economies, Gifts, Living Systems

Our commercial economy is headed for destruction. There are many contributing factors, but in the end it all boils down to the fact that we’ve broken the core covenants, contracts or agreements of successful economies. These rules exist for a reason and you can no more avoid them than you can the principles of mathematics or the laws of physics.

The commercial economy is completely dependent upon the two layers of underlying economies that it is built on. First, there is the social economy inside of which we raise our children, have real relationships and take care of each other. For example, we don’t pay parents to make babies, teach language, potty-train, or devote a couple decades of care and support. Parents “manufacture” the entire labor force for the market economy. They provide talented employees in a much more real way than head-hunting firms, yet earn no commissions for their years of work.

Second, the free-of-charge social economy also relies on its underlying gift economy of nature to provide drinkable water, fresh air, hillsides of timber for building homes, fields of fertile soil for growing food, herds of animals, and ample sunshine without which we could not exist. Nature manufactures our entire food supply and ecosystem – every carbon-sugar our cells require for sustenance – without receiving a penny or so much as a single share of equity in a corporation.

In case you doubt that these are in fact economies, just recall for a moment what an economy is defined as: a system of production, distribution and consumption. There is no question that nature is producing, distributing and consuming energy, organic compounds, biomass, plants, animals, rain and sunshine. Nor that families, friends and society are producing, distributing and consuming language, stories, knowledge, skills and culture.

Now that we recognize these are economies, let’s also note just how successful they are. Despite the setbacks of ice ages, meteor strikes and natural disasters, earth’s “savings account” of biological resources has grown in mass, diversity and genetic abilities for billions of years. Also, in spite of predators, wars, plagues and unsanitary conditions, human societies have grown in population, skills, and knowledge for at least hundreds of thousands of years. The Dow Jones could only dream of such success.

There is a very specific wealth-building pattern at the heart of both of these economic systems that is key to their success. Think of it as the ground wire that allows the electricity to flow through the circuits of the living systems which comprise our planet and society. Value fundamentally belongs to the whole system, not to the parts. Wealth is built and held in the commons.

Rules of the Commons

  1. Any limited resource you take is yours only temporarily and must be returned in full when you’re done with it.
  2. Use what you take to grow the value producing capacity of the commons.

These may just sound like nice ideas, but I assure you, they are neither idealistic nor merely theoretical. Organisms and species ignore them at their own peril. Those that break these covenants deplete their environment and progressively erode their chances of survival, eventually causing their own extinction (or near extinction). However, every species and individual that follows those rules enriches their environment and increases their chances of survival.

Let’s take a look at these principles in action in an economy you’re actually very familiar with – your body. Remember, an economy is a system of production, distribution and consumption. Your body takes the nutrients and sugars in food, distributes them to cells, produces other cells, enzymes, hormones, minerals, amino acids, bones and tissue which in turn keep the whole process going. All resources consumed by your body are returned to the larger ecosystem. And while your body is running, all resources that your organs or cells use are theirs only temporarily and must be shared with the rest of the body.

Do you know what cells that stop sharing their resources with the rest of the body are called?

Cancer.

That’s right. When cells stop sharing their resources and devote those resources instead to their own growth, they are considered cancerous. And unless that pattern of cancerous growth is interrupted, the grow consuming more and more resources until they kill their host.

This is what it looks like to break the rules of the commons.

When you think about that kind of cancerous behavior, do you see any connections to how companies are organized to behave? What do you imagine are the consequences of allowing this pattern of behavior continue?

How long until cancerous corporations, people and countries who keep breaking the rules of healthy economies strip the planet of resources and poison our ecosystems to levels that can no longer sustain human life?

When do we activate our social immune system to reject unhealthy patterns and anybody operating in those ways?

The Deep Wisdom of Worth

These commonwealth economies contain deep wisdom. We have knowledge of the truth of them in every fiber of our being and literally in every cell of our body. Yet in today’s culture and economy we ignore this truth. We diminish it with marginalizing phrases like “Protestant Work Ethic” and diminish our native desire to provide as much value as we can.

But hard work feels good. It feels good to build something, to make something great happen, or to participate in the flow of energy of physical labor. Accomplishment is satisfying. Yet in the face of this emotional and physical response, we elevate an ideal of accumulation as wealth and just being able to “make your money work for you” which actually means having everyone else do the real work for your profit.

Maybe it is not religious acculturation but rather a biological urge – not a Protestant Work Ethic, but a Biological Worth Ethic. The bees, trees, ants and plants just keep working. They keep doing their part to keep the larger system going. I think they know that their biological "worth" depends on it. If they don’t keep the ecosystem going, there won’t be an ecosystem to feed them. Every creature, every cell, every living system is working to keep these agreements and build greater shared value, except us. We’ve built an entire economy on extracting value for our personal gain.

In our society, the wealthiest people are the ones who "just have money work for them." Typically it isn’t even their money; it’s ours – our savings, investments and retirement funds. They gamble with other people’s money instead of creating actual new value and then we bail them out with more of our tax money when they lose their bets. Sadly "too big to fail" really means "too greedy to follow the rules."

Ironically, we think we’re the most intelligent life-form on the planet.