ENVIRONMENT Secretary Gina Lopez believes that “we must build an economy based on love” and this belief is central to much of her vision of genuine development. This vision in turn informs her policy and position towards certain economic sectors like mining, forestry and energy. Certainly, one can understand how today’s “economists” could cringe upon hearing statements like this as our modern economies are largely based on money and politics where, as Bob Dylan, Nobel Laureate for Literature, sang, “love don’t have any place”.

Very true, considering that in an economy exchanges of goods and services between people are facilitated by money, meaning to say two people who do not know each other (and therefore cannot love each other) are able to exchange goods and services because there is money to facilitate the exchange even without love. Likely, the less love, the more money and more money velocity as the transaction is viewed purely on its own, on its utility to both parties and certainly, unless the parties knew and cared for each other, “love wouldn’t have any place” in the transaction.

So, how then can love become the foundation of the economy? I would say that in a fundamental way, it already is. First, all production and consumption starts from human need. And the smallest unit from which production and consumption starts in a society are the households. And logically, what starts most households are marriages that started from love. The children are normally loved and nurtured, to the point of parental sacrifice, for their own sake and not for money.

Now most households are founded not as a means of accumulating money and property (except for arranged marriages arranged for that very purpose and we know that many of these don’t last very long) but as the fulfillment of a deep love between two individuals who can procreate and form a living, growing household (although households now can be same-sex with adopted children, etc.). Therefore, in the most basic socio-economic unit, love plays the most important role.

Where the formal economy as we know it originates from is the concept of sectoral enterprises that take “land, capital and labor” and organize them for productive purposes so that households and other enterprises (and government) can consume for the totality of their needs for themselves and their household members. These units of organization, the sectoral enterprises, unlike the households, focus entirely on getting the largest sustainable return for the risk capital deployed. And for that to happen you can imagine that love would get in the way of that goal. Even corporate social responsibility projects (CSR) have little to do with love but rather have to do with corporate brand imaging development.

If one looks at the deepest impulses of sectoral enterprises versus households, one quickly realizes that the former depends on extraction, or taking, while the latter, the household impulses, are based on nurturance. And since households are rooted in specific areas or places, and have the impulse of nurturing, the village of households relying on the healthy functioning of ecosystems, in turn, take to nurturing and long-term economic management of their local environment. Natural villages of communities have been proven to be the best managers of their surrounding environment as compared to enterprises or government. This was proven by Elinor Ostrom, the 2009 Nobel Laureate for Economics.

“Elinor Ostrom, a political scientist at Indiana University, received the Nobel Prize for her research proving the importance of the commons around the world. Her work investigating how communities co-operate to share resources drives to the heart of debates today about resource use, the public sphere and the future of the planet. She is the first woman to be awarded the Nobel in Economics.” (http://www.onthecommons.org/magazine/elinor-ostroms-8-principles-managing-commmons)

Ostrom’s achievement effectively answers popular theories about the “tragedy of the commons,” which has been interpreted to mean that private property is the only means of protecting finite resources from ruin or depletion. She has documented in many places around the world how communities devise ways to govern the commons to assure its survival for their needs and future generations.

A classic example of this was her field research in a Swiss village where farmers tend private plots for crops but share a communal meadow to graze their cows. While this would appear a perfect model to prove the tragedy-of-the-commons theory, Ostrom discovered that in reality there were no problems with overgrazing. That is because of a common agreement among villagers that one is allowed to graze more cows on the meadow than they can care for over the winter—a rule that dates back to 1517. Ostrom has documented similar effective examples of “governing the commons” in her research in Kenya, Guatemala, Nepal, Turkey, and Los Angeles.

Based on her extensive work, Ostrom offers eight principles for how commons can be governed sustainably and equitably in a community.

The eight principles are anchored on principles of concern and nurturance, or love, which in turn results in long-term optimized use of natural resources that then becomes the foundation of the local economy.

The English word “economics” is from the Greek word “oikonomos” which meant the “management of the household”. And the Chinese knew that if the household was secure, progressive, healthy and productive, then the village would be just fine, and if the villages were doing well, then the town would do well, and if the towns were all doing well then the province and regions and the whole country would be doing fabulous. The global order would be peaceful and progressive when countries are peaceful and progressive with one not trying to over-extract from another to the point of hurting the other.

What can we make of the unraveling of the global economic order created after World War II and has resulted in unbearable inequality and negation of whole peoples that we are now gripped by the hate of terrorism and failed politics? Indeed, to me it means we need to put love back as the foundation of the economy and future columns will look at how that might happen.000