1. Understand basic requirements
a) A healthy economy needs to be both viable (providing the resources required now) and sustainable (maintaining viability so that it will last over years)
b) Because populations, requirements and available resources all change over time, an economy has to develop (renewing its component parts) if it is to be sustainable
c) Achieving sustainable development requires appropriate resources to flow from the economic structure for both consumption and renewal
2. Recognise all three components of economic structure
a) A planetary economy made up of all the energy currently used or potentially available for use by all life-forms (which convert energy internally) and circulating in various forms within the Earth’s crust, water and atmosphere (where chemical processes also convert energy), which is both receiving energy (notably from the Sun) and losing it to space
b) The total human economy (macro-economy), which is a part of the larger planet-wide energy circulation and involves energy in the form of commodities required and desired by humans; including all capital and consumer goods and types of money (in this context, money is a manufactured capital good used within the human economy)
c) The many local economies (micro-economies), in which one currency is predominately used by the population of the micro-economy to obtain the commodities (goods and services) they require or desire and where most human economic activities are planned and executed
3. Plan to create positive interactions between the planetary & human economies
a) Capital goods are affected by entropy and therefore need to be maintained to stay in use and will eventually deteriorate to the point where they are no longer useful and then will need to be renewed by taking energy from the planetary economy
b) Once consumables have been converted to forms of energy that the human economy cannot currently use and capital goods are no longer in use, they remain within the planetary economy and may become damaging to the human economy because some forms of energy have the potential to contaminate water or soil and contribute to adverse changes in climate
c) The human economy can limit damage by using energy to create a renewed resource in the short-term or to work with physical and chemical processes within the planetary economy with the aim of transformation back to a resource useful in the longer-term
4. Take action within each micro-economy
a) Promote an understanding within micro-economies that working with others is the only way to allow individuals, groups and organisations to have sustainable access to resources from across the global human economy and achieve their own individual requirements
b) Work with other micro-economies to create positive interactions between the planetary and human economies because no micro-economy, however big, can be sustainable on its own
c) Measure the energy value of economic activity within each micro-economy in parallel with accounts expressed in the principal currency because, whereas money measures local desire effectively, energy accounts can measure and help to plan sustainable human interaction with the planetary economy
Paul Newman
April 2014