Saturday, April 07, 2012

Part 2: Social Impacts of the Circular Economy

In a previous post, I talked about my recent obsession the The Circular Economy.  I'm taking a look at the social implications of a fully or even partially implemented circular economy.  What could we expect for changes in the social sphere?

Changing - easily?
The first benefit would be...nothing.  What I mean is that, in a circular economy, while there will certainly be shifts in behavior and activity, there is no large-scale "call for change" that causes the everyday consumer to recoil, feel judged, and climb into their business as usual shell.  Someone buying a printer, an area rug, or a chair could buy that item without much of a thought to what to do with it at the end of life because there would be a system developed around end-of-life reuse that would make it simple and straightforward to do.  In fact, they would have to go out of their way to NOT have the item reused.  In other words, the social benefit we reap is lower resistance to the concept and faster adoption. (Yes, this is idealized - there would certainly transitional challenges - and it's good to think of what could be.)

Lower Unemployment
While this certainly has economic implications, reducing unemployment has far-reaching social impacts as well.  In a circular economy, regionally distributed remanufacturing and refurbishment hubs shift the overall costs associated with continued use from material to labor - specialized labor (essentially a renewable resource) at that.  These jobs are kept locally and regionally, reducing the social challenges that accompany unemployment like depression, separated families, atrophying work skills, ill-health, and feelings of isolation.  These all come with associated social costs as government an non-profits provide the services the unemployed need.   

Lessening the Affects of Income Inequality
I suppose one could argue whether this is a "good" or a "bad".  With a reuse and refurbish economy with a minimum amount of virgin materials used, consuming (in perhaps a new sense of the word - "using up") an item is a "good thing".  The item enters the reuse stream as something requiring disassembly, assessment, and remanufacturing to be sold again to another user.  So, the current linear system's relationahip between higher income, higher consumption and therefore higher resource use is flipped - no longer are the profligate spenders subjected to the judgment of their peers for being wasteful polluters.  Could this have an impact on the current debate over income inequality?  Maybe.  I won't pretend that this is a utopian solution to creating universal harmony between the classes.  I can imagine the creation of multiple, isolated circular economies where those with the most have the highest quality circular remanufacturing streams, those in the middle have the middle (if it exists) and those at the bottom have the least.  In fact, what we might call the  "circular economy" is already in practice in developing areas or where incomes are low and this it's done by necessity. 

Building Social Capital Where we Live  
When the housing bubble burst, contributing to the financial crisis and the economic downturn in 2008, our culture of mobility came to a screeching halt.  The ease with which we jumped from house to house "trading up" and an unemployment rate on the rise, pulling up stakes and moving for a new opportunity was not simple.  Despite the hand-wringing that comes when some sort of an "unsustainable" bubble burst, perhaps this is a good thing - we might start paying attention to where we are now, making improvements instead of seeing greener grass through every open gate.  It's possible that in a circular economy, with distributed local and regional remanufacturing and reuse centers we'll be reconnected with both the organizations and people with which we share space with.  The term "throwing away" could mean "throwing to the next town".  It's not a forgone conclusion, but the opportunities to recreate civic bonds that have been lost according to some (see Robert Putnam's Bowling Alone) will be more plentiful.

Connecting Communities of all Sorts 
One can imagine formal and informal value cycles emerging and self-organizing in business and personal communities, it's already happening through craigslist, freecycle, ebay, etsy, etc.   In the B2B space, it will be formalized and institutionalized, with large scale companies sealing procurement/value cycling agreements that span years and revolve around delivering the services/value needed, not the items themselves (think cloud computing).  What social impacts will this form of supply chain collaboration create?  At the individual/consumer level, people seek out their neighbors and/or regional organizations that can use their stuff and connect with like-minded individuals that may share other aspects to build community resilience and inter-dependency.

What's missing?