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Doughnut economics 🍩
Solving Inequality & Ecological Degradation
with a New Economic Model
No, not that kind of doughnut!
Hope you're doing really well, and a warm welcome to our new subscribers. Thank you very much for joining us.
A few weeks ago, Team LUXTRA attended the Future Fabrics Expo in London. One of the speakers was Sandrine Dixon-Declève, co-President of the Club of Rome. The Club of Rome is an organisation that, amongst other things, is pushing for government action to address climate change. At one point Sandrine mentioned doughnut economics, which I had heard of years before (thanks Ilse). It's still a really niche concept, so I thought today you might be interested in learning about it.
I'm now going to handover to Brenda, our marketing intern, who has done the research and she will explain how it all works. Take it away, Brenda!
Sandrine Dixon-Declève presenting at the Future Fabrics Expo
Hello hello! ☀️
I'm happy to meet you all and to write on a such interesting topic. To quote renowned English economist and creator of Doughnut Economics - Kate Raworth - this could be “the one doughnut that might actually be good for us”. Now, if “economics” is not your thing, don't panic! If you are simply interested in the well-being of our world, then read on.
One of my go-to resources for quick summaries is Four Minute books, who have summarised the concept thus:
"Doughnut economics is a wake-up call to transform our capitalist worldview obsessed with growth into a more balanced, sustainable perspective that allows both humans and our planet to thrive."
In a lecture she gave in the Netherlands, Kate compares economics with medicine: both essentially deal with human lives and both have the responsibility for the well-being of society. Students of medicine are required to study the entire human body. Economists on the other hand, are typically blind to many of the factors at play within economies. This myopia is precisely what doughnut economics seeks to rectify.
Kate Raworth and the Doughnut
Rethinking our approach
Growth is good: that's the mantra spoon-fed to us all. But how is that working out for us? Just LOOK at the state of the planet (soaring temps, wildfires, floods). Not to mention the accelerating gap between the rich and the poor. Talking about “the 1%” is so 2021. Today it's the 0.01% who count.
Doughnut Economics presents an alternative view. In nature, nothing grows forever. Instead most living things grow up to a mature state and then they simply thrive. Kate's model suggests a way to create a truly thriving economy and planet…
The Doughnut - the ideal scenario
A healthy doughnut
The Doughnut (the part in light green, above) is the sweet spot: it's the safe and just space for humans, the environment and all other living beings.
A bit like a pie (how many other pastry-related analogies can we throw in here?!) on the outside there are slices representing the 9 planetary boundaries: things like freshwater withdrawal, air pollution and climate change.
On the inside we have 12 social pie-pieces which are based on the UN's Sustainable Development Goals (SDGs): water, food, education, health, gender equality, etc etc.
The Doughnut - the reality
A failing doughnut: look at all that red 😖
To keep this (semi) short, it's pretty clear that all the red in the image above shows the areas in which we are failing. There is significant social failure (refer to all the red in the donut “hole”) and several environmental areas have already exploded past their limits. Kate explains that “[we are] flying into the sunset of mass consumerism…with economies that have come to expect, demand and depend upon unending growth because we're financially, politically and socially addicted to it.”
Financially: because publicly traded companies and banks are under constant pressure to increase returns.
Politically: because politicians aim to raise GDP and countries feel the pressure to become the next global powerhouse.
Socially: because we have bought too much into consumer propaganda believing that consumerism will transform us.
Side note: did you know that consumer propaganda was invented by Edward Bernays who was actually the nephew of Sigmund Freud? Crazy, right?
OK… so what now?
Reaching perfect Doughnut conditions will involve turning towards regenerative and distributive economies rather than our current degenerative and divisive ones.
Kate offers workshops for organisations looking to become healthy Doughnuts (check out the Doughnut Economics Action Lab where they help put theory into practice). Kate is also part of the Club of Rome that Jessica mentioned above, so Doughnuts are being discussed in high place.
So that's the very basics of Doughnut Economics! Woohoo you made it to the end! Hopefully you learned something new today 🙂.
I won't go into further details but if you want all the nitty gritty, Kate's best-selling book has it all or, if you haven't already seen it, Kate gave a wonderful TED talk explaining her model as well.
Thanks so much to Brenda for taking us through Doughnut Economics.
Founder | Big-time Doughnut Enthusiast | Proud B-Corper