Why do we need a new economics?

We need a new economics to replace this diagram:

diag1

The two axis graph is used as the basis of explanation when beginning to teach current approaches to economics.

The implication of this diagram is clear: unlimited possibilities exist in the northeast direction to which the arrow points. The further you move in that direction the better it is implied your life will be.

Long ago I realised that this is not true. The life of unlimited consumption which this diagram suggests possible is not attainable.

The earth is constrained. We can only consume its resources without limit now if we ignore the consequences for the future.

We are constrained. Our lives are finite. We want to so much more than the consumption which, inevitably and without comment,  these graphs  suggest desirable.

When I was 19 I realised that a graph like this could never explain the complexity of the world in which I lived. By the time I was 21 I had learned enough economics to know that others shared the opinion. Despite that thirty years later the basic philosophy that more is better that is implicit in that arrow heading off to the North East in this graph remains the absolute bedrock and foundation of our economic thinking.

This graph has a lot to answer for. I have concluded that it is beyond redemption. We cannot build a new economics unless we can build an explanation of the world that can be visually explained in another way.

What follows is my attempt to build that alternative explanation.

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