An Introduction to Natural Economics

I often use the word “politics” when talking about my views, but I’m increasingly aware that this isn’t the right word to describe it. For many people, “politics” is about elections and parties, policies and politicians, legislation and protest, and quite frankly, I’m not interested in any of that. Representative democracy in much of the world is a sham, full of corruption, dishonesty and impotence. Since from my point of view the economic system is far more important than the political system, the vast majority of party politics always misses the target, because if it believes in tinkering with the economy at all, it merely ‘administers’ and ‘props up’ the market economic system, and never seeks to replace it with a better system.

So what I’m really interested in is economics - and yet I would never dream of using this word in preference to “politics”, because if there’s one thing I’d want to distance myself from more than the shameful antics of power-hungry political stooges, it’s the dogmatic farce which is neo-classical economics. The modern discipline of economics is an unscientific doctrine which is the ideological underpinning of the economic right wing and the clergy of their religious order, the holy free market. Economics ought to mean something like “the study of the system of production and distribution”, but economics as it is practised today is nothing of the sort. It doesn’t study the economy as it is, and instead criticises the economy for not living up to the idealised models that economists have devised using absurd and ideological starting premises that have no basis in reality.

Still, “descriptive economics” is also not something I’m particularly interested in. I don’t mind being prescriptive - so long as you don’t claim that it’s science. In a sense, what I want to do is a different kind of prescriptive economics, but one which is at least based on scientific principles. What will emerge is something which I’m going to call “natural economics”. I’m not sure if it already has a name, but that’s the best I’ve got for it at the moment. So let’s find out what “natural economics” is.

Libertarian communists often talk of a “society based on needs”. And that’s our starting point, even though it’s going to get substantially revised as we discuss things. There’s a recognition here that a “system of production and distribution” - that is, an economy - is supposed to serve a purpose, and in natural economics, we could say that this purpose is to meet the needs of society, or to meet the needs of the people in society. To be more precise, the idea of a “system of production and distribution” raises two key questions - what are we producing? And how are we distributing it? For natural economics, the answers are: we are producing the things that people need, and we’re distributing them to the people who need them.

We recognise at the same time that the market system, which is one kind of economy, is not “based on needs”. (A full explanation for this idea is beyond the scope of this text.) At bottom, a market system is based on growth, or equivalently, on capital accumulation; it’s based on an imperative for there to be more production and consumption. What is being produced is far less important than the fact of production itself - which is what keeps the economy growing. What’s being distributed or consumed is similarly far less important than the fact of consumption itself, regardless of whether any real needs are being met. Furthermore, the labour that people undertake in a market system is not important because of its goal in production terms: the mere fact of labour, “having a job”, is more important than what you actually do or what it achieves. Economic activity takes place not to satisfy needs but merely to keep the system going, to make sure that the cycle of consumption, profit and growth can continue. Marx called it “alienation”. As he explained, capital has a life and motion of its own, and the economy is here to serve capital’s inherent and cancerous drive to grow and accumulate itself. Meanwhile, meeting society’s needs or human desires is secondary and epiphenomenal.

I’m going to try to stick to minimalistic principles here, and currently the only principle we have is to produce and distribute “based on need”. So what’s the minimal economic system that meets this criterion? Logically it would have to start by determining what is needed. This could be done by simply asking everyone in the world what they need (which I call the “Christmas list model”), or it could be determined scientifically-empirically, using prior consumption data and evidence about social and physiological needs. Then, production is organised to meet all of these needs. Finally the products and services are distributed to exactly the people who need them. We cannot make any part of this process “conditional” - that is, if something is needed then it must be produced, and if it has been produced then it must be distributed to where it is needed, no questions asked.

It would seem that the most difficult thing is the first step - determining people’s needs. So let’s look at the two possible models. In the Christmas list model, we might ask, what would stop people from asking for all kinds of extravagant things? This question suggests that we might not trust people to know what they really need, and that they might be swayed by ideas about what they think they need, or what they’d just like to have, even if it’s a crazy fantasy. With minimalistic principles, there’s no obvious method for determining whether Alice should be “allowed” to have a space probe for mining operations on Jupiter’s moons, or whether Bob should be permitted sixteen thousand monkey suits. On the other hand, the scientific-empirical model seems to suffer from a parallel problem - how can scientists and plan-makers possibly know exactly what everyone wants? In other words, we have a double problem where we can’t really trust a distant bureaucracy to know what people want, but we also can’t trust people themselves to know what they want either! Even more troublingly, it might turn out that satisfying everyone’s individual wants might not be technically possible, either because it would entail an unsustainable use of resources or because we just don’t know how to produce the desired thing. Shouldn’t “natural” economics take account of such things?

This doesn’t mean that the whole idea of natural economics is doomed now. After all, why are we trying to adhere to this principle of being “based on needs” anyway? If you look back a bit, you’ll see that I just plucked it unquestioningly out of the libertarian communist literature. Perhaps it doesn’t have anything to do with natural economics after all.

Needs versus wants. It’s evident that there are some things that people need physiologically, like food and water, whilst there are other things that seem to be “optional” - things that you could “do without” if necessary like televisions or robots. At the same time, we can see that in our current society people do, in a way, need computers and smartphones and holidays abroad. We don’t necessarily need the computer or smartphone, but we do have an underlying need to have access to information about the world around us. We don’t necessarily need the holiday abroad, but there is an underlying need for relaxation and relief of stress. We don’t necessarily need paintings or plants in our home, but we do have an underlying need to live in pleasant surroundings. We don’t necessarily need a designer jacket, but we do have underlying needs to protect ourselves from the elements, to express an identity or allegiance, or to feel accepted and validated by a certain social milieu that’s important to us. So really, our “wants” are all manifestations of more basic, underlying needs. We can also see that in our current system, the market demand for something is to some extent related to these surface manifestations, to our “wants”, and we can also see how there can be a disconnection between the wants and the underlying needs. People might misinterpret their underlying needs, or they might try to meet them in destructive ways.

But even trying to just determine what the underlying needs are would seem to be a fool’s errand, because they are to some extent determined by society. Society’s norms, values and culture play a role. The need for the holiday abroad, for example, is often only there because of people’s stressful working conditions. Similarly, in a society that places value on women’s body image and appearance, the cosmetics industry is addressing a real need, albeit one that could be completely neutralised in a different cultural setting. Furthermore, the very existence of an industry, coupled with aggressive advertising and marketing, can induce real needs in people. So the fashion industry itself creates a constant “need” to keep up with the trends, supported by glamorous imagery. Apple, the consumer electronics company, develops products and then uses tactics which can only be described as psychological manipulation to convince people that they are desirable and magical, so much so that they have to upgrade from one to the next. And finally, people’s needs are to some extent dependent upon what other people already have. If trendsetters, or even just the neighbours, already have the next new thing, then people’s underlying psychological need to be accepted and validated by their peers is threatened if they don’t “keep up”. Internet access might seem to be a luxury, but if you’re in the USA where most people have it, then you might end up with severely reduced opportunities or even feel like a social outcast; for some communities, it might be said that not having internet access is a sign of poverty. It’s relative poverty, to be sure, but let’s not make the mistake of claiming that these “needs” aren’t real or that they’re “just luxuries”; the truth is, they are real needs which have been induced and perpetuated by the environment, by society.

So needs are partly determined by society and culture, but we mustn’t think that this is the real story and there are no individual needs after all. Alongside physiological needs, there are also needs based on people’s individual psychology, their values and desires. To sum up, we could say that the underlying needs of a person are a complex mix of physiological, genetic, psychological, social, interpersonal and environmental factors. These factors combined are all the determinants of people’s wants and their behaviour, and together they constitute what I call the causal ecology of behaviour. We could also surmise that the underlying needs of society as a whole are the shared universe of its members’ underlying needs, shared at different scales - individual, interpersonal, community, bioregion and universe. So this is the causal ecology of human society.

Now there’s a very good reason why we should not restrict our attention just to human society. That’s because there’s another huge and hitherto overlooked determinant of our underlying needs: resources. The available resources - meaning naturally-occurring materials and substances as well as knowledge and skills in society about how to produce things - are key to defining the sorts of things that society wants, what it can do and even have a crucial impact on culture. For this reason it scarcely makes sense to call them “resources” - they’re not there just to be “used” for obtaining what we want; they’re part of what determines what we want, what we can want in the first place. This is what I referred to as “technical viability” in my other essay, Nothing Costs Money.

So, added to the causal ecology which determines society’s needs, we have technical knowledge and skills, materials, minerals, ores, stocks and reserves, as well as the laws of physics, chemistry and biology which govern them, which leads us to also include the ambient conditions, the climate, microorganisms, biodiversity and ecosystems and the synergies and symbioses that connect them. So the needs of human society are bound up with pretty much everything else, and we might as well therefore consider the full causal ecology of the planet Earth, incorporating all of its inhabitants’ needs and behaviours. I like to say “causal ecology”, but we could just as easily use plain “ecology”:

Ecology determines the needs of society.

I’m using a broad definition of “ecology” here. Ecology isn’t just the trendy new name for “the environment”, because that term was still rooted in the capitalistic world view which sees the natural world as a pool of resources to exploit and a dumping ground for the waste products afterwards. Environmentalism is about “respecting” the environment by imposing “responsibility” onto an otherwise completely exploitative and throwaway economy. In contrast, ecology sees humans as an inseparable part of the natural world, or conversely, the natural world as an inseparable part of human society. There is, indeed, no possible scientific basis for separating humans out from the natural world, because they clearly depend on it utterly. There is a complex web of dependencies between society, culture, the individual, the genome, plant life, animal life and ambient conditions. Together these dependencies determine what society can do and what it wants to do. They determine what the individual, human or not, is capable of doing and what it wants to do. They determine who we are in the first place. These things, together, are the causal ecology. Now for the next big statement:

Natural economics is the study of an economy that is based on ecology.

So what does this suggest about how a “natural economy”, an ecological economy, should function? I would use one of the following definitions interchangeably:

The idea that the causal ecology determines our underlying needs is intended to be seen as a natural law which is applicable even now. The novelty is that a natural economic system is one where nothing intervenes between the underlying need and its satisfaction through production and distribution, except the causal ecology (i.e. technical viability) of that need. Of course, if the need can’t be met by a system of production and distribution in principle (e.g. spiritual enlightenment), then it doesn’t fall into the remit of natural economics, although it is still affected by the natural laws of ecology.

The natural economy is therefore supposed to be a system that serves the ecology and not the other way around. It’s supposed to be a vehicle for the expression and satisfaction of the ecological system, rather than subordinating ecology to the needs of the economy. Because of this, we do not need to have “laws” protecting the “environment” or curbing emissions - those are only necessary in an economic system like capitalism where ecology is an impediment to the rules of the economy. The natural economy is one where sustainability and ecological health are hard-wired into the system precisely because they are inextricable parts of the same causal ecology that makes production possible in the first place.

A natural economy is based on natural laws, rather than having laws of its own. For example, in most cases the desired products or services don’t spontaneously appear in the right place when required - rather, labour and resources are needed to produce and distribute them. Therefore the system needs to find ways of dividing up the necessary labour. But once the labour is done, there is no need to keep on working - quite different from our market economy where it’s more important to “have a job” at all times.

Natural laws about how things are produced, how they could alternatively be produced and where they are needed - these are laws which can be determined by scientific enquiry. Therefore, a natural economy is a scientific economy, one which is based on a proper analysis of technical methods, testing them and implementing them.

Finally, it is worth noting that the ecological criteria under which products are produced are likely to be ones where minimising inputs and minimising human labour are favourable. This is again based on the natural laws of ecology where inputs in the form of natural resources are prone to run dry if they are used up too quickly. And human labour in many cases has to be minimised when people don’t really want to do it. Only a natural economy is capable of minimising work and thereby freeing up society’s time so that it can be spent on other things, like cultural and creative pursuits, or academic inquiry for its own sake.

The study of natural economics divides itself into a few subdisciplines:

I urge economists - and others who have the inclination - to forget about the market and start studying the exciting new discipline of natural economics.