Alternative Monetary Paradigm
by Paul J. Dejillas
Professor of Anthropology
Money ought to be given prominence and broader treatment in the design of a new alternative paradigm. The new paradigm intends to focus its treatment on money and to view the latter from a more holistic perspective by integrating into its treatment the major non-economic dimensions of money.
Several new alternative paradigms have emerged in the past two decades, propounded by social scientists that realize the limitations and inadequacies of today's theories and models in transforming social realities. Although these are not primarily designed for the construction of a new monetary system, their views and theories can be adopted to reorient and reinforce today's monetary system.
A close review of today's alternative paradigms reveals that much of their discussions are not purely concerned of the scope and purposes of our course on mediated economics. In addition, each theory or view tends to focus only on one or some elements within the authors' specific field of discipline. Thus, from a more holistic point of view, each paradigm can still be considered as restricting and limiting for our purposes. It is from this perspective that I propose a broader theoretical construct or categorization that seeks to weave together major paradigms emerging today and attempt to come up with a new alternative paradigm for viewing and transforming the world's existing monetary system.
The major task of this final part of my lecture is mainly to identify and define, in broad terms, the major categories and elements that would comprise this new alternative monetary paradigm. Because of limited time, the final task of presenting a more comprehensive discussion on the theories underlying these broad categories will have to be done in another forum.
The new alternative paradigms that are emerging today can be broadly grouped into six categories, namely: economic, political, social, cultural, religious or ethical, and ecological. This categorization establishes six basic interpretations of monetarism, which views money as:
· Medium of exchange (economic);
· Instrument for people empowerment (democratic and political);
· Instrument for justice and peace (ethico-religious);
· Medium for advancing man's material and non-material values (cultural);
· Means for social advancement and growth (social); and
· Means for conserving ecological balance and maintaining the integrity of the entire creation (ecological).
These views and interpretations are already encapsulated in several major social movements and academic disciplines that have emerged and proliferated during the past three decades. These are the:
· Socially-oriented and ethically-inclined economists;
· People-empowerment movements;
· Ethico-religious, including new age, movements;
· Cultural/linguistic/anthropological disciplines;
· Social movements, sectoral organizations, and various broad-based or party coalitions and aggrupations; and
· Environmental movements.
Thus, in the discussion we will directly refer to the main proponents of these theories but guided by the parameters of our study. The theories and models that underlie each of the six categories can serve as the bases upon which to build the foundation of a new alternative monetary paradigm.
Let me proceed by briefly presenting a panorama or bird's-eye-view of the various views and theories that emerge under each of these interpretations.
Economic Dimension: Medium of Exchange
Some authors propose alternative economic paradigms that emphasize the simultaneous and combined realization of the tri-dimensional market objective of growth, stability, and social equity. The concern for growth is not so much aspired for growth per se as for the equally important concern for equity and stability. In the same manner, economic stability and equity are likewise pursued within the context of the economy's ability to grow, expand, and finance the people's needs (Dejillas, 1996:11). A "socially-oriented market economy," which the author proposes, could be adopted as an alternative economic framework for viewing and transforming the existing monetary system.
This framework can be applied to directly confront the issue of unimpeded and equitable flow in the circulation of money in the entire economic system. The supply of money needs to circulate to all families and sectors of society, not just a few, and to transform the narrowly restricted market objectives of growth and stability towards the concern for equity in the benefits of growth and stability that money brings. Applied to the monetary and financial system, the alternative economic framework addresses the equity concerns for the use of money by responding to the following questions (Dejillas, 1996:12-13):
· Will the use and circulation of money promote higher level of wages and incomes relative to profits?
· What particular category of labor will be benefited by the increase in wages and incomes? In what region?
· Will it broaden the base of higher income and profit earners?
· Will it contribute to long-run peace and stability in the region or sector of the economy?
· Will it benefit the marginalized and oppressed sectors of society?
In regulating the level of money supply in the economy, the alternative economic framework raises the following concerns (ibid.):
· Will it provide more goods and services to the people?
· Will more people be gainfully or productively employed as a result?
· Will more goods and services become more available and affordable for distribution to the people?
Likewise, the demand aspect for money can also be a concern of this alternative framework, by responding to the following issues:
· Whose demand are we trying to respond to?
· What type of demand is to be given priority? Transactions? Precautionary? Or speculative?
McLaughlin and Davidson also speak of an emerging "new planetary economics" that is concerned of social justice … more equitable sharing of work, and greater economic self-reliance at the individual, local, regional, and national levels " (1994:325-326).
Medium for People Empowerment
Money has to be viewed as a means for empowering the marginalized sectors of the economy. This can be achieved by broadening the access to credit facilities and loan assistance. Terms and conditions that are collateral-based need to give room for alternative financing schemes.
Many emerging paradigms today give emphasis on individual empowerment. Ed Schwerin speaks of "true empowerment" as that which is "based on … capability, knowledge, skills, political awareness, participation … (as quoted by McLaughlin and Davidson, 1994:124). The term is understood to mean not only in the economic perspective but also "psychological---relating to feelings and attitudes; social---relating to ability; and political---relating to activism" (ibid.).
Some theories address the transformation of political structures to better serve the objectives of the economy. Osborne, for example, in his Laboratories of Democracy says that "the fundamental goal is no longer to create---or eliminate---government programs; it is to use government to change the nature of the marketplace" (1988:326-327).
Thus, there is a close relation between the use of money and the use of political power. Money democratizes power by empowering the impoverished sectors of society. In turn, political power ensures the equitable and unimpeded flow in the circulation of and demand for money.
Along the same view, McLaughlin and Davidson, in their pioneering book Spiritual Politics: Changing the World from the Inside Out, introduce a new paradigm, called "transformational politics," which can be directed at influencing the nature and operations of the marketplace. According to them, this new transformational paradigm reflects, among others, the following principles:
· Respecting the interconnection of all life
· Creating a synthesis out of adversarial positions
· Transcending old definitions of Left and Right
· Synthesizing the best of hierarchy and democracy for real empowerment
· Matching rights with responsibilities
· Promoting government initiatives to develop self-reliance
· Searching for common ground and the good of the whole
· Thinking in whole systems
· Creating nonviolent, win/win solutions to problems
· Shifting from a mechanistic toward a spiritual, value-oriented perspective
According to the proponents, Osborne and Gaebler (1992) in their Reinventing Government have been applying key aspects of transformational politics. It is in this same spirit that we can also adopt the principles advanced in transformational politics to restructure today's existing monetary system.
On the whole, the political dimension of money has also to touch the issues of growth, stability, and equity in the distribution and use of power in society. Thus, in the view of these new alternative political paradigms, the following questions are relevant in the determination of the level of supply and demand for money:
· What particular sectors of society shall be empowered?
· Will empowering that sector(s) promote peace and stability in the area or region?
· Will it promote and enhance social justice and equity in the distribution of power in society?
Medium for Cultural Advancement
Other views emerging in the last few decades emphasize the new values that emerge out of today's economic system. According to McLaughlin and Davidson, "new economic values are … evolving from East-West cooperation and the emergence of the European Community." These evolving values give emphasis on the need for cooperation even between previous enemies (e.g., France and Germany), and sharing of resources with countries trying to change their economies (e.g. Western European aid to Eastern Europe and the former Soviet Union).
Clive Hamilton, in his book The Mystic Economist, exposes the innermost core of modern economics and its influence on our lives. He argues that economics, far from being the study of how to make us better off, reflects and promotes the very attitudes and behaviors that prevent us from living fulfilling and contented lives (1994: see the outside page of the back cover).
In the final analysis, the emerging cultural views also consider the issues of growth, stability, and equity in society (see Dejillas 1993, 1996)). They are also concerned of such questions as: "Will it promote the growth and enhancement of the true identity of the people and the nation as a whole?," "Which particular sector and culture of society shall be promoted?," "Will the promotion of such a culture promote social justice and equity?"
Today, efforts to establish or integrate value systems into existing economic systems proliferate. The World Social Forum is today the largest aggrupation of civil society whose one major agenda is the establishment of a so-called “solidarity economy” in response to what it calls the “capitalist economy” propagated by the World Economic Forum (Dejillas, 2002). The Alliance for a Responsible, Plural and United World Solidarity Economy is introducing an alternative global economic system for the 21st century also appropriately labeled as “solidarity economy” in response to the crisis spawned by today’s capitalist economy (Marcos Arruda 2001). In an effort to get entangled by today’s economic mess, another alternative has been introduced, the “sharing economy” (Paul Hague 2003-https://www.algonet.se/ ~paulh/economy.html).
In the latest forum in Brazil on January 31 to February 5, 2002, the WSF broached the idea of a more “humanizing globalization” founded on the principle of solidarity economy as an alternative to neo-liberal globalization. While the participants were not able to lay down the details of this concept, some generalities of its economic and political landscapes have already been raised. Jean Louis Laville of France expressed one input. According to him, “The first condition for solidarity economy to become the foundation of a humanizing globalization is to dismantle the idea that economy is just a market.” He argued that it is not only the market hat produces wealth, as the neo-liberalists would like us to believe, and advanced the idea that “solidarity (also) creates material wealth as well as cultural richness.” Another delegate explained that the principle of solidarity economy is not an anti-market proposal since, as he clarified, “we need the market because the elementary exchanges can only be achieved through regulated and free interchange.”
Another advocate to “solidarity economy,” Argentinean professor José Luis Coraggio, added that “a key-factor of the proposal for a solidarity economy is to institutionalize moral rules that can define a functioning for all economy …” He argued that “this is not an anti-State proposal, but it demands that the public economy may be embedded with values of a moral economy, through democratization of the representative system, serving the majorities it is intended to represent” (ibid.). The term “solidarity” could have emerged from their perception and belief that the economy, being diverse and complex, requires civil initiative to complement public action. According to Coraggio, “it may be a lever for the construction of the Social State, and a lever for the re-democratization of the public State” (ibid.).
As it is propagated to today, sharing economy is based on six principles: (a) human growth, rather than economic and technological growth, as the main motivator; (b) work or labor is an integral part of human growth and is not done for profit, power, and prestige; (c) equal opportunity for everybody to work; (d) human resource is distinct than other resources like money; (e) human values are not to be quantitatively measured but are to be expressed in terms of their meaning; and (f) resources are not to be distributed according to the people’s purchasing power.
Means for Social Advancement
Other emerging theories touch on social factors. McLaughlin and Davidson speak of an emerging social paradigm, which focuses on the following social issues (pp. 325-326):
· Increasing the satisfaction of the whole range of human needs:
· Social justice
· Good health for all
· Achievement of personal aspirations
· More equitable sharing of work
· New emphasis on the quality of work life
· Greater economic self-reliance at the individual, local, regional, and national levels; regional and global conservation and
· Sustainable use of natural resources
Kim Yong Bock, in his Faith and World Economics, speaks of what he calls people-centered economics. According to him, there should be a fundamental paradigm shift in the economic thinking and practice. He advances the idea that any economic theory and practice must be people-centered where "the people should be their own subjects in their own economic life---and the state, science and technology, and intellectual and cultural resources must serve the people" (Bock, 1993:15). He calls this new paradigm minjung economic paradigm (or people-centered economics).
Bock's people-centered economic paradigm can certainly be adopted to redirect today's existing monetary system. What remains is to identify concrete indicators that measure economics as people-centered.
The emerging views propounded by McLaughlin and Davidson as well as Bock can be adopted to form part of the new alternative monetary paradigm. For money to be a successful mediator and facilitator in society, it must directly address the basic individual and social needs of man and society, which is not only economic in nature, but also psychological, ethical, and even spiritual. Again, consistent with our concerns, money as a medium for social advancement needs also to consider the issue of growth, stability, and equity.
Religious Dimension: Instrument for Justice and Peace
We need not further emphasize the fact that the new paradigm needs to ensure that the use, allocation, and circulation of money are pursued with consideration to the issue of justice and fairness. Hamilton's critique of modern economics points out the need to extend models "to incorporate 'ethical' preferences so that a rational economic agent can trade-off a clear conscience" (1994, p. 185). His ethical perspective could certainly enrich the transformation of our monetary system.
Other authors raise religious and biblical views, which could enrich today's monetary system. For example, Rubin, in his "Religion and International Affairs," points out that "to neglect religious institutions and thinking would be to render incomprehensible some of the key issues and crises in the world today" (1994:33). To him, religion influences society and politics saying that in fact Christianity and Catholicism have become a major political force that favors the attainment of democracy and social justice.
Because of the influence of religion, Vendley and Little advance the idea that "religious communities (Buddhism, Islam, Hinduism, and Christianity) should recognize the role they play … and exercise that role much more than they usually do" (1994:306). Chewning (1989) edited a book entitled Biblical Principles and Business: The Foundations that deals with biblical principles which, to the contributors, can serve as foundations for a Christian view of business and economics. The book discusses several biblically related truths that if, according to the editor, kept continually in balance and harmony, will profoundly shape man's attitude towards business and his behavior in the market place. In his article, Chewning advances that "humans are fallen in nature, having both positive and negative realities associated with that condition" (p. 21). According to him, the economic system needs to install both freeing and controlling mechanisms if it is compatible with biblical truths. Another contributor to the book, Grudem highlights 16 biblical principles that can influence the issue of production and distribution of goods in society (pp. 27-52).
In the meantime, Pierard (pp. 57-73) advances the idea that the bible provides rather clear guidelines as to how an economic system should function. Nash (pp. 80-96) presents a critique of the economists' theory of value from the religious point of view. Jones (pp. 101-112) is more daring in his views. His article forcefully points out that "God has prescribed certain standards for right conduct in the form of a duty-bound ethic and He has also given us a goal-oriented ethic that sets before us certain objectives, including … normative economic values to be fostered." Two contributors confronted the issue of property, wealth and economic justice. Brown (pp. 120-135) argues that "God wants individual stewards to have dominion over discretely defined pieces of property," while Mouw (pp. 140-158) goes even further by pointing out that "a kind of family and community obligation is also associated with the concept of private property as enunciated in the Bible."<P>
The emerging ethical and religious views expounded by the above theorists are certainly relevant to our concern for restructuring today's monetary system.
Religious beliefs have resurrected to become one of the pillars of today’s economic systems. For Christian economics, see the following references:
· Dejillas, Leopoldo J. 1993. Christian Democracy and Social Market Economy. Pp. 147
· Land, Richard D. 1989. The Ethics of Love Can Succeed in the Marketplace In R. C. Chewning, pp. 266-276.
· Longenecker, Richard N. 1989. "O Tempora! O Mores! --- On Being a Christian in Business Today."
· Islamic Economics: https://www.albalagh.net/Islamic_economics/
· Buddhist Economics: https://www.geocities.com/Athens/Academy /9280/econ.htm; and https://www.worldtrans.org/whole/ buddecon.html
Ecological: Instrument for Preserving Nature and the Integrity of Creation
Osborne added a new dimension, which can be integrated into the new alternative monetary paradigm. He says that while economic growth is our primordial concern, it must be combined with environmental protection goals (1988:326-327). Along this same line of thinking, McLaughlin and Davidson speak of "interconnectedness of all life." According to them, the present environmental crisis is "symbolic of our lack of connection to the natural world and of the centuries-old split between spirituality and materiality" (1994:46). They see the need of "renewing our bond with the natural world and seeing it once again as part of the sacred circle in which all life is one" (1994:47). The authors then point out the emergence of a paradigm that focuses on regional and global conservation as well as on sustainable use of natural resources" (1994:325-326).
There is no longer any doubt that today the concern of the monetary system needs to include the issue of sustainability, so that generations to come will not be deprived of the same benefits and privileges that we enjoy today. We are still in need of models that would address the issues of pollution, transportation system, energy use, armaments build-up, deforestation, and other important concerns that enhance rather than destroy human life and the environment. This ecological dimension of the new alternative paradigm no doubt supports the basic concerns for growth, stability, and equity in the use of our natural resources.
Designing the New Paradigm
We are now ready to construct our new paradigm. Several authors trace the etymology of the word "paradigm" to the Greek word paradeigma, which means a model or pattern. A paradigm can be defined to consist of a theory, which identifies and defines the variables that go into the model and the relationships between and among these variables. Our new alternative monetary paradigm is depicted in tabular form below.
A New Alternative Paradigm for Viewing and
Transforming Today’s Monetary System
The six-dimensional categories we have briefly defined above represent the vertical view of our new alternative monetary paradigm. The new paradigm intends to demonstrate the broader dimension of the monetary system. The use and circulation of money as well as the determination of its supply and demand levels need to be viewed in all of the categories outlined in the vertical dimension of the paradigm. Also, each of these categories is not mutually exclusive and independent of each other. Instead, they are to be treated simultaneously as an integral and interrelated whole. To view one category apart from the other categories destroys the objectives for which the paradigm is constructed.
Thus, the economic view needs to be considered in conjunction with the political, social, cultural, ethico-religious, and ecological aspects of the system, and vice versa. In the same manner, the ecological view needs to be considered simultaneously with all the other dimensions, and so on.
Meanwhile, the horizontal dimension of the new alternative monetary paradigm intends to show that each of the six categories shall be viewed simultaneously within the context of their combined impact on growth, stability, and equity. The policy implications therefore become a product of the interacting influence between and among the variables defined in both the vertical and horizontal dimensions of the new paradigm. The resulting policy-mix is a package designed to address the multi-dimensional aspects of social reality.
The column on "policy implications" ensures the transformational aspect of the model. Policies derived from careful multi-dimensional assessment of a given social system are designed to restructure and transform that same system.
TO BETTER APPRECIATE the value and significance of our new framework, let us apply the new monetary paradigm in the context of a specific reality. This part of the article is reserved for discussion with the students in the class, the purpose of which is to assess the ability of the new model not only to view, but more importantly to transform reality.
At any given period of time, one economic mediator may prevail to make transactions between individuals and nations legitimate and possible. But this prevailing mediator is also strengthened or cemented by the other mediators playing minor and supportive, but nonetheless equally, if not more, influential roles in the process of economic exchanges.
List of Readings for the Next Chapter
“Abundance from the Biblical Perspectives.”
Ben Barker. 1983. “Abundance and Scarcity.” The Freeman, a publication of the Foundation for Economic Education, Inc., June 1983, Vol. 33, No. 6. https://www.libertyhaven.com/theoreticalorphilosophicalissues/economics/economicissues/abundance.html
Boldt, Lawrence G. 2004. “The Tao of Abundance.” Life’s Crossroads. Vol. 5, Issue 2. April-May 2004. https://www.soulfulliving.com/tao_of_abundance.htm.
Ched Meyers. “Balancing Abundance and Need.” https://www.theotherside.org/archive/sep-oct98/myers.html
Jae Malone. “Awakening Abundance.”
Flemming Funch. 1994. “Abundance Economics.” 26 November 1994. https://www.newciv.org/essay/abuneco.html
Gandhian Economics: Replacing the Economics of Scarcity with an Economics of Abundance. 1990. The Other Economic Summit. https://www.ee.upenn.edu/~hunt/Abundance.html
Milanie Aron, 2002. “Jewish Teachings on the Economics of Scarcity.” 7 December 2002. https://www.shirhadash.org/rabbi/021207-scarcity.html.
Resisting Abundance? From Dr. Dyer's book, "You'll See It When You Believe It.“https://www.babyboomers-seniors.com/jan00/dyer.htm