‘Well-being economics’ would reshape politics and address income inequality and climate change, says professor Dirk Philipsen

Duke Professor Dirk Philipsen
Duke University professor Dirk Philipsen argues significant economic change is needed to address pressing issues like climate change and income inequality. (Courtesy of Dirk Philipsen)

By Aedan Hannon
Medill Reports

Climate researchers are increasingly concerned about upcoming “tipping points,” epidemiologists are preparing for future pandemics, and political scientists are warning that income inequality and the resurgence of authoritarianism and populism are threatening the future of democracy. Dirk Philipsen, an associate research professor of economic history at Duke University and the author of “The Little Big Number: How GDP Came to Rule the World and What to Do about It,” studies how capitalism’s current metrics for success contribute to these crises. As a founding associate of the Wellbeing Economy Alliance, a coalition of organizations, movements and individuals working to reorient economics, Philipsen advocates for valuing human and ecological health over growth and profit. The German- and American-educated scholar discusses what he sees as the urgent need to move beyond capitalism.

Why is it essential that we transform the economy?

If you look at [President Joe] Biden’s inaugural speech, he said we’re facing a multitude of crises – immigration, inequality, structural racism, climate change, COVID. None of those can be understood outside of the capitalist economy.

What is well-being economics?

It is based on the realization that indefinite exponential growth is not possible on a finite planet, that an economy based on transactions does not really address human needs, much less human desires. And it is squarely focused on people and planet.

Can you give a little background on your work?

I’m not so much for reforming what we call economics today as much as I am for abolishing that version and changing it with well-being economics. You can also call it cyclical or regenerative economics, or economics for the common good – economics that is embedded in nature and society and does not see itself as superior to, or separate from, all of those things.

Is economics a political issue?

I’m with feminists who say that the personal is political, and the political is personal. Changing the core nature and logic of our economy is about as political as it gets.

How would embracing well-being economics reshape politics?

You could ask a much simpler question. In what ways would well-being economics not reshape politics? I would say in no way.

Are progressive policies like the Green New Deal enough?

Within mainstream neoliberal economics, you can make some political shifts, and the Green New Deal would be a significant shift. But it is not a model that finally ends our fatal addiction to growth. Nonetheless, it is exactly the kind of thing that we need to effectively address climate change and to draw that connection between economic policy and income inequality. It does have the potential to restructure some part of the economy, but that’s different from how we think about and how we do economics.

How would well-being economics strengthen democracy?

Well-being economics is based on the fundamental philosophical question: Are people capable of governing themselves? Our answer is unequivocally, yes, of course we are. You can trust people governing themselves more than you can trust corporations, states, governments or dictators. Well-being economists would argue that we as the people who produce and consume need to make the decisions as to what to produce and consume. In [the current] economy, we don’t. You have a vote when you have money.

Does the pandemic give us an opportunity to reset?

What the pandemic, the crisis of the [U.S.] Capitol and the political crisis in Washington all have in common is that they only create preconditions for the possibility. The pandemic has clarified that the people who make our lives happen are consistently the people who have the most precarious and underpaid jobs. In our economic system, there is an almost perfect inverse relationship between the significance of your job and the status, income and security that you have. We could use that [awareness] to create an economy that is giving credit to those who actually contribute to the well-being of people and planet.

How can young people help with this transition?

Becoming active with other young people is absolutely vital. I always advise to look at “The Story of Solutions” by [Greenpeace USA Executive Director] Annie Leonard, which tries to make that distinction between what is transformative and what is not. I would encourage young people to try to support, embrace [and] facilitate life in community, rather than looking at return on investment.

Two interviews have been edited for brevity and clarity.

Aedan Hannon is a reporter at Medill. You can follow him on Twitter at @AedanHannon.