We need a new global economy, one which recognises the deepening crisis facing life on Earth and is designed to help to solve it. And a good way to build one, experts say, is to switch to something called ecological interest rates. Interest rates usually capture people’s attention only if they have savings, when they’re bothered by low rates, or borrowings such as a mortgage, which means high ones. But economists are becoming unusually preoccupied with them, partly because it’s very likely that they will soon do something shocking and unusual: go negative. There’s another reason, though. With intense focus on a green economic recovery after the pandemic, there’s a growing realisation that there is no real link between money, its cost and our ecological life-support system. The global economy has outgrown the biosphere’s carrying capacity, as a conservative annual assessment of ecological overshoot makes clear. It is as if we were trying to shove size 10 economic feet into size six planetary shoes. The size of the economy, in turn, is fuelled by the supply of credit in different monetary forms. More money in circulation tends to increase conventional economic growth.
Climate News Network 3rd March 2021 read more »