Authors: Derek Razo & Chelsea Robinson
Today, market failure is the new norm. In the context of runaway inequality, technology and ecological collapse, solving economic alignment is simply not optional if we are to preserve democracy, ecological stability and economic progress.
Two key ideas are helpful here: Shared ownership and Stewardship. These are the foundations on which we can build an aligned economic system. Shared ownership gives people a stake in the assets that they help build and maintain, and stewardship enables large scale economic coordination bound to higher purposes above and alongside profit.
Implementing stewardship economy-wide could help us achieve economic alignment, but it requires a fundamental shift in finance, law and culture. In this new paradigm, assets are structured to work towards higher aims of security, dignity, and sustainability. Asset holders will need to change their goals, and their approach to economic control and benefit.
In order to convert a large amount of assets into this new paradigm, a vast new infrastructure is needed. One off successes are encouraging and necessary. The effort to stand them up is nothing short of heroic, even when they are deeply imperfect. But generally, the champions of this nascent new economic paradigm are woefully under-resourced and their efforts are starting at a tremendous disadvantage.
Efforts championing this new paradigm are often lacking pathways to scale, which would be required for stewardship to be the norm. They often end up deliberately working against incentives that would attract support from bigger players, and this inhibits their momentum. The challenge is not just conceptualizing alternatives, or showing one-off instances of success, but making them practically, widely appealing and accessible. Alternatives remain just that - ‘an alternative’ - unless the cultural and structural environment sees them as a competitive new norm.
The default ownership and financing system provides incredible leverage, resilience and flexibility on behalf of capital and asset owners. When liquidity is scarce for everyone, the most extractive entities have the advantage of liquidity during market fluctuations. The question arises: How do we compete with that? How do we stand up infrastructure that offers this kind of resilience and competitiveness to the shared ownership ecosystem? How do we "out-cooperate" the extraction of resources by pooling our strengths to build collective "big players"?
History offers valuable lessons through many examples of solidarity and mutualism between people and businesses, which have been instrumental in the survival of cultures and economies worldwide. This ethos becomes a guiding principle as we seek reliable methods for generating value, stewardship and sharing upside at scale. Many examples exist at scale, and through time, that demonstrate how to build extremely competitive, mutually beneficial financial and legally interconnected entities. Long standing and well-studied examples like Mondragon and the Japanese Keiretsu are joined by more recent examples such as the Industrial Commons, Sardex and Obran.
If you're looking for a roadmap to move our economy in this direction, "Assets in Common" is a must-read. Drawing on extensive research and real-world examples, they showcase innovative approaches like cooperation between companies, shared balance sheets, holding companies, and shared services. "Assets in Common" identifies what's working at scale and offers practical insights and actionable steps for business and community leaders who want to be part of the solution.
Comments