It’s the Economy, Stupid, but which Economy?

Responding to an uncertain future by re-emphasising a Social Economy

I remember the phrase reflected in this this title well. In 1992, the phrase originally coined by Bill Clinton’s campaign strategist, James Cargill, “It’s the Economy, stupid”, became the byword of Bill Clinton’s successful presidential campaign. The year before, President George H. W. Bush (Bush Senior) had almost 90% positive ratings immediately following the ground war in Kuwait. A year later, with the US economy faltering, his popularity nose-dived, and Clinton was in, promising a new economic future alongside the need for change rather than ‘more of the same’.

The economy will always be a critical element of national success. As President Trump prepares to re-enter the Oval Office on Monday, a radical approach to the economy will again be centre stage. The economy has no favourites; even those who design and deliver national economies harbour and protect their proponents. Global leaders will be decorated or derided by economic success or failure, respectively. The next four years will be interesting,particularly as the International Monetary Fund (IMF) has raised concerns this weekend over ‘Trumponics’ (my term, not theirs) whilst upgrading our UK economy with an unexpected inflation reduction.

The question I want to pose, whilst tentatively supporting the notion of “It’s the Economy, stupid,” is one with an equally important warning: which economy?

As we enter the final year of the first quarter of our second millennium, it is time to face the challenges of uncertainty that we face across the globe. My instinct is that 2025 is going to be an unprecedented milestone in global leadership. Second only to the awful happenings in Ukraine and the Middle East, national economic protectionism and sovereignty will lead to or divert an uncertain international future.

From a traditional economy to an adaptive and inclusive market landscape

When it comes to 2025, the question we need to ask is: which economy should be leading the way? In my following newsletters, we’ll look at 10 main differences between the classic economy – one centred around national protectionism, sovereignty and market-led growth – and the new social economy – where resilience is in the community, resources are shared, and where well-being is at the core. Yet both economies are — by all accounts — striving for stability, growth and resilience in the face of uncertainty.

I have published an article today on my Selfless Leader portal which outlines my main arguments for the transformation to a social economy. Click the link below:

This includes an outline of the 10 differences as well as exploring how the practice of leadership could change to reflect the move towards socially focused economic factors. However, my newsletter to follow will summarise my key points in a structured series of commentaries. As I mentioned in my last post of 2024, the benefits of focusing on a wider social economy will represent my main theme in 2025. This first newsletter starts that journey.

By exploring these contrasts and intersections, I would like to illustrate how a social economy can support or redefine the old order to address the world’s problems more fairly and sustainably. As always, there is a balance to be struck. It is an economy that can help the vulnerable or the oligarchs. What we need are vanguards, those leaders or pioneers at the forefront of foundational movements who are often associated with innovation or progress for the collective good. This is the social economy.

What is the social economy?

The term social economy differs from traditional descriptions of the economy primarily in its emphasis on social objectives, community welfare, and collaborative principles over profit maximisation and purely market-driven approaches.

From leadership shifts to reinventing trust and success, we need new models for inclusion, sustainability and shared prosperity.?In this newsletter, I offer three important insights into how a social economy might open up the road to a fairer and more secure future.?In the coming weeks, I will continue to dig into these themes, providing new perspectives on the economic and leadership changes needed to keep up with a changing world.

My next newsletter will set out what I see as the 10 differences between a traditional economy and a social economy and how practice currently differs.

My third newsletter will look at "Reimagining Leadership for a Social Economy." I will explore how leadership needs to change to embrace collaboration, inclusion and sustainability.

?Getting beyond the top-down, bottom-up structures of the conventional economy, we’ll explore how flexible and participatory leadership fosters trust, empowers communities and drives change.?Leadership in the social economy involves making collective action possible while managing a social good that is at once sustainable and financially profitable.

Then in "Trust as the Basis of Economic Systems," we examine the foundational nature of trust as it pertains to three levels of leadership: Iinstitutions, organizations, and our individual connections.?Though conventional economies were founded on transactional, rule-driven trust, a social economy requires relational trust based on mutual respect, mutual insight and openness.?Relational trust allows us to bind communities together, foster cooperation and produce economies that are both efficient and deeply humane.

Finally, my fifth newsletter in the series looks at impact. "Beyond GDP: Measuring Success in a Social Economy" calls into question the aging role of GDP as the index of growth.?Instead, I look at the "triple bottom line" methodology, weighing social, environmental, and economic outcomes equally.?From new indicators such as Bhutan’s Gross National Happiness to the Human Development Index, this piece illustrates how alternative metrics can re-shape success and lead policy towards a more sustainable and inclusive future.

We will be discussing all of these themes in the upcoming newsletters.?Come join me as we explore the disruptive power of a social economy and how we, as leaders and citizens, can create a fairer world.