The OECD as the cradle of the Club of Rome

Matthias Schmelzer, University of Jena, based on a newly published article on the origins of the Club of Rome within the OECD.

The Club of Rome’s first report, The limits to growth, appeared in 1972 and was ultimately published in thirty languages and sold over thirty million copies worldwide. It made many people aware for the first time that with continuing growth the world would eventually run out of resources. Today, 45 years later, its electrifying conclusions, which modelled the ‘overshoot and collapse’ of the global system by the mid twenty-first century, still provoke intense debates.

The report also brought international fame to the newly founded Club of Rome, which has since become a key reference point in the public memory of the 1970s and environmental discourses more generally. It boasts considerable authority as a private, non-state, and global group of experts concerned about the fate of humanity, and a wise warden for the ecological survival of planet Earth. However, this extraordinary public and academic attention has largely overlooked the constitutive entanglements with the OECD that characterise the Club’s foundation and early history.

This OECD–Club of Rome nexus needs explaining. The OECD, founded in 1961 as the successor of the Organisation for European Economic Co-operation (OEEC) that had overseen the Marshall Plan aid, soon became, in the words of one of its Directors, “a kind of temple of growth for industrialised countries; growth for growth’s sake was what mattered”. By the late 1960s, however, faced by increasing popular anxiety about unsustainable growth in Western societies, scientists and bureaucrats within the OECD launched a debate on “the problems of modern society”. The driving forces of this growth-critical and ecologically oriented debate were two of the most powerful men within the Organisation: the head of the OECD since its foundation in 1961, Secretary-General Thorkil Kristensen, and the Organisation’s long-time science director and unofficial intellectual leader, Alexander King. The topic assumed such importance that it was central to discussions at the OECD’s ministerial meetings in 1969 and 1970.

However, Kristensen, King, and their associates around the science directorate and the Committee for Science Policy were frustrated by governments’ inability to deal with long-term and interrelated ecological problems and thus looked for allies outside the OECD. They got together with Italian industrialist and global visionary Aurelio Peccei, at that time an executive of Fiat and the managing director of both Olivetti and Italconsult, and in 1968 this elite group of engineers, scientists, and businessmen, founded the Club of Rome. They were fundamentally sceptical about the potential of existing political institutions to catalyse the controversial global debate they deemed necessary, because they regarded these institutions as the “guardians of the status quo and hence the enemies of change”. They saw themselves “faced with the extraordinary arrogance of the economist, the naivety of the natural scientist, the ignorance of the politician, and the bloody-mindedness of the bureaucrat”, all unable to tackle the ensemble of problems they had identified.

Thus, they built a transnational network to advance their view of planetary crisis both through the OECD (thus targeting key economists and ministers from member countries) and through the Club of Rome, whose reports forcefully shaped public debates. This network blurred the lines between the “official” OECD and the “private” Club, not only in terms of overlapping membership but also in terms of discourses. While the Club functioned as a “detonator”, its core members used international organisations “as transmission belts”, as Peccei explicitly put it, and thus acquired a strong leverage.

The personal overlap between the OECD and the Club of Rome in its initial phase is remarkable. Not only were three of the four persons that founded the Club working in or with the OECD (King, the Austrian systems analyst, astrophysicist, and OECD expert; Erich Jantsch; and the Swiss director of the Geneva branch of the Battelle Memorial Institute and Vice-Chairman of the OECD’s science committee Hugo Thiemann). Besides the Italian industrialist Peccei and the German industrial designer Eduard Pestel, who secured the funding from the Volkswagen Foundation for the first report, all the crucial personalities in the formative period of the Club of Rome were closely connected to the OECD. Almost the entire core group of the Club of Rome, its “executive committee” – which has been characterised as the true “motor” of the Club of Rome, and who signed Limits to growth – also had positions within the OECD.

This transnational group of experts at the interface of national governments, international organisations, and the Club of Rome formed a unique circle of elite environmentally conscious planners. Even though claiming to speak for the entire globe, they represented a very narrow fraction of the global population, in part because of their organisational base in the OECD, often dubbed the “Club of the Rich”. They were all highly-educated and largely white men and thus reproduced the tradition of upper-class gentlemen’s clubs, and all came from countries in the global North (mostly European, some US and Japan). With close ties to elite universities, transnational business, and international organisations, they acted from economic positions of privilege and power. Furthermore, the entire network had academic backgrounds in the natural sciences (in particular chemistry and physics) or engineering, with only a few trained in economics, and none in the social sciences or humanities. Finally, almost all had spent at least part of their career as national government experts or administrators.

All these factors influenced the perspective and politics of the network at the heart of the OECD–Club of Rome nexus. A more profound appreciation of the gestation, midwifery, entanglements, transfers, and tensions that characterise this nexus opens up a more complex understanding of both organisations and the actors driving them. It puts in perspective the public perception of the Club of Rome as a private, non-governmental, and global think tank by analysing its origins within an all-male elite group of engineers, scientists, and businessmen, and its intimate interrelationships and personal overlaps with the OECD, an intergovernmental organisation representing the industrialised capitalist countries. This social positioning fundamentally shaped the network’s outlook, most importantly with regard to its systemic analysis of interrelated global problems in a computer-engineering perspective, the technocratic outlook from the perspective of the global North, and top-down management approach.

How did the cradle of the Club of Rome react when its offshoot published its first report in 1972? After all, Limits to growth was consciously set up as a “detonator” to give a jolt to established governments and international organisations. At first, it did indeed impress and unsettle the OECD. But once the public debate took off, the views expressed in Limits deepened the internal fractures within the OECD and provoked hostile reactions, leading to a revitalisation of the strong pro-growth position.

The strongest force behind the backlash against the critiques of growth came with the onset of economic turmoil, soaring energy prices, and stagflation from 1973-74 onwards. While the energy shortages and their effects on industrialised countries were largely interpreted by the public as proof of the Club of Rome’s predictions, within the OECD these developments did not strengthen the faction critical of growth. On the contrary, the debate on the “problems of modern society” was choked by a combination of changing member-state interests, an attempt by the top level of the Secretariat to better position the OECD, and a shift of influence within the Organisation.

The growth critique sparked a bitter controversy between the macro-economic branch of the Organisation and the science experts and environmental scientists around King, which the latter lost when the OECD refocused on trade, energy, and growth. In particular, the publication of the Club of Rome’s first report polarised the debate to such a degree that not only the OECD but Western policy-making circles more generally returned to the promotion of quantitative growth. While the Club of Rome was born in the corridors of the OECD, its first report effectively ended these intimate relationships.

Useful links

Matthias Schmelzer (2016), The Hegemony of Growth. The OECD and the Making of the Economic Growth Paradigm, Cambridge University Press

The OECD Interfutures project (1979)

Australia: the biggest loser in future viability

bertelsmann-sgiDaniel Schraad-Tischler, Senior Expert at Bertelsmann Stiftung where he heads the Sustainable Governance Indicators (SGI) project, and Christof Schiller, project manager for the SGI project and associated Fellow at the Potsdam Center for Policy and Management.

In the past two years, Australia’s viability for the future has dramatically decreased and its need for reform with regards to economic, social and ecological sustainability has increased enormously.

This of one of our findings in this year’s Sustainable Governance Indicators (SGI) by the German Bertelsmann Stiftung. It’s an international monitoring tool which sheds light on the future viability of all 41 countries of the OECD and European Union. On the basis of 136 indicators we assess government actions and reforms. More than 100 international experts are involved in our study.

In comparison with the other developed industrialized nations, Australia is now ranked just 25th in future viability, dropping ten places in comparison with our 2014 survey. It is now 13 places behind neighboring New Zealand and on a similar level to Poland. Thus with regards to the need for reform in important economic, social, and ecological policy fields, Australia is one of the biggest losers in our study this year.

We found major reform needs in many policy areas, including research and development, social inclusion, and environmental policy. Australia must improve considerably here if it wants to secure its future viability in the long term.

However, when assessing the steering and reform capacity of the political system Australia receives above-average scores in our study, ranking 11th out of 41 nations.

Overall, the Scandinavian countries achieved the best results, with Sweden ranking first, followed by Switzerland and Germany. Of the largest national economies, only two G7 nations (Germany and the United Kingdom) are among the top ten. The U.S. moved up one rank, but is still below average. Greece continues to come in last in the comparison among countries.

With the end of the commodity boom, a growing need for reform

In our Policy Performance Index, sharp contrasts were revealed between excellent scores for integration policy and massive deficits in the areas of research and development, social inclusion, and the environment.

One reason Australia scored so well in integration policy is that job opportunities for immigrants are approximately as good as those for native-born Australians. No other OECD country – with the exception of Hungary – does so well in this regard. Our study praises the effectiveness of Australian integration policy, but we also found weaknesses and challenges, including the country’s uncompromising treatment of asylum seekers who try to reach the country by boat from Southeast Asia.

Australia’s increasing need for reform is mainly due to the end of the commodity boom, which has led to stagnation in living standards and a rise in unemployment rates since 2011. We found that with the end of the boom, Australia must develop new growth industries. Manufacturing, tourism, and education services appear unable to fill the gap.

In research and development, Australia ranks just 26th out of 41 countries in our study. Although it provides significant public financial support for research and development, the results are quite disappointing. For example, Australia registers just 77 patents per million inhabitants per year, compared with 335 in top-ranked Japan.

Australia is generally in need of significant public investment to bring its infrastructure to a level comparable to other advanced economies. The price for Australia’s low level of public debt has been inadequate roads, ports, and railroads. Yet the structural fiscal deficit impedes large new spending programs for infrastructure.

Lagging in social inclusion and environmental protection

In social inclusion, too, Australia ranks no higher than the lower mid-table range. The poverty level in the population is 13.8 percent. By contrast, in the Czech Republic or Finland just 5 percent of the population have to manage on less than 50 percent of the median income.

We found that the situation for indigenous Australians in particular continues to be the most serious social failure of the country’s policymakers. There have been numerous policy initiatives over recent decades seeking to address the appalling outcomes experienced by indigenous people, but there is little evidence of substantive progress. Remedying this must remain a priority over the coming years.

Australia also has a lot of catching up to do when it comes to its environmental policy. In the past, the country has addressed environmental challenges haphazardly. Considering the country’s climate, there is much room for the development of sustainable policies on energy and the environment. Transport could be made much greener, for instance by using higher excise duties on fuel to improve too often inadequate public transport systems.

With regard to the governmental system’s general reform and steering capacity, however, our study comes to a positive conclusion: Australia achieves 11th place in our Governance Index. Only the Nordic countries plus New Zealand, Luxembourg, the U.S., the United Kingdom, Canada, and Germany rank higher.

Among the strengths of the Australian governmental system, we found the efficient coordination between ministries as well as the parliament’s role in helping to shape policy and its supervisory competence.

Thus, there are reasons to be confident that Australia will be able to overcome the challenges outlined above. But the country’s performance in our international assessment of policy-making and governance should be a wake-up call.

Useful links

OECD Society at a Glance 2016: How does Australia compare?

OECD environmental tax profile for Australia

OECD Australia economic forecast survey

What does mainstreaming biodiversity mean?

IDB-2016-logo-En Before there was the Insights blog, there were the Insights books. One of the first, on sustainable development, mentioned “a magical place, seemingly untouched for thousands of years”, on the Poland-Belarus border. Well, this “last remaining fragment of a primeval forest”, Białowieża National Park, is about to be touched, by loggers. The decision has sparked an impassioned debate, in Poland and far beyond. Forests seem to be anchored deep in the psyches of many peoples. There is even a theory that the story of the Garden of Eden refers to deforestation in the Middle East 10,000 years ago, and three millennia later, The Epic of Gilgamesh would describe how the gods curse Sumeria because the hero cut down the sacred forests.

The OECD is as Jungian as the next intergovernmental organisation, but on International Day for Biological Diversity we’re angsty about the loss of forests and other forms of life for material as well as subjective reasons. Biodiversity worldwide is in decline as the pursuit of economic growth and development leads to the conversion, and in many cases over-exploitation, of natural resources for inputs to production and consumption.

The theme of Biodiversity Day this year is “Mainstreaming biodiversity; sustaining people and their livelihoods”. According to World Bank figures, “natural capital accounts for an estimated 30% of total wealth in low income countries compared to only 2% in OECD countries”. Developing countries could learn a few (negative) lessons from what happened to the developed countries on their way to OECD status. The European Potato Famine of the 19th century killed in more or less direct proportion to the lack of diversity in the poor’s diet, with a million victims in Ireland where a third of the population relied almost exclusively on potatoes for food. The Dust Bowl that devastated the North American prairies in the 1930s was in large part due to farmers destroying the grass that held the topsoil in place.

If biodiversity is so important, and neglecting or damaging it so harmful, why don’t countries “mainstream” it?  For a start, although preserving as many species as possible goes back as far as Noah’s Ark (based on Gilgamesh), biodiversity as a scientific concept is recent, dating from a 1985 US National Research Council/National Academy of Sciences forum on biological diversity, while the term “biological diversity” itself first appeared in Raymond F. Dasmann’s 1968 book A Different Kind of Country.

Even so, most of us probably have a pretty good idea of what biodiversity means. But what about “mainstreaming”? Outside the OECD and like-minded institutions, it now has a faintly negative connotation – mainstream media, mainstream tastes for instance. There are various definitions, but they all give the idea that it involves integrating biodiversity into growth and development processes and in sector policies in a systematic way (notably in agriculture, forestry and fisheries, among others).

This is going to be extremely difficult in practice, whatever the rhetoric. One of the main reasons biodiversity isn’t adequately mainstreamed is that it has to compete with other (often more visible) national priorities for growth and development, so there is insufficient political recognition of biodiversity and the underlying ecosystem services it provides. Hopefully, the new Sustainable Development Goals (SDGs) will help to change this and raise the profile of biodiversity to a higher political level. Two of the 17 SDGs focus on biodiversity (terrestrial and marine).

The way in which the political will for change comes about reminds me of one of the grim conclusions of another Insights book, on fisheries. Fishing is a good illustration of how the unsustainable exploitation of natural resources poses a problem of political economy. The impetus for change is often a major catastrophe, such as the collapse of the industry when the fish stocks suddenly disappear. However, doing what is sustainable may mean a sudden, visible, loss for a small group of people who can organise to block change, while the benefit is much more long-term, less visible and less important on an individual basis, so there is less political pressure to implement what would be the best, long-term solution overall. An OECD contribution raised a similar point at a Convention on Biological Diversity (CBD) event in Montreal earlier this month, citing “Long timeframes for mainstreaming results to occur” as one of the challenges that also arises in the context of mainstreaming biodiversity in development co-operation.

Another lesson from fisheries is that biological systems do not behave in a linear fashion. You may think a slow decline in fish numbers gives you time to find a solution, or that stocks may recover as they did sometimes in the past, but when an ecosystem reaches a tipping point, change can then become sudden and catastrophic. And usually, that tipping point is only identifiable afterwards, it can’t be forecast.

That’s why the CBD, the organisers of today’s campaign, are so worried about the interactions of a number of complex systems. Take what they say about fishing, to stick to that example. Overfishing, pollution and unsustainable coastal development are contributing to irreversible damage to habitats, ecological functions and biodiversity, going on to say that “Climate change and ocean acidification are compounding such impacts at a time when the rising global population requires more fish as food, and as coastal areas are becoming home to a growing percentage of the world’s population”.

With respected bodies like the Paleontological Research Institute at Cornell University estimating that because of human actions, current extinction rates are up to 100 times greater than they would have been otherwise, it’s getting urgent not just to act efficiently. Clunky administrative procedures in international and national programmes are a problem, as is the fact that typical projects have a 4 or 5-year cycle rather than the 10-15 years needed to make a difference. As well as that, monitoring and evaluation of mainstreaming efforts have to be more robust than at present to allow you to know what works and what doesn’t.

The SDGs’ targets for life below water and life on land are ambitious but achievable, and they’re certainly far more attractive than the alternative presented in Gilgamesh, where the Annunaki, the seven judges of hell, raise their torches, lighting the land with their livid flame. Don’t say you weren’t warned.

Useful links

The CBD, like the UN climate change convention, has a Conference of the Parties, COP. CBD’s COP 13 in Cancun, Mexico in December this year, will also be focusing on mainstreaming biodiversity as its overarching theme.

OECD work on mainstreaming biodiversity and development

Summary Record of the OECD workshop on Biodiversity and Development: Mainstreaming and Managing for Results, 18 February, 2015

Excerpts from the mainstreaming sections in ‘biodiversity’ chapters of the OECD Environmental Performance Reviews.

Biodiversity and development co-operation OECD Development Co-operation Working Papers

Economics and policies for biodiversity: OECD’s response

Green and growing, or ripe and rotting?

Towards green growthNathalie Girouard, OECD Environment Directorate

In a recent lecture on climate change, the OECD Secretary-General stated that “Tomorrow’s societies engineered around yesterday’s solutions won’t get us there.” The OECD’s work on green growth is just one example of where the Organisation is working towards the development of solutions for today.

The OECD’s 2011 Green Growth Strategy set out a framework for governments to foster economic growth and development, while ensuring that natural assets continue to provide the resources and environmental services necessary for human well-being. To ensure the OECD’s advice on green growth did not become a solution for the past, the Organisation recently prepared the Towards Green Growth? Tracking Progress report. The report takes stock of country experiences and challenges in implementing green growth. It reviews and strengthens the green growth strategy based on the lessons from country efforts, as well as advances in OECD work – including more than 130 green growth publications and over 115 country surveillance reviews containing more than 300 green growth recommendations. Lastly, it assesses the green growth mainstreaming efforts that have been made within the OECD, as these experiences are relevant and instructive for governments and organisations going through the same process. The aim of the report is to accelerate countries’ implementation of green growth policies by providing more targeted and coherent policy advice. In other words, provide relevant solutions that are effective for today’s green growth challenges.

The analysis of country experience shows that countries are making progress, but more work is needed. Thus far, 42 countries have signed on to the OECD’s declaration on green growth. Roughly a third of OECD member countries and a number of OECD partner countries have adapted, or are adopting the Green Growth Strategy’s indicator framework. Examples of green growth policies include China’s 12th 5-year plan on green development, Portugal’s Green Growth Commitment, and Ireland’s framework for sustainable development. Yet to date, no country has comprehensively linked environmental and economic reform priorities. The analysis of the OECD’s green growth recommendations identified that common challenges facing countries relate to the implementation of market instruments to price pollution; orienting tax systems to advance green growth; designing environmentally relevant subsidies; and gearing sectoral policy towards green growth.

This analysis, along with the assessment of OECD’s work on green growth allowed for the development of several key findings and recommendations. First, direct pricing of environmentally harmful activity is indispensable to green growth, but political opposition remains a challenge. To respond to this opposition, more effort is required to tackle the social challenges of reform (e.g., labour market and household impacts). In addition, where constituencies are strongly against tax increases or shifts, governments may need to consider policy mechanisms other than direct pricing.

Misalignments in government policy are also acting as a major hurdle to meaningful reform. Two prominent examples are that governments spend roughly $640 billion per year on environmentally-harmful fossil fuel subsidies and that diesel fuel is taxed at a lower rate than gasoline in 33 out of 34 OECD countries – despite the fact that diesel emits higher levels of harmful local air pollutants and CO2.

The analysis of the mainstreaming process for green growth at the OECD showed that it is proceeding rapidly, but unevenly. Around 70% of OECD country policy surveillance documents contain green growth recommendations. This accomplishment is in part driven by the OECD’s Economic Surveys, where over 80% include green growth recommendations. The elements driving this successful mainstreaming include: high-level leadership and clear accountabilities; formal structures for collaboration; clear articulation of how green growth links to other policy priorities; and dedicated human resources. Nevertheless, more work is needed to better integrate green growth into the OECD’s work on investment and innovation. The forthcoming Green Growth and Sustainable Development Forum on Systems Innovation for Green Growth is one mechanism that can be used to advance work in this important area.

To ensure that the OECD’s green growth strategy remains relevant, the report also outlines a series of improvements. These are intended to modernise the strategy and outline work priorities for governments, the OECD and others. These include enhancing the understanding of complementarities and trade-offs between economic and environmental goals; enhancing public trust in green growth by addressing the social impacts of reform; and ensuring that policies are coherent and aligned within and across sectors. Further developing and considering the ocean economy and mining in gearing sectoral policies for green growth. Lastly, using green growth indicators to raise awareness, measure progress and identify opportunities and risks as well as factoring in the challenges and opportunities that green growth represents for developing and emerging economies.

2015 needs to be a big year for green growth. The Tracking Progress Report is just one of the many contributions to continue to advance work in this field. While governments and international organisations endeavour to green growth through the forthcoming Sustainable Development Goals and the COP21 negotiations, it is important to remember that solutions for today can also come from individuals. As George Eliot said, “The strongest principle of growth lies in human choice.”

Useful links

To explore the findings of the report, a publication launch webinar will be hosted by the Green Growth Knowledge Platform (GGKP) on 27 July, featuring Carlo Carraro (Co-Chair of the GGKP Advisory Committee), the OECD’s Chief Economist Catherine L. Mann and Kevin Urama (Managing Director, Quantum Global Research Lab) as the lead discussants.

Key recommendations in English, French and Spanish

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English

Green Growth and Sustainable Development: Key OECD documents

What will our livelihoods be like in 2030?

TLivelihoodsoday’s post is by Martha Baxter and Bathylle Missika of the OECD Development Centre

Humankind has experienced more than two centuries of almost continuous progress since the Industrial Revolution, but will this trend continue? And as we prepare to adopt a new set of Sustainable Development Goals to guide our policy choices, how can we best capitalise on progress made while anticipating challenges ahead such as the youth bulge or massive droughts? A new report by the OECD Development Centre supported by the Rockefeller Foundation cautions that that a number of global trends could slow or even reverse the progress made. Securing Livelihoods for All: Foresight for Action looks at how the world’s livelihoods may change between now and 2030. It finds that threats may come from many fronts: from global economic trends and demographic transitions to environmental change and new technologies, among others.

The report doesn’t try to forecast what will happen. It uses foresight techniques to ask “what if?” questions and develop five stories of the future, interconnecting several trends we’re concerned about, and picking up on some of the weak signals coming from new and emerging trends.

Of the five possible futures developed in the OECD report, three are dire, involving massive population movements, inequality, poverty and citizen unrest, while two involve vibrant societies that possess the skills, creativity and flexibility to thrive and stave off global crises.

The first scenario is called “Automated North”. Automation proceeds faster than expected and affects ageing societies in particular. The rapid automation in advanced and some emerging economies means that jobs in most sectors are increasingly taken over by robots and artificial intelligence systems. The process is so fast that most people whose jobs are replaced by technology cannot adapt and find it difficult to secure their livelihoods. Inequality increases faster than expected. With fewer jobs available to nationals, pressure is growing to increase barriers to immigration in developed countries. Lower fiscal revenue combined with more people in need of social security support means that government debt becomes unmanageable. Social tensions and disruptions increase. In many developing countries, the automation process is much slower, meaning that these countries are no longer competitive, even in low-cost, low-value added sectors.

In the second scenario, “Droughts and joblessness in the South”, droughts become widespread in large parts of the developing world, challenging livelihoods in regions with large youthful populations (sub-Saharan Africa, North Africa, Middle East and South Asia). Subsistence farming becomes almost impossible and even larger scale farming is seriously challenged. Famines become normal, not only for small-scale farmers but also for poor people in urban areas as food prices sky-rocket. Migration takes place primarily within countries as rural populations flood to the cities. But international migration also increases as cities reach their absorption capacities. The pace of change – in the youth population explosion as well as in the severity of droughts – is very fast. Countries, communities and individuals are unlikely to be able to adapt livelihoods or support mechanisms fast enough. The result is hunger, increasing inequality and social disruption.

In the third scenario “Global financial crash, a major financial crisis triggers a collapse of the global trading system and a shift to protectionism. A housing bubble bursts in China and some other emerging countries. High levels of corporate debt in the developing world become unsustainable and lead to capital outflows. The European Union unravels, prompting another financial crisis. Commodity prices continue to fall rapidly, creating significant challenges for currency stability in countries relying on commodity exports. These financial disruptions trigger a major global economic crisis, affecting trade, investment and consumption. Protectionist pressure re-emerges but does not help to avoid social disruptions, and governments fail to address problems of increasing inequality. In developed and developing countries alike, many people’s livelihoods come under pressure. At least one billion people fall back into extreme poverty.

The “Regenerative economies” scenario posits a more positive vision of the future. Technological innovations create enough new jobs for most people and economic activity becomes more sustainable. Many new fields flourish, including cybersecurity, environmentally resilient engineering, robot-enhanced service jobs, and jobs requiring high skills in nanotechnology and biotechnology. As the real economy becomes a virtual economy, many sectors undergo a transformation. Country borders and distance become less relevant. Markets become more international than ever before. Countries reshape their education systems so that people can perform in the knowledge economy. Technological innovation in agriculture results in migration from rural to urban areas in many developing countries, but planned, medium-sized cities with energy-efficient infrastructure contribute to sustainable urbanisation rather than slumification. While impacts on livelihoods are positive overall, certain people will still need social security, but such systems will be more affordable for nation states under this scenario. This scenario could touch all regions of the world, but would come about faster in advanced and emerging countries.

In the final scenario, “Creative societies”, diverse experiments at the local level focus on individual resilience and social well-being. Technology-induced joblessness increases in developed and developing economies alike. Societies evolve towards new ways of living and working, in which individuals and communities are the key actors of change. In the absence of secure full-time employment, individuals must put together a portfolio of work – part-time jobs, shared work with colleagues, trading skills and services. This portfolio lifestyle is made possible by three important factors: technology, which allows people to work anywhere at any time; the adoption of guaranteed minimum incomes in most developed countries, paid for by higher taxes on capital, rather than labour; and new social attitudes in which young people are not so interested in consumer culture, but contribute to what might be called “the experience economy.” Cities pursue a green agenda, retrofitting buildings and prioritising water conservation. A robust urban food movement develops, involving urban community gardens. Public-private livelihood incubators flourish in most cities, providing job counselling, the matching of skills and opportunities, start-up financing, and individually tailored aid packages for young and old. Developed countries learn from experiments in social inclusiveness and adaptive, frugal innovation pioneered in developing economies.

So what is awaiting us? Which scenario triumphs depends on the building blocks laid down today, for example a shift in values towards prioritising sustainability, as highlighted in the “regenerative economies” scenario, and on policy choices. There are also many more scenarios that could be developed beyond the ones explored in the OECD report. But what matters is that imagining different scenarios of the future can create space for strategic, often difficult, conversations in today’s policy discussions. These conversations will allow us to discuss the livelihoods we have and the ones we want by 2030. The bad news is that in spite of the use of forecasts and foresight, we still do not have anything resembling a crystal ball. The good news is that we have more than a say in how our future livelihoods will unfold.

Useful links

Perspectives on global development from the OECD Development Centre

OECD Forum 2015. Investing in the Future: People, Planet, Prosperity

OECD Forum home pageForum 2015, Investing in the Future: People, Planet, Prosperity will take place in Paris on 2-3 June. It will be organised around five themes: Investment; Inclusive growth; Innovation; the New Climate Economy; and Sustainable Development Goals

People

45 million people are unemployed in the OECD, which increases the risk of poverty, ill health, and the levels of inequality within our societies.
This legacy of the crisis is undermining the confidence and trust of citizens in everything from governments to markets, businesses and institutions at large.

The Forum will discuss how to promote access to more and better quality jobs, but also how governments, universities, business and civil society can address growing inequality by expanding access to education.

What skills will be needed to make people more resilient and entrepreneurial? And how to promote the exchange of knowledge between people, universities and business that leads both to innovation and more inclusive growth models.

The Forum will also reflect on actions aimed at reducing the gender gap and enhancing the role of women in economies and societies at large, in the context of the celebration of the 20th anniversary of the Beijing Declaration and the G20 commitment to reduce the gender gap in workforce participation by 25 % by 2025.

Read more on inclusive growth

Planet 

New technologies and business models are essential to help achieve a NEW CLIMATE ECONOMY, which combines strong economic growth while minimising impacts on the environment.

This will be an important issue in the run up to the COP 21 negotiations in Paris and discussion will be informed by the joint OECD, International Energy Agency (IEA), Nuclear Energy Agency (NEA) and International Transport Forum (ITF) work on aligning policies for the transition to a low carbon economy.

The Forum will be an opportunity to reflect on the importance of a coordinated approach to: mobilise infrastructure investment; rethink taxation and urban development; address resource scarcity and the food-water-energy nexus.

Cities will play a key role in this new economy. Cities already generate around 80% of global economic output, and use around 70% of global energy. 54 % of the world’s population lives in cities today, and this figure is expected to increase to 70% by 2050

Prosperity

The Forum will explore the importance of INVESTMENT in placing economies on sustainable growth paths; addressing inequalities; fostering innovation; helping the transition towards low-carbon economies; and financing the Sustainable Development Goals (SDGs).

Investment is still lagging compared to pre-crisis levels, dampening demand and constraining potential growth. Breaking this vicious cycle is a priority to restore dynamism to our economies and create jobs.
Read more on investment
Ongoing innovation in ICT, renewable energy, nanotech, telemedicine, biotechnology, Big Data and the “Internet of Everything” is offering promising solutions in areas such as health, ageing, climate change, food security and represents an increasingly significant source of future economic growth.

The update of the OECD Innovation Strategy will feed into Forum debates with particular emphasis on governments’ ability to meet social and environmental challenges by creating an enabling environment fostering innovation.

Read more on innovation

Better Life Index

‌‌‌‌The OECD will present the 2015 Better Life Index update, incorporating new data and communicating what has been learned from almost 90 000 user responses received since 2011. The Index will be available in seven languages: English, French, Spanish, German, Italian, Portuguese, and Russian.

A complimentary site, highlighting Italian well-being priorities will be launched in conjunction with Expo Milan 2015 in English and Italian.

Seeing paradigm change

Greening household behaviourToday’s post by James Greyson, Head of BlindSpot Think Tank is in response to Naazia Ebrahim’s recent article on greening household behaviour. We asked James to expand on his argument that “System change policy would design waste out of economics”.

“And above all, watch with glittering eyes the whole world around you because the greatest secrets are always hidden in the most unlikely places.” – Roald Dahl

This line from a story by the imaginative genius Roald Dahl was published after his death in 1990. Today these words still sound like handy advice for those of us watching the world and looking for places where change can shift paradigms. Dahl hints at a key insight for solving intractable global problems, that our way of looking determines whether we find what we’re looking for. Since we’ve collectively not found it, why not look for help in an unlikely place such as a children’s story?

Our world and its problems should have been watched for long enough. Inequality, debt, financial instability, corruption, conflict, ecosystem damage, waste and poverty have been seen through history.  These big problems have been watched by problem-solving professionals since at least the 1972 UN Stockholm Conference. Despite all efforts since then the risks that the conference declaration warned about, such as “massive and irreversible harm to the earthly environment on which our life and well-being depend”, just grow and grow. After all this time there are still no solutions in place to avoid that unpredictable moment of irreversibility when any global problem overtakes any hope of recovery. Even now, this moment could be avoidable so we should be seeking new possibilities.

Roald Dahl hints at the necessary imaginative leap. If millions of professionals can work for decades on global problems without actually solving them then we might be missing something. Dahl’s advice to look in unusual places can be read as an invitation to not only look where we expect to find solutions. Solutions on the scale and speed that are needed will probably not be found where everyone has been looking already, but within our collective blindspots. Looking for what we’re missing, especially when we’re missing something big, is itself missing from global problem-solving work. Are blindspots too embarrassing for professionals and organisations supposed to have all the answers? Or are we just a bit stuck doing what we’re doing?

The search for solutions in likely places is not just habit, it’s also a complex system behaviour. This is how paradigms self-reinforce, by hiding the possibility of diametrically different paradigms. Anything too radically different gets filtered out. The space for technical and policy solutions is shaped by the current paradigm rather than by the need to replace the current paradigm. For example, the opportunity of economics that prevents waste, rather than causing it, is overlooked within a system that looks at waste management primarily as a question of rubbish disposal. Incineration for example is considered by the OECD as a component of waste minimisation, rather than a way to convert solid waste into atmospheric wastes. This perpetuates the linear waste-making economy.

Roald Dahl offered a pointer on how to search where solutions seem unlikely. Watching the whole world around us might mean looking at whole system behaviour. We can follow the trail from tangible problems, such as climate impacts or designed-to-fail products, to the systemic problems, such as economies set up to keep losing resources as wastes in ecosystems. We can identify new paradigms for the system, such as circular economy, where used resources end up again as new resources. Then we can make policy to quickly switch the paradigm world-wide, for example by insuring the waste-risk of products. Then the new paradigm can self-organise everything else, phasing out waste from products and lifestyles everywhere.

Watching the whole world is the alternative to the default ways of coping with complexity and change – reductionism and denial. Denial gives licence not to see any problems that require change. Reductionism gives licence to consider any selected subsystems of the world and as much change as seems feasible (which is never enough). Watching the whole world gives licence to look across patterns of global complexity and make sure the necessary changes are feasible. Reductionism allows the problems to grow, ironically making more reductionism seem like the only way to make progress. The whole system viewpoint offers the opportunity to discuss, define and implement ‘the greatest secrets’ of policy solutions for system change.

How would system change policy work in practice? We could rely less on change within systems, such as all the initiatives that try to agree and enforce percentage improvements in problem symptoms like emissions or ecosystem loss. We could take more care to define system paradigms: what are the unintended design features that allow the problems to persist? The most common proposal for a system change, to measure progress beyond GDP, may turn out to be a blindspot since prevailing paradigms seek growth in ways that also undermine growth. The OECD have shown for example that inequality hurts growth. New paradigms that phase out society’s dependence on causing global problems would be growth bonanzas. So politicians wedded to growth should be shown system change policies as a way to get growth, rather than be told to give up on it.

Dahl’s advice to watch with glittering eyes reminds us that civilisation need not continue to undermine itself. As professionals we need not continue to struggle with fragments of global problems only to see things worsen overall. The complexity and interconnectedness of the world’s systems can be harnessed to solve problems they’ve previously caused. We can be curious and excited about finding hidden opportunities for systemic change that not only minimise damage but also reverse historical damage. By embracing Roald Dahl’s imaginative legacy we can edit out the big risks to our future and add amazing new chapters to our shared story.

What do you think? How best to organise system change policy to reverse persistent global problems? Add your comments below or let me know via Twitter @blindspotting.

Useful links

TEDxBradford – James Greyson – Let’s unshrink thinking and reverse reverse-progress…

OECD work on consumption, innovation and the environment

OECD Environment Directorate on iSSUU, including Policy Highlights on water, food, transport, waste and energy