Collective Financial Wellbeing

The participatory economic system is thought to lead the global economy on the way to recovery. Society, in general, is expected to thrive in the context of the main principles that cover the loopholes of capitalism. Participatory economics can influence financial wellbeing by changing how we earn money and spend it. With the current economy, individuals generally work for a wage within hierarchical or market-based relations. Participatory economics has an alternative approach called "balanced job complexes," which is a more democratic way of managing a workplace by equally distributing the responsibilities and outcomes and empowering employees to make decisions on their own.

From a financial perspective, we are on shaky grounds, risking experiencing another crisis, mainly because of the issues below:

  • Four out of five young people lack a basic understanding of personal financing and budgeting;
  • Student debt reached one of the highest peaks in history last year, amounting to almost two trillion dollars;
  • 50% of US adults are financially unstable. Workers and unemployed individuals alike report being anxious about their financial situation. Among younger people (aged between 18 and 34), the stress is even greater, given their student loans and higher job instability;
  • 2/3 of American households are at constant financial risk, without an emergency fund;
  • A staggering 78% of adults struggle to make ends meet, living paycheck to paycheck. Without a financial safety net, Americans are more susceptible to get into a spiral of debt when emergencies happen;
  • More than 60% of the US adult population recorded having credit card debt for the past year. The high interest rates affected their already feeble financial security;
  • Four out of five citizens cannot afford to own a house because of their poor credit, debt, and increased population in metropolitan areas.

By adopting the principles of participatory economy, we should reap several benefits, including:

  • decreasing the resources spent on work by establishing an improved social structure;
  • increasing the citizens' financial wellbeing through collective goods and decentralizing work planning and dividing decision-making among individuals;
  • improve personal finances by applying collective consumption rules and entrust facilitation groups to fairly price goods and services;
  • aligning consumption with income, thus reducing waste and eradicating poverty;
  • benefit individuals by making corporations align their activity to serve the social good.

Participative economy favors expanded ownership rights for all people, which means that it would be illegal for someone to own or control more than what they need. This helps redistribute wealth so that everyone will have enough material resources to live comfortably. When all economic decision-making depends on every individual in the society rather than just a few people at the top, then all individuals can participate in improving conditions within their workplace or neighborhood. There will still be some inequalities due to inherited talents (which may result in one person becoming an expert chess player) but not because someone was born into a wealthy family. Financial wellbeing is expected to positively impact each member of our society without bias and in favor of the common good.

Contents