Towards decentralized systems for a sustainable and prosperous world

With an example of the current nitrogen problem in the Netherlands

Working methods of centralized systems in neoliberal society create an increasingly unsustainable world. Governments, banks and multinationals set a bad example with too much political, economic and competitive power and create inequalities in society, where greed, absorption, egoism and bureaucracy can be rampant.

 

Progress is achieved through working with decentralized systems based on blockchain technology. The 2local community has developed an alternative worldwide economic system that supports local and sustainable transactions between consumers and connected companies.

 

Cryptocurrencies and a cashback system in the 2local economic system ensure affordability of local and sustainable products and greater equality in society, the resolution and prevention of excesses through cooperation and the search for harmony.

 

 

 

We in the West live in a financial system based on incurring debt. We have to grow at least 2% economically every year because otherwise the debts cannot be paid off. Inflation "should" also be 2% to ensure that prices do not fall in any case, because that would weaken the economy. It is a system that is completely intertwined with the adage of more growth. This financial system is harnessed in the liberal economy and is further elaborated in the neoliberal economy. In the neoliberal economy, governments, international banks and multinationals are too closely intertwined. In my Blog: 'Get started yourself!' this Combination of governments, Multinationals and Banks that operate Internationally is called the COMBI-Complex! The seeds of this have been sown in small inward-looking groups. The neoliberal system is built on a debt economy. Money is borrowed to build capital. The owners and the rich earn the most in the economy. However, they do not recirculate the money in the economy, but increase their wealth. Large companies borrow money, during the last years extremely cheaply, and use it to buy up their own shares. As a result, the rich are getting richer and the poor getting poorer, as Piketty already showed in his 2017 book: 'Capital in the Twent-First Century'. This creates an increasing scarcity. People without wealth are therefore forced to borrow more and more. Employees can earn only little money, because most of the money goes to the owners, the wealthy. The employees are forced to borrow more and more, which is made easy for them by the banks, and actually by the whole COMBI complex. If they don't borrow much, they can no longer buy a car or a house at all. There is simply too little money available for the common man, because that goes to the big companies and the rich

 

The governments in Western society facilitate this centralized system. Only the rich and those who think they can get rich through this system benefit from this system. These rich, multinational corporations, the shareholders, the people who, through generations, have accumulated capital that grows and grows every year, are represented in places between the original producers (of mainly raw materials) and consumers.

The multinationals operate worldwide and can buy raw materials and labor hours there where prices are lowest and process the cheaply bought raw materials where the wages are lowest, and sell the products where the purchasing power is greatest and thus exercise their economic power all over the world. They have monopolistic and oligopolistic power to keep the purchase prices low and the sales prices high. Other intermediaries, such as traders, banks, insurers and upgrading companies, who supposedly add value through all kinds of tampering with raw materials, also play a role here. Their products are not 'real' values, but so-called fancy or fake values ​​that can only be sold with ingenious marketing techniques and tricks. In that system, multinationals and banks work together to keep the debt system intact, from which they also benefit most.

 

The shiners in this area are the banks, which, with their centralized monetary systems have tremendous power and use it wherever the system needs it. For example, the core job of the central banks is to keep inflation low, at 2% per year, but their policy is not aimed at that. After all, then in times of rising inflation the banks should not increase the amount of money in the economy so much, as they have been doing for years, and raise interest rates, as they have not been doing for years, while there have been many indications that inflation will rise. The central banks should anticipate this, but that is not happening because the system benefits from the growing economy and thus money creation has the upper hand. See also my Blog: ‘Cryptocurrencies are the future. Today, Dutch ING-bank economist Carsten Breski says in Nu.nl that high inflation is good for governments, because they receive more income, and can thus more easily pay off the high debts, especially with the southern euro countries. That could even prevent a new euro crisis. As an economist, this is new for me. It has nothing to do with the economy. It is purely political. This illustrates once again the close interconnectedness of the COMBI-Complex.

 

I list four major developments of the centralized economic and financial system with disastrous consequences for most people in society. First of all internal and competitive forces predominate. There is too little attention to humanity and too much is pretended that ego-orientations are 'natural' processes. This encourages greed in society. Second, the core of the Combi-Complex consists of (too) close-knit groups that work closely together and where too little account is taken of the differences in society. This leads to inward-looking groups in society, where there is no contact with the outside world. I call this absorption. Third, small businesses are being destroyed by the economic dominance of the big ones. They cannot compete against large multinationals. They can only earn money by being employed by the big companies, which strengthens the system itself and further widens the gap between the rich and the poor. The connection between people in society is lost. Many people are finding it increasingly difficult financially. It is therefore not surprising that in order to survive, they have to stand up for themselves. Self-existence comes first and social values ​​are overlooked. Instead of acting against the big companies, where the cause of the problems must be sought, it is obvious to blame others. As a result, we see a hardening in society, for example through hoarding, as soon as there is a threat of scarcity. Selfishness in society is then lurking. This fuels the idea of ​​'me first' and reinforces the thought that people can create the world themselves according to their own decisions and leads to egoism in society. Fourth, in order to prevent the worst excesses of the (neo)liberal economy, the government has started to impose more rules, such as the unfortunate concept of the 'participation society. Market forces in healthcare were also introduced, which would lead to more individual freedom and responsibility. However, it led to too many rules and too few well-considered working methods, which induced an enormous increase in bureaucracy.

 

We have to switch to a decentralized system in which the intermediaries, between the 'normal' producers and the consumers, disappear from the system. That can start with introducing a decentralized financial system (Defi). And that is currently possible with the introduction of blockchain technology. Cryptocurrencies can take over the financial task. Furthermore, these decentralized systems and the cryptocurrency eliminates the middlemen in the real economy as well. Direct contacts between producers and consumers are then possible, so that no fancy products and services are produced and no profit margins stick in the long global chains.

 

As an example I mention the food sector. Ever since the Second World War, the government, the big business community, machine factories, fertilizer factories, chemical pesticide manufacturers, gigantic internationally operating food companies, together with the banks and governments, have been working on an 'industrial' agriculture that does more harm than good. Primary producers (farmers) and consumers do not benefit from it. Farmers are being pressured to produce at low prices with the most capital-intensive machinery, chemical fertilizers and pesticides, and supported by huge subsidies and research funds, local, national and European. The banks make this possible by providing huge loans to the farmers, leaving them deeply in debt and unable to go anywhere. As an example, in the 2014-2020 period, Quote 500 families mainly benefited from a sustainability subsidy of 60 million euros (NRC, June 18-19, 2022). Consumers do not benefit either, because in supermarkets for the products of the food industry you have to pay a lot, while the quality, measured in nutritional value and effective health, leaves something to be desired. The products contain residues of chemical fertilizers, pesticides and unnecessary additives, with disastrous health effects. I will only mention here the link between chemical plant protection products and Parkinson's disease, which has been demonstrated by Prof. Bas Bloem (Radboudumc), but the pesticide is nevertheless not banned by the government. Effective marketing techniques and tricks seduce consumers to buy these so-called upgraded products in particular. The few farmers and consumers who do not participate in this 'race to the bottom' are having a very difficult time. They, especially the organic farmers, receive much less subsidy, less research money and less support from the government and the banks. As an example, biodynamic farmer Jaring Brumia, who produces milk from old Frisian red-and-white cows with only grass as feed, and who therefore simply give less milk, was told by the bank that his figures were not good enough (VPRO Backlight, 3 December 2021)! Organic consumers pay a high price. Due to this industrial development, hardly any attention has been paid to its negative effects, namely, soil impoverishment, reduction of biodiversity, increased energy consumption, especially by the fertilizer industry, loss of liveable countryside, damaging nature.

 

In my book: Local Food for Global Future' (available for free at Researchgate or buy as Paperback) I already outlined these developments in detail in 2015. In the current industrial food system there is too much distance between the farmer and the consumer. There is a loss of awareness of what good food quality is. Cheap bulk products that are poor in food quality are 'enriched' by the food industry. We are dealing with hunger on the one hand and obesity on the other. The current food system is too monotonous: use of chemical fertilizers and pesticides and loss of biodiversity. The current food system is mega-global. There is monopolistic and oligopolistic competition: worldwide by multinationals and nationally by retail companies. There is talk of mega-corporations and industrial production. Food products are treated as 'commodities'. There are no fair prices for the farmer. These drawbacks require a new food system with the highest urgency. In the new food system based on the ‘sustainable food security’ paradigm, proximity is the central concept: restoring the social connection between farmer and consumer, access to and control of sufficient food. Economically, it's about fair prices, local production, micro-machines and small-scale processing of food with its own intrinsic value that is not seen as 'commodity’. Ecologically, there is an increase in biodiversity and access to the landscape. Sovereignty guarantees the right to food and the right to food production. The local production guarantees access to food for everyone in the region. Safety and nutritional value is increasing, as is awareness of the impact of food on health and well-being. There is access to wholesome food and food democracy.

 

The industrial food system had to get into trouble at some point. We are now seeing that happen with, among other things, the nitrogen measures and binding rules for nature restoration: the so-called ‘nitrogen crisis’ is currently a hot item in the Netherlands. Finally, the Commision of the European Union sounds the alarm that it cannot continue like this. But only taking action on nitrogen emissions will not solve the problem. And certainly not by buying out farmers. See here  how it is! In the Netherlands we have far too little agricultural land to feed the national population. It is therefore not wise to sacrifice agricultural land for nature or for any other purpose. We desperately need every square meter of agricultural land, namely for the production of healthy food for all Dutch people. And then we still have too little agricultural land and we will have to import certain products. The shortage of agricultural land in the Netherlands could cause the next crisis when it comes to food security and self-sufficiency in uncertain times. The fact that we as the Netherlands are nevertheless able to export so many agricultural products is due to the decayed agricultural-industrial complex, which processes a great deal of imported raw materials (mainly animal feed from poor countries and chemical fertilizers) into bulk products that are exported en masse, without taking into account the negative side effects that occur here in the Netherlands, such as surplus of manure, pollution and attack on nature reserves. And that is exactly what is breaking us now. That is why buying out farmers makes no sense. Focusing on technological solutions will continue on the path that has led to the current crisis and is also a dead end.

 

That is why we must stop exporting agricultural products, and therefore also the associated imports. After all, this is about food, which provides for the basic necessities of life. Ethically different standards apply for food than for products such as furniture or textiles, for example. The paradigm switch to ‘sustainable food security’ has the effect that we can focus on sustainable production methods that do not damage the environment, nature and landscape, but, on the contrary, contribute to the value of the environment, nature and landscape. The organic sector in the Netherlands, operating under difficult conditions, can serve as an example in this regard. No use of chemicals and positive contributions to the quality of food and life will lead to more small-scale farming and more processing of agricultural products on farms. It means that more farmers, and more economic activity in the countryside, will be needed to realize this new system.

 

More than 25 billion euros have been earmarked in the Netherlands by the Cabinet to reduce nitrogen deposition. That is an amount of 500,000 euros per intensive farmer. That amount could also be spent on the conversion of Dutch agriculture to 100% organic. The current organic farmers, who have already paid for this conversion themselves, have shown that it is possible.

 

This overview of agriculture is just an example. The new decentralized system can help to achieve these goals and may also bear fruit in other sectors.

 

In the new 2local economic system, which may be partly due to blockchain technology, decentralized systems can avoid the major problems mentioned above. Emphasis on collaboration in our relationship with others realizes sustainability and prosperity for everyone. The crypto coins can easily be used here to make payments between producers and consumers directly and quickly. Due to the disappearance of many intermediaries, both consumers and producers will benefit. A focus on innovation helps the affordability of sustainable products through a cashback system and ensures greater equality in the world. The people with less financial scope benefit the most from this. By making connections between people we realize local cooperation. Through decision-making via decentralized blockchain technology more attention is being paid to norms and values ​​as a reflection on one's own actions in society. By realizing the 2local economic system, the pressure in society that leads to the above-mentioned excesses, such as greed, absorption, egoism and bureaucracy, will disappear and make way for harmonious developments between the various forces in society.

 

Harry Donkers

 

June 2022