Democracy Now’s Amy Goodman speaks with the acclaimed Chilean economist, Manfred Max-Neef:
Could you explain ‘barefoot economics’?

Well, it’s a metaphor, but a metaphor that originated in a concrete experience. I worked for about ten years of my life in areas of extreme poverty in the sierras, in the jungle, in urban areas, in different parts of Latin America.

At the beginning of that period, one day I was in an indigenous village in the sierra in Peru. It was an ugly day. It had been raining all the time, and I was standing in the slum. And, across from me, another guy was also standing in the mud. Well, we looked at each other, and this was a short guy, thin, hungry, jobless, five kids, a wife, and a grandmother, and I was the fine economist from Berkeley, teaching in Berkeley, and so on. And we were looking at each other, and then suddenly I realized that I had nothing coherent to say to that man in those circumstances, that my whole language as an economist was absolutely useless.

Should I tell him that he should be happy because the GDP had grown five percent or something? Everything was absurd. I discovered that I had no language in that environment, and that we had to invent a new language.

And that’s the origin of the metaphor of barefoot economics, which is the economics that an economist who dares to step into the mud must practice. The point is that economists study and analyze poverty in their nice offices, have all the statistics, make all the models, and are convinced that they know everything that you can know about poverty, but they don’t understand poverty. That’s the big problem, and that’s why poverty is still there. And that changed my life as an economist completely. I invented a language that is coherent with those situations and conditions.

And what is that language?

The thing is much deeper. I mean, it’s not like a recipe with 15 lessons or ‘satisfaction guaranteed or your money back’. That’s not the point. The point is much deeper. Let me put it this way. We have reached a point in our evolution where we know a lot. We know a hell of a lot, but we understand very little. Never in human history has there been such an accumulation of knowledge like in the last 100 years. But look how we are. What was that knowledge for? What did we do with it? The point is that knowledge alone is not enough. We lack understanding.

The difference between knowledge and understanding? I can give an example. Let us assume that you have studied everything that you can study, from a theological, sociological, anthropological, biological, and even biochemical point of view, about a human phenomenon called love. The result is that you will know everything that you can know about love, but sooner or later you will realize that you will never understand love unless you fall in love. What does that mean? That you can only attempt to understand that of which you become a part. If we fall in love, as the Latin song says, we are much more than two. When you belong, you understand. When you’re separated, you can accumulate knowledge. And that’s been the function of science. Science is divided into parts but understanding is holistic.

And that happens with poverty. I understood poverty because I was there. I lived with them, I ate with them, I slept with them, and so on. And then you begin to learn that in that environment there are different values, different principles compared to those from where you are coming, and that you can learn an enormous amount of fantastic things among poverty. What I have learned from the poor is much more than I learned in the universities. But very few people have that experience, you see? They look at it from the outside, instead of living it from the inside.

The first thing you learn is that in poverty there is an enormous creativity. If you want to survive, you cannot be an idiot. Every minute you have to be thinking, “what next?” What do I know? What trick can I do here? What’s this and that, that, and that? Your creativity is constant. In addition, this is combined with networks of cooperation, mutual aid, and all sorts of extraordinary things which you’ll no longer find in our dominant society, which is individualistic, greedy, and egoistical. It’s just the opposite of what you find there. And it’s sometimes so shocking that you may find people much happier in poverty than what you would find in your own environment, which also means that poverty is not just a question of money. It’s a much more complex thing.

So, to avoid another catastrophe, collision, if you were in charge, what would you say has to happen?
For me, the problem begins in the university. The university today has become an accomplice of maintaining a world which we don’t want, because if you don’t teach something different to the economists, well, how the hell are you going to change it when they are professionals? It’s impossible. When I started economics in the early 1950s, it was totally different. We had some fundamental courses like economic history and history of economic thought. Those courses don’t exist in the curricula anymore. You don’t have to know the history. It’s not necessary. It’s not necessary that you know what previous economists ever thought. That’s not necessary. You don’t need it. I mean, that’s stupid arrogance. No, now we know for sure this is it forever, you know? Then it ceases to be a discipline, it ceases to be a science, and it becomes a religion. And that is what economics, neo-liberal economics, is today.

So, first of all, we need cultured economists again, who know the history, where they come from, how the ideas originated, who did what, and so on and so on. Second, we need an economics now that understands itself very clearly as a subsystem of a larger system that is finite, the biosphere. Hence economic growth is an impossibility. And third, a system that understands that it cannot function without the seriousness of ecosystems. And economists know nothing about ecosystems. They don’t know anything about thermodynamics, anything about biodiversity. They are totally ignorant in that respect. And I don’t see what harm it would do to an economist to know that if the beasts would disappear, he would disappear as well, because there wouldn’t be food anymore. But he doesn’t know that we depend absolutely on nature. For these economists, nature is a subsystem of the economy. It’s absolutely crazy.

In addition, we must bring consumption closer to production. I live in the south of Chile, in the ‘deep south’, and that area is a fantastic area for milk products. A few months ago, I was in a hotel, and there in the south, for breakfast, I was given a little packet of butter. I get one, and it is butter from New Zealand! I mean, if that isn’t crazy! And why? It’s because economists don’t know how to calculate real costs. To bring butter 20,000 kilometres to a place where they make the best butter, arguing that it is cheaper, is a colossal stupidity. They don’t take into consideration the impact of 20,000 kilometres of transport. What is the impact on the environment of that transportation, and all those things? In addition, it’s cheaper because it’s subsidized. So, it’s clearly a case in which prices never tell the truth. It’s all tricks, and those tricks do colossal harm. If you bring consumption closer to production, you will eat better, and you will have better food. You will know where it comes from. You may even know the person who produces it. You humanize this thing. But the way the economists practice today is totally dehumanized.

Manfred Max-Neef is a Chilean economist and founder of the Centro de Estudio y Promoción de Asuntos Urbanos (CEPAUR). In 1981 he wrote the book for which he is best known, From the Outside Looking in: Experiences in Barefoot Economics, which describes his experiences practising economics among the poor in South America. In 1983, Max-Neef won the Right Livelihood Award for his work in poverty-stricken areas of developing countries. In 1993, he was appointed rector of the Universidad Austral de Chile in Valdivia. His latest book, Economics Unmasked: From Power and Greed to Compassion and the Common Good was published in 2011.

Source: This is edited version of an interview that first appeared on Democracy Now.