In the beginning we going to see what is Common Welfare Economy and the best person for introduce it is his creator Christian Felber.
Next we show you the twenty points of Common Welfare Economy.
1. The same collectively shared values that contribute to fulfilling interpersonal relationshipsare the basis for the Common Welfare Economy: confidence building, cooperation, appreciation, democracy, solidarity. (Scientific research proves that fulfilling interpersonal relationships constitute a key factor to happiness and motivation.)
2. A shift will take place from competition to cooperation, from the pursuit of profit to the pursuit of the common good, established through a new regulatory incentive framework. Companies will be awarded for cooperation and solidarity. Competition will still be possible, but creates disadvantages.
3. Economic success will no longer be measured with (monetary) exchange value indicators, but with (non-monetary) user value indicators. On the macroeconomic level (national economy) the GDP will be replaced – as an indicator of success – by the Common Welfare Product, on the microeconomic level (company) the financial balance sheet by the Common Welfare Balance Sheet(CWBS). The latter becomes the main balance sheet of all companies. The more companies act and organise themselves along social, ecological and democratic lines, the more solidarity they display, the better will be the results of their Common Welfare Balance Sheet. The better the CWBS results of the companies of a national economy, the higher its Common Welfare Product.
The Common Welfare Matrix, which serves as the basis for generating the Common Welfare Balance, can be downloaded here
4. The better the common welfare results, the more financial benefits will be accrued by the company: lower taxes, fewer customs duties, loans on more favourable terms, priority in public procurement and research programs, etc. Market access thus becomes easier for ethical companies, and fair, ethical, regional and ecological products become more economic than unfair, non-ethical and global products.
5. The financial balance sheet thus becomes a secondary balance sheet alongside the primary Common Welfare Balance Sheet. Financial profit is no longer an end, but a means for achieving the goal of the company or, to be more precise, the goal of all entrepreneurship: to further the common good. A financial surplus may be used for: investments (with social and/or ecological value), loan repayment, accrued liabilities (to a limited extent), limited distribution of profit to employees and for interest-free loans to other companies. It may not be used for distribution of profit to non-employees, hostile acquisition of another company, investments in financial markets (which will not exist anymore), and donations to political parties. In return, the tax on corporate profits will be abolished.
6. As profit is no longer an end in itself, companies may now aspire to their optimal size. They are no longer in danger of being bought out and they are not forced to outgrow or outperform other companies. Businesses will be freed from the prevailing pressure of continual growth and dog-eat-dog competition.
7. Because it is possible for companies to grow naturally to their optimal size, without the pressure of competition, there will be many companies in every sector. As the pressure to grow ends, cooperation and solidarity with other companies will be a lot easier. Companies can help each other with knowledge, know-how, forwarding of clients, sharing of workforce or with interest-free loans. For these acts they will be rewarded with good results in the CWBS – not at the cost of other companies, but with benefits for all: companies can start building a learning community based on solidarity, and the economy becomes a win-win-situation.
8. Inequalities in income and wealth will be limited through democratic discussion and decision-making: for instance, the maximum salary could be capped at 10 times the minimum wage, individual wealth at 10 million Euros. Transfer of capital and inheritance can be permitted tax-free up to 500,000 Euros and in the case of family-owned enterprises up to 10 million Euros per child. Any exceeding amount is distributed to the next generation via a “generation fund” as a democratic endowment: evenly distributed seed capital ensures equal opportunities. All exact limits and figures shall be determined by an economic convention.
9. Large-scale enterprises with more than 250 employees partially pass over into the shared ownership of its employees as well as the public or multiple stakeholders. Elected delegates of “regional economic assemblies” will represent the public. The government does not exercise authority over public enterprises.
10. The same applies to democratic commons , the third category of property, next to a majority of (small) privately owned businesses and a minority of large-scale enterprises owned (partly) by employees and public. ‘Democratic commons’ are enterprises which provide basic services in the sectors of education, health, social welfare, mobility, energy, communication, and banking, i.e. sectors serving the common interest.
11. The democratic bank is a major democratic commons. Like every enterprise it serves the common welfare and, as a democratic commons, is subject to the control of the democratic sovereign (the people) – not the government. Its core services include guaranteed savings, loans on favourable terms, eco-social high risk loans and free current accounts. The state will be financed primarily through interest-free loans from the Central Bank. The Central Bank exercises the exclusive right to the creation of money and controls the cross-border movement of capital to end tax avoidance. Financial markets as we know them today will no longer exist.
12. According to a proposal of John Maynard Keynes, a global currency cooperation will be established with a global currency (“Globo”, “Terra”) to finance international trade and investment. On the local level, regional currencies can complement national currencies. To avoid unfair trade, the EU shall establish a fair trade area (Common Welfare Area) with equal standards. For importers, the tariff correlates with the CWBS result: the better the result, the lower the tariff. The long-term goal is a Global Common Welfare Area as a UN agreement.
13.The intrinsic value of nature is recognised, thus it cannot become private property. A person/family/company who wants to use a piece of land for the purpose of living/farming/manufacturing, will be assigned what he or she needs free of charge. The assigning of land is tied to ecological management and the fulfulling of a concrete need. As a consequence, landgrabbing, huge landowndership and real estate speculation will end. In return, real estate property tax will be abolished.
14.Economic growth is no longer a political goal. Instead, it is replaced by the reduction of the ecological footprint to a globally sustainable level. The categorical imperative will be extended by an ecological dimension: one may only choose a living standard that can be shared by all people of the world without diminishing the possibility of others to choose the same standard of living. Individuals and companies will be encouraged to reduce their ecological footprint to a globally just and sustainable level.
15. Average working time will be reduced to a level which is generally considered desirable: 30 to 33 hours per week. As a consequence, people will have more time at their disposal for other essential types of work, such as human relationships (care for children, sick and elderly persons), self-realisation (personal development, arts, education, gardening, …) as well as community and political work. Due to this more balanced distribution of labour time, the living standard will become less resource intensive and more sufficient and ecologically sustainable.
16. One in every ten professional years will be a free yearfinanced by an unconditional basic income. In the free year, people can do whatever they want. As a consequence, demand on labour markets will decrease by ten percent – the present unemployment rate in the EU.
17. Direct democracy and participatory democracywill complement representative democracy. The democratic sovereign will be able to regulate its representatives, initiate and pass laws, change the constitution and control important economic domains, such as railways, energy providers, or banks. In a “real democracy”, the needs and interests of the sovereign people and their representatives are identical. Basic conditions for real democracy are comprehensive rights to co-determination and the control of power.
18. All 20 cornerstones shall be developed in a broad bottom-up process, before they are handed over to a democratically elected economic constitutional convention. This convention proposes laws that are submitted to a referendum. Those cornerstones, which are approved by the people, will be anchored in the constitution and can, at any time, be changed and further developed – only by the people themselves. Alongside the economic convention, a number of other assemblies are summoned to further develop democracy, for example an education convention, a media convention, a democratic convention.
19. To anchor the values of the Common Welfare Economy deeply in the next generations, the educational system also has to be constructed along the principles of the the Common Welfare Economy. This requires new forms of schools and new content, e.g. values and ethics, “emotionology“, communication, democracy, nature and environmental education/experience, and bodily awareness.
20. As the parameters of entrepreneurial success are redefined in the Common Welfare Economy, different leadership skills will be required. Those persons who are socially responsible and competent, empathic and compassionate, socially and ecologically oriented will be the highest in demand and serve as the new role models for business leaders.
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