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  • From: "Tradingpost" <tradingpost@lobo.net>
  • To: livingontheland@lists.ibiblio.org
  • Subject: [Livingontheland] Deep Green: Ecological Economics - The Best New Idea for 2009
  • Date: Mon, 09 Feb 2009 12:08:40 -0700


Deep Green: Ecological Economics - The Best New Idea for 2009
http://www.greenpeace.org/international/about/deep-green

In the future, economists will return to Earth

The year 2009 will witness a tsunami of economic appeals to fix, as
disgraced Federal Reserve Chairman Alan Greenspan put it, the 'flaw' in
their thinking. Most will get it wrong.

The proposals for bailouts, regulations, and government spending sprees all
share one tragic flaw: They assume no physical or biological limits to
human growth. Most economists cling to an 18th century mechanical universe
that conjured an 'invisible hand' of God, which would allegedly convert
private greed into public utopia.

Indeed, a few got rich but the meek inherit an Earth featuring child
slavery, sweatshops, a billion starving people, toxic garbage heaps, dead
rivers, exhausted aquifers, disappearing forests, depleted energy stores,
lopped-off mountain tops, acid seas, melting glaciers, and an atmosphere
heating up like a flambé.

Meanwhile, a rigorous sub-culture of scientists and economists have been
working to free economics from its eighteenth century quagmire by
reconciling human enterprise with the laws of physics, biology, and
ecology.

Their time has come. This year, 2009, will signal the birth of a genuinely
innovative economics that will eventually displace the patchwork
rationalisations for greed. The new ecological accounting is variously
called 'dynamic equilibrium', 'steady-state' or 'biophysical' economics.
What about technology?

Ignoring nature remains the tragic conceit of conventional economists, who
presume we can grow our economies forever without regard to quantities of
materials, energy, and pollution. Biophysical economics, on the other hand,
acknowledges that there exist no cases in nature of unlimited growth.

Dr. Albert Bartlett, Emeritus Professor of Physics at Colorado University,
urges economists to learn the laws of nature. Non-material values -
creativity, dreams, love - may expand without limit, but materials and
energy in the real world remain subject to the requirements of
thermodynamics and biology. "Growth in population or rates of consumption
cannot be sustained. Smart growth is better than dumb growth," says
Bartlett, "but both destroy the environment."

What about technology? Some economists imagine that computer chips or
nanotechnology will save us from the laws of nature, but every technical
efficiency in history has resulted in more consumption of energy and
resources, not less. Remember when computers were going to save paper? That
never happened. Computers increased paper consumption from about 50 million
tonnes annually in 1950 to 250 million tonnes today. Meanwhile, we lost 600
million hectares of forest.

Nor is the internet a celestial realm where ideas are exchanged for 'free'.
Computers require copper, silicon, oil, toxic chemicals, massive energy for
server networks, and garbage heaps for techno-trash. In every
industrialised nation, energy and material consumption is increasing, not
decreasing. Technology is not energy. It costs energy.
Malthus revisited

In the 1970s, World Bank economist Herman Daly wrote Steady-State Economics
to outline the future of ecological economics. Daly makes a distinction
between 'sustainable growth', which is 'impossible', and 'sustainable
development', which is natural. "The larger system is the biosphere and the
subsystem is the human economy," says Daly. "We can develop qualitatively,
but we cannot grow beyond the biosphere's limits."

A UK commission chaired by Sir Nicholas Stern called global warming 'the
greatest market failure ever seen'. Pavan Sukhdev, economist for
Deutschbank, estimates that forest destruction erases $2.5 trillion in
'natural capital' annually. Mark Anielski, an economist in Edmonton,
estimates that 'ecological services' from Canada's boreal forests - carbon
capture, water filtration - are worth about $93 billion per year.

In the 19th century, Thomas Malthus and John Stuart Mill introduced
ecological economics, warning that human expansion would eventually meet
natural limits. Industrialists have mocked Malthus and ignored Mill for two
centuries, but the evidence now suggests that the discovery of petroleum
only postponed the effects.

Many economists now recognise that Malthus and Mill were essentially
correct. A 2008 Goldman-Sachs report about commodity shortages stated, "we
see parallels with Malthusian economics." Popular investment advisor, James
Dines, told a New York Investment Conference in May that food and fuel
scarcities are a "result of a Malthusian planetary limit."

Limits to growth are real," says Anita M. Burke, former Shell Oil and B.C.
Hydro sustainability advisor. "We must embrace adaptation strategies that
create new ways of being in relationship to each other and the planet. The
solutions offered by growth economics are inadequate. These will be
replaced by an economics that accepts the limits and laws of nature."
Biophysical Economics

"Energy used by the economy is … a proxy of the amount of real work done
in our economy," says Charles A. Hall, at the State University of New York.
In the 1980s, Hall and others hypothesised, "Over time, the Dow Jones
should snake about the real amount of work." Twenty years later, a
century's market and energy data shows that whenever the Dow Jones
Industrial Average spikes faster than US energy consumption, it crashes:
1929, 1970s, the dot.com bubble, and now with the mortgage collapse.

World oil production plateaued in 2005, and as the price of oil rose from
$35/barrel in 2004 to $147 in 2008, it added a $3.5 trillion annual cost to
human civilisation. "That reduced discretionary income," says Hall. "The
domino that led to a decline in aggregate demand, particularly for suburban
real estate." Jeff Rubin, Chief Economist at CIBC World Markets, agrees:
"Oil shocks create global recessions."

A popular Wall Street publication, The Corporate Examiner, is planning a
special edition this year on 'the end of faith-based economics', with an
article by Hall and his colleagues. In October, Hall convened the first
International Conference on Biophysical Economics in Syracuse, New York,
and will publish a book this year. "Since economics is about the production
and transfer of physical things or services that require energy," says
Hall, "it is a biophysical science, not a social science."

Robert Costanza, Director of the Gund Institute for Ecological Economics at
the University of Vermont, will launch two periodicals this year: an annual
academic anthology, The Year in Ecological Economics, and a bimonthly
magazine, Solutions, for technical and popular articles about ecology and
economics. "To repair our economic system," explains editor Ida
Kubiszewski, we must realise that "the mounting environmental and social
problems we face are systemic. Articles in Solutions will employ
whole-systems thinking."

The editorial board includes pioneers of ecological economics - Herman
Daly, Ernest Collenbach, and Vancouver's Bill Rees, who developed
'ecological footprint' analysis at the University of British Columbia. Rees
calculates that human consumption of the biosphere is 'already 30 per cent
into overshoot', consuming more than the ecosystem can replenish. "We must
account for the environment," says Rees, "reduce total consumption, and
then address equitable distribution."

"We are dying of consumption," says Peter Dauvergne, sustainability advisor
at UBC and author of The Shadows of Consumption. "The unequal globalisation
of the costs of consumption is putting ecosystems and billions of people at
risk."

To honestly achieve a "sustainable" economy, humanity must step through a
paradigm shift, as profound as the transition in the sixteenth century when
Copernicus showed that the Earth is not the centre of the universe.
Likewise, ecology teaches us that humanity is not the centre of life on the
planet. Just as the Pope's henchmen refused to look through Galileo's
telescope, some economists avoid looking out the window to see what keeps
humanity alive: photosynthesis, precious materials, and concentrated
energy.

"Sooner or later," as ecologist David Abram puts it, "technological
civilisation must accept the invitation of gravity and settle back … into
the rhythms of a more-than-human Earth."

In the 21st century, human enterprise has reached the scale of the planet.
We have to account for ourselves on nature's balance sheet. This is
biophysical economics. It appears inevitable. Biophysical culture is what
we will make of it.




  • [Livingontheland] Deep Green: Ecological Economics - The Best New Idea for 2009, Tradingpost, 02/09/2009

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