Economists Are at a Loss

The toolbox of classical economics is inadequate for our time, and our antiquated thinking is driving us even deeper into the current crisis. Clearly, this must be changed, as Joseph Stiglitz, Nobel Prize laureate in economics, said in a lecture at the 4th Meeting of Economic Sciences at Lindau, “The standard macroeconomic models have failed by all the most important tests of scientific theory. They did not predict that the financial crisis would happen; and when it did, they understated its effects.” [2]

We need to adapt ourselves and the nature of our relations to the qualities of our connections in the global-integral system. By continuing to develop behavioral economics, we are taking a step in the right direction—just as the economy has become global, so have our social relations. This is why ego-based relations do not work anymore. We must learn the qualities required of relationships in the new world. This will not only bring us into balance with the global-integral world, but will enable us to understand and welcome the changes that social and economic systems must undergo.

The change is inevitable; it cannot be stopped. The more we deny it, the more we will experience the change as a crisis. But if instead we come to grasp the meaning of the change and make the necessary changes, feelings of distress will give way to hope and prosperity, and to harmony and peace, both among each other and between humanity and Nature.

Therefore, all that needs to change is the nature of our interrelations. If we commit to a new social and economic treaty, a global and integral one, with mutual guarantee among us, we will be able to begin transforming the existing economic paradigm, and that of every system of life humanity has built. Such a change is possible only through broad education and information. This will create an empathetic environment that nurtures the values of mutual guarantee and stresses its advantages. Only such an evolutionary process will guarantee a stable, efficient economy that provides harmonious, balanced, and sustainable living for all.

[2] “Short films from the 2011 Lindau Nobel Laureate Meeting in Economic Sciences,” The New Palgrave Dictionary of Economics Online, http://www.dictionaryofeconomics.com/resources/news_lindau_meeting