This month I finally got to meet Donnie Maclurcan of the Postgrowth Institute. His recent speaking tour brought him to South Bank University, five minutes from my office, and I got along to a public lecture called ‘the not-for-profit world our hearts know is possible’. In a nutshell, Donnie’s hypothesis is that the not-for-profit world is larger than we think, broader than we think, and is already outcompeting profit-driven businesses in some key areas.
It was an inspiring and thought-provoking evening. Donnie’s presentation is now online, and I’d be interested to hear what you think.
The Earthbound Report 
Just wish he could add some tips for the general public if we can assist this movement in any way.
Hi Dichasium,
Thanks so much for the invitation to offer some tips for ways people can assist. Some thoughts:
– Steer as much as possible of your purchasing to not-for-profit businesses;
– If you and/or your friends run businesses that are legally ‘for-profit’, open up a conversation about the value, to the business and community, of transitioning to ‘not for profit’ (most often a multi-year process, but hugely rewarding)
– If you want to set up a not-for-profit enterprise yourself, a quick browser search will highlight resources relevant to the country you are in. We’re also launching The Not-for-Profit Handbook soon, that might be of interest: https://www.trycelery.com/shop/notforprofithandbook
– Drop us a line (info@postgrowth.org) if you’d like to help in any way with our work in bringing this model to the world – we’d be delighted to hear from you!
Thanks,
Donnie and the Post Growth team
I think its very similar to business which deploys all profit for social benefit. http://www.p-ced.com/1/node/332
We attended this too! I wrote about it for Blog Action Day as I was struck by the potential of not-for-private-profit enterprises to reduce inequality – http://lydialivinglightly.org/2014/10/16/inequality-is-there-a-better-way/
Wow – thanks so much for the article and reflections Lydia!
In a resource constrained world NFP’s will have the edge and instead of a desire for wealth people will simply desire job security and having enough. & yes Donnie is one of the most inspirational speakers in sustainability today.
Personally I would love to see NFP worker owned resource coops. Why allow unscrupulous companies pollute and often exploit indigenous populations when the locals could be employed own and make use of their own resources?
Thanks for such kind words Simon.
It’s an interesting point you raise about worker-owned coops. As far as we can tell, all worker coops around the world still operate, legally, on a for-profit basis (i.e., there is no restriction on the ability to pay out profits to members), even though many of them then choose not to pay out any profits to individual members. Are you aware of any exceptions to this observation? If not, I guess I’d say that we would love to see more cooperatively run resource management organisations which would, legally, take a not-for-profit form.
Donnie
No I’m not aware of any but I see no reason why legislation couldn’t change to include this. Or what about they become B coops? I have also been looking at the Commons approach of James Quilligan with commons community trusts and social charters. I’d love to see a convergence of coops, community trusts, Not For Profits and complimentary currencies. Prof Lietaer has done some fantastic work on that. Do you know of him? BTW I do have a project I’d like to pitch to you regarding this.
Thanks Simon,
I guess national/local legislation could demand worker coops be not-for-profit, but I see the capacity for them to make private profit as a key part of the story behind how they are sold to people, i.e., ‘take home the profits you earn’, which is probably why worker coop members are still legally able to privatise profit, across the world’s various jurisdictions.
B Corps go one step further on this spectrum as you MUST be for-profit in order to be a certified B Corp.
I guess what we are trying to share is that not-for-profit businesses don’t have to be one kind of business structure, rather they can be any business that restricts the ability for surplus to be privatized.
I know of Prof Lietaer, although we’re yet to connect directly. If you have any links to his work you feel is most pertinent to ours, I’d love if you could share them. I’d also love to hear more about your project. I can be reached via info (at) postgrowth (dot) org.
Warmly,
Donnie
There is a coop form in the UK known as a community benefit society or Bencom in which surplus is used for the benefit of the community rather than being distributed to membership. We saw it as an ideal match for our business plan to tackle poverty in 2004. It alinged perfectly with a business distributing no dividend with 50% of surplus invested in community development funds and the remainder retained for growth.
I approached ICOF the coop funding body back then with the business plan after we had registered as a company limited by guarantee. They said they could not offer us loan funding becuase we were not a bona fide coop – i.e. one which distrbutes surplus to members.
The perceived flaw with the CLG form is that it can be converted to a share company and thereby allow directors to cash in on funds intended for social benefit. We had however suggested a mechanism for investing in a irrevocable trust to overcome this problem.
In an interview that year, our late founder described how it had been deployed to source an experimental project in Russia and the operationl model used.
“The P-CED model is not a charity sort of operation. It is business. What we choose to do with profits is entirely up to us, and we choose before anything else happens to set most of our profits aside to assist poor people. In fact, our corporate charter requires us by law – UK law, where rule of law is very well established – to use our profits only for social benefit. We cannot do anything else with it.”
http://www.iccrimea.org/scholarly/economicdev.html
Isn’t it the overall case that whilst using most or all profit for social benefit or just the poor cannot prevent exploitation of people and the earth, it surely must contribute to reducing it? I would be grateful for any acknowledgement or other reply.
I (Dichasium) need to clarify straight away that ‘exploitation’ is open to the debate, but I am only using the word for those who accept that some exploitation does produce a bad which is greater than any good.
Listened to the whole thing now. First point is the bad statistics. “Any shade of capitalism will increase global inequality”. Well since under our current model global inequality has been falling that is a fail right out of the gate.
Then there is the stat from 2001-2011 Not for profits grew 25% while For profits grew 0.5%. Sounds good but since there were far more For profits to start with in absolute terms more For profits were started than Not for profits.
The idea that economic history hasn’t been about private gain. Tell that to a Norman baron.
I was disappointed. Why not for profits might outcompete for profits was skimmed over.
This was just heart ruling head and that’s not how any real economy works
There was a whole section in the middle that gave reasons why not for profits can outcompete – though I see you’re expecting to see how they outcompete ‘for profits’, which misses the point. Perhaps I should list some of them in a separate blog post.
Inequality is rising within countries almost everywhere. That’s well known. And if you take China out of the picture, between country inequality is rising too. We’ve been over that:
http://makewealthhistory.org/2013/07/08/is-global-inequality-rising-or-falling/
Not sure you’ve understood the different growth rates there either. Nobody’s claiming that more non-profits are being started than for-profits.
Obviously you’re out to pick holes, but there’s no reason for you to feel threatened. As you say, competition will decide.
I don’t feel threatened, why do think I would by this.
Donnie said global inequality is rising, it isn’t. He is wrong. You are talking about in country inequality is not the same thing even if you hope people won’t notice. And to say ignore China, it’s the Spirit Level style of ignoring evidence to reach your preferred conclusion.
‘No one’s saying more not for profits are being created than for profits’ That is the impression he was trying to give. Stop lying with numbers, your lot aren’t good with them.
By some measures yes it is decreasing, but China was coming from a low level of development, its GINI index is as bad as the US -which is growing- and it had to wreck its environment to do so. Quite easy to feel warm when you are using your house for firewood. Won’t last long though. BTW what do you think will happen to Chinese food production and inequality when they pump their aquifers dry?
& take China out of the picture and its a different conclusion. Apart from problems with the methodology. http://ucatlas.ucsc.edu/income/debate.html
“There was much research and debate regarding global inequality in 2005 with two major reports published on the issue, both agreeing that global income inequality continues to increase. According to the UNDP Human Development Report (HDR) 2005 only 9 countries (4% of the world’s population) have reduced the wealth gap between rich and poor, whilst 80% of the world’s population have recorded an increase in wealth inequality. The report states that ‘the richest 50 individuals in the world have a combined income greater than that of the poorest 416 million. The 2.5 billion people living on less than $2 a day – 40% of the world’s population – receive only 5% of global income, while 54% of global income goes to the richest 10% of the world’s population.’ ” http://www.stwr.org/poverty-inequality/global-inequality.html
So it isn’t so much lying about the numbers but taking a long term big picture approach. But you lot have never been too good at that.
Sadly your numbers are old, see the more recent reports I linked to.
With China’s inequality, every country that has developed into a modern economy has seen inequality rise. If you want development it is an inescapable part of it.
If equality is you goal Mao’s China was better.
And what does China do when it’s aquifers run dry? Money buys options so it can use that trade thing to buy food, or desalination plants or water conservation. Mao’s China couldn’t afford to do any of that.
It’s not about ignoring China, but not quoting statistics with “vastly different underlying numbers”, as you just told us not to do. China’s population is so huge that it skews the global picture on inequality. That doesn’t mean you ignore it, but it can just as misleading to claim that global inequality is falling – it’s just not really possible to speak that generally.
You say you don’t feel threatened, but every time the subject of inequality comes up on this blog, you jump in without fail to tell me how much it doesn’t matter. I just wonder why.
Every time? Didn’t have a whole post on inequality with loads of inaccuracies and I didn’t comment on that.
Don’t let facts get in your way.
It’s the topic of inequality that is most likely to prompt comments from you, unless of course I mention Richard Murphy.
The topic of inequality is one where you sound most like a sixth former.
When I was in sixth form I was freshly back from Madagascar. About three hundred yards from where I lived there was a house with an 8-foot wall, and the servants in the house would tip the household’s rubbish over it into the scrub outside the compound. When they did, a toddler in a ragged t-shirt would emerge from a cardboard and plastic shelter a few feet away and skip over to see what was for dinner.
I don’t know your background, but I imagine my experience of inequality is much more visceral than yours. Perhaps you can understand why I just will not settle for the idea that extreme inequality is acceptable, unavoidable, and nothing to be concerned about.
And what part of that gives you the right to impune my motives by suggesting I’m threatened by talk on inequality?
Play the ball, not the man.
Just trying to understand your consistent and vehement defense of inequality. You’re suggesting it’s because I’m ill-informed and naive on the topic, which I don’t really buy.
I’ve said many times that focusing on inequality isn’t the problem, it is poverty. Tackling inequality, especially in the way lots of people you link to like, would damage the economy and make the poor poorer. So that toddler living in rubbish would be stuck there longer in your world than mine.
Banging on about how much you care does make you case any better.
That is why I tackle you on inequality. That you can’t understand that is a failure of your empathy, not mine.
Easy to say if you don’t understand poverty as relative, and we’ve previously established that you don’t. That puts you in the minority, since practically every government and international agency recognises that absolute poverty is too narrow a definition. Lifting people out of poverty is more than income, it’s about the freedom to choose, to participate in society.
But carry on. I do genuinely appreciate those that are prepared to argue with me, even though on inequality we are at odds at a pretty fundamental level, and that makes it difficult to debate anything.
DevonChap,
Thanks for your comments.
Given your interest in statistics, might you be able to provide references for your claims? I think you’ll find that while extreme poverty has been falling, global inequality has not. I’d be interested to see any data that suggests it hasn’t.
You raise an understandable point about the starting base of for-profits (approx. 30mill.) v not-for-profits (approx. 1.2mill). However, my quick calculations show that even with these different bases, this means approximately 300,000 new NFPs were added while only around 150,0000 FPs were added. I also find the rate of increase compelling in light of the global financial crises having occurred during that time.
Re: the ethic of private gain, I found Robert Heilbroner’s “The Worldly Philosophers” incredibly useful in dispelling the myth that private gain has been central to economies in the past few thousand years.
Plenty more reasons why not-for-profits may well outperform for-profits in the coming decades. These will be shared in the forthcoming book – How on Earth: Flourishing in a Not-for-Profit World by 2050.
Donnie
My source for declining global inequality is here.http://www.voxeu.org/article/global-income-distribution-1988
A more user friendly article is here http://mobile.nytimes.com/2014/07/20/upshot/income-inequality-is-not-rising-globally-its-falling-.html?referrer=
I admit I could be wrong in the over the new busineses started. What is your source? But my point that quoting percentages on vastly different underlying numbers is misleading holds.
As to private gain. It clearly has been part historically and has been fantastically successful recently. Out competing that is going to be hard.
DevonChap, I too, like Jeremy, ‘wonder why’ (you are the fly in the ointment). In fact, I once asked you something similar and you honestly replied. Can you answer this more fundamental one for me please – do you think that trying to make the world a fairer, kinder place by attempting to live under a different economic process is a non-starter? Thanks for any reply you may make.
The fact is that I don’t think the alternatives offered here, such as they are, would make the world a fairer, kinder place. They would fail economically and failed economies produce societies that are less kind, less fair than ours. The intentions don’t matter, it is outcomes. Faust’s road to hell is paved with good intentions.
I’ll look at these. Taking a wider view ofc that is a reasonable point about inequality but then one would look at where most of the wealth is flowing and whether economic growth and wealth is adding to social harmony where everyone thinks they have a chance to improve their lot.
Or on the other hand the majority sees the bulk of this wealth creation going to a small segment of society. The Chinese people are well aware of the pollution and corruption and have protested accordingly. Combine that with a sense of injustice that they cannot get their piece of the pie and it can only get worse.
Lastly you might think a bit more about food production and that in a world already having water problems, can you really expect China to just open its wallet and purchase what it needs? Most food needs are meet within countries, take away a lot of China’s grain producing regions and you think the world will just step up and deliver?
I could grant short term gains reducing inequality but you are still using the house as fire wood to keep warm and eventually that short term gain disappears.
DevonChap, Thanks for that. There’s not a reply box under your comment so I hope you won’t mind me pursuing this. I’d only like to know if you believe there is any way to attempt to make the world a kinder, fairer place and if so, would you share it. I do appreciate your honesty.
Ssh, don’t mention it here, but the fact is that the world we live in is already the kindest and fairest society that have ever existed. I’m sure the noble savage fantasists will say some that some previous society was more equal, or run by women but the fact is that broad spectrum our society is more peaceful and less violent, fairer to all races and skin colours, women, and gays and lesbians than any in history. That is before we cornucopia of things we have that make our lives easier and more fulfilled than ever thought possible. The simple fact is that people don’t appreciate it. what our liberal capitalist market economy has brought about.
Richer societies are more caring. The wealthier we are the more concerned we are with the wider environment and the welfare of others. The enrichment of society has allowed the welfare state and universal health care of a standard that would seem like magic 100 years ago. If we carry on this way I see no reason why things shouldn’t get even better if we carry on the way we are going. We are on course to end extreme poverty in a few decades. A historic human achievement of the globalised world but all the thanks we get is complaints.
To me, against the back drop of our genuine progress compared with the nasty brutish and short lives of not that many generations ago inequality is very much a first world problem. If you are starving while the rich eat like kings then inequality is a problem. But we aren’t. While counted in money there seems like a big gap actually in terms of living standards there isn’t much difference. There is little other than fripperies that a rich person can do that a average person in the UK can’t. Maybe they have nicer phones and clothes but we still have serviceable phones and furniture.
And our society allows who don’t like it to opt out. You don’t want to be consumerist, no one makes you buy stuff. There is no state hence-men insisting your children attend the party run organisations, no secret police forcing people to inform on their friends, no social pressure that ostracises you if you love the wrong people.You can live where you want,work for who you want. Our society works on a mass level without oppression. Amazing but treated as nothing.
Then there is climate change. Yes its a problem but our wealth allows us to tackle the problem, develop and deploy new technologies and adapt to changing conditions. It isn’t going to derail our society. And we aren’t running out of resources. They are all still here, just moved.
Now liberal market capitalist society is not perfect, being run by humans it never will be. It will never measure up to the imagined alternatives, the assertion “there must be another way!” but every other way tried (and many have) has been found wanting.
I am optimistic about our society. we don’t need radical change. I understand the appeal of radical change, more of the same is boring but it is working. Yes you can pick holes, but stop and consider the massive amount of good before you do.
DevonChap, As you said one should ‘play the ball and not the man’.From your reply to me it now appears that you are playing an entirely different game to that of ‘Make Wealth History’ and therefore your shots can only serve to try to knock Jeremy off his pitch in an attempt to stop his game. That, with respect, is underhanded and not really playing the ball at all. You are on different pitches, there is no match and your shots only serve to play the man. That must be a yellow card, at least! Of course, Faust’s hell has a real referee and I’m only a bystander. But we all have intentions that need to be considered well.
I think there is plenty of room for improvement in all of our ways and we cannot afford to rest on our laurels and blow our own trumpets for any/all the good we may have achieved. I think there is a real need to examine our ways and seek to improve them, whether as individuals or a group of any size. We cannot stop the human flaws but we can seek to direct them towards (further) improvement whether it takes radical change or not and whether it works temporarily or not at all. I, like Jeremy am playing on a different pitch to yours and I am glad to finally realise this due to my questions and your honest replies. Thank-you. 🙂
DevonChap, After my 8.57pm reply, I saw your earlier 6.51pm reply to Jeremy. At last, I can see not only your diffent pitches but the issue separating you. I think inequality does contribute much to poverty and wealth contributes much to climate change. I am open to argument against my views but it is between you two and Jeremy may have given this one up long ago. I can now bow out of your ‘match’ and see if Jeremy wants to take you up on this, but I wonder if it belongs to a different blog.
Should this be a echo chamber where you can group think yourselves into a corner or should there be opposing voices?
I am not trying to play the wrecker but if the ideas put forward here are such delicate flowers they can’t stand my cross examination then they are pretty poor.
If a mutual congratulation society where you can revel in you supposed and undeserved moral superiority is what you are after then fine. Conversations can be hard. If you don’t want to listen to opposing opinions then shut your mind.
DevonChap – Now that’s darn silly talk. Jeremy has not aligned himself with me and I have not aligned myself with him. It was inevitable that I would mention him because I’m talking about you two and where I stand on it. I am allowed to agree with his view.
You may not be consciously attacking Jeremy’s whole premise about wealth and inequality but that can be a consequence of what you do. And that’s fine if Jeremy wants to take arguing the ‘facts’ on board, but I am surely allowed to voice my opinion.
As for your other point that’s silly too. I already said, I can now bow out of you trying to show Jeremy’s ‘facts’ as wrong. Furthermore, we all know how facts can be written or found to apparently support both views. I cannot verify either of them so both must be taken cautiously. If you were to debate the premises regarding the effects of wealth and inequality I would find this more productive, but that is probably not the purpose of ‘Make Wealth History’.
I am only too willing to examine any sensible evidence that could make me think again or prove me wrong. I would be very grateful for such. It is not a jot about moral superiority. I’m sorry that you have taken this stance.
I do think that Jeremy’s premise on inequality and wealth is wrong. Not just wrong but counter productive to human welfare. Are you suggesting that you shouldn’t challenge things that you believe to be harmful?
As to facts, ultimately one of us will be closer to the truth than the other. Just to disregard facts is to fall on assertion and take us further into unreality. It is up to you, the reader, to make your conclusions.
DevonChap (again no direct reply button?)
Have I not made it evident that I am referring to your battles about what the economic‘facts’ are? Sorry if I failed. So, of course, I’m not suggesting that you shouldn’t challenge what you think is harmful. I’m saying that you are not likely to agree when your aims differ, and that, being assured of your aims is really of much more significance. I expect you two do feel assured (at least at this moment in time), so the economic ‘facts’ will regularly be an issue and not be very productive. The reality/non-reality of our premises is more vital.
So glad you have responded nicely – yes a simple word, but means so much to me 🙂
DevonChap
Would you care to summarise why you think Jeremy’s premise on inequality and wealth are counter-productive to human welfare? I, for one, would be very interested to hear.
DevonChap
It seems that you will not furnish me with a brief summary of your reasons for disagreeing with Jeremy’s premise on inequality and wealth. Is this correct?
If so, I wonder why you shy away from this and leave me without the facts but only with assertions which you have said will lead me into unreality. Why would you not openly help me at all on this subject?
Sorry I didn’t reply sooner. Real life got in the way.
Given that as I say, wealth is supporting human welfare, with our present economic system bring many more millions out of dire poverty than have even happened before, I don’t want to disrupt a system that I consider to be broadly working.
If we tackle inequality by making the rich poorer it will not make the poor richer, just decrease the global sum of wealth. The sure way to increase the welfare for poor countries is for them to industrialise. Ever time a country has industrialised inequality within that country has risen even though welfare for all rises. There is no proven alternative. That inequality is necessary.
Also the argument that there being richer people makes those with less unhappy, so we should reduce the wealth of the rich seems a deeply immoral one. The rich did no make those people less wealthy and to attack a minority to make the majority feel better is deeply wrong.
I have no problem with progressive taxation but the aim should be to fairly fund required services and welfare, not social engineering.
Thanks DevonChap for your reply to me (above-29 Oct 3.31pm).
I think that with our current day advances we can no longer look back to previous attempts at change. We may only now have acquired the power to take us to the fatal flaw of the current system. If Jeremy and others have this in mind (or some equally forceful motivation), your attempts to debate/argue economic facts and figures and quoting the past will be totally pointless, worse still, a waste of everyone’s time. If Jeremy falls into one of the said type of thinkers he could answer your economic contentions once and for all and provide a link to his over-riding premise. If he is able, I wish he would in order to save debate from the wrong grounds.
I am very grateful to you for the honest replies which have enabled me finally and conclusively to properly express my original reason for engaging with you. Of course, if you think my conclusion is wrong, I would again be grateful to hear why.
Yours is a typical caricature, that being concerned about inequality means making the rich poorer, but I don’t argue for redistribution. I’m sceptical about income tax as a whole, progressive or not. I’m much more concerned with spreading the wealth around better as it is created, through shared ownership of companies for example, pre-distribution as some like to call it. I’m also interested in reducing opportunities for rent seeking, through measures like a land value tax.
http://makewealthhistory.org/2012/10/17/a-beginners-guide-to-predistribution/
On the development side, I’ve written before of examples of countries that have seen rapid economic development without big rises in inequality. You rubbished them because they used interventions that you consider heretical.
http://makewealthhistory.org/2013/03/19/what-drives-development/
In short, you’re so quick to attack my views and ideas as counterproductive, you rarely bother to look at what they actually are.
We know how this can go on. I find quotes of yours that do support substantial redistribution and point to posts you make linking very favourably to people who do. You then say I’m misinterpreting you or you don’t support what you chose to link to. Then I say you should express yourself better and you question my motives.
If I believed in wholesale redistribution as a solution to inequality, I’d have no hesitation in saying so.
I happen to think it’s inadequate as a long term solution, since it just endlessly patches over inequality rather than getting to the heart of the problem. I’m much more interested in avoiding inequality in the first place, and I think the blog reflects that. If you’re hearing something else, I’m not sure I can do anything about that.
DevonChap & Jeremy
I think we’ve come to the same conclusion through different methods. The point being, that DevonChap is not going to change Jeremy’s poliltics with his facts and figures and if he influences anyone by them, they are not being sufficiently cautious which is not good for them or anyone. Sorry DevonChap. I’m out of this matter now. It has put the relative benefits of Economics in a clearer light for me. Thanks.