Technology in Support of Sustainability as One of 17 Principles of Regional Economic Order Under the Maxims Democracy and Market Economy.
An Article in the Compendium of Market-Based Social-Ecological Economics
Key issues in view of the neoliberal crisis:
How can we guarantee employment and fair income?
How can we protect the environment effectively?
How should we shape the economic globalization?
What should the economic sciences contribute?
What must be the vital tasks of economic policy?
How can we legitimize economic policy democratically?
Table of Contents
In view of the threatening extent of the devastations caused by the neoliberal economic doctrine, the turning towards compatible economic principles becomes almost existential. But only when these principles are combined to form a model of sustainable regional and global economic order, can the urgently needed economic policy measures be derived.
All 6 global principles are summarized in the article Principles of Global Economic Order in the form of questions. The supplementary 17 regional principles are listed in the article Prinzipien regionaler Wirtschaftsordnung, also as questions.
In the context given here, the term »regional« refers to largely homogeneous entities, currently primarily nation states and supranational political and economic areas (unions), that meet all the requirements for political sovereignty and economic autonomy and are therefore in a position to form a viable foundation for the prosperous coalescence of the world. Hereafter, these entities are mostly referred to as economic areas.
The European Union (EU) and, in particular, the euro zone existing within the EU, can serve as a cautionary example here. Both are supranational entities that have emerged from the political and economic self-interest of powerful players, and whose inhomogeneity and centralism have since unfolded great destructive potential (as a supplement see the article Demokratie und europäische Integration).
In the course of the historical economic development in Europe and the USA democracy and market economy have emerged as useful and reliable Maximes of Economic Order. Both maxims have, however, been distorted by the neoliberal indoctrination since the 1990s to such an extent that the »natural principles« inherent in them are hardly perceived by the citizens any more. It is therefore essential to return to these principles and to combine them into a model of a sustainable regional and global economic order. See also the article Market and Market Economy.
In contrast to the centralistic structures produced by modern Neoliberalism, the model presented here is based on decentralized structures, or, better still: on subsidiary structures. Only if the citizens in as many countries as possible are recognizing democracy and market economy in their interaction again as convincing maxims, can a culture of political co-determination and economic self-determination return to society, politics and the economy and work towards social and ecological justice. Embedded in subsidiary structures, the citizens bear full responsibility for their actions and well-being, so that they are always brought to shape the conditions in their immediate environment in exchange with each other and at the same time create the preconditions and the foundation for global exchange.
Social and ecological justice, by the way, arise from a multitude of economic mechanisms: For example, the terms Efficiency and Productivity as well as specialization, which are wrongly defined in the neoliberal context, are redefined in the sense of social justice and ecological sustainability and are no longer subject to the arbitrariness of »liberalized« (unregulated) markets, but to economic policy control. The market thus regains the freedom it deserves, which enables it under meaningful and uniform framework conditions, rules and standards to allocate economic resources efficiently and equitably like no other mechanism.
Thus, the price is able to perform its original function again as the central information medium and control element of market transactions of individual economic players, because under the conditions of social and ecological justice and productivity it reflects all internal and external costs. By allowing the players to be guided by truthful prices resulting from the interplay of supply and demand, economic resources move – as if steered by an »invisible hand« – to where they provide the greatest benefit to individuals and, at the same time, to society as a whole. As a supplement see the article Economic Pricing.
Subsidiary structures ensure that prosperity and welfare are no longer at the mercy of the imponderables of a worldwide production quantity achieved under oligarchic rule and high capital concentration, but result automatically from the domestic production structure. The production structure alone is decisive for local and regional economic diversity and consequently for the level of employment, the performance-related equal distribution in society and the preservation of natural resources.
Unlike domestic competition, international competition can not, by its very nature, be granted the freedoms of regulated domestic markets. It must rather be based on bilateral trade agreements given the completely different traditions, standards and resources in the world. In these agreements the exchange rate must be set as the crucial trading link, supplemented by autonomous tariffs and trade quotas to balance out the differences and to grant trade profits to both sides. The primary objective of these agreements must be to ensure that imported products with their characteristics and prices are integrated into domestic competition in the most stimulating but harmless way possible.
The separation into regional and global order thus results quite naturally from the principle difference between domestic and foreign trade. Besides, this explains why there can be no superordinate, all-dominant, self-regulating and self-stabilizing world economic order in a desirably diverse and democratic world. For more details see the article Future-Proof Foreign Trade.
Among politically sovereign and economically autonomous nation-states and economic areas, the global order is reduced to agreements of norms of conduct, especially regarding norms of international trade and cooperation. By applying these norms, economic subsidiarity can be extended beyond national borders and find its perfection at the global level in the form of projects of global interest and scale.
With domestic and cross-border subsidiarity the doctrinal practice of transferring economic powers from lower to higher levels (especially nonstate) is overcome, of which neoliberal protagonists claim it would bring about »more appropriate« and »more efficient« decisions. Along with overcoming this practice, the justification is removed for a World Trade Organization, which is entrusted by its current 164 member states as the guardian of the Grail of global cut-throat competition based on dumping prices in lead currency (i.e. US dollar or euro). This is an unprecedented event in economic history, especially because the condition for membership is the (voluntary) renunciation of national economic autonomy.
It should be noted that the demarcation of the specific functions of the various economic levels, i.e. the subsidiary structure of autonomous nation-states and economic areas both domestically and beyond their borders, is absolutely crucial for the future viability of economically autonomous entities and for the global economy as a whole:
Functioning regionality is a prerequisite for sustainable globality. Globality is the complement of functional regionality.
In what follows, is the plea for the technology in support of sustainability as one of 17 principles of regional economic order:
3. The Technology in Support of Sustainability
Man, in his evolutionary inability to adapt, is forced to secure his existence as a homo faber by artifacts in the environment that is actually hostile to him. The constant quest for new insights to make life as pleasant as possible through technical skills and tools is necessarily in man’s nature. However, since the twentieth century, when a critical awareness developed that technical innovations not only open up opportunities but also involve risks, the enthusiasm for technology has increasingly been accompanied by reservations. The reservations derive their justification from the sobering experiences of health, ecological and thus also social and economic setbacks.
These setbacks are mainly due to two causes: On the one hand, to the narrow perspective, which relates the efficiency and effectiveness of new technologies and techniques only to individual business processes, without taking into account the efficiency of upstream and downstream processes and their macroeconomic effects on society and the environment. On the other hand, related to the associated trend to select the contents of research and development programs from the outset according to their suitability for large-scale industrial applications or the optimization of existing technologies and techniques for central mass production to achieve a supposedly higher efficiency of production factor inputs including a higher productivity of production processes. Under these circumstances, technological development aims at isolated business productivity, which by its self-serving nature excludes due social and ecological productivity. By means of a truthful national accounting, this development could be exposed at any time as value-destroying apparent productivity.
By contrast, sustainable prosperity and welfare require science-based research and development aimed at social and environmental efficiency and productivity. Under such conditions, social and ecological requirements cannot be separated from each other, they are interdependent and constitute a uniform research content:
The primary requirement is research and development aimed at highly productive technologies that can be applied decentrally.
With decentralized applicability and the decentralized economic structure thus made possible, social productivity results from the high degree of participation of people in economic value creation and their remuneration thereof, i.e. from a high level of employment and a performance-related share of the economic outcome.
With decentralized applicability and decentralized economic structure, ecological productivity results from people’s direct local responsibility for the sustainably efficient use of non-renewable and renewable resources and renewable energies.
The requirements with regard to efficiency and productivity certainly do not only apply to the production processes, but also to the entire life cycle of the products resulting from the processes, including their disposal.
The economic and technology policy control, which aims at decentralized applicability including material and energy efficiency, is divided into two parts: Within the framework of long-term services of general interest, public research and development programs are initiated by political decisions and carried out as public goods on the one hand, and on the other, tax measures are used to create incentives for the implementation of private-sector programs. As a supplement see the article Factors of Production.
Click here for the German-language version: Technologie und Nachhaltigkeit.