Capital Institute

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= financial reform initiative in the U.S.

URL = http://www.capitalinstitute.org/

Description

" The Capital Institute is a non-partisan, transdisciplinary Collaborative Space, founded in 2009 by former JPMorgan Managing Director John Fullerton.

Our mission is to explore and effect economic transition to a more just, resilient, and sustainable way of living on this earth through the transformation of finance." (http://www.capitalinstitute.org/about)


Discussion

"Capital Institute was born out of an observation of nature, a premise, and three questions.

Observation: Exponential growth of the macro economy is in conflict with the physical limitations of a finite planet. The incompatibility of the current economic and financial paradigm, one that operates without ecosystem limits, has caused immeasurable social and environmental damage and threatens the future health and well-being of the planet.

Premise: The economic system is an integral part of the natural biosphere within which it sits. Our financial and economic systems, while continuing to provide for society’s needs, must evolve to work in concert with the planet’s systems. Although challenging, such a transformation is possible through innovative thinking, the pioneering of new designs and solutions, and bold and decisive action.

  • Question 1: What would an economic system that operates within the physical boundaries of the biosphere, while more equitably serving the needs of people, look like?
  • Question 2: How must the practice of finance and the financial system itself evolve in order to fuel and sustain the transition to such an economic system?
  • Question 3: What is the purpose of capital in such an economic system?


Our Challenge: Economic and Financial Systems Are Not Sustainable

Our economic system is driven by short-term profit maximization and financial wealth accumulation. It depends on the continuous depletion of the earth's resources and escalating aggregate consumption.

This brand of capitalism, exported around the world with its many notable achievements, has two fundamental flaws:

  • The World is Full: The $60 trillion global economy now uses up 1.4 times the Earth’s capacity to regenerate resources per year, a condition known as ecological overshoot. Multiple symptoms of this ecological deficit, most notably climate change, have begun to manifest themselves in ways that can no longer be ignored. Basic physics tells us that business as usual is unsustainable. We cannot invent our way onto a perpetual, indiscriminate growth track. Instead, systemic changes in our growth model will be required that prioritize economic activities based on how well they support the long-term health and well-being of the planet.
  • Wealth Disparity: Ecological and societal collapse often go hand-in-hand, with reinforcing feedback. An equally disturbing trend, and one that is heightening societal tensions, is increasing wealth disparity. The top 2% of the world’s population now controls more than half of global financial wealth, while the poorest half of the world owns a mere 1%. Income gaps between rich and poor have more than doubled in the past half-century. Historically, income disparities of this magnitude have brought on revolutions."

(http://www.capitalinstitute.org/about)


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