Economics by Kate Raworth – Book Review by Paul de Hoest

Doughnut Economics is not just about economics, it’s a wide ranging political book about life itself, the future of our planet and the role that economics plays in shaping our future.  It is a visionary book that portrays a future collaborative possibility in which everyone’s basic human needs are met whilst at the same time not destroying our shared ecological habitat. It is an easy read, you certainly do not need an economics qualification to understand it, although it is a book that deserves to be read by both economists and non-economists alike.

You might think that the implied goal of public policymaking, nationally and globally, to ensure that everyone’s human needs are met whilst not destroying our shared habitat would be uncontentious but I am not aware that it has ever been expressed in that way by any one in office and, as Raworth points out, we are a long way from achieving it.  The two great achievements of Raworth’s book are firstly that she proposes an intuitive framework in which to consider that policy problem (“The Doughnut”) and second, she demonstrates that the current political obsession with “economics first before everything else follows” is wrong-headed and the economy needs to be thought of as embedded within the living world so that the current policy measure of choice, GDP growth, becomes incidental to other policy objectives rather than it having any merit as a goal in itself.Doughnut 1 Jpeg Scan

The essence of the Doughnut is that there is a social foundation floor of well-being that no one should fall below and an ecological Doughnut ceiling of planetary pressure that we cannot safely go beyond. Between the two lies a safe and just space for all. These are presented pictorially as two concentric circles – the inner circle represents the social foundation floor and the outer circle represents the planetary ecological limits.  The safe and just space for mankind is represented by the space between the concentric circles.

Raworth comes to the unsurprising conclusion that we are currently operating both inside the inner circle (e.g. billions of people in the world in absolute poverty, lack access to basic education, have no political voice or have no access to clean water) whilst at the same time we are operating outside the outer circle (e.g. climate change, excess resource extraction, land degradation and bio-diversity loss).  The challenge therefore is to manage living standards upwards for millions of people whilst managing downwards the excessive pressures placed on ecological resources. Unsurprisingly therefore much attention is given to how to reduce global inequality and better manage resources.Doughnut 2 Jpeg Scan

The great insight of the book is that the current policy obsession with money GDP ignores the scope to unleash the powers within the un-monetised household and commons sector and the role of the state to support these as well as the market.  The book demonstrates that the economy is not a mechanical model that responds predictably to external stimulus but rather should be thought of as a living organism that behaves more like a complex system than a machine.  Such an organism is self-directed, creative and constantly evolving.

Raworth does not pretend to have all the answers but she presents many examples that have been implemented all over the world that are thriving despite acting within the current self-imposed straightjacket of finance and GDP hegemony.  There are sufficient examples to provide a glimpse of a possible future and demonstrate that there is so much untapped potential to be unleashed through, for example, open source communications and collaboration, that it is entirely credible to believe it is possible to achieve the twin goals of reducing global inequality whilst restoring our impact on the earth.

This is an optimistic book that should be read by anyone interested in understanding why we are failing to tackle inequality, climate change and resource depletion and what can be done to change this.  Raworth says that “we are the first generation to properly understand the damage we have been doing to our planetary household, and probably the last generation with a chance to do something transformative about it.”  Once you have grasped that there really is a choice then this book points towards a more equal, inclusive, happier and more human future without destroying the Earth if only we have the courage to change our current economic mindset and try.  There is not much time left to make that choice!

Buy it from Amazon or better still your local bookshop.

Paul de Hoest






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