Regenerative Community Action Network
RegenCAN & the
8 Forms of Capital
The 8 Forms of Capital framework uses the ethos of permaculture (how dynamic systems naturally operate and can work in concert with other systems) to design models for creating prosperity. The key is not to focus on just a single area (e.g., making money), but to work within several areas at once in order to create positive feedback loops that will accelerate and magnify progress to your goals.
For example, developing skills a person can apply for the benefit of their community, which in turn leads others to support them professionally as well as provide valuable reciprocal services free-of-charge. Interestingly and notably, the 7 or so types of wellbeing (quality of life) overlap with the the 8 Forms of Capital.
Many people believe that financial wealth is a fast track to happiness and welbeing. But it’s not true. Various international studies have shown that it’s the quality of our personal relationships, not the size of our bank balance, which has the greatest effect on our state of wellbeing.
Just like wellness is not just the absence of disease or illness. Wellbeing is a complex combination of a person’s physical, mental, emotional and social health factors. Wellbeing is strongly linked to happiness and life satisfaction. In short, wellbeing could be described as how someone feels about themselves and their life.
The micro BLITZ Time Exchange uses the 8 Forms of Capital framework to guide our members in their transition to a more holistic outlook on wealth. Why? Because obsession with monetary (financial) wealth clouds judgment and stifles the development of a balanced approach to prosperity.
A balanced approach to wellbeing and prosperity allows an indigent to build a substantially better life for themselves than an indigent who has won millions in a lottery! By using the 8 Forms of Capital framework, and the dynamics of the FD+ Compact and the micro BLITZ Time Exchange, an indigent person can climb out of poverty and thrive!
Social Capital
Having a lot of social contacts and a strong network of people willing to do you a favor or help you with certain things is a good indicator of social capital. A person or entity who has ‘good social capital’ can ask favors, influence decisions, and communicate efficiently.
When building up social capital, you are not building it for making a profit or getting a service for free. Because of your behavior and your willingness to give, people are happy to give you a hand because they know you deserve it. It is not a direct exchange; it is more a social bond.
Material Capital
Physical goods and objects that we own are their own sort of capital. This starts with raw materials (e.g. timber) and ends with more complex forms such as computers, cameras, cars, houses, or other consumer goods. Whatever you physically own would be material capital.
Financial Capital
We are most familiar with financial capital: Money, currencies, securities, and other instruments of the global financial system. It is our primary tool for exchanging goods and services with other humans.
Living Capital
Permaculture design teaches us the principles and practices for the rapid creation of living capital. It encourages us to share the abundance of living capital rather than the intangible ‘wealth’ of financial capital. Living capital is made up of the animals, plants, water, and soil of our land — the true basis for life on our planet.
Intellectual Capital
Intellectual capital is best described as a ‘knowledge’ asset. The majority of the current global education system is focused on increasing intellectual capital — whether or not it is the most useful form of capital for creating resilient and thriving communities. Having intellectual capital by society norms is the right way to ‘be successful’. Based on this belief we see a massive amount of people trading money for more intellectual capital.
Experiential (or Human) Capital
The most effective way to learn anything comes through a blended gathering of intellectual and experiential capital. We accumulate experiential capital through actually organizing a project in our community, building a strawbale house, or completing a permaculture design.
Spiritual Capital
Your understanding of yourself and your place in the universe is part of spiritual capital. Awareness and mindfulness with yourself and others are door openers to gaining spiritual capital. Sitting with nature and connecting with your surroundings is also a way to tap into a source of spiritual capital.
Cultural Capital
Cultural capital describes the shared internal and external processes of a community – the works of art and theater, the songs that every child learns, the ability to come together in celebration of the harvest, or for a religious holiday. Cultural capital cannot be gathered by individuals alone.
Why it Matters to RegenCAN Members
Being less dependent on financial capital is one major step towards resilience in a money-based system. Therefore it is very important that impoverished individuals & society work on alternatives (beyond alternative currencies and local trade systems) and establish and value the different forms of capital to build a thriving and socially just society.