Basic economic and societal elements of a Restorative Economy in Paul Hawken's The Ecology of Commerce (1993)

Basic underlying assumptions: We have the capacity and ability to create a remarkably different economy, one that can restore ecosystems and protect the environment while bringing forth innovation, prosperity, meaningful work, and true security. 2

1.   Business must recognize the needs of corporations, society, and the environment. Business must judge its goals and behavior, not just from inherited definitions of profit and short-term interest, but also from the perspective of the environment and society.9


2.   Industrial Economy. Industrial economics separated production processes from the land, the land from people, and, ultimately, economic values from personal values. In an industrial, extractive economy, businesses are created to make money. Their financing and ability to grow are determined by their capacity to produce money.11

3.   Restorative Economy. In a restorative economy, success and viability is determined by the ability to integrate with or replicate cyclical ecological systems in its means of production and distribution.   In such an economy, restoring the environment and making money would be the same process. Corporations would compete to conserve and increase resources rather than deplete them. 12-13

4.   Three basic issues business must face. What it takes from the environment, what it makes, and what it wastes.21

5.   Economic progress. The ability to over-exploit the earth's stored-up supply of resources is what we call economic progress. To compensate for the limitations placed on production by the carrying capacity of the environment, we are speeding up the rate at which we fish, farm, deforest, and extract. We call this economic progress and global development.23

6.   Basic delusion of capitalism. If capitalism has one pervasive untruth, it is the delusion that business is an open, linear system: that through resource extraction and technology, growth is always possible, given sufficient capital and will. In other words, there are no inherent limits to growth. 33

7.   Larger goals of business. If businesses believe they are in business to serve people, to help solve problems, to use and employ the ingenuity of their workers to improve the lives of people around them by learning from nature that gives us life, we have a chance. Corporations must change to meet the world's needs, not the other way around. 55

8.   Intelligent product system. The larger goal of an intelligent product system is to create a completely cyclical economy. There are three categories of production: consumables, products of service, and unsaleables. In such a system, responsibility belongs to the maker of the product, not merely the user, and certainly not with the victim.71

9.   The market does not reflect the true cost of products and services. In a price-based market system, the producers compete to offer the lowest prices by externalizing the costs of production onto society and the environment. In a restorative economy, businesses must be able to make money by sustaining living systems, not just by passing off their costs onto society and the environment in the form of pollution and destruction of resources.83 |

10. Environmental consequences of the GATT (WTO) treaty. The most damaging element in the WTO is that countries cannot "discriminate between like products on the basis of the method of production." WTO gives international economic advantage to the companies that are best able to externalize environmental and social costs, because nations can't pass laws forcing them to internalize their
cost and take full responsibility for their environmental impact. 99


11. The Industrial economy is a parasite to the earth.   We have reached a point where the value we do add to our economy is now being outweighed by the value we are removing, not only from future generations in terms of diminished resources, but from ourselves in terms of unlivable cities, deadening jobs, deteriorating health, and rising crime... We have become parasites
and are devouring our hosts.126


12. Economic sustainabilitv. Sustainability is an economic state where the demands placed upon the environment by people and commerce can be met without reducing the capacity of the environment to provide for future generations.138

13. Economic Golden Rule: Leave the world better than you found it, take no more than you need, try not to harm life or the environment, and make amends if you do.139

14. Basic Principles for sustainable businesses. By adopting these principles, business can re-imagine the world it operates within and still prosper in the marketplace. 143

-- Replace nationally and internationally produced items with products created locally and regionally

-- Take responsibility for the effects they have on the natural world.

--Do not require exotic sources of capital in order to develop and grow.

-- Engage in production processes that are human, worthy, dignified, and intrinsically satisfying.

-- Create objects of durability and long-term utility whose ultimate use or disposition will not be harmful to future generations.

--Change consumers to customers through education.

15. Creating an ecologically sound society. It will have to come from the grass roots up, not from the top down. We have spent too much time making the world safe for upper-middle-class white men.161



16. We need a market that recognizes the true, full costs of doing business. We require a market economy that rewards the highest internalized cost, an economy in which business prospers when it is responsible both socially and ecologically. We need business to thrive by exceeding regulatory standards rather than by challenging or circumventing them.167

17. Businesses should compete to be more ecological.They should compete to be more ecological, not only on moral or ethical grounds or because it is the right thing to do, but because such behavior squarely aligns with their bottom- line profits and self interest.167

18. Green taxes. The main function of green taxes is not to raise revenue for the government but to provide participants in the marketplace with accurate information about cost. The purpose of a green tax is to give people and companies positive incentives to avoid them. Every incremental dollar collected from green fees should reduce income and payroll taxes equally, starting with the lowest income brackets and moving to the highest. Green taxes should not place a burden an lower economic brackets or the middle class.169

19. Efficiency and the economy. Economics is the careful management of the wealth and resources of a community. Efficiency should be the common ground between economics and ecology. Efficiency should include not only production and distribution, but also both the natural and human communities. Thus, any time there is inefficiency in the form of pollution or waste, it is uneconomic and therefore more costly; and, in addition, increases in efficiency will save money, improve the economy, and preserve and restore the environment.177

20. Resource utilities. Many resource systems in the world are presently over-exploited and could benefit from becoming a utility that is publicly regulated, privately managed, and market-based. A "grazing land utility" would be managed to maximize income from grazing fees, and therefore would have economic interest in not overgrazing, since any form of degradation would reduce the value of the utility to its owners. A "salmon utility" on a stretch of river would try to increase supply of wild salmon. 191

21. Incorporating ecological principles in our societies a economies. Society must recognize that ecologicalprinciples apply absolutely to human survival, and that if we are to endure as a world culture, or as a group of local cultures, we will have to incorporate ecological thinking into every asp our mores, patterns of living, and most particularly, our economic institutions. 202

22. Carrying capacity. The definition of carrying capacity is the maximum level of a species or population that can be consistently supported by the resources of the environment. The key word is consistently, meaning decade after decade, century after century. 207

23. Reduce our impact on the environment. We must reduce substantially the impact that each of us has upon our environment.. People will not cut back on their possessions and wants on their own. We have to then find an ecological, imaginative, and participative means to lessen our impact. We have to be able to imagine a life where having less is truly satisfying, more interesting, and of course, more secure. 210

24. Life and business are always moral questions. Life is always a moral question that lies before us, dependent on our gratitude and constant struggle to cause as little suffering all and everything around us. We must always ask what are qualities that we want in our businesses, economies, society governments, and in our larger environments. Corporations and economies are means to serve larger ends -- the well-being of individuals, communities, nations, and the global environment 219