This is an edited transcript from our conversation event (in May 2021) with Small Giants Academy Head of Strategy Kaj Lofgren about Regen Melbourne, a network of more than 40 organisations and 600 individuals exploring a regenerative future for Melbourne.
BERRY LIBERMAN: Let’s start with a general introduction to doughnut economics.
KAJ LOFGREN: Ok. I’m going to do this relatively quickly just to give you a snapshot of where we’re at. So Kate Raworth was working at Oxfam for a long time. She worked in microfinance and a range of areas. She also did her studies at Oxford, a very traditional institution. She had this thought that we need to reframe ultimately the goal of economics. That’s where we need to start. What are the goals we’re all working towards? Well, we need to agree that we have an ecological ceiling that we cannot breach – that’s fixed by the natural environment. We also have a social foundation which we’ve universally agreed across the world through the SDGs that we want to meet. So these are principles that we can agree to as a goal for our entire system. For our politics, for our economics, for our social services, for the way we manage multi-lateral international engagements. She looked at it as a diagram. This doughnut shape of an outer ceiling of the ecology and the inner foundation of the social elements, which creates this safe space in-between. The safe and just space with humanity. And that’s the goal. The goal is to get us into that space.
Now some countries like Australia have done really, really well on the social foundation. We’re doing really well across many of these metrics at an international perspective. Of course there’s lots of work to do and we’ll get into that in a moment. But we are shocking when it comes to the penetration of our ecological ceiling. And other countries of course that are far less developed are okay on the ecological ceiling but have huge shortfalls in their social foundation. So this model applies differently depending on where we are in the world.
Also the magic of it is that it can be applied to different contexts. From a classroom to a business to a local government to a large non-profit organisation. It really does sit across the economy. The book that Kate wrote has a subtitle: “seven ways to think like a twenty-first century economist.” And what I’ve just talked through in terms of that goal is only the first one. So that’s the first way to think like a twenty-first century economist. It’s to go to this idea of GDP as the goal, GDP growth as the goal, to this idea of moving into the safe and just space for the doughnut.
The entire economic system we currently have – the way it’s taught, the way it’s understood – is about this idea that we are rational, we’re self-interested and we’re isolated individuals that dominate our natural environment. That’s the way we’re meant to be embodied in the economy. But of course we know that’s not true. We know in times of crisis and flood and other things we come together as communities. We are deeply interconnected. We’re deeply communal. We’re deeply altruistic in nature. It doesn’t mean that we’re not sometimes self-interested, of course. Like we want to protect our families, we want to make sure that we’re prosperous at an individual level. But it’s not at the expense of the communal. It can be nourished to be part of it. And that’s what Kate is referring to when she’s talking about this idea of being social adaptable humans. It’s not a pivot away from the idea that we can be self-interested, but it’s acknowledgement that we are more than that. And our society needs to reflect that. Economics needs to nurture that.
Well what’s fascinating about the doughnut to me Kaj and the way that Kate describes it is that we all have to be very uncomfortable having our minds blown. We like to do the intimate, the tangible, the small. But the point of the doughnut is that Kate was saying as a human cohort, our responsibility was economics in the Greek definition, “household management.” We were able to think of the household management. And then we were able to stretch our imagination to the city state. And the point about the doughnut is that the outer container, the parameters of our home, is our planetary boundary. And we have to take our collective imagination to the planetary boundary. It’s very hard for us to do because there’s a lot of overwhelm in that. And so Kaj you will show us how we can sort the self out. Self, family, community, state, federal. And then we really need to be as nations working together in these kinds of models in a distributive by design way. And it’s complex but we’ll get our heads around it.
It comes back to that second point around the embedded economy. When Kate talks about the market, the state, the commons and the household, she’s speaking about the personal, the individual, the family, the place where our economy starts. It’s around the kitchen table, it’s working out how to manage the kids, it very much starts at that point. And if you ignore that part of our society when we’re thinking about how to govern it and manage it, if we think of growth as the only goal, if we think of the market as the only thing that matters then we’re missing huge amounts. And we’re imagining it as a system of levers and pulleys, a mechanical system. We used to think of the economy as a machine and this very much came out of a bit of professional jealousy from the economics profession towards physicists and scientists. This is 150 plus years ago, where there was really a desire to try to build equations, laws, systems that could be interpreted in a similar way. Like the laws of gravity. These things just matter, they apply no matter what. That was the holy grail of economics at that point, and that still permeates the profession. The reality of course is that this simplistic understanding of the economy as a machine and those with power just pulling levers of the machine is a false analogy. The reality is that it’s dynamic with feedback loop after feedback loop. And instead of thinking about it as levers we should be thinking about it through a lens of systems thinking. Not doing that is what leads to the type of repercussions that we see now, the climate emergency and the social inequality issues.
If you think about it from the 20th Century perspective, we’ve got this idea that growth will basically sort out our problems. That once we’ve grown big enough the fruits of that growth will be distributed, trickled down through the system. This is still policy in many, many countries. But we all know that it’s not how it works. We know that this system is flawed. In fact Joe Biden was asked about this a month ago and he said, “trickle down economics is dead.” So there’s starting to be an acknowledgement of this. But it needs to be more held at the core. And the idea here is that we move from that to a model which is distributive by design. Which is a really interesting idea that is worth its own several hours bottle of wine around the campfire to explore. But this is around not just thinking about the redistribution of income but also of wealth. So we go to ownership systems, we go to who owns land, who owns organisations, who owns technology, who owns the commons, who owns knowledge? These questions become really critical if we’re talking about distribution by design
The other point economics says is that as you grow an economy we’ll start to work out the environmental stuff. We’ll get cleaner through growth. And again that is only partially true. It is true that some developed countries have gotten cleaner over time but often that’s because we’re outsourcing our emissions. We’re putting our manufacturing somewhere else. The planet doesn’t care about that. So that’s still going to cause huge problems. The idea here is that we need to embed these regenerative principles in the way we design our economies and not expect the growth just to work it out. If we’re running organisations or we’re running a community group or we’re running our households, how can we set ourselves up so that we are regenerative in the way that we do things? We’re not just expecting us to be able to do it at some future point.
So we’re changing the goal from GDP. But it’s also just acknowledging that our systems are growth addicted. We are growth addicted. If our politicians came out tomorrow and said, “GDP doesn’t matter so much to us,” they would be persecuted out of office. So this system sits within all of us. If we run our businesses we are measuring ourselves undoubtedly on our profit over a quarterly basis. And if our states are measuring their progress on GDP growth and our organisations are measuring their progress on profit then we have a huge issue. Kate is saying is that we are the only system in the natural world that thinks we can grow forever. Nothing else does. It is just us. And there’s something fundamentally flawed about that assumption that that is even possible. So we need to understand that instead of being growth addicted we can be growth agnostic. We need to design our society, design our organisations in a way that says regardless of whether we are growing we need to thrive. Thriving is the goal. Getting into the doughnut is the goal. Sometimes that will involve growth. Some parts of our economy need to grow. Some parts of the world need to grow. But the idea of having that as its own goal is a real problem.
So let’s talk about how these ideas move into activation through the work being done with Regen Melbourne as an example.
For sure. People from all around the world approached Kate directly after they read the book and said, “how do we activate around this? How do we develop a kind of translations to something in the real world?” Et cetera. So she set up an organisation called the Doughnut Economics Action Lab, talking about how do you take it from an idea to action. And some of the early adopters of that were cities like Amsterdam, Portland, Philadelphia and a number of other places from a kind of municipal level who said, “How do we apply this framework to our place? How do we ask questions? How do we do community consultation around it? How do we develop visions around it?” They developed this city portrait process. Basically it’s a series of questions and a number of workshops that you run to develop a mirror of your city. So you take this doughnut and you say, “well what metrics apply to us? How do we define these things in real terms?” So it’s not just arbitrarily getting inside this space and seeing it as a kind of nice model. It’s really technical. People get into the details of what does it mean to be above the baseline of food in my city of Philadelphia? How do we answer that question? Well we’ve got to get all the food practitioners in Philadelphia around the table. Just say, well, how do we measure progress here? And so at a very granular level you can start to see how you’re going from a global macro view to a city view.
Okay so Regen Melbourne. Height of the pandemic last year. If you’re in Melbourne you’ll probably have flashbacks to that six-month extended lockdown period that we had. We were all engaged I think in different conversations around what would this look like post-pandemic in Melbourne. A number of us got together in a masterclass that the academy held with Kate and her husband Roman to talk about the doughnut and long-term thinking. And in that workshop a whole bunch of people put up their hands and they said, “why don’t we localise this to Melbourne? Learning from Amsterdam and other places. How would we do it here?” And very quickly this collective of organisations formed. We’re now up to I think more than 50 organisations based in Melbourne. About a thousand people are involved. We said, “well let’s start talking about it.” And we designed a community engagement project that used this city portrait methodology and then added a whole bunch of Melbourne flavours. And we ran a number of workshops, a number of roundtables, we did a bunch of leadership interviews. And we produced a report that came out at the end of April outlining three foundational elements. The first one was that in these workshops that we ran using the city portrait methodology we asked people what is your vision for different aspects of a city? So what is your vision for food in Melbourne? What is your vision for housing in Melbourne? We got dozens and dozens and dozens of statements at a very granular level of the doughnut. And then one of our extraordinary volunteers, Nicky, designed a process by which we could group those vision statements into a number of categories and then elevate key words that were used. And what we landed on was this statement around a vision for Melbourne. A Melbourne that is knowledgable, full of life, affordable, connected through its culture, collaborative in nature and enabled by the systems that surround it.
What we also needed was a compass and a way of measuring progress towards that vision. And that’s where we came to this Melbourne doughnut. In our version not only did we want to kind of make it beautiful and alive for our city, we also added a couple of elements. One which is critically important. In every aspect of our conversations that we had, when we were talking about the health of our city or the empowerment of our city, one subject kept coming up again and again. And that was that the health of our art and our culture is intrinsically linked to the health of our entire city. In fact it’s kind of a prerequisite for it. And in the SDGs there is very little conversation around art and culture. And so what we did was add a segment in the social foundation of our doughnut that explicitly speaks to this point. That if we don’t achieve a healthy art and culture in our city then we cannot achieve a healthy city. And so that’s one of the really critical additions of the Melbourne doughnut that doesn’t appear in other doughnuts around the world, at least not as far as I understand. The other major element that we added here was around kind of the dynamism and aliveness of the model. As you can sort of see on the left there’s a flatness to the existing doughnut which Kate recognises. And what we’ve done is say there are some elements that bind the doughnut together. And fundamentally that is if we are going to achieve the social foundation or achieve the ecological ceiling, there needs to be a healing and there also needs to be a reconnection to nature and country in the context of the ecological ceiling and to each other in the context of the social foundation. So our work from here is to say well, how do we monitor these things? How do we build systems around them to be able to provide a mirror back to Melbourne to say, “we are doing better than we did last year on these elements and we need to work harder on these elements.” That’s the work to come.
The final element of the Melbourne process was to develop a roadmap. So we realised into the process that we were working on that the sort of community engagement, the nice conversations around the future of Melbourne were never going to be enough. So we developed a roadmap of actions that we think take place over the next two years which start Melbourne on the pathway to fulfilling this doughnut, to getting into the safe and just space of the doughnut. And they include three buckets of work. One is further developing the doughnut itself. How do we build an insights process to work out how we’re going against this compass? How do we look at gaps in policy? How do we develop expert led working groups around each one of these elements? Then there's a bucket of roadmap steps I guess around community activation. So we want to run a regenerative business forum, we think that would be an amazing thing for our city. What is the real role of business in the future of our city? We think there’s a possibility of establishing neighbourhood groups. We want to recruit local councils and we think there’s a role for a Melbourne wide regenerative project incubator where we bring together project organisations and funders to support beacon projects that are working to get Melbourne into this safe space.
The last one is really around the network itself. ‘Cause we realised that the network is important to the work. It’s not just the work that matters, it’s also the convening and the relationships and the collaborative fabric that is being built in the network. And so we’ve got to do some work on distributed governance and resourcing strategy. And we also think the doughnut itself can be used as a kind of navigation tool. Like if I’m passionate about something in Melbourne how do I find other people that are passionate about that? And we think there’s a way of using the doughnut to sort of navigate that. Where are the opportunities, where are the jobs? Where’s the funding? Where’s the research around particular areas? The doughnut can be a wonderful navigation tool. So I guess what I want to…just to show with that, not to necessarily get into the details, but just to say we’ve done a whole lot of thinking and engagement and community conversations. We’re now at a beautiful point where this is all getting rolled up into the next phase. How do we activate around this roadmap and make it real?
How is traditional owner custodian engagement and indigenous knowledge informing this work?
At a philosophical level I couldn’t agree more that the grounding of a model like this from somewhere else into Melbourne as a place can only happen in a meaningful or impactful way if it starts with first nations voices and centring first nations ideas in the how and the what and the vision and all the things. And I think that’s both from a kind of practical perspective, like what are the ideas that can come from that? But also just the speaking to the kind of healing and reconnecting piece that envelops the doughnut. Hopefully you can start to see that those conversations are kind of ongoing and in the work. Even the fact that we didn’t end up with an element of our vision that was just about the environment. Instead of doing that kind of separation piece, which is often the case when we reference the ecology or the environment, it’s kind of, “and we’ll do that bit.” Instead for us it was very clear through many of these conversations that it was kind of included and woven into the work rather than seen as separate. And then I guess the other thing I’d say is that the Small Giants Academy has an elder in residence, which is N’arweet Carolyn Briggs, the Boon wurrung senior elder. Small Giants Academy’s offices are in St Kilda on Boon wurrung country. And she’s an advisor to the work. She’s in the strategy work. We talk to her about initiatives and projects that we’re working on and was interviewed as part of the process that we’re on with the Regen Melbourne work. Sort of sits as an advisor of the work there as well. And we also have many conversations with a wonderful thinker and academic Yin Paradies who’s a director of race relations at Deakin University. Which spoke to some of the methodological parts of this. So it’s not just engagement in that broad sense but it’s also if one doesn’t think about the process then as well as being part of that conversation then you’re never going to get to sort of meaningful relationships. The process is as important as the conversations. It has to be an ongoing part of what we do.
The broader the tent, the more diverse the members around the table, the more interesting, A, the conversation, your life, and more reflective of this moment and where we’re heading. I want as many people from across the isle around these tables together because I think that if we’re in our bubbles, our algorithmic bubbles, our political bubbles, our language bubbles, our staying with people who speak like us, talk like us, sound like us on every level whether it’s political alignment or cultural alignment, whatever, I just think we need to be uncomfortable much more. And create really spacious hospitable language for one another to show up so that we can really hear one another.
We’ve held a roundtable of economists as part of the process that we’re in ‘cause one of the critiques of alternative economics of which there’s a whole series of branches, you know, there’s feminist economics, there’s wellbeing economics, there’s “alternative economics.” And one of the critiques of this field is that there’s not enough economics in it. Like traditional economists say, “Yeah, that’s fine, but it’s not economics.” So what we did was we convened this roundtable of economists and said, “well here’s the thinking. Where are you guys at? How does this sit for Melbourne? Let’s have a conversation about that.” And we had conservative economists in large institutions. And we had renegade economists like Kate. And we talked about where are the points of agreement and where are we like converging and having debate? And ultimately the outcomes of that conversation was we all agree on the goal. Like the goal has to change. Even the most conservative economists were saying the idea of growth as the only goal is crazy. It’s unsustainable. It leads to broken systems, way too many what they call externalities. We need to change the goal. Where the debate of course happens is in order to achieve the doughnut do we need to throw away neoliberalism as an ideology? Do we need to throw away the idea of competition as an organising principle? There’s plenty of debate there. And I think in some areas there’s going to be grey and some areas it’s going to be black and white, and we have to embrace it.
