Benefits of the New Economy
1) Equal standard of living for all: An economic policy based on mutual consideration will lead to allocating necessary public resources to raising lower income classes above the poverty line. At the same time, workshops and training in life skills and personal finance will help develop personal and economic independence. Living beyond one’s means, over-consumption, and reckless use of credit have become a global pandemic that requires treatment. These have played a major role in the global economic crisis that has been going on since 2008, if not before.
2) Reducing the cost of living: When greed is no longer the basis of our commercial and economic relations, when each of us settles for a reasonable profit and does not strive to maximize profits at the expense of others, prices of products and services will plunge toward their real cost. The prime beneficiaries of the deflation will be the lower income classes. The reduction of the cost of living will reduce inequality and the social and economic gaps in society.
3) Narrowing inequality and social gaps: A phenomenon that has become more evident in the global economy is the constant increase in inequality. This is the main reason for the worldwide social unrest. When we relate to one another like family, we will not be able to tolerate inequality among us or among countries in the international community. Instead of tension and fear of revolution or violence, the mutual guarantee economy will produce broad consent on the need to narrow the economic gaps, thus maintaining the stability of the system. Diminishing inequality means, among other things, economic and social concessions on the part of the upper classes, education and influence of the environment toward mutual guarantee, and an effective deliberation mechanism, known as “the round table.” These will guarantee that decisions are made in transparency and fairness, reflecting the social and economic consensus required by the relationships of mutual guarantee among all people.
In return, those who can contribute to everyone’s well-being will receive social acclaim and approbation. At the same time, those who receive assistance will enjoy a life of dignity and will appreciate the new system for having improved their economic and social status. Moreover, the mutual guarantee economy will guarantee that gaps existing today will not be duplicated in the future because the system will be balanced, stable, and based on high social cohesion.
4) A genuine reform in the budget: The only element that will enable us to create social justice in mutual guarantee, while noting the well-being of every individual in society—without breaching the budget—is the sense that we are all in the same boat and must cooperate for mutual benefit. We must determine a more equitable order of priorities in national budgets from broad consensus, instead of acting like wrestlers in the ring. There should be an economy managed with transparency, one that allows everyone to understand and influence how decisions are made.
5) Improving human relations at work and the individual-firm-state relations: In a mutual guarantee-based economy, economic and governmental systems will become friendly toward people under the umbrella of mutual guarantee—catering to citizens, rather than to governments. Similar improvements will take place in the authorities’ treatment of firms and in relations between the business sector and the state’s tax authorities.
6) Trust: The transition to another economy will be gradual. First, there will be dynamics of change and hope, a new spirit in society, a sense of cohesion and personal security. The anxiety and fear of being used and abused will give way to voluntary concessions and gestures in many areas, such as housing and rent prices, wage agreements that are fair to all sides, simpler and more efficient bureaucracy that truly serves the public, fair and honest banks, or garages that fix only what requires fixing and at a reasonable cost. All these examples have one thing in common—a sense of trust in others, a feeling that is so desperately needed in these insane times.
7) An efficient decision-making process: The new economy will be conducted with transparency. People will be able to see how decisions are made and will be able to influence them. The sense of transparency, along with involvement in the process, will create sympathy with the decisions made. Many studies in organizational behavior show that when we partake in a process, we tend to support decisions even when we are not in complete agreement with them. This is the way toward the feeling that we are so badly missing—the sense of fairness, our ability to approach decision-makers, and the need for social justice. This is the only way for the transformations in society and in the economy to be successful. There will be a progressive welfare policy, and inequality will be narrowed down through public deliberation and broad consent. Collaboration, sharing, and transparent decision-making will contribute to the stability and sustainability of the socioeconomic system.
8) Balanced consumption: The over-consumption that has become such an important part of our lives will, with the encouragement of our social environment, gradually, and through broad consent, make way for balanced consumption. Private consumption will return to normalcy instead of the exaggerated consumption that relies on commercials and social pressure whose sole purpose is to persuade us to purchase products and services we do not need. Many redundant products and services will disappear, and consumption will rely on practical calculations of utility and service in our daily lives at a reasonable level that is the norm in our respective environments. Brands as social status will be replaced with contribution to society and participation in community life and work for the common good.
Following the decline in demand, the cost of living will drop and a reasonably dignified living standard will be accessible to all. That process has already begun and is connected to the crisis and the gradual transition of humanity from a competitive, wasteful economy that is self-centered and unequal, to a balanced and functional economy whose goal is to provide for the basic needs of every person.
9) Improving the state of ecology and Nature: The shift from exploitative economy and over consumption—which deplete natural resources and damage man and the Earth—into balanced consumption will reduce the amount of industrial production and the number of unnecessary products. These processes will contribute significantly to improving the planet’s ecology: air and water pollution will decrease, the mountains of waste will be reduced dramatically, and the plundering of energy and natural resources will cease. The return to normalcy of consumption and production, to equality and fairness in division of resources, will guarantee that the use of natural resources is done at a pace that allows earth to replenish its treasures.
There are plenty of resources on this Earth to provide for the entire human race and all the species on earth for a long, long time. The mutual guarantee economy is a balanced and harmonious economy, and hence will be friendly toward Planet Earth, on which our lives depend.
A profound advantage of the mutual guarantee is that in a balanced and harmonious system, the likelihood of conflicts among nations and countries, even aggressive diplomacy, is virtually nonexistent. Power struggles, protectionism, tariffs, currency struggles, and exploiting weaknesses of other countries will make way for the new economy—in the spirit of mutual guarantee.