Living Standards, Poverty and Income Inequality in the UK

By John BristowNo Comments

This is an extract from the 2015 Annual Report produced by the Institute of fiscal Studies on Living Standards, Poverty and Income Inequality in the UK.

“Our first such report, in 2002, highlighted robust year-on-year growth in living standards and falling levels of poverty, while inequality was rising gradually. This latest report covers data up to and including 2013–14. The picture is strikingly different. Average incomes are edging up slowly again after falling sharply after the Great Recession. Income inequality has fallen back to levels last seen one or two decades ago, depending on the measure. Relative poverty is lower than before the recession, but that is because the poverty line fell in line with average incomes: in absolute terms, the poor did not tend to see falls in income of the magnitude experienced by those on middle and higher incomes, but their disposable incomes have at best been stable once their housing costs are properly accounted for. Important new themes have emerged, including increasing numbers in work alongside a deterioration of the financial position of working families, especially relative to pensioners.”





Picketty: Capitalism and Income Inequality

By John BristowNo Comments

More on Thomas Picketty’s historical research into capitalism and income inequality in Europe and the US since the 18th century:

Thomas Picketty

Thomas Picketty

As stated, the book’s central thesis is that when the rate of return on capital is greater than the rate of economic growth over the long term, the result is concentration of wealth. He defines capital as the stock of all assets held by private individuals, corporations and governments that can be traded in the market no matter whether these assets are being used or not. The rate of return includes profits,  dividends,  interestrents and other income from capital,      and growth is measured in income  or output.

He shows us that the return on capital has exceeded growth over the last 1000 years apart from the last century. He sees the 20th century to be an exception.

For the after tax rate of return on capital mapped against growth for the world see the graph:

Despite the periods when the wealth of the elite is diminished by world war, depression or debt-fuelled recession, Picketty argues that his data show that over long periods of time average return on investment outpaces productivity-based income by a wide margin. He dismisses the idea that bursts of productivity resulting from technological advances can be relied on to return sustained economic growth. Also a return on investment can increase when technology can be substituted for people. Piketty believes the growth rate will always return to being below the rate of return.

Income inequality as measured by the income of the top 1% in several countries tended to drop in the middle of the last century but has increased in the past several decades. Here is the graph:

He sees the trend being towards higher inequality. This was reversed between 1930 and 1975 due to unique circumstances: two world wars, the Great Depression and a debt-fuelled recession destroyed much wealth, particularly that owned by the elite. These events prompted governments to undertake steps towards redistributing income, especially in the post-World War II period. The fast, worldwide economic growth of that time began to reduce the importance of inherited wealth in the global economy.

The book argues that the world today is returning towards “patrimonial capitalism“, in which much of the economy is dominated by inherited wealth: the power of this economic class is increasing, threatening to create an oligarchy.

Some of the Criticism of Thomas Picketty’s historical research into capitalism and income inequality in Europe and the US since the 18th century

On the causes of income inequality:                                                                                      Most other economists explain the rise of top 1% incomes by globalization and technological change. The top 1% incomes are now mostly salaries, not capital incomes.  Daron Acemoğlu  and James A. Robinson point out that he seems to ignore the central role of political and economic institutions in shaping the evolution of technology and the distribution of resources in a society”.                                                                                                                                                                                                   Others point out that a large part of the increase in wealth has been through the value of land not capital goods.

Others have problems with definition of capital Piketty uses:                                                David Harvey sees him having a “mistaken definition of capital“, which describes as: […] a process, not a thing […] a process of circulation in which money is used to make more money often, but not exclusively through the exploitation of labor power. Picketty defines capital as the stock of all assets held by private individuals, corporations and governments that can be traded in the market no matter whether these assets are being used or not.

And where the rate of return comes from:                                                                                 James K. Galbraith criticizes Piketty for using “an empirical measure that is unrelated to productive physical capital and whose dollar value depends, in part, on the return on capital. Where does the rate of return come from? Piketty never says”.

For more see:





Economics, Rich and Poor Gap

Population Growth in 21st Century

By John BristowNo Comments

Population Growth and Fertility Rates this Century

The work of professor Adrian Raftery, at the University of Washington, and his international research team, including UN experts, published in September 2014, has overturned 20 years of consensus – that global population, and the stresses it brings, will peak and plateau by 2050 at about 9bn people. This study for the first time uses advanced statistics to place convincing upper and lower limits on future population growth. He and others (such as Simon Ross, chief executive of Population Matters a thinktank supported by naturalist Sir David Attenborough

David Attenborough

David Attenborough

and scientist James Lovelock) stress that it should be included in the issues and goals on the UN-led sustainable development agenda.

Up till 2015 the estimate of the global fertility rate (number of children per woman) had declined to 2.42. But from then on there has a slowdown in the pace of fertility decline. There are higher fertility rates in Africa especially. In countries like Nigeria, the continent’s most populous nation, the decline has stalled completely with the average woman bearing six children. The cause of the stalled fertility rate is two-fold, said Raftery: a failure to meet the need for contraception and a continued preference for large families. “The unmet need for contraception – at 25% of women – has not changed in for 20 years,” he said. And “the preference for large families is linked to lack of female education which limits women’s life choices”. In Nigeria, 28% of girls still do not complete primary education.

An alternative scenario is given by the statistician Jorgen Randers (one of the co-authors of Limits to Growth), who argues that traditional projections insufficiently take into account the downward impact of global urbanization on fertility.

Jorgen Randers

Jorgen Randers

Randers’ “most likely scenario” reveals a peak in the world population in the early 2040s at about 8.1 billion people, followed by decline. In China in 2015, for example, a baby boom is predicted (possibly 6M more births a year) after raising the family planning limit from one to two children per woman. This may balance the ageing population a bit, but it is expected to be short-lived as social and economic factors accompanying urbanisation will play a part: the cost of raising children and raising the quality of their lives is high in cities (childcare, education, rents, commuting, uncertainty in the job market).

How far and when all countries reach the stage where birth and death rates are in balance and the rate of population growth goes back to where it was in agrarian economies, 0.5% a year is uncertain, and unlikely in this century. Hopefully though fertility rates will come down to a global average nearer to 2 per woman in the population.

Another population concern is the rising life expectancy and ageing populations currently seen in Europe and Japan, which raises questions about how working populations will support large numbers of elderly people. But the new research shows the same issue will affect countries whose populations are very young today.



Stages of Changes in Population in the Transition to an Industrialised Economy

By John BristowNo Comments

The demographic Transition Model and Variations within it in the steps to an industrialised economy.      

The decline in population growth rate is due to the demographic transition from high birth and death rates to low birth and death rates as a country develops from a pre-industrial to an industrialized economic system. This is typically demonstrated through the demographic transition model developed in 1929 by Warren Thompson which is based on an interpretation of demographic history over the previous 200 years in industrialising societies . Thompson identified 4 stages:

  1. Death rates and birth rates (number of people per 1000 population per year) are high and roughly in balance in an agrarian and pre-industrial society, with growth rates less than 0.05%. Population growth is typically very slow in this stage, because the society is constrained by the available food supply
  2. Death rates drop rapidly as a country develops its economy, technology and education, to improve its food supply (selective breeding and crop rotation) and sanitation (food handling, water supply, sewage, and personal hygiene). Access to technology, education in basic healthcare, and increases in female literacy reduce mortality too, especially childhood mortality. Without a corresponding fall in birth rates (and fertility) there is an imbalance and countries in this stage experience a large increase in the rate of population growth (percent growth over a period divided by number of years).
  3. A fall in birth rates and fertility rates (number of children per woman) due to increases in wages, more urbanization, less subsistence agriculture, the improved status and education of women, access to contraception, more parental investment in the education of children as children’s work becomes less valued. Population growth begins to slow down.
  4. 4.Birth and death rates are relatively low and more in balance, with some variations. Birth rates can drop to well below replacement level leading to a shrinking population, a threat to industries that rely on population growth. Death rates may remain consistently low or increase slightly due to more lifestyle diseases from unhealthy diets, little exercise and high obesity. As the large group born during stage two gets older, it creates an economic burden on the shrinking working population. The ratio of working age people to older people is likely to decline substantially in all countries, even those that currently have young populations.

As with all models, this is a generalised picture of population change and may not accurately describe particular countries. Most developed countries are in stage 3 or 4 of the model; the majority of developing countries have reached stage 2 or stage 3. The major (relative) exceptions are some poor countries, mainly in sub-Saharan Africa and some Middle Eastern countries, which are poor or affected by government policy or civil war, notably PakistanPalestinian territoriesYemen, and Afghanistan – and, as in Africa, epidemics such as AIDS or Ebola. ChinaBrazil, Thailand and others have passed through the stages very quickly due to fast social and economic change. China also had programmes to emphasise the quality rather than quality of children from 1972 followed by the one child family planning law from 1980 which brought the fertility rate down to 1.2 or 1.5 children per woman until the two child policy in 2015. There are variations in the developed economies too. In some, such as Japan and some European countries, there is negative population growth (i.e. a net decrease in population over time), mainly due to low fertility rates. In the UK a 15% growth rate (.6% versus 3% in many EU countries) has been predicted between 2014 and 2039, mostly due to net immigration and the birth rates in migrant families.

For the world as a whole the 2015 estimates of birth rate (births per 1000) was 18.6, and the death rate 7.8 (deaths per 1000) See the World Fact Book


Challenges, International Development, Population

Limits to Growth: Extract from Synopsis of 2004 Update

By John BristowNo Comments

Limits to Growth: Extract from the Synopsis of The 30-Year Update

By Donella Meadows, Jorgen Randers, and Dennis Meadows  Donella Meadows

The following piece is taken from a short synopsis of Limits to Growth: The 30-Year Update. The full length book is available at the website of Chelsea Green Publishing

A Synopsis: Limits to Growth: The 30-Year Update

The signs are everywhere around us:

  • Sea level has risen 10–20 cm since 1900. Most non-polar glaciers are retreating, and the extent and thickness of Arctic sea ice is decreasing in summer.
  • In 1998 more than 45 percent of the globe’s people had to live on incomes averaging $2 a day or less. Meanwhile, the richest one- fifth of the world’s population has 85 percent of the global GNP. And the gap between rich and poor is widening.
  • In 2002, the Food and Agriculture Organization of the UN estimated that 75 percent of the world’s oceanic fisheries were fished at or beyond capacity. The North Atlantic cod fishery, fished sustainably for hundreds of years, has collapsed, and the species may have been pushed to biological extinction.
  • The first global assessment of soil loss, based on studies of hundreds of experts, found that 38 percent, or nearly 1.4 billion acres, of currently used agricultural land has been degraded.
  • Fifty-four nations experienced declines in per capita GDP for more than a decade during the period 1990–2001.

These are symptoms of a world in overshoot, where we are drawing on the world’s resources faster than they can be restored, and we are releasing wastes and pollutants faster than the Earth can absorb them or render them harmless. They are leading us toward global environ- mental and economic collapse—but there may still be time to address these problems and soften their impact.

We’ve been warned before. More than 30 years ago, a book called The Limits to Growth created an international sensation. Commissioned by the Club of Rome, an international  group of businessmen, states- men, and scientists, The Limits to Growth was compiled by a team of experts from the U.S. and several foreign countries. Using system dynamics theory and a computer model called “World3,” the book presented and analysed 12 scenarios that showed different possible patterns—and environmental outcomes—of world development over two centuries from 1900 to 2100.

The World3 scenarios showed how population growth and natural resource use interacted to impose limits to industrial growth, a novel and even controversial idea at the time. In 1972, however, the world’s population and economy were still comfortably within the planet’s carrying capacity. The team found that there was still room to grow safely while we could examine longer-term options.

In 1992, this was no longer true. On the 20th anniversary of the publication of Limits to Growth, the team updated Limits in a book called Beyond the Limits. Already in the 1990s there was compelling evidence that humanity was moving deeper into unsustainable terri- tory. Beyond the Limits argued that in many areas we had “overshot” our limits, or expanded our demands on the planet’s resources and sinks beyond what could be sustained over time.1 The main challenge identified in Beyond the Limits was how to move the world back into sustainable territory.

To overshoot means to go too far, to grow so large so quickly that limits are exceeded. When an overshoot occurs, it induces stresses that begin to slow and stop growth. The three causes of overshoot are always the same, at any scale from personal to planetary. First, there is growth, acceleration, rapid change. Second, there is some form of limit or barrier, beyond which the moving system may not safely go. Third, there is a delay or mistake in the perceptions and the responses that try to keep the system within its limits. The delays can arise from inattention, faulty data, a false theory about how the system responds, deliberate efforts to mislead, or from momentum  that prevents the system from being stopped quickly.

The 30-Year Update

Now in a new study, Limits to Growth: The 30-Year Update, the authors have produced a comprehensive update to the original Limits, in which they conclude that humanity is dangerously in a state of overshoot.

While the past 30 years has shown some progress, including new technologies, new institutions, and a new awareness of environmental problems, the authors are far more pessimistic than they were in 1972. Humanity has squandered the opportunity to correct our current course over the last 30 years, they conclude, and much must change if the world is to avoid the serious consequences of overshoot in the 21st century. See the graph

When The Limits to Growth was first published in 1972, most economists, along with many industrialists, politicians, and Third World advocates raised their voices in outrage at the suggestion that population growth and material consumption need to be reduced by deliberate means. Over the years, Limits was attacked by many who didn’t understand or misrepresented its assertions, dismissing it as Malthusian hyperbole. But nothing that has happened in the last 30 years has invalidated the book’s warnings.

On the contrary, as noted energy economist Matthew Simmons recently wrote, “The most amazing aspect of the book is how accurate many of the basic trend extrapolations … still are some 30 years later.” For example, the gap between rich and poor has only grown wider in the past three decades. Thirty years ago, it seemed unimaginable that humanity could expand its numbers and economy enough to alter the Earth’s natural systems. But experience with the global climate system and the stratospheric ozone layer have proved them wrong.

All the environmental and economic problems discussed in Limits to Growth have been treated at length before. There are hundreds of books on deforestation, global climate change, dwindling oil supplies, and species extinction. Since The Limits to Growth was first published 30 years ago, these problems have been the focus of conferences, scientific research, and media scrutiny.

What makes Limits to Growth: The 30-Year Update unique, however, is that it presents the underlying economic structure that leads to these problems. Moreover, Limits is a valuable reference and compilation of data. The authors include 80 tables and graphs that give a comprehensive, coherent view of many problems. The book will undoubtedly be used as a text in many courses at the college level, as its two earlier versions have been.


The World3 computer model is complex, but its basic structure is not difficult to understand. It is based in system dynamics —a method for studying the world that deals with understanding how complex systems change over time. Internal feedback loops within the structure of the system influence the entire system behaviour.

World3 keeps track of stocks such as population, industrial capital, persistent pollution, and cultivated land. In the model, those stocks change through flows such as births and deaths; investment and depreciation; pollution generation and pollution assimilation; land erosion, land development, and land removed for urban and industrial uses.

The model accounts for positive and negative feedback loops that can radically affect the outcome of various scenarios. It also develops nonlinear relationships. For example, as more land is made arable, what’s left is drier, or steeper, or has thinner soils. The cost of coping with these problems dramatically raises the cost of developing the land—a nonlinear relationship.

Feedback loops and nonlinear relationships make World3 dynamically complex, but the model is still a simplification of reality. World3 does not distinguish among different geographic parts of the world, nor does it represent separately the rich and the poor. It keeps track of only two aggregate pollutants, which move through and affect the environment in ways that are typical of the hundreds of pollutants the economy actually emits. It omits the causes and consequences of violence. And there is no military capital or corruption explicitly represented in World3. Incorporating those many distinctions, how- ever, would not necessarily make the model better. And it would make it very much harder to comprehend.

This probably makes World3 highly optimistic. It has no military sector to drain capital and resources from the productive economy. It has no wars to kill people, destroy capital, waste lands, or generate pollution. It has no ethnic strife, no corruption, no floods, earthquakes, nuclear accidents, or AIDS epidemics. The model represents the uppermost possibilities for the “real” world.

The authors developed World3 to understand the broad sweep of the future—the possible behavior patterns, through which the human economy will interact with the carrying capacity of the planet over the coming century.

World3’s core question is, How may the expanding global population and materials economy interact with and adapt to the earth’s limited carrying capacity over the coming decade? The model does not make predictions, but rather is a tool to understand the broad sweeps and the behavioral tendencies of the system.

Technology Markets

The most common criticisms of the original World3 model were that it underestimated the power of technology and that it did not represent adequately the adaptive resilience of the free market. Impressive—and even sufficient—technological advance is conceivable, but only as a consequence of determined societal decisions and willingness to follow up such decisions with action and money.

Technological advance and the market are reflected in the model in many ways. The authors assume in World3 that markets function to allocate limited investment capital among competing needs, essentially without delay. Some technical improvements are built into the model, such as birth control, resource substitution, and the green revolution in agriculture. But even with the most effective technologies and the greatest economic resilience that seems possible, if those are the only changes, the model tends to generate scenarios of collapse.

One reason technology and markets are unlikely to prevent overshoot and collapse is that technology and markets are merely tools to serve goals of society as a whole. If society’s implicit goals are to exploit nature, enrich the elites, and ignore the long term, then society will develop technologies and markets that destroy the environment, widen the gap between rich and poor, and optimize for short-term gain. In short, society develops technologies and markets that hasten a collapse instead of preventing it.

The second reason for the vulnerability of technology is that adjustment mechanisms have costs. The costs of technology and the market are reckoned in resources, energy, money, labor, and capital.


For more than a century, the world has been experiencing exponential growth in a number of areas, including population and industrial production. Positive feedback loops can reinforce and sustain exponential growth. In 1650, the world’s population had a doubling time of 240 years. By 1900, the doubling time was 100 years. When The Limits to Growth was published in 1972, there were under 4 billion people in the world. Today, there are more than 6 billion, and in 2000 we added the equivalent of nine New York cities.

See the table on doubling times:

Another area of exponential growth has been the world economy. From 1930 to 2000, the money value of world industrial output grew by a factor of 14—an average doubling time of 19 years. If population had been constant over that period, the material standard of living would have grown by a factor of 14 as well. Because of population growth, however, the average per capita output increased by only a factor of five.

Moreover, in the current system, economic growth generally occurs in the already rich countries and flows disproportionately to the richest people within those countries. Thus, according to the United Nations Development Program, the 20 percent of the world’s people who lived in the wealthiest nations had 30 times the per capita income of the 20 percent who lived in the poorest nations. By 1995 the average income ratio between the richest and poorest 20 percent had increased from 30:1 to 82:1.

Only eight percent of the world’s people own a car. Hundreds of millions of people live in inadequate houses or have no shelter at all—much less refrigerators or television sets. Social arrangements common in many cultures systematically reward the privileged, and it is easier for rich populations to save, invest, and multiply their capital.


Limits to growth include both the material and energy that are extracted from the Earth, and the capacity of the planet to absorb the pollutants that are generated as those materials and energy are used. Streams of material and energy flow from the planetary sources through the economic system to the planetary sinks where wastes and pollutants end up. There are limits, however, to the rates at which sources can produce these materials and energy without harm to people, the economy, or the earth’s processes of regeneration and regulation.

Resources can be renewable, like agricultural soils, or nonrenewable, like the world’s oil resources. Both have their limits. The most obvious limit on food production is land. Millions of acres of cultivated land are being degraded by processes such as soil erosion and salinization, while the cultivated area remains roughly constant. Higher yields have compensated somewhat for this loss, but yields cannot be expected to increase indefinitely. Per capita grain production peaked in 1985 and has been trending down slowly ever since. Exponential growth has moved the world from land abundance to land scarcity. Within the last 35 years, the limits, especially of areas with the best soils, have been approached.

Another limit to food production is water. In many countries, both developing and developed, current water use is often not sustain- able. In an increasing number of the world’s watersheds, limits have already been reached. In the U.S. the Midwestern Ogalallah aquifer in Kansas is overdrawn by 12 cubic kilometres each year. Its depletion has so far caused 2.46 million acres of farmland to be taken out of cultivation. In an increasing number of the world’s watersheds, limits have already, indisputably, been exceeded. In some of the poorest and richest economies, per capita water withdrawals are going down because of environmental problems, rising costs, or scarcity.

Another renewable resource is forests, which moderate climate, control floods, and harbor species, from rattan vines to dyes and sources of medicine. But today, only one-fifth of the planet’s original forest cover remains in large tracts of undisturbed natural forests. Although forest cover in temperate areas is stable, tropical forest area is plummeting.

From 1990 to 2000, the FAO reports that more than 370 million acres of forest cover—an area the size of Mexico—was converted to other uses. At the same time that forests decline, demand for forest products is growing. If the loss of 49 million acres per year, typical in the 1990s, continues to increase at 2 percent per year, the unprotected forest will be gone before the end of the century.

Nonrenewable Resources

A prime example of a nonrenewable resource is fossil fuels, whose limits should be obvious, although many people, including distinguished economists, are in denial over this elementary fact. More than 80 percent of year 2000 commercial energy use comes from non- renewable fossil fuels—oil, natural gas, and coal. The underground stocks of fossil fuels are going continuously and inexorably down. Between 1970 and 2000, even though billions of barrels of oil and trillions of cubic feet of natural gas were burned, the ratio of known reserves to production actually rose, due to the discovery of new reserves and reappraisal of old ones.


Biodiversity, Climate and Temperature, Economics, Population, Resources and Pollution

Sustainability with Prosperity

By John BristowComments Off on Sustainability with Prosperity

How are we to achieve sustainability with prosperity and a good quality of life for all?                                                                    

For example: the need to attend to:

  • How the way we use materials and generate energy in our economy affects all life systems on our planet, on which we depend,
  • How we can use limited resources more effectively
  • How we can meet everyone’s basic needs and ensure equal opportunity for there to be stable and healthy societies.

Our technology is now very powerful in its effects on nature and each other, our population continues to grow, and what happens in any one country can affect others across the globe much more than before. Is there a need for greater collaboration and synergy                    

Between us and nature – the living systems of which we are a part,

Between us, richer and poorer, within and between societies?

Does this mean a new kind of economy? A fundamental change in the way we see and do things, and in how we identify our needs and get them met?

Is this to co-exist with a changing capitalism?

Has social evolution towards another kind of economic system started?

How far is there a shared felt need for a change and what are the signs of it?

How much do we need to change, how can we make this attractive and possible, and how can technology help?

Does economics need to be a multidisciplinary subject covering all natural and social sciences?

I am preparing a collection of website entries or posts to address these questions.


Addressing Climate Change Denial

By John BristowComments Off on Addressing Climate Change Denial

Denial of Climate Change and its Effects images-1

Sometimes we humans look as though we are running over a cliff to our downfall by denying or ignoring the destruction we inflict on our habitat, the biosphere and its ecosystems: causing climate change by greenhouse gas emissions, exhausting natural resources, converting almost all wild habitats for our use and polluting air, water and soil through waste and chemicals.

There is now seen to be a risk that the average global temperature will rise by 4 0 C   during this century. Any average global temperature increase above 4 0 C is hard to adapt to. For example it would make life difficult if not impossible in much of the tropics, and eventually lead to the melting of the Greenland and Antarctic ice sheets and the rising of seal levels by many metres. To find anything comparable we have to go back to the Pliocene – last epoch of the Tertiary period, 3m years ago. There were no continental glaciers in the northern hemisphere (trees grew in the Arctic), and sea levels were 25 metres higher than today’s. In this kind of heat, the death of the Amazon is as inevitable as the melting of Greenland.

We are already beginning to experience extreme weather more often, resulting in drought or floods, loss of  crops and human life, and destruction of the living environment.   We do not know how much it will accelerate as one effect of it leads to another (such as ocean acidification meaning less CO2 absorbed by the ocean).

A three-degree increase in global temperature – possible as early as 2050 – would throw the carbon cycle into reverse. Instead of absorbing carbon dioxide, vegetation and soils start to release it. So much carbon pours into the atmosphere that it would pump up atmospheric concentrations by 250 parts per million by 2100, boosting global warming by another 1.5C.   There could be runaway change (See David Wasdell’s video interviews on this site  and his own papers). The chances of avoiding four degrees of global warming are poor if the rise reaches three degrees and triggers a runaway thaw of permafrost. The chances of avoiding five degrees of global warming are negligible if a rise of four degrees releases trapped methane from the sea bed.

We could then repeat some of the crises in the past that took 1m years to recover from, but this time with it man-made. When temperatures were between 4 and 5 degrees higher 55m years ago, following a very sudden burst of global warming in the early Eocene, alligators and other subtropical species were living high in the Arctic.  With 5 degree increase it can mean large-scale extinction of plant and animal species and the loss of millions of human lives, like 65m years ago with the extinction of the dinosaurs. It could then rise higher as at the end of the Permian, 251m years ago, when global temperatures rose by six degrees, and 95% of species were wiped out. For the effects of temperature increases by degree see an overview online.

This can all be avoided if we act now both to reduce carbon emissions and take carbon out of the air (which we can now) and store it safely, geologically or biologically, copying natural processes, or by drilling deep underground (See for example artificial trees and also in the journal Scientific American)  More research funding is needed for this. Clean BioChar or biological charcoal that does not reduce the oxygen in the air and does not put the carbon back over time could be part of the solution but research is essential to ensure safety with this and other solutions. See the Permaculture network’s warning on BioChar.

Part of the failure to take these risks on board and address them fully is denial, and defence against feelings of anxiety or despair and powerlessness.

Part of it is due to the limitations of our unchecked cognition as it has evolved so far.

Mixed together this is a powerful cocktail.

For an overview see the New Scientist 18 August 2014 article by George Marshall “Hear no climate evil”.

George Marshall is the author of Don’t Even Think About It: Why our brains are wired to ignore climate change, which was published by Bloomsbury between August and October 2014 in 3 countries. He is the founder of the Climate Outreach and Information Network in Oxford, UK

Defence against anxiety and powerlessness

The overwhelming and seemingly hopeless struggle portrayed by the media and many campaigners provokes feelings of anxiety and powerlessness.

Our response to climate change is uncannily similar to an even more universal disavowal: unwillingness to face our own mortality, says neuroscientist Janis Dickinson of Cornell University. She argues that aggressive assertion of group identities, political polarisation, and angry denial found around climate change is consistent with “Terror Management Theory” (TMT) which is used to explain behaviour in the face of reminders of mortality. See J. L. Dickinson (2009) The People Paradox: Self-Esteem Striving, Immortality Ideologies, and Human Response to Climate Change in Ecology and Society, Vol 14 (1). Online

And more recently her paper on How Framing Climate Change Influences Citizen Scientists’ Intentions to Do Something About It published online by Taylor and Francis

This shows how mentioning dangers for humans did not increase participants’ interest in taking personal action on climate change, but mentioning dangers for birds was highly effective! Others, such as psychoanalytic psychotherapist, Rosemary Randall on the Question Time on Climate Change event organised by the RSA in London describe typical defences too. See the video of this discussion

Limitations through Unchecked Cognition and Cultural Biases

The Noble prize winner in (behavioural) economics, the psychologist Daniel Kahnemann, has studied human cognition and behavior in the market place. Kahneman won the 2002 Nobel prize in economics for his research on the psychological biases that distort decision-making, in the market place and elsewhere. One of these is “loss aversion”, which means that people are far more sensitive to losses than gains. One form of this is ignoring the compound interest on debt and credit card loans the increase of which was part of the recent debt crisis. This is hard enough to do mathematically. Take J. Zinman’s powerful analogy for compound interest using a chessboard of a $1 of interest per square that doubles until the 64th. Try estimating it. It is by then $9000 quadrillion.

Kahnemann regards climate change as a perfect example as it seems like a distant problem that requires sacrifices now to avoid uncertain losses far in the future. So some argue that we have to experience, see and feel the effects in the present to act, have an emotional shock and feel the hurt, if you like – but that might be too late and result in panic.

Many of us have no spare time, energy, money or attention to address it with others either – immediate survival or earning enough to support our families occupy us.

Nicholas Stern, author of the influential Stern Review on the economics of climate change, describes it as the “perfect market failure”. As Marshall points out, discussions about economics invariably turn into self defeating cost-benefit analyses:

Stern offers a choice between spending 1 per cent of annual income now, or risking losing 20 per cent of it in 50 years’ time. This language is almost identical to that Kahneman used two decades earlier in his experiments on loss aversion. Is it surprising that when a choice is framed like this, policy-makers are intuitively drawn towards postponing action and taking a gamble on the future?

Another of Kahneman’s biases is an “assimilation bias” that bends information to fit people’s existing values and prejudices. If cost/loss and uncertainty around climate change really are universal psychological barriers, it is hard to explain why 15 per cent of people fully accept the threat and are willing to make personal sacrifices to avert it. Most of the people in this group are left wing or environmentalists and have managed to turn climate change into a narrative that fits with their existing criticisms of industry and growth.

Uncertainty and ambiguity leave room for people to choose to believe what they want. Scientists reinforce distance with computer predictions set two generations in the future and endless talk of uncertainty. One of the latest reports from the Intergovernmental Panel on Climate Change uses the word “uncertain” more than once per page. The “uncertainty principle” in the original global climate change conference statements for assessing and guarding against risk  does not counteract this. Climate change is complex, there is a lot of difference in the effects in different countries or locations, and the models currently cannot predict accurately all the time, leaving room for the doubters to point out where there are contradictions. Scientists need to have amongst them specialists in communication who can provide the information on what is known and agreed on, and what the effects and risks are, while being clear on what is uncertain, especially in the details; constructive scepticism and disagreement is necessary for good science but it does not have to lead to inaction.

The media in the UK like to promote debate – but this can be without regard to how much the key participants on each side have valid knowledge and information. This makes it all the more uncertain. Up till recently such debates have not been between climate scientists with a similar knowledge base – though now 97% of them agree on the serious fast increase in greenhouse gases and the human contribution.

Conservatives may justify climate inaction on the grounds of cost and uncertainty but they, too, are able to accept both as long as they speak to their core values. As former US vice-president and climate sceptic Dick Cheney said: “If there is only a 1 per cent chance of terrorists getting weapons of mass destruction, we must act as if it is a certainty.”

Strongly held values can explain the convictions of those at the ends of the political spectrum, but they do not adequately explain the apparent indifference of the large majority in between. If asked, most agree that climate change is a serious threat, but without prompting they do not volunteer it. This indifference is another form of denial, with which we started.

The law of unintended consequences and Lock-in

This is another example of the limits of unchecked cognition. Robert Merton, the creator of many key concepts in sociology in the last century, first named this and identified five factors involved: ignorance (including info not available), error, immediate interest or gain overriding any long term damage, basic values and self-defeating prophecy.

Merton, Robert K. (Dec 1936). “The Unanticipated Consequences of Purposive Social Action”. American Sociological Review 1 (6): 894–904. See online

What is called “lock-in” – habits, routines, social norms and cultural values, unquestioned assumptions, and of course locked-in longer term investments (as in energy infrastructure or the extraction of coal, oil or natural gas) – are all part of this. This can put the response time globally into 3 or 4 decades, even if we act as fast as we can now.

Ways Forward

The problem itself is far from being what Stephen Gardiner of the University of Washington in Seattle calls a “perfect moral storm” or market failure, and the situation is not hopeless; but dealing with it will require a more sophisticated analysis of human cognition and the role of socially shared values in building conviction, and a mutually reinforcing multi-pathway approach going in the same direction to make the necessary transition.

Take the presentation of information to raise awareness. Facts can be produced on waste and pollution such as the production of each laptop generating waste that is 4000 times its weight, see Hawken, R. and others Natural Capitalism (1999). But this may not have an emotional impact or leave a lasting memory.

Sometimes visual presentations have more impact. A video was produced to show the accumulated impact of used car waste. Carbon Visuals: Animating the world’s cars

This has to be done alongside practical examples of how people are tackling the problem.

To see how the sun-earth system together with the biosphere determine our climate is very complex, possibly beyond our modelling capacities. This requires scientists working together. Historical studies going back millions of years need to be combined with mathematical modelling based on more recent data (see again David Wasdell). But as James Lovelock said recently we cannot afford to spend too much time on the details of climate modelling. He points out that “all the modelling we do shows that the climate is poised on the jump up to a new hot state. It is accelerating so fast you could say we are already in it.” He says we need to focus on learning more about climate change so to be able to adapt to it better. We cannot afford to “fiddle while Rome is burning” as he put it. He points out that global warming has hardly been mentioned in the UK election campaign in April 2015.

There is a growing awareness that we need to focus equally on reducing carbon emissions and on taking carbon out of the air by mimicking nature, geo-engineering that is very low risk, as mentioned above (6th paragraph). This is beginning to be addressed in the recent reports from the IPCC.

Again as with leaders in other systems, people’s assumptions, agendas, reputations, research grants and the years they have invested in research or models can be at stake. Trust, and real collaboration in the service of something bigger than any individual, alongside the commitment to the principles of good scientific method and truth, is needed for this to happen.

One way of counteracting the inability to see or comprehend and feel the accumulated impact of a number of small actions at a collective level is shown by the work of Peter Senge and colleagues. They point out the need for – and give examples of – systems leaders who bring people together who represent different parts of a system within society. They then use tools and skills to help them break down the barriers to trust, real dialogue and reflection between them so that they can see and make sense of the system and its interacting parts together. They can then work together on generating a future vision, creating solutions, trying them out in practice and learning by doing. Others can then follow. For methods and examples see their paper. They give examples of projects in cities bringing together the public and private sectors with community-based organisations, and multinational companies designing more sustainable products, production processes and product life cycles involving their supply chains throughout the world.

We need a critical mass of leaders who have the capacities for this. Senge and others identify some of these capacities, such as to:

(1) See and map the larger system with others sharing the same question, with the humility, based on an awareness of their own limitations, to go beyond their own vantage point or areas of knowledge or interest.

(2) Foster reflection and more generative conversation to:

Open minds to surface assumptions and see that the problems may be in and between each of us in the system, as well as “out there”,

Open hearts to listen,

Open the will to let go of pre-set goals and agendas,

and so build relationships in the process.

(3) Shift the conversation from reactive problem solving to co-creating the future by sharing aspirations and building a common vision, then trying things out and learning in a safe way, building confidence by joint accomplishments and working through tensions and frustrations on the way.

This can lead to a mature understanding of the situation and of the conditions for positive social change and innovation

At the same time “massive small change” at the local, national and international level is a key driver of change as ideas can be tested and examples and role models created for others to follow, while empowering groups and networks. At the international level this can be a small enterprise of young engineers creating affordable and easy to use technical solutions to problems in the less developed economies where there is lack of access to electricity, poor irrigation or drought, crops failing, etc. (The massive small change and engineers without borders network organises occasional conferences that support this). Or local community groups and enterprises around the world, in rich and poor economies, creating more sustainable ways of living that are  attractive and at the same time fit the needs and realities of the 21st century (The Transition Towns Network and the older Natural Step Movement are examples of these). Local businesses wanting to explore a more environmentally aware approach to prosperity and growth, within ecologically safe limits can form socio-economic networks for sustainability in the full sense in their local communities, supported by their local universities and by national or international knowledge and learning networks and alliances. Local community networks are often involved with scientists too in regenerating local ecosystems or in protecting animal and plant species from the effects of rising global temperatures or the destruction of  natural habitats. This means looking for the type of ecosystem best adapted to this century and not trying to conserve the type of wild area we are used to. For UK and Ireland Rewilding and for a Wildlife Trust’s comments on it go to.

System leaders, groups and networks like these can transform anxiety, doom and denial into a sense of urgency with a realistic confidence and hope as more and more practical, cost-effective and attractive solutions are found and demonstrated. People can feel empowered, able to do things together with others. Innovators like these in businesses and local communities, within networks, can be a key force for change that national governments and international forums or agencies can encourage, support and be informed by.

This can counteract the defences and the limits of unchecked cognition that lead to a breakdown of co-operation and our fears becoming a reality, an example of a self-fulfilling prophecy (to use another of Merton’s concepts) at work.


Carbon & Greenhouse Gases, Climate and Temperature, Global Temperature, Patterns in Societal Change

Patterns in Innovation & Change: Use of the Internet

By John BristowComments Off on Patterns in Innovation & Change: Use of the Internet

This is the second of two discussion in September 2014 with Akvo in London.

This is the second of two discussion in September 2014 with Akvo in London. This one is between Mark Charmer, Director of Communications and myself. As with the first discussion this can be viewed on YouTube by clicking on video under each of the five headings below when you scroll down.

Mark Charmer

Mark Charmer

John Bristow

John Bristow

The first discussion covered how Akvo with their software tools and training helps people to use the internet and mobile communications to monitor aid activity for international development more easily and share the information in different media quickly and effectively with others. This can increase the connectivity between the organisations involved locally and internationally so that they can solve problems, network, learn and innovate together more effectively and quickly to address urgent needs. The use of the internet and mobile communications can also enable them to discover and learn more effective and efficient ways of organising and free people up to make a big difference more quickly – and see the results. For more info: see the first discussion and/or visit their website.

Their purpose as an organisation is directly relevant to one of the aims of my website: to promote use of the internet for creating the infrastructure and relationships for faster problem solving, learning and innovation to address the problems of this century, and to help bring about transformational changes where needed in the systems which shape the way we think, feel and act and through which our societies are informally and formally co-ordinated and organised – in this case helping poorer countries to lift themselves out of poverty.

In this the second discussion we drew out of examples some of the enabling conditions for systemic changes in complex systems to keep pace with the challenges of our times. We started with how the use of the internet that Akvo supports in the area of international development can foster these conditions and the learning together needed to make the changes. Diversity with integration, stability with change, self-organising alongside direction, boundaries and control – and ease of data collection for monitoring and for fast, honest and valid feedback, were some of the characteristics of these enabling conditions.

Changes in the way aid organisations work and work together are systemic, as they are not just working in the same way and making improvements as best they can within the current system and way of working. They are transformational changes in the system in which they work – the system guiding the thinking, decisions, actions, behaviour of the people and organisations, and the connectivity, interaction and cooperation between them. The system as a whole, which they create together through their actions and exchanges, moves into another form. Having the tools and training to use the internet and mobile communications differently can help bring these changes about. We need such systemic change, we suggest, to make best use of aid to help poorer countries to meet the basic human needs of people within them, and to ensure that big investments in their infrastructure fit the requirements of these countries in the 21st century.

Here are the videos of the discussion in five parts:

1. Introduction by John Bristow

            video   on YouTube                                                                                                    

2. Use of Technology and Networking for Monitoring, Learning and Co-ordination

            video    on YouTube

3. Mixed Forms of Leadership and Organising

            video    on YouTube

4. Direction, Structure and Self-Organising

             video    on YouTube

5. Understanding and Enabling Change in Societies

              video   on YouTube





International Development, Patterns in Societal Change, Use of Internet

Innovation in International Development: Akvo’s Contribution

By John BristowComments Off on Innovation in International Development: Akvo’s Contribution

Akvo helps people and organisations to use information and communications technology to collect and share information more easily, and co-operate more effectively, to improve and speed up aid for international development worldwide. Their purpose as an organisation is directly relevant to the themes of this website: using the internet for creating the infrastructure and relationships for faster problem solving, learning and innovation in addressing the problems of this century – in this case helping the poorer countries to lift themselves out of poverty. Scroll down to links to a video recording of a discussion with their London-based communications director.

Akvo builds open source internet and mobile software which is designed to support international development partnership networks and make co-operation and aid activity more effective and transparent. The technology enables greater connectivity between people and organisations from different sectors involved in aid activity across the world, and creates the infrastructure to free people up to discover and learn more efficient and effective ways of organising. Using the same tools Akvo itself is developing new forms of organising for its work as a small multinational organization that supports and partners with a large number of organisations involved in international development around the world.

They provide their software as a service, backed by a global partner-support and training team. Akvo’s tools are used by over 1,800 organisations around the world from small local NGOs to national governments and multilateral aid organisations.  Visit their website

Akvo RSR stands for Really Simple Reporting. It’s a web- and Android-based system that makes it easy for development aid teams to bring complex networks of projects online with paperless reporting directly from the field.

Akvo FLOW is a mobile phone and online service that transforms field monitoring using Android smartphones. Organisations use Akvo FLOW to evaluate their development aid activities and make informed decisions based on accurate, current data.

Akvo Openaid helps governments and big international organisations present aid-spend data online in easy to navigate ways so they can meet transparency obligations.

Akvopedia is a portal for online knowledge on smart, low-cost, sustainable water and sanitation technology and approaches.

Akvo is a non-profit foundation headquartered in the Netherlands with staff in 13 countries across five continents. Akvo’s tools are open source and used by around 2,000 organisations throughout the world in areas such as water, sanitation, health, education, food security and economic development.

Mark Charmer

Mark Charmer

Jo Pratt

Jo Pratt

Here below are the links to 6 video clips  of a half hour conversation with

Mark Charmer a co-founder and  communications director in Akvo, and  Jo  Pratt, a  communications manager.

They are based in London, England.

The Video is in six parts. Click on Video  under each heading to view on YouTube.

How Akvo supports improvement & innovation in aid activity for International Development

 1. Introduction

      video  on YouTube

 2. Innovating as an organisation using the internet

      video  on YouTube

 3. How Akvo started

      video on YouTube

 4. Using the internet and mobile communications  to improve monitoring, learning  and co-operation in and between organisations – 1

       video  on YouTube

 5. Using the internet and mobile communications  to improve monitoring, learning and co-operation in and between organisations – 2

       video  on YouTube

 6. Helping organisations discover and learn more efficient and effective ways of working using the internet and mobile communications

       video  on YouTube

Governance & Organising, International Development, Patterns in Societal Change

Understanding more about our Financial System and its Instabilities

By John BristowComments Off on Understanding more about our Financial System and its Instabilities

Towards a Sustainable Financial System: a conference at the LSE in March 2014  

Opening address by Lord Adair Turner, currently a senior fellow, Institute of New Economic Thinking, in the Centre for Financial Studies in Frankfurt, and a member of the Financial Stability Board  working on reform architecture for the global financial system for the G20; and recently Chair of FSA in UK.

This can be seen on video (45 mins) on the LSE website

He raised 3 inter-related questions and discussed them in the address, summarising some of the errors in basic assumptions used to manage the finance system up to the 2008 crisis:

1. Given that 97% of our money is created by the private sector in the form of credit from private commercial banks, how much is needed and for what purpose is this created?

2. How does this affect the stability of the financial and economic systems?

3. What might be the role of regulation by the state and of control by the central bank?

Money is created in three ways:

(1) Fiat money: The state prints the optimal amount of money needed to stimulate nominal demand, creating a small unfunded fiscal deficit. This puts new money into the system and increases net private financial assets. Can a government create a fiscal deficit responsibly, to an optimal extent, in line with GDP? Can we trust politicians not to buy support and create inflation? Currently this is taboo.

(2) Banks in the private sector create money by loans in the form of numbers or  a figure in a deposit account of the borrower. This is then available immediately as money to purchase with, and then repaid later. This difference in time as the loan matures means that money and purchasing power is created in the economy by credit. Private net assets are not increased as for every bit of money there is a bit of debt. So it increases private debt. 97% of money is created this way now, in the market. Deposit money and actual money are confused in people’s mind.

(3) Funded fiscal deficit. This creates new private assets in the financial sector but not new money, as it has to be offset by a public liability to pay off the debt.

In the late 19th century there was a stable supply of money (nominal GDP) as it was based on gold or metallic money. This was accompanied by a slow decline (downward flexibility) in prices (e.g. through technology increasing productivity) and nominal wages, which in turn could create growth.

In a modern economy where money takes a deposit form, how can we know if just enough credit is created for the increase in nominal demand needed? How are we to achieve stability in the money supply and financial system today?

A sufficient growth in nominal demand (which in itself can be debated as it affects sustainability in all its senses, and reflects assumptions about the mix of economic systems we need for today) may be a 5% money increase: 2½% actual growth and 2½% reflecting increase in prices/inflation.

Will the amount of money created by private credit be optimal for the desired growth in GDP and nominal demand, say 5%?

Will a sufficient proportion of credit be allocated and used for productive or socially useful purposes?

Are the consequences of debt contracts taken fully into consideration?

Borrowers use two different ways of raising money or mobilizing capital in the form of a bond or debt (e.g. from a bank), or in an equity or share form (not through banks). Equity is not certain enough to mobilise sufficient capital. Debt is not contingent on the economy as a whole or the profitability of the borrower’s business. Debt contracts are needed.

Up till recently it was believed that private sector credit creation would be controlled by market disciplines.  Borrowers will borrow at a price or rate of interest that accords with their expected return from their investment, the so-called “natural rate of interest”, derived from assumptions about key economic factors such the natural rate of productivity growth and how much people want to spend and save. The pre-crisis theoretical orthodoxy on the monetary and macroeconomic side was: low and stable inflation was not just desirable but also sufficient as an objective, as then the financial system would be in balance because the money rate of interest would be in line with the natural rate of interest, and so the financial system would be creating the right amount of credit. So money creation by credit from private commercial banks had “no meaningful role” in influencing the amount of money in the economy (Mervin King 2012). On the financial theory side there was more concern that there would not be enough credit rather than too much, as debt contracts were seen to be essential and there was a belief that free markets by themselves would maintain an optimal balance.

But the crisis of 2008 showed that we created too much of the wrong kind of debt. Empirical arguments have since been developed that show the system can be too much credit as well as too little  (on a graph the relation of credit to GDP is an inverse or upside down U curve). We can lend money without a reasonable expectation of return, leading to overinvestment cycles. The securitization of subprime mortgages were a result of neglected risk.

In an upswing of the cycle, risks can be downplayed and banks can lend without due attention to risk leading to an over-creation of credit and debt contracts.

Debt contracts are not contingent on the state of a business or potential of an asset: so it is more possible to lend without a reasonable expectation of return.

In the downswing of the cycle, there can be bankruptcy and default, as debt contracts do not respond to the state of economy in a smooth fashion.

While past equity investment carries on, if something wrong with the lending machine, the debt cannot be rolled over and there is a problem.

With debt overhang as people realize they are at risk or lose confidence, businesses become aware they are highly leveraged they de-leverage and reduce their investment. Households reduce consumption and spending.  Debt overhang leads to a slow recovery.

There are two problems with debt and so two forward indicators of such a crisis: (1) the pace of the growth of debt is high, and once there is a crisis (2) the higher the level of private debt relative to GDP (the right end of the inverse U curve) the bigger the problem.

The facts show that the system created too much debt before the crisis. Twenty years before the 2008 crisis pace of private credit growth was on average 10% – 15% per year higher than nominal GDP, growing at 5% (credit/GDP). In western developed economies the level of  private domestic credit as % of GDP rose from 50% in 1950s to 180% of GDP.

In the pre-crisis way of thinking, there was a policy conundrum: if central banks raised the interest rate when rate of increase in credit was higher than the rate of increase in GDP, there would be a risk that growth would be slowed and inflation drop below the desired target. But if they did not then they feared there would be instability. So there seemed no way of creating conditions for an  equilibrium in a monetary economy needed for economic stability and the desired rate of growth. The monetary system in its current form seemed to be inherently unstable.

To address this there is a need to attend to different categories of credit.

The original assumption about retail banking was that savings by the household sector would be lent to the business sector to finance investment. But the reality is that this has been only 15% of the credit. Instead credit has been used to finance the purchase of existing assets.

Financing consumption can be useful for smoothing across the life cycle when there is budgetary constraint. But lending money against existing assets (such as mortgages for purchasing real estate in the form of an existing building) has been a major cause of financial instability. It drives up the price of the asset – real estate – which validates in the minds of those lending and borrowing that there will be an increase in its net worth and so motivates them to continue to borrow and lend. This can feed through to new investment or to consumption through wealth, but this is not fully proportional to an increase in nominal demand. Every 15 yrs one banking system lends money for real estate without prudence.

In commercial or private real estate, changes in the money lending interest rate for the whole economy do not on their own have a sufficient effect on the credit to asset price boom while credit is easily available the asset prices (e.g. price of real estate) increase. Natural rate of interest is the interest rate in the mind of borrower, how far they expect an asset to increase in value or price, determines how much they borrow. But there is no one single natural rate for the whole of the economy.

The result is that there is more monetary wealth but no increase in nominal demand, which is the indicator that the central bank uses to raise interest rates. So it does not show up immediately. There is a problem then of debt overhang.

Three causes of rising intensity of credit in relation to growth:

1. Lending money against existing assets, especially real estate, creating a rise in real estate prices and an asset boom.

2. Pace of increase in inequality increases and there is more credit for consumption. Richer people have a larger propensity or desire to save but this money is not used for investment as it is lent to poorer people in the form of subprime mortgages to make up for deficiencies in income.

3. Global current account imbalances between surplus and deficit nations.

Countries where surpluses are not matched by equity or real property claims against the rest of the world, then they will be balanced by credit claims against the rest of the world.

We shift leverage between private and public sectors, or between countries, as this is the only way we know to address the excess leverage.

As too much private credit is created and it is not misallocated and not used effectively, Lord Turner suggests we need to go beyond bank regulation and look at the structure of the system and behaviour within it to get stability and equilibrium and address imbalances. Monetary and fiscal policies are needed to prevent too much debt and credit intensity that leads to unstable growth, and control is needed by the central bank.

Current account imbalances between surplus and deficit nations as it drives credit intensity and unstable growth

The central banks need to attend to and manage the level of debt as well as the rate of increase in it. The inverse U can be anticipated.  The limit could be 80% or 90%; it is not possible to be precise. But it is possible to see the shape of an inverse U curve.

The allocation of credit arising as a result of free market decisions can never be socially optimal. There is an externality of lending against real estate that goes up in price; this can never be captured by logical private assessment of risk rates. So higher risk ratings for real estate credit are needed.

There need to be constraints on lending both for the borrower as well as the lender.

There need to be more institutions that dedicate themselves to using savings for investment (as in Germany).





Economics, Money System
Blue Taste Theme created by Jabox