Post No.: 0295
Putting a monetary price on natural resources and the environment may help us to see their value to us – but a danger of doing so is that governments start to commoditise natural resources as things to simply exploit and ‘spend’ in order to boost our national economies according to GDP. It also means that corporations will tend to grab access to these natural resources for themselves if they can, when they’re better off remaining as the public goods or global commons they are. So it’s reductionist to assume that literally everything has a price measured in monetary terms or only in monetary terms.
The environmental Kuznets curve hypotheses that, as countries initially get richer, they first tend to produce more pollutants for prioritising economic production, then they later clean up when they decide they can re-prioritise to more environmental concerns. This (along with the regular Kuznets curve for economic production increasing inequality first then decreasing inequality later) is heavily criticised though because most pollutants don’t seem to decrease as expected – one reason is possibly because enough economic production is never enough (e.g. the current reversal of USA’s environmental policies on fossil fuels despite the size of USA’s economy). How much pollution is a price worth paying for boosting GDP figures? This is one reason why GDP is an inadequate measure of the health of nations.
Whenever you buy petrol, which is currently ~£1.20 per litre – even if you’re merely on minimum wage, which is currently ~£8 per hour – think about how many individual organisms died and how long it took (about 10,000 years) to create the raw crude oil that eventually made that petrol. Does a mere 9 minutes of your work (this calculation is even worse if one earns more than the minimum wage) truly compensate for all those organisms and especially all those thousands of years it took to create every litre of refined fuel that lasts for about 8 miles (if a 36mpg vehicle) or about 12 minutes (if travelling at 40mph) to burn up; which then also leaves ‘negative externalities’ or uncompensated passed-on-costs (i.e. pollution in this case) onto the environment and onto other people and species of life in addition too? Carbon dioxide waste products are useful products for trees, plants and other photosynthesising organisms but not if not enough are around because of concurrent deforestation.
The point is that it’s wrong to think ‘I’ve financially paid for it so I can do whatever I want’ – we haven’t paid enough for it or to the right places at all i.e. to the environment, including to other species we exploit or harm.
Some who are old enough may remember lessons taught in school about the dangers of global warming 30 or more years ago, but many people nonetheless did not and still do not heed those lessons. Fossil fuel companies and the politicians who supported them favoured their own interests and fought against interventions, and convinced the public to favour these companies and their supporters’ interests too; which wasn’t too difficult because most of the public wanted to carry on with their energy-consumptive lifestyles anyway. These giant and powerful fossil fuel companies used much the same strategies as the tobacco industry (e.g. attempting to cast doubt on the science and even claiming that consumption of their products was actually a great thing for us all!) Now despite a succession of different governments and leaders, there are no uncertain terms – we’ve got to wean off fossil fuels and go almost completely onto renewable energy sources. Woof!
The literal waste of other animals in the wild feed an ecosystem in a sustainable and virtuous cycle, but the industrial waste humans leave on the planet mostly harms life. Post No.: 0244 looked into this. Humans have been living as if there are free lunches (or at least heavily discounted lunches) when it comes to compensating the environment for what it gives. But this is wrong because there are no free lunches, and even classical economic models understand this. The naïve, single-minded goal that many economic commentators and advisors still believe in – of maximising a nation’s GDP – neglects real concerns about dangerous long-term environmental issues such as pollution, non-renewable resource depletion, biodiversity loss and anthropogenic climate change.
Too many are being individualistically selfish since these environmental debts won’t catch up to these generations personally but are being passed onto future (yet-born) generations (who don’t yet have a voice or vote). Whatever the true figures, there is wide agreement that the human species is taking more out than the species has been putting back in return to the Earth, and this is by definition unsustainable, especially because every living species on Earth ultimately relies on the planet to survive. (Living in space for long durations is currently proving to be far tougher than we thought – we’ve been incrementally learning through every obstacle to living in extraterrestrial locations, from gravity to cosmic rays, how much we’ve evolved on this planet and depend on this planet to thrive.)
In physics, power is work or energy over time – the rate that energy is used/transferred – and humans may seem more powerful than all other species on this planet today or ever in known history, but that’s only because the consumption rate is currently too unsustainably high. It’s analogous to spending more money than what’s coming in via earnings to replace what’s being spent – it creates a lifestyle or civilisation that looks or seems fantastically successful but these deferred costs will soon catch up; except it hardly sufficiently bothers some people today because the vast bulk of these costs will be or already has been deferred onto younger and future generations. Self-regulation fails when one party benefits from an act but passes at least some of the costs onto others.
We don’t just have economic debts (e.g. national debts) but environmental debts – and although economic debts can be deferred indefinitely as long as a nation’s credit rating is good, environmental debts can’t be indefinitely put off in this way. In fact, when these environmental debts catch up with us, it will cause our economic debts to also catch up with us too because our economies ultimately depend so much on natural resources. Therefore if we care about our economies then we should also care about our ecosystems. But governments still don’t seem to care enough with real or sufficient action because democratic leaders need to appease voters who care more about their jobs and the economy, governments care about maximising the GDP scorecard for their own time in office, and because of game theory when countries are competing against each other to at least stay where they are in global economic ranking terms. The latter means that if others defect in curbing their emissions then one will be encouraged to defect too, and thus everyone will likely eventually defect. (Why contribute to something that benefits everyone if everyone else doesn’t want to contribute?) And that’s the current equilibrium.
Global warming highlights the problem of everyone selfishly thinking ‘I don’t want to curb my emissions (whether as an individual for the sake of maintaining a lifestyle, a corporation for the sake of profit maximisation, or a nation for the sake of its own economy) but I want others to curb theirs’ – which results in a stalemate of ‘carrying on as usual’ that harms everybody both individually and collectively in the long run. Previous global-wide international environmental treaties have amounted to little more than lip service and mostly missed targets (even if ratified) because who has the power to punish the powerful (mainly the ‘developed’ or otherwise rich countries) if they defect? Trade agreements that increase economic activities take priority over environmental agreements that often involve restricting economic activities in certain areas. And it’s a market self-correction problem and market failure when consumers demand something that’s pleasurable for them in the short-term but ultimately harms them and everybody else in the long-term.
Disposable goods, ‘fast fashion’ and constantly buying the latest models of gadgets is good for repeat business and maximising a corporation’s profits, hence industries want to push this kind of consumerism onto us too – but this is bad for the environment and the planet’s limited valuable resources. Companies that sell even very expensive gadgets don’t tend to design their products so that they’re easy to be fixed either because they’d rather us chuck them away and buy new ones rather than fix them and keep them for long. And consumers are at fault too because of putting conspicuous consumption over environmental concerns and for not fully paying the price for our waste but passing these costs onto the rest of the flora and fauna kingdom (e.g. our plastic or hazardous waste that finds its way onto even the most remote places on Earth or the deepest parts of the oceans). There’s therefore a conflict between what’s best for the quarterly or yearly profits and what’s best for the planet in the long-term. Many habits that are good for the environment, such as fixing and keeping things for longer, aren’t good for business – these interests misalign despite the marketing claims.
Other fluffy animal species may look pathetic in their lifestyles compared to modern humans but their pace of consumption, energy-used-over-time, or power, is sustainable for the environment and planet they live on. Well not always, but these species either experience a dramatic drop in population or go extinct, and that’s a risk for the human species too – that’s the key and common way that nature self-corrects, and nature will self-correct if humans won’t themselves in time. On the current trajectory, humans could be here, had a great party funded by overdrafts, but quickly (in geological terms) died off soon after, or at least human civilisation could experience retrograde steps.
Some people actively object to regulations that protect or save the environment, ecosystems and/or biodiversity when it hinders their ability to earn a living (e.g. some fishermen are against quotas). Now it’s morally clearer to demand large corporations to do more to not damage the world but it can be dilemmatic when it comes down to people living in relative poverty (e.g. people poaching sharks for their livelihood versus trying to conserve every shark possible). It’s not that these poor people are being avaricious, and one can blame the demand side of the free market too, not just the supply. Poor people can only burn wood to keep warm and cook because they don’t have electricity (from renewable-source power stations) via a grid. It’s easy for people in other, wealthier, countries to preach from our comfortable armchairs that these poor people shouldn’t do what they feel they must do to survive and earn a living for their families and that these poor people shouldn’t have ambitions to get themselves out of poverty. As typical, things tend to be more complicated than at first glance; although a pattern that constantly emerges is that it’s the more ‘developed’ and richer countries that must take the initiative and responsibilities, even though they’re the most powerful to get away with not doing so.
Overall, the current rate of resource consumption makes humans look powerful and ‘successful’ as a species, but the current rate of consumption and sources of energy and levels of waste, environmental damage and biodiversity loss aren’t sustainable. It’s getting harder to put a monetary price on the planet’s finite resources and that’s why we must look at things in other dimensions other than financially – this could be one major step towards how this whole problem could be turned around.
Woof. As long as countries, companies and individuals care more about being or staying financially rich, it’s hard to see how our priorities will change to caring more about the environment when the ‘green economy’ isn’t enough to substitute every single thing in the current standard economy in a monetarily like-for-like manner.