New Wine needs New Wineskins
Relational Thinking and Economic Policy in Europe
ECPM Conference, Munich, May 2015
Dr Michael Schluter
© Relational Research 2015
Christianity is a relational religion
• Creation• Rupture in Eden• Covenant• Incarnation• The Cross• Eternal life
The Book
© Relational Research 2015
Christianity is a relational religion
The Person
• Faith/Trust the key issue• Love & discipleship• Prayer• ‘Poverty’• The Cross
© Relational Research 2015
Christianity is a relational religion
Church Relationships:• With God• With one another• With their leadership• With the State• With other church
communities
The Church
© Relational Research 2015
What is a paradigm shift?
•Financial lens•Environmental lens•Individual lens•Relational lens
© Relational Research 2015
What is Relational Thinking?New categories and new language
Note link to:• Directness• Continuity• Multiplexity• Parity• Commonality© Relational Research 2015
Why the EU Economy is Unrelational
Unstable
Unsustainable
Unethical
© Relational Research 2015
Why is the EU Economy Unstable?
•Financial derivatives•Banks’ balance sheets•Equities trading mechanisms
© Relational Research 2015
•Fertility rates•Family fracturing•Dependence on debt
Why is the EU Economy Unsustainable?
© Relational Research 2015
Unsustainable fertility rates
Lithuania Romania Italy Germany Switzerland Self-sustaining population
0.6
0.8
1
1.2
1.4
1.6
1.8
2
2.2
© Relational Research 2015
Unsustainable family fracturing
© Relational Research 2015
Debt as Percentage of Tax RevenueDebt as percentage of GDP
France
Germany
UK
Spain
Italy
Greece
0% 80% 160% 240% 320% 400% 480% 560%
205%
207%
249%
268%
317%
497%
Source: IMF, Eurostat
Unsustainabledependence on debt
Unfair to young people and to creditors?
Why is the EU Economy Unethical?
•Growing wealth and income differentials•Reward without responsibility•Levels of youth unemployment• Intergenerational inequity
© Relational Research 2015
1 500
Growing wealth and income differentials
© Relational Research 2015
Reward without responsibility
Investment without involvement© Relational Research 2015
Levels of Youth Unemployment
UK France Portugal Italy Spain Greece0%
10%
20%
30%
40%
50%
60%
70%
18%23%
35%
43%
54%58%
Source: Eurostat
Inequities partly caused by single currency
Debt as Percentage of Tax RevenueDebt as percentage of GDP
France
Germany
UK
Spain
Italy
Greece
0% 80% 160% 240% 320% 400% 480% 560%
205%
207%
249%
268%
317%
497%
Source: IMF, Eurostat
Intergenerational inequity
Unfair to young people and to creditors?
Why the EU Economy is Unrelational
Unstable
Unsustainable
Unethical
© Relational Research 2015
A Relational Economic Plan for Europe
1. Embed relational values
2. Equity to replace debt and derivatives
3. Engage capital providers and other stakeholders
4. Empower extended families
5. Entrust welfare to local communities
© Relational Research 2015
Relational Economic Strategies 1
Embed relational values through:
A. A weekly shared day off
B. Relational schools
C. Family and community self-reliance
© Relational Research 2015
Relational Economic Strategies 2
Equity to replace debt and derivatives
A. Replace debt with equity
B. Penalise derivatives
C. Intergenerational accounting
© Relational Research 2015
Relational Economic Strategies 3
Engage investors and other stakeholders
A. Measure stakeholder relationships (IIRC)
B. Limited liability conditional
C. Regional finance institutions
© Relational Research 2015
Relational Economic Strategies 4
Empower Families
A. Colocation of relatives
B. Families to become ‘mutuals’
C. Strengthen Family balance sheets
© Relational Research 2015
Relational Economic Strategies 5
Entrust growth and welfare to local communities
A. Capped welfare budgets
B. Investment and innovation
C. Reduce dependence on the State
© Relational Research 2015
A New Growth Dynamic for Europe
Resulting from:
•Stronger Family relationships•Stronger stakeholder relationships•Stronger community relationships•Stronger regional relationships
© Relational Research 2015
A New Vision for Europe
• Relational vs individual rights• Money as a source of social glue• Capital as a servant, not the master• Progress measured by RWB (not GDP)
© Relational Research 2015
Please visit our websites…
•Relationalthinking.net*•Relationalschools.org•Relationshipsfoundation.org•Jubilee-centre.org
…*and come to our conference