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This blog was first published by Carnegie UK

To coincide with the 10 year anniversary of the publication of the Report by the Commission on the Measurement of Economic Performance and Social Progress, the Carnegie UK Trust is publishing a series of blogs which outline the approach taken to measuring and improving wellbeing by different governments, organisations and initiatives around the world.

The economic model that has become so dominant is called all sorts of things: ‘neoliberal’; ‘market fundamentalist’; ‘overly financialised’; ‘extractive’; and ‘toxic’.

What it is called doesn’t matter so much as how it has strangled our imaginations and our sense of possibility: the current economy is seen as the only kind of economy that we can have, and the mainstream thinking is that to resist it would be to bring society to its knees.

Yet society is already on its knees – seen in widening economic inequalities; in levels of insecurity, despair and loneliness; and in desperate searches for ways to cope, whether at the pill box or the ballot box. Many people fear the loss of their jobs, insecurity in old age and the destruction of their dreams and cultural norms. And, as Martine Durand writing in this series observes, “bitter divisions within society…[are] so vividly demonstrated in a number of recent elections”.

The planet is also on her knees – on the brink of the 6th mass extinction with the prospect of catastrophic climate breakdown getting closer and closer.

The root cause of so much of this is how the economy is currently designed – in a way that does not account for nature, in a way that is blind to distribution of resources, and in a way that puts measures of progress such as short-term profit and GDP to the fore.

These are structures that are deliberate – and hence can be dismantled and designed differently.

In the depth of the Great Depression, in 1933, John Maynard Keynes wrote:

The decadent international but individualistic capitalism, in the hands of which we found ourselves after the War, is not a success. It is not intelligent, it is not beautiful, it is not just, it is not virtuous – and it doesn’t deliver the goods. In short, we dislike it and we are beginning to despise it. But when we wonder what to put in its place, we are extremely perplexed

Today is a time of similar economic inequality to when Keynes was writing and just as then, more and more people are beginning to despise the current arrangements.

Fortunately, today we are not short of ideas as to what to put in its place.

Concepts of societal wellbeing are familiar the world over, even though different terms might be used to describe the central idea of flourishing for all people and sustainability for the planet.

This shared vision for a better way of doing things can be found in the scripts of many religions. It is contained in worldviews of First Nations communities. It can be read in the scholarship of development experts and in research findings about what makes people content. This vision echoes in evidence from psychology about human needs and from neuroscience about what makes our brains react, and, perhaps most importantly, can be heard loud and clear in conversations with people all over the world about what really matters to them.

growing movement is forming around the idea of a wellbeing economy. Academics are laying out the evidence base, businesses are harnessing commercial activities to deliver social and environmental goals, and communities are working together not for monetary reward, but following innate human instincts to be together, to cooperate and collaborate. These efforts will be made easier the more pioneering policy makers embrace a new agenda for the 21st century. We can look to how Costa Rica delivers longer life expectancy and higher wellbeing than the US with just a third of the ecological footprint per person. New Zealand is showing how to design government budgets for a wellbeing economy. Alternative business models like cooperatives show us how success beyond profit can be embraced.

So we’re not starting from scratch. By learning from the many examples and reorienting goals and expectations for business, politics and society, we can build a wellbeing economy that delivers good lives for people first time around, rather than requiring so much effort to patch things up. We designed the current economy, so we all can design a new one: the only limits are our imagination.

Guest blog by Jennifer Wallace, Head of Policy, Carnegie UK Trust

Over the past two decades, the word wellbeing has increasingly been used in public policy. The relevance of the conversation in both policy and people’s individual lives suggests a deep-seated sense of unease at the way prevailing economic and policy processes are failing to enable wellbeing for all.

But there remains conceptual confusion about the core meaning of the term, what one academic referred to as ‘a cacophony’ of different meanings. This confusion brings a wide number of people into wellbeing discussions but does so at a cost – not all concepts of wellbeing have the same underpinning philosophical root and there are potentially rather contradictory implications from these different conceptions.

In the international wellbeing movement, of which WEAll is now a key player, wellbeing is understood as a way of measuring and thinking about social progress. The movement is often defined by what it is against, namely that social progress cannot be defined solely as economic progress, as measured by GDP. But there is less agreement about what the movement is for – ‘Living well’ (personal wellbeing) and ‘living well together’ (societal wellbeing) give us two broad mechanisms to do this but the policy implications of these two definitions are often in tension.

Personal wellbeing focuses on ‘living well’ and measures quality of life through subjective measures of life satisfaction and happiness (and so it is sometimes called subjective wellbeing). It has its philosophical roots in Epicurean happiness and utilitarianism. In classical utilitarianism, it is not the distribution that matters, merely the total amount of utility. That some are left behind is not necessarily problematic. A broader, but still personal, version of wellbeing has been promoted in the UK over the past two decades.

There are reasons for caution in using personal wellbeing as a guide for public policy. For one, evidence shows that there is a genetic component to wellbeing, which means that the proportion of personal wellbeing that governments can positively affect is smaller than it might first appear. Related to this, there are well known life cycle trends in personal wellbeing and distributive effects which require careful analysis and care. Environmentalists caution against the short-termism of an approach which does not factor in the potential medium to long-term environmental costs of policy decisions. And there are critiques that argue personal wellbeing is further individualisation of the role of governments, focusing on interventions on the person rather than structural changes that would alter the contexts in which people live, work, and play.

Societal wellbeing, or living well together, addresses these concerns by setting out measures that are understood by the society as being essential components of a good society. The philosophical roots are in the Aristotelian-eudemonic tradition which sees human flourishing as the goal for society. To flourish, basic needs must first be met, housing, education, health and so on. Basic needs are universal to human beings, but their realisation is relative. For example, we may agree that housing is a basic human need, but the quality of that housing, how it is to be provided and what is tolerated as good enough housing, will differ across societies.

While the absence of income, health or education may make flourishing difficult, their availability does not itself create flourishing. To flourish is understood as having a purpose in life, participating in society, having a community around oneself. Amartya Sen developed the Capabilities Approach which seeks to supplement purely objective measures with an understanding of what people can do (functionings) and be (capabilities). Societal wellbeing, based on this philosophy, is therefore a multi-dimensional concept that describes progress in terms of improvements in quality of life, material conditions and sustainability. Further, societal wellbeing includes the assessment of longer-term harm caused by actions that create short-term happiness, it is therefore a system for assessing social progress that incorporates both the present and the foreseeable future, often described as the wellbeing of future generations.

The balance between personal and societal wellbeing plays out in practice across the jurisdictions of the UK. In my experience, perception from outside Westminster is that personal wellbeing has ‘captured’ the wellbeing movement in the UK, with key proponents reinterpreting the word wellbeing as relating solely to personal wellbeing. Meanwhile the small devolved jurisdictions of Scotland, Wales and Northern Ireland have developed frameworks for measuring societal wellbeing. Their use of societal wellbeing, and the transformative impact it has on public policy, is explored in my next blog ‘The Value of Wellbeing’.

Jennifer’s book Wellbeing and Devolution: Reframing the role of government in Scotland, Wales and Northern Ireland is available open access available via Springer Online.