Posts

The Poison Beer of GDP

 

By Herman Daly, CASSE Economist Emeritus – October 3, 2018

Disaggregating reported GDP growth to reveal the differences in growth by income class, as per the Schumer-Heinrich Bill, is a good idea. After all, telling us, say, that average income grew by 4% is not nearly as informative as telling us that the richest ten percent received the entire growth increment while the bottom ten percent suffered a decline in income. Average income and growth rates are like the famous recipe for “50% rabbit stew”—one rabbit, one horse. We already know the extreme inequality in the distribution of wealth, of income, and of the growth increment, even without the Schumer-Heinrich Bill. However, if that information is incorporated every time new GDP figures are reported it will be much harder to ignore. Of course, that is exactly why the bill will be opposed by those who want us to believe that we are all getting 4% better off every year or that “a rising tide lifts all boats”, when in fact a rising tide in one place means an ebbing tide somewhere else.

Once we correct GDP for ignoring distribution, then perhaps we can go on to correct other defects, such as the fact that it adds defensive expenditures made to protect ourselves from the unwanted costs of growth (pollution, depletion, congestion, crime, etc.) while failing to subtract as a cost the damages that made the defensive expenditures necessary in the first place. For example, damages caused by an oil spill are not deducted, but expenditures to clean up the spill are added; depletion of soil fertility is not deducted, but expenditure on fertilizer is added, etc.

In addition, the very concept of income in economics is defined as the maximum amount that a community can consume this year and still produce and consume the same amount again next year, and the years after. The income from a fishery is its sustainable catch; the income from a forest is its sustainable cut. Consuming more than that is capital consumption, not income. Yet, as far as GDP is concerned, we can cut the entire forest and catch every fish this year and count it all as income—there is no rule against counting consumption of natural capital as income in GDP accounting.

If our main goal is to increase GDP rapidly, then we will not want to slow it down for concern about equity of distribution, or by correcting the asymmetric accounting of defensive expenditures, or by correcting the fundamental economic error of counting capital drawdown as income.  Maximizing GDP growth will lead to less concern for distributional equity, more depletion and pollution, and more consumption of natural capital.

I am reminded of a story told by G. K. Chesterton. A pub was serving poison beer and customers were dying. Alert citizens petitioned the local magistrate to close down the offending establishment. The cautious magistrate said, “You have made a convincing case against the pub. But before we  can do something so drastic as closing it down, you must consider the question of what you propose to put in its place…”.  Contrary to the magistrate you don’t need to put anything in the pub’s place. Nor is it really necessary to put anything in the place of the poison beer of GDP. As it happens, however, there are in fact better things to put in its place, such as the Index of Sustainable Economic Welfare, National Welfare Index, and Genuine Progress Indicator.


Herman DalyHerman Daly is an emeritus professor at the University of Maryland School of Public Affairs and a member of the CASSE executive board. He is co-founder and associate editor of the journal Ecological Economics, and he was a senior economist with the World Bank from 1988 to 1994. His interests in economic development, population, resources and environment have resulted in more than 100 articles in professional journals and anthologies, as well as numerous books.


What About Innovating Beyond the Growth Trap? A Challenge to the Ecofiscal Commission’s Growth Fixation

By James Magnus-Johnston

James Magnus-JohnstonA new voice has emerged recently in Canada called the “Ecofiscal Commission,” which could have the funding, clout, and determination to steer the country in a more promising direction. The group includes high-profile economists, former political leaders, and high-powered financiers. They define “ecofiscal policy” as something that “corrects market price signals to encourage the economic activities we do want (job creation, investment, and innovation) while reducing those we don’t want (greenhouse gas emissions and the pollution of our land, air, and water).” There seems to be a semblance of steady state thinking among this otherwise rather conventional lot.

Not so fast. The Ecofiscal Commission recently clarified that it “believes that our economies can continue to grow, even as we improve the environment by polluting less and using our natural resources more efficiently.” I found it noteworthy that this group of high-profile individuals decided that it was necessary to address the question of growth. Perhaps that’s because folks like myself don’t believe their policies are sufficient to address 21st century challenges, such as anthropogenic climate change and mass extinction.

One of their commission members, Dr. Dick Lipsey, is a “renowned expert in the field of economics and innovation,” and Professor Emeritus of Simon Fraser’s Department of Economics. In a recent Ecofiscal blog post, he rehearsed a standard narrative of innovation and technological progress that many ecological economists are familiar with. His narrative makes mention of neither the rebound effect nor of exactly what technologies will systematically reduce our material footprint. He even seems to suggest that if we don’t grow the economy, our health outcomes will decline due to a lack of medical innovation.

Locomotive.SMU, Central Univ. Libraries, DeGolyer Library

“It is wholly a confusion of ideas to suppose that the economical use of fuel is equivalent to a diminished consumption. The very contrary is the truth.” -William Stanley Jevons. Photo Credit: Southern Methodist University, Central University Libraries, DeGolyer Library.

He goes on to write about how “those who, like this commentator, think only of today’s commodities and today’s technologies, do not see the possibilities of raising living standards, while also dealing with pollution, through technological advance.” This seems straightforward enough—we don’t know what we don’t know. New technologies will emerge over time. He then proceeded to make a sweeping claim by listing a number of technologies that have made life more convenient, including “dental and medical equipment, antibiotics, bypass operations, safe births, control of genetically transmitted diseases, personal computers, compact discs, television sets, automobiles, opportunities for fast and cheap world-wide travel, air conditioning…” And so on. For the record, I’m quite happy for all of these advances, yet I still don’t see how anything on this list is addressing our self-inflicted mass extinction, though I suppose it’s making us comfortable in the meantime.

I could spend time addressing the factual basis of his claim that innovation requires growth, but we’ve been doing that since the 1970s, when Henry Wallich discounted the findings of Limits to Growth (DH Meadows et al.), arguing that technology would save us from the ecological crisis. We’re still waiting for this claim to ring true, and there’s a raging contemporary debate, which speaks to some lingering uncertainty about the claim. For my part, I see the invention of new technology as a response to a specific technical problem (or set of problems) rather than merely the offspring of pro-growth economic conditions.

What I find far more curious is (a) why Dr. Lipsey’s sweeping claim avoids mention of mass extinction or climate change; and (b) how this opinion can reflect the voice of so many high-profile public figures. It is true that, as Lipsey writes, “…our Victorian ancestors could not have imagined what to do with ten times as much of all of the goods that they knew about.” Yet it is also true that we have far more than ten times the goods that they knew about, and that our aggregate material footprint is still going up. Efficiency gains are a “feel good” story, but the gains have yet to reduce our aggregate material footprint at the global level.

I’m not an ideological enemy of innovation or entrepreneurship. In fact, I’m a bit of a techno-geek—I (rather shamefully) like new technologies and toys. I get irrationally excited when I see developments in green technology and transportation, and I’ve started a business. I can’t wait to use a hyperloop. But, as Lewis and Conaty write in The Resilience Imperative, I embrace the principle that efficiency without sufficiency is lost. Or to put it another way, it feels intellectually dishonest to suggest that efficiency has the potential to deliver us from a cultural propensity for overconsumption. I’m not certain why we should focus our energy on miniaturizing goods or “cleaning” our production process to the exclusion of simply consuming less. We need both.

Underpinning some of Dr. Lipsey’s claims is the epistemological assumption that innovation is merely a technological, material, or financial phenomenon. What precludes us from innovating ethically and socially, towards more desirable ends? John Maynard Keynes considered the day when society could focus on happiness and well-being rather than economic growth. He wrote, “The day is not far off when the economic problem will take the back seat where it belongs, and the arena of the heart and the head will be occupied or reoccupied, by our real problems—the problems of life and of human relations, of creation and behavior and religion.” If innovation is so predetermined, why might one suggest it is possible to innovate technologically, but not towards a more sustainable economic size? That is, after all, what this growth debate is really all about.

I can’t also help but wonder whether or not Dr. Lipsey recognizes that his narrative emerged during a time when one could not see or feel the effects of a deteriorating planetary life support system. I don’t blame him for his choice to rehearse this narrative—like many 20th century thinkers, his whole identity has been constructed to promote the idea of growth. But at some point, we will all need to accept our planetary prognosis and act accordingly. It’s become exceedingly clear that price signals alone won’t preserve forests, oceans, or climate stability. Peter Victor has argued that while D.H. Meadows et al. possibly underestimated the price-mechanism’s role in adjusting economic outcomes, their critics have overestimated it.1 By the time we’ve settled on a carbon price, the planet will already have become several degrees warmer and we’ll no longer have the luxury of technocratic tinkering. Behavioral economists have also debunked the myth that humans are motivated only by price signals. Human beings are complex, irrational actors who are influenced by far more than just the almighty dollar. Many of us have given up on the neoclassical paradigm precisely because of this new knowledge. Call it innovation.

It’s not necessarily true anymore that economic growth increases our incomes and always transforms our lives for the better. Today, some features of economic growth are increasing the incomes of the richest, stagnating the incomes of the poorest, and depleting the innovative spirit of the economy. Who has the time to worry about climate change and mass extinction when they’re just getting by or more concerned about how to cash their next pension check? Ask any Greek citizen.

Perhaps we can be thankful that growth didn’t stop in 1900 or 1950, as Dr. Lipsey argues. But this isn’t 1950. We have to solve a new set of problems. There’s never been a better time to innovate the discipline of economics, and with it, our definition of progress.

 

 

Good Health Requires Different Economics

by Dr. Trevor Hancock

Editor’s note: A version of this post ran originally in the Times Colonist.

TH - PHSPFor the past three years, I have been leading an important project for the Canadian Public Health Association (CPHA), which led to the release on May 25th of our Discussion Paper and a 100-page technical report on global change and public health.

In these documents, we identify what we call the “ecological determinants of health”: clean air and water, food, materials, fuel, the great cycles of water, nitrogen and phosphorus, detoxification of wastes, climate stability, and others.

These determinants of health come from the Earth’s natural ecosystems, and they are threatened by the massive and still growing human-induced global ecological changes now underway. These changes thus represent the greatest threat to the health of the public in the 21st century. They include the following:

  • Global warming and resultant climate instability;
  • The contamination of all ecosystems and food chains—and all humans—with persistent organic pollutants and other novel entities such as nano-particles;
  • The depletion of key resources and damage to ecosystems that provide life-supporting “goods and services”; and
  • The loss of species and biodiversity, a human-induced “sixth great extinction” that threatens the overall web of life.
dreamstime_s_26094052

Human-induced global ecological changes are threatening public health.  Photo Credit: © Stockshoppe | Dreamstime.com

Here I explore some of the many issues and approaches we discuss in our report, beginning with the underlying values and beliefs that drive the ecological changes we are witness to, and the changes in those values and beliefs we need to create.

The drivers of the ecological changes noted above, now collectively being referred to as “The Anthropocene,” are a combination of population growth and affluence, with technology sometimes amplifying and sometimes reducing their impact. But underlying these drivers is an increasingly globally shared set of values and beliefs that together comprise “modernism.” The central value is a belief in “progress,” and that progress equates with growth, especially growth in material wellbeing.

This leads to the pursuit of economic growth to meet the growing demands of a growing population. But this is the fundamental problem because, in our current economic system, growth means more demands on the Earth’s natural resources and more damage to its ecosystems.

Such damage is resulting in the decline, and may result in the collapse, of key ecosystem functions that are the basis for the life and survival of humans and other life forms; when ecosystems decline or collapse, so too do the societies that are dependent upon them. This damage in turn undermines the economy and threatens the continued wellbeing and even the very survival of communities, societies, and our increasingly interconnected global civilisation.

Moreover, as resources become scarce and ecosystems fragile, those with wealth and power will ensure their access to them, even if it means others—including other humans and other species—have less. This will both heighten global and local inequity and push more ecosystems toward collapse and more species toward extinction. It will also heighten the potential for both local and global strife.

Faced with these immense challenges of potential ecological and social decline and collapse, the only answer from conventional economics is more growth. But continued conventional growth in a finite system—the Earth—is clearly impossible when it involves more growth in demand for resources and more strain upon our increasingly fragile life-supporting ecosystems. There are indeed limits to growth—or to be more precise, there is a limit to growth, and that limit is the Earth itself.

Our current economic system is broken and must be discarded and replaced with an economic system that is compatible with the Earth and all its ecosystems and resources. This will require a massive global change in the underlying cultural and political values that drive our current economic system.

That change has to begin with the wealthy countries because we cannot say, in effect, that we will keep what we have but the rest of the world cannot have what we have because there isn’t enough to go around. We in the wealthy countries need to shift our focus from the pursuit of economic development to the pursuit of a higher goal: human development that is equitable and sustainable.

After all, what business are we in—or should we be in—as societies and governments? Are we here to grow the economy? Is that really the ultimate human purpose? Or are we here to “grow” people? And are we here only to “grow” some people—people like us, perhaps?—or are we here to pursue a more noble purpose: ensuring the achievement by everyone of the highest human potential of which they are capable, in a manner that is ecologically sustainable and socially just?

Dr. Trevor Hancock is a public health physician and a professor at the School of Public Health and Social Policy at the University of Victoria. He has played a key role in founding several environment-focused organizations, including the Canadian Association of Physicians for the Environment and the Canadian Coalition for Green Health Care. In the 1980’s, Dr. Hancock was one of the founders and the first leader of the Green Party in Canada. 

thancock@uvic.ca

 

The Future History of Political Economy – Part 2

Thermodynamics in Economics: Revolutionary portent, future history

by Eric Zencey

Eric ZenceyEcological Economics represents the extension into economics of the thermodynamic revolution of the nineteenth and twentieth centuries. In physics, that revolution dethroned Newton and brought relativity. In biology, it was midwife to the birth of ecology, the study of ecosystems as wholes in which energy networks—food webs—are a defining structure. In chemistry the laws of thermodynamics brought clarity and rigor to a science that struggled to bring theoretical unity to diverse phenomena. So far, though, most economists are perfectly willing to treat their subject matter as if the laws of thermodynamics simply don’t apply to it.

2 models 5

But the thermodynamic revolution in economics can’t be permanently forestalled. For one thing, it’s getting harder and harder for the neoclassical model to reassure us that its system of Newtonian abstractions is a good fit to the real world. The Great Collapse of 2008 demonstrated that whatever else it is, the discipline of economics isn’t very good at predicting major economic phenomena. Climate change and the Sixth Extinction make it hard for economics to maintain its pretense that economic activity takes place in abstractia, on the clean white pages of textbooks or on whiteboards holding formulae, with no roots in or consequences for anything outside of itself. Truths derived on the model of Newtonian mechanism are supposed to be abstract and ahistorical, but our planet and our economy are most assuredly evolving concretely and over time.

The driving dynamic of this economic and planetary change—the driver of history for the past three centuries—has been human use of high-EROI fossil fuel. The driving dynamic of the history yet to come will be the declining EROI of our civilization’s energy sources.

Oil Well 3.Texas State Archives

Oil used to gush out of the ground under pressure, making for a very high Energy Return on Energy Invested (EROI). In the 1920s, wells like this gave the industry an average EROI of 100 to 1 or more. Today’s petroleum industry has a much lower EROI. Photo Credit: Texas State Archives

You can see some of the consequences of declining EROI already:

  • Despite a rising real per capita GDP, for a significant percentage of workers in OECD nations personal income has flatlined or is declining. An increasing concentration of income helps explain this but another dynamic is at work as well. As EROI falls, it takes more economic effort to get the energy that’s needed to support economic effort. Even as gross economic activity (GDP) grows, production of net benefit is shrinking.
  • Other sectors of the economy have been affected by this ongoing increase in the economy’s matter-and-energy overhead. “Austerity” has become the watchword for governmental budgets, even in the wealthiest nations in the world. Developed countries find it increasingly difficult if not impossible to pay maintenance and upgrade costs on infrastructure investments made in the heyday of 100-to-1 oil.
  • In its 2013 report card on America’s infrastructure, The American Society of Civil Engineers estimated that the U.S. needs to invest $3.6 trillion over seven years to restore and maintain existing infrastructure.
  • Worldwide, many of the ecosystems that support human civilization are degraded and close to collapse. Forced by both ideology and declining EROI into austerity budgeting, governments are reducing their scope and energy at the exact moment that sustainability would have them take strong action to rein in the rational, free-market tendency of corporations to maximize profits by degrading the commons and externalizing other costs.
  • Pension-fund wipeouts are becoming common as one way to fulfill the economy’s structural need for debt repudiation—a need that lies in our system’s willingness to let debt grow faster than a declining EROI economy can pay back, even after growth has been stimulated by lifting or reducing regulations that limit the environmental damage done by economic activity.
  • The planetary carbon sink is full, producing climatic effects that even an abstraction-inhabiting, arithmo-morphizing economist has to acknowledge as a troubling reality.

Centuries from now economic historians are likely to understand the relationship between EROI and wealth creation much better than does the average economist of today. I think it likely that future political economists will express wonder not at the 20th century’s enormous economic success, but at how little we actually added to our stock of wealth for all the high-EROI coal and oil it was our pleasure to burn. They are almost certain to shake their heads in wonder that we, enjoying an energy supply and an EROI never seen on the planet before or since, could ever have experienced an economic downturn, could ever have let a human starve from want, could ever have been so programmatically blind to the physical origins of our fortunes.

The Future History of Political Economy – Part 1

Economics Ignores Thermodynamics

by Eric Zencey

Editor’s Note: An earlier version of this essay appeared as a comment in the Great Transition Network Forum, which will appear on the Great Transition Initiative website next week along with a new essay by Herman Daly, “Economics for a Full World.”

Eric ZenceyEcological Economics and its corollary, Steady State Economic thinking, represent a step forward for the discipline of economics and also a return to how it was practiced in the past. In the nineteenth century, economics was a part of a larger enterprise: political economy, the integrated treatment of morals and economics, ultimate ends and efficient means. Late in that century economics calved off from political economy, leaving behind political science and political philosophy as the residuum. It did this in service to the ideal of becoming rigorously scientific.

It’s odd, then, that alone among disciplines with any pretense to analytic rigor, economics has steadfastly resisted the thermodynamic revolution that swept physical and life sciences in the nineteenth and early twentieth centuries. Physics, biology, chemistry, geology, even the study of history were transformed, but not economics.

I think we can blame this on bad timing, willful ignorance, and oil.

Bad timing

In the late nineteenth century the archetypal science was physics and physics was Newtonian mechanism. Ignorant of what a young thermodynamic theorist named Albert Einstein would soon do to the Newtonian paradigm they emulated, Stanley Jevons and other economic “scientists” set about mathematically modeling the economy as sets and subsets of self-contained, equal-and-opposite actions and reactions, happily (and explicitly) assuming that all economic activity consists of ahistorical, which is to say completely reversible, processes. No one who has a nodding acquaintance with the law of entropy could have countenanced this. Entropy is Time’s Arrow, the law of irreversibility; it describes the one-way flow of energy use. A purely mechanical process can be run forward or backwards, but we’ll never invent a machine that can suck in exhaust gases, heat and motion and transform them into gasoline. The entropy law can tell you why. Newton couldn’t.

Just as a consumer might choose to keep a recently purchased appliance even though a newer, better model has been brought onto the market, neoclassical economists weren’t about to re-tool their brand-new thinking to reflect changes in the underlying metaphysics they had been so keen to adopt. It didn’t seem to them that there was any reason to.

“Seem” is the operative word here. Because the entropy process is time’s arrow, and because Ecological Economics places the entropy process at the center of its analysis, it’s entirely appropriate for Ecological Economics to understand its subject matter and itself as a discipline in historical terms. Like other paradigm-defining insights, this one seems obvious once it has been stated: elements of the neoclassical model that could pass for true on a large and forgiving planet a hundred years ago are obviously not true today, when the planet’s source-and-sink services are severely taxed, when natural capital is the limiting factor in production, when there are seven billion of us and our economic wants, capacities and expectations have been amplified by our access to the ancient sunshine of fossil fuels.

Willful ignorance

By modeling the economy as a closed and circular system, neoclassical economists have encouraged themselves to operate in a methodologically enforced state of denial about the physical roots and ecological consequences of our wealth-creating activities. And yet economics has experienced no paradigm-shaking crisis as a result. Neither climate change nor any of the other source-and-sink catastrophes facing civilization have been laid at the feet of bad economic theory. One reason: Neoclassical economists succeed in treating environmental costs as “externalities.” How could environmental degradation be the result of economic activity if it’s external to the economy?

Midas.Giovanni Caselli from the Age of Fable

The power to create wealth gave Midas an unsustainable life as a complete solipsist. Oil’s power to create wealth has had a similar effect on Neoclassical economics. Illustration by Giovanni Caselli from The Age of Fable.

In its self-confirming isolation of the economy from nature and theory from reality, neoclassical economics amounts to a highly principled practice of solipsism. When this pathology is manifest in an individual it produces unpleasant consequences that might eventually prompt some reflection and personal growth. Not so with the collective delusion of mainstream economists. Evidence of our ongoing ecological catastrophe falls far from their purview—not just disciplinarily but geographically, as the wealthier nations (wherein the vast majority of economists reside) export their ecological footprint to the impoverished nations of the world. And for several generations (at least since Reagan defeated Carter, removed Carter’s solar panels from the White House and ushered in an era of GDP growth through de-regulation of the social and ecological consequences of economic activity), there has been a strong self-selection among students of economics. Undergraduates with any kind of deep personal connection to natural systems tend to find the study of standard economics unattractive, displeasing, even soul-deadening. This leaves the field to those most willing to bracket off as irrelevant to their professional purpose any question about the moral and ethical consequences of economic activity, any question about the health and maintenance of nature, any question about the economy’s relation to the larger social and natural systems within which it operates.

Oil

Even so, you might expect that a discipline with such a demonstrably deficient view of its subject matter would fail of its object—would fail to offer wise counsel about the collective project of augmenting the stock of wealth that humans can enjoy. But economics has had much apparent success. Despite regular downturns and financial crises, the wealth produced by our economies has grown and grown and grown. I think there’s a ready explanation that becomes visible through the conceptual lens of Ecological Economics, which tells us that energy isn’t a commodity like any other but a fundamental factor of production (part of a trio: matter, energy and human design intelligence). When your economy operates on an energy source that cranks out wealth-making value in a ratio of 100 to 1 or better—the estimated Energy Return on Energy Invested that petroleum offered us in the early 20th Century—you can believe any damn thing you want about how economies operate and your economy will still generate a great deal of wealth.

Which is to say, high-EROI oil granted the new science of economics immunity from being proven false by events. But falsifiability of principles and propositions is one solid measure of a science. (Non-falsifiable beliefs are called faiths.)

In effect the discipline of economics has a free rider problem—it’s been given a free pass by the enormous power of oil to misunderstand itself and its subject matter. You could also call it a Midas Problem, after the legendary king whose touch turned everything he touched into gold, including his dinner and his daughter. The power of wealth-generation that oil granted to our economy made it impossible for the discipline of economics to connect in any fundamental way with otherness, including the otherness of the planet and its role in the very processes that economics presumes to model.

 

Progress Toward a True-Cost Economy Now Comes From Developments in Renewable Energy

by Brent Blackwelder

Brent BlackwelderA renewable energy revolution is sweeping the planet. This revolution has profound implications because it signals that the global economy is moving to stop the growth of our human carbon footprint.

The global economy has run for a century primarily on fossil fuels but is now undergoing a rapid transition to a global economy based significantly on rooftop solar, wind, and efficiency. This is a tangible movement toward a steady state economy because with wind and solar, the amount we use today does not affect tomorrow’s supply; and unlike fossil fuels, the pollution externalities are small and do not harm fellow competitors or the public.

This revolution is more than a technical fix because it is shifting the ingredients of the material products and services of the economy from toxic, polluting, non-renewable substances and ingredients to ones that are renewable and dramatically lower in pollution. It is demonstrating that renewable energy can avoid imposing dangerous impacts onto the public or onto future generations.

Skeptics over the last two decades have argued that renewable sources such as wind and solar are trivial and simply incapable of providing the power needed by the global economy—that all they will ever do is provide only a small percentage of the world’s electricity. I remember the days when utility executives belittled renewables, warning that more than about 5% of wind or solar electricity in a region would crash the grid!

Photo Credit: janie.hernandez55

The renewable energy revolution is a stepping stone toward a sustainable true-cost economy. Photo Credit: janie.hernandez55

I want to present a few startling and uplifting facts that demonstrate the dramatic progress recently made by solar and wind power around the world. 1 These facts give the lie to the phony assertions made by utilities in their efforts to block renewable energy.

Rooftop solar is growing worldwide by 50% per year. In 1985 solar cost $12 per watt, but today’s prices are closer to 36 cents per watt. Every five hours the world adds 23 MW of solar—which was the global installed capacity in 1985.

In January of 2014 Denmark got 62% of its electricity from wind. In 2013 Ireland got 17% of its electricity from wind, and Spain and Portugal both exceeded 20% from wind. Today China gets more electricity from wind (91,000 MW) than it does from nuclear reactors. The United States is second in the world in installed wind turbines, with South Dakota and Iowa obtaining over 26% of their electricity from wind.

As we look to achieve a true-cost, steady state economy, questions are constantly raised about the behavior of other powerful nations that might appear to have no interest in a sustainable economy. The renewable energy revolution provides breakthrough opportunities here. China is already putting its energy future into more and more renewable energy. It plans to more than double its current wind capacity with an expansion goal of 200,000 MW by the year 2020.

Even the French, who rely on nuclear reactors for 75% of their electricity, are planning on increasing their wind generating capacity to 25,000 MW from their present 8,300 MW.

The renewable energy revolution will enable civilization to stop the growth of highly polluting fossil fuels. It will enable society to leave the majority of the remaining reserves of fossil fuels alone and unburned. Acceleration of this revolution helps in solving many problems and is a key to restoring and maintaining the life support systems of the earth.

For a number of reasons, this renewable energy revolution is a stepping stone toward a sustainable  true-cost economy. First, unlike fossil fuels, the footprint of wind and rooftop solar is minimal. Wind turbines erected on farmland use very little land and allow farming to continue. Rooftop solar can be placed on flat commercial and industrial roofs in metropolitan areas where connections to the grid are available.

In comparison, extraction of fossil fuels can create some of the worst pollution and habitat destruction ever seen. Consider the devastation being caused in the biologically diverse mountain forests of West Virginia by mountaintop removal coal mining. Or look at the obliteration of Alberta’s landscape and contamination of its lakes and rivers from tar sands mining.

This point is substantial because far too many of the products of the global economy involve externalization of enormous pollution costs.

Second, the usage of wind and solar today does not affect the amount of wind and solar available tomorrow. They are renewable. Furthermore, wind and rooftop solar are basically waterless technologies, whereas fossil fuel and nuclear power plants use enormous quantities of water for cooling. As water shortages multiply worldwide as a result of population and industrial growth, and climate disruption, this benefit will become even more significant.

Third, wind and solar are big job creators. In Germany the number of jobs in wind and solar is about 400,000 versus 200,000 in coal and conventional fuels. This amazing boost in clean energy jobs has happened in the last decade. Job creation is a major concern in any transition to a sustainable economy.2

Those who are serious about getting to a true–cost economy should help accelerate the renewable energy revolution as a way to achieve it.

 

Notes

  1. See The Great Transition by Lester Brown and colleagues at the Earth Policy Institute for a superb account of the global renewable energy revolution that offers hope to all.
  1. See Energiewende for the job figures; see also Peter Victor in Tim Jackson’s Prosperity Without Growth for a discussion of transition scenarios and jobs.

Do We Have the Courage to Bring the 800-lb Gorilla out of the Corner?

by Jimmy Fox

Jimmy FoxThe planet’s ability to provide useful materials and absorb wastes (its biocapacity) is deemed essential to sustain human life. Yet consumption of those useful materials (our ecological footprint) per person is rising at an alarming and unsustainable rate. According to the Global Footprint Network, humanity currently uses the equivalent of 1.5 planets worth of biocapacity per year. Stated another way, it takes the Earth 1.5 years to regenerate what we use and waste in a year. Here in the USA the average person’s ecological footprint in 2010 was approximately 8 soccer fields per person per year — the largest of any nation — while the global capacity in the same year was estimated to be about 2 per person. What this tells us is we Americans are not living within our means. In addition to deficit spending we are, in fact, deficit living. And other countries are not far behind.

ecological footprint scenarios

Our ecological footprint — which path will we take? (Image courtesy of Global Footprint Network).

Today this reality is a conundrum for anyone with an ecological conscious, particularly an American in the field of conservation. Current production and consumption of energy (for our bodies and machines) directly and indirectly create a suite of problems from loss of habitat to pollution. For conservationists, the 800-lb gorilla in the room is our society’s pursuit of economic growth fueled by conspicuous consumption. Quite simply our country’s gross domestic product (GDP) serves as a self-evident indicator for loss of nature and liquidation of our shrinking resource base. As conservationists, we need to bring this gorilla out of the corner and help friends and neighbors understand the problem. It’s time to have frank conversations about the need for intelligent consumption, recycling and reusing, and stabilizing human population.

Some will say this is too radical and not an issue a conservationist should be wading into. I would argue nothing is more important or in need of leadership. In the past Olaus Murie, Aldo Leopold, and Rachel Carson spoke to the matter. In 1948, articulating the need for a land ethic, Aldo Leopold wrote, “Our bigger-and-better society is now like a hypochondriac, so obsessed with its own economic health as to have lost the capacity to remain healthy.” Approximately ten years later, Olaus Murie pressed for the establishment of the Arctic National Wildlife Refuge and believed it was emblematic of, “the real problem of what the human species is to do with this Earth.”

Today, Dr. Curt Meine (author of Correction Lines), Dr. Julianne Warren (author of Aldo Leopold’s Odyssey), and Dr. Brian Czech (author of Shoveling Fuel for a Runaway Train and Supply Shock: Economic Growth at the Crossroads and the Steady State Solution) are Americans in the field of science writing and speaking passionately about the real problem. I encourage you to follow their work. If reading books isn’t your cup of tea or you’re short of time, check out the Aldo Leopold Foundation’s documentary, Green Fire and Rob Dietz and Dan O’Neill’s call for a steady state economy in Enough is Enough, or if you’re into Hollywood entertainment, watch Wall-E with the kids for an exploration of where we could be headed.

Of course there are critics inside and outside the conservation community. The status quo is tenacious. Calling for change is uncomfortable. We have to be prepared for the allegations. Like Thomas Jefferson’s efforts to abolish slavery while being a slave owner, we have to acknowledge we own a piece of this mess while we move humanity forward. We must admit we conservationists are contributing to the problem with every aerial survey, vehicle, item of clothing, glass of wine, or electronic device we buy (even the six-year old MacBook Pro I’m using to write this post). Acknowledging our contribution to the problem isn’t enough — otherwise it’s just rhetoric. We must act and model the behavior we hope for ourselves and others. Consider these three broad actions to get started:

1. Break the problem down. Become familiar with what contributes to the problem of an oversized ecological footprint. There is a mountain of literature on the unsustainability of human population growth and consumption of natural resources. Figure out the myriad connections between the nation’s pursuit of higher GDP and the conservation challenges we face today.

2. Identify solutions. There are so many ways we can lessen our ecological footprint from the individual level to the national pursuit of a steady state economy. Start at home and the workplace. Make an inventory of the wasteful practices and figure out how to make life and work more sustainable. Don’t overlook local, state, national and international solutions that could use our support and advocacy.

3. Exhibit leadership. The solution to this problem will require all of us to adapt. There are no technical fixes that will save us, no easy remedies and no authority figures leading the way. Solutions will be found through our interactions and relationships with others. Find the courage to share your concerns about the current reality and speak passionately about your aspirations. Talk about what we can do to close the gap between our unsustainable lifestyle and a sustainable one — and do it.

I realize this issue isn’t much fun to think or talk about. It’s personal. It calls into question what we do and our devotion to nature. It forces us to think about how our actions today will negatively affect future generations. As a conservationist, it’s much easier and more socially acceptable to treat the injury than call for a cure. We can busy ourselves with species protections and habitat restoration. But if we value nature — if we value humanity — business as usual is unacceptable. As conservationists we are documenting the outfall of the problem and have a moral obligation to sound the alarm. Ask yourself, would Rachel Carson ignore the gorilla in the room were she alive today? Ask yourself, if we won’t act, why should we expect anyone to? Now is the time for leadership. Leadership means having the courage to address the ultimate source of our conservation problems.

Bringing the 800-lb gorilla into a public forum isn’t easy. But like most hard work, it’s useful.

Jimmy Fox advocates for intelligent consumption as a citizen of Fairbanks, Alaska. He is a Fellow of the National Conservation Leadership Institute and serves his country as a distinguished manager in the U.S. Fish and Wildlife Service. He also promotes leadership in conservation at cognizantfox.com.

Maybe It’s Time to Offend a Few Folks

by Alexandra Paul

Paul_AlexandraSpeaking out about human overpopulation is not an easy thing, as I have been told that people get offended. I have not personally experienced offending anyone, but perhaps those folks have been too polite to tell me. I have not read any studies that prove people are offended, but perhaps I have missed them. If I offend you in this video, please let me know.

I once asked the executive director of the Rainforest Action Network why RAN didn’t discuss the huge number of people on the planet as a factor in rainforest devastation and encourage smaller human families, as everyone in that nonprofit organization probably understands that the demand for resources from 7 billion people on the planet is causing extensive damage to the earth. They know that if the UN projection of 10 billion people on the planet by 2050 is right, it will be disastrous for forests everywhere. She admitted, abashedly, that she did not want to alienate donors.

RAN is an organization whose members break into corporate offices and hang banners out the windows excoriating Big Oil, yet they are afraid to talk about human overpopulation in their pamphlets or on their website. If RAN won’t admit the link between diminishing natural resources and a population that grows by 220,000 people every day, then what large environmental organization will?

It turns out, none.

Is it really impolite to promote smaller families?

Is it really impolite to promote smaller families?

Even within the population community, there is disagreement on how to approach the topic of lowering fertility. Some activists believe that the word “overpopulation” is too strong, even though by all accounts the world IS overpopulated: An article in the journal Nature reports that the global groundwater footprint is about 3.5 times the actual amount we have in our aquifers. Scientists have estimated that humans consume 50% more of the earth’s resources than she is able to restore each year. If people continue to consume the planet’s resources at this rate, by 2030 humanity will need two planets worth of resources to support the world’s population.

My message is clear: I recommend one child per couple to lower the population, avert future famines, and avoid wars over water. If that sounds radical, then maybe it is time for radicalism. In a culture that bemoans a falling fertility rate because it will damage the economy — instead of praising smaller families because it means less crowding, more nature and better quality of life for all — there is great need for more voices of sanity. Voices like Edward Abbey who said, “Growth for the sake of growth is the ideology of the cancer cell.”

For those of us in the United States, this message is especially important. Although our families average 2 kids per couple, our consumption outweighs that of larger families in Africa and Asia. The average American consumes 20 times more resources than someone from Mozambique and generates 169 times more carbon dioxide than a Bangladeshi. We have even outdone ourselves: a family of four today lives in a house twice as large as one the family would have occupied in 1950.

I believe that we must stabilize and then lower the world population if humans are to survive on this planet. If advocating a culture that encourages smaller families is offensive, then I must offend. Too much is at stake to be polite.

Alexandra Paul is an internationally recognized actress and an environmental and social activist.  To hear Alexandra speak about overpopulation, please see her TEDx video.

Confessions of a Closet Football Fan

by Brian Czech

BrianCzechIf you’re an American or just familiar with the American scene, you know what’s brewing. We’re not talking about the inauguration, sequestration, or Secretary of State nomination. No, something much bigger. We’re into the NFL playoffs and the biggest sporting event in the world is right around the corner: the Super Bowl!

I suppose those rabid European soccer fans would argue that the World Cup beats all, and in my ignorance of worldwide sports I’m probably missing a few rivals from other continents. Bully for them, but surely no other sporting event attracts the media coverage, the movie stars, and the tag lines of the Super Bowl, where the highest-paid athletes in the world compete to hoist the Lombardi Trophy.

As a kid growing up on the edge of Green Bay, Wisconsin, I was engrained with a culture defined by its professional football team, the Packers. Born in 1960, my first decade was spent while Coach Vince Lombardi’s Packers put their indelible stamp on American sports. Tiny Green Bay, the David among NFL Goliaths like the New York Giants and Chicago Bears, won an unprecedented five NFL championships in one decade, culminating with their dramatic victory in the “Ice Bowl.” On the frozen tundra of Lambeau Field, with the temperature plunging to -20°F, good ol’ Bart Starr snuck it in on the Dallas Cowboys with 15 seconds left.

Wouldn’t you know, I didn’t get interested in this stuff until the year after the Ice Bowl. At the football-fanaticizing age of 8, I was ready to add my voice to the collective howl of “Go Pack!” But the Pack wasn’t going anywhere except the loser column for the next 20 years.

Meanwhile television was spreading like the flu through the American household. Coverage of the NFL became the state of the art. Epic clashes were replayed in slow-motion, narrated by the best voices Hollywood had to offer, accompanied by orchestrated, adrenaline-pumping brass music.

Unknown to the NFL, during those same years books like The Limits to Growth, Small Is Beautiful, and Steady-State Economics appeared. My own research ended up focusing on the conflict between economic growth and biodiversity conservation. I got my Ph.D. in 1997, the year the Packers finally won another Super Bowl.

My interest in the Packers was rekindled, but I never started wearing a cheesehead. In fact, I hardly even mentioned the Packers in public. Instead, I became a closet football fan, and these are my confessions.

First, to my cultural kin back in the home state, as well as the general Wisconsin Diaspora, my confession is… well you read it above. I’m reduced to an abashed Packer fan, which is practically an oxymoron. But it’s not because of the embarrassment of the cheesehead phenomenon. And, I swear, it has nothing to do with the fact of the Packers being soundly defeated in this year’s playoffs (just last night, uncannily)! This piece has been on my mind for some time.

Now there’s nothing wrong with the sport of football, not in my opinion. The problem is the commercialization, industrialization, and non-stop growth of football. The NFL has a huge and growing ecological footprint. Players are routinely paid in the millions, and many drive Hummers and build mansions. Scouts, agents, and football reporters spend more time in the air than Hilary Clinton. And the owners; let’s not even get started on the owners!

We have to remember that the expenditure of a dollar is a solid measure of environmental impact, and the NFL sector exceeds the budgets of half the nations on the planet, the Environmental Protection Agency, and a bazillion school teachers. That’s why you won’t see me hollering “Go Pack.” I don’t want to be seen as supporting things like the Lambeau Field Atrium, which takes approximately 30 million dollars a year of air conditioning, much less the $1.4-billion Cowboys Stadium or the $1.7-billion Metlife Stadium. After all, I’m the same guy who called for an end to conspicuous consumption in Shoveling Fuel for a Runaway Train: Errant Economists, Shameful Spenders, and a Plan to Stop Them All. I don’t want to be the shameful spender and a hypocrite to boot.

Well, I said “confessions” (plural) so here is the other one. This one is even more difficult, but I write on a Sunday and what better time to confess? So… (gulp)… I confess that, albeit in the closet, I have been watching football. Quite a bit this year, in fact. And I don’t mean just a high school game here and there. In fact I don’t mean any of those, but rather full-bore NFL.

Yes, it feels hypocritical, but I can rationalize it ’til the cows come home. To wit:

  • If I’m watching a football game, I can’t be driving anywhere.
  • If I watch it at home on TV, I won’t be spending money in a sports bar.
  • I’m a fan of the Packers, the only community-owned team in the NFL.
  • The NFL does have a salary cap, which makes it one of the very first “cap-and-trade” precedents in the United States.
  • At least I’m not supporting NASCAR, by God.

I better stop there, before I burst from the confessional blurting “Go Pack!” But no, if you’re reading this, I’ve gone ahead and confessed, and perhaps you’re reading an epiphany as much as a confession.

Even a community-owned team huddles around the strategy of growth (photo credit: Elvis Kennedy)

Even a community-owned team huddles around the strategy of growth (photo credit: Elvis Kennedy)

Like many fellow fans, my habit may have started innocently, going to Lombardi Junior High, playing a bit of football (not very well either), selling coke at the Packer games, cheering on the Pack through thick and thin. But things have changed. More than me or any fan or any player, the world has changed and the NFL has changed. This isn’t the days of the Ice Bowl when folks wore their ice-fishing coveralls to the game and the players went back to work in a regular job during the off-season. No, the NFL has gotten way unsustainable, maybe not as much as with NASCAR, but way unsustainable nonetheless, and growing with no end in sight or in mind. Although the NFL has a salary cap, the NFL as a whole is rabidly pro-growth, constantly seeking expansion of teams, stadiums, and schedules.

The culture of professional sports illuminates a major challenge to achieving a steady state economy, namely the soul-searching task of curbing one’s own appetite for unnecessary or over-the-top goods and services. In this case we have an entertainment service that for many has deep cultural roots and may even invoke primal instincts to fight and to win. Perhaps the only way to curb such an appetite is to dwell for awhile on the fact that the level of unnecessary consumption associated with a perpetually growing NFL, NBA, MLB, NHL, and worst of all NASCAR no longer fits in the days of endangered species, climate change, and economic meltdown. The only way a professional sports league will fit, going forward, is with limits to its growth, all in the context of a steady state economy.

Limiting the growth of professional sports won’t happen if the owners and leagues can help it. This has to come from the consumer side of the ledger, perhaps with the help of some steady statesmanship. I remember writing a letter, published from afar in USA Today, exhorting Packer fans in Brown County to vote “no” on the Lambeau Field Atrium due to the gaudy air-conditioning bill and environmental impact. I must have seemed like a Martian to the cheeseheads. Winning that vote would have taken more leadership from state and county officials – that’s what I mean by steady statesmanship.

But for now it’s mostly up to us fans. We can’t keep letting the lure of these professional sports turn us into drunken fools at the Coliseum, fiddling while Rome burns. We’re the consumers, and if we watch fewer games the sports leagues will have to stop bloating.

I’ll do my penance in 2013. I’m taking the year off of professional football watching, Super Bowl and all. I have more important, fulfilling, and even enjoyable things to do Sundays.

Amen.

Technological Progress for Dummies, Part II

More than One Kind of Nut

by Brian Czech

“Failure breeds success,” I hope some famous person once said. For I have failed to accomplish the goal set out in Part 1 of Technological Progress for Dummies. The goal was to summarize an article — in plain language and in less than a thousand words — that described why technological progress cannot reconcile the conflict between economic growth and environmental protection. I found I couldn’t do it without several thousand words, and too much plain language is as difficult to digest as a dollop of jargon. As for the article itself, it’s long and full of jargon.

And now for the successful offspring of such abject failure. (Drumroll, please.) I can successfully say that most folks have tightened a nut or two.

In the old days you would have used a monkey wrench. Then a tidbit of technological progress happened and you had a box wrench, which allowed you to tighten that nut a tad more efficiently. When they finally invented the ratcheting socket wrench, you were really in business. It seemed like you could tighten far more nuts with the same amount of elbow grease; five nuts to one when you threw in some coffee!

Such is the basic pattern of technological progress. Invention and innovation allow you to do more with less. Well ok, maybe not actually “less.” If you tighten five nuts to one, you’re prone to using five times the nuts. And the ratchet set is something you have to add to the toolbox. But you can definitely tighten more nuts without working harder, so in workaday parlance, you’re doing “more with less.” If you want to get technical about it, you could say you’re producing more output per unit input. Your productivity is increasing.

For the economy as a whole, productivity increases with technological progress. It’s an impressive process; nearly awesome at some points in history. It makes us proud of the human race, boosts our confidence, makes us think the sky is the limit. Many are even led to believe we can grow the economy without impacting the environment. After all, if we can do more with less, how about doing more with a lot less?

And why stop there? If we invent and innovate enough, maybe we can do more with no more! We can just keep growing GDP without using any more wood, water, minerals, petroleum — natural resources in general. No more steel, nuts, or tools. No more stuff, no more energy.

It’s reminiscent of the alcoholic announcing, “I’m not drinkin’ any more, but just as much.” We may not be using more natural resources to produce more goods and services, but if we’re still using the same amount we can’t really say we’ve stopped impacting the environment, can we? Especially since we had to dig deeper for the minerals, drill deeper for the petroleum, etc. And notice we haven’t even mentioned the flow of pollution (and won’t, to keep things simpler.)

So it’s time for the really big guns. Now we’re going to produce more, not only with way less, not only with no more, but with nothing at all! We’ll just beam it all up. Why not? After all, research and development expenditures in the United States alone are some $300 billion per year. That oughta buy us out of any problem, including this one! That’s why economists like Robert L. Bradley, Jr. announce, “Natural resources originate from the mind, not from the ground, and therefore are not depletable.”

Now if you’re a scientist worth your stellarator, you can see through the subterfuge in a nanosecond. The first law of thermodynamics tells you there’s no producing something from nothing. You can’t even get perfectly efficient with the resources you do use, because that would violate the second law of thermodynamics. So there’s a limit to technological progress — doing more with less — as it applies to the full collection of materials at our disposal along with the energy we receive from the sun.

The problem remains, however, that for purposes of plain language, the laws of thermodynamics and even the phrase “laws of thermodynamics” don’t cut it. Only in plain language can we make a difference in everyday life and public policy. That’s why President Obama signed the Plain Language Act of 2010.

So here’s some more nuts and bolts. Remember how doing “more with less” leads to five times the nuts? Tell your local Robert L. Bradley, Jr. that we shall all refuse to tighten five times the nuts without five times the bolts and washers, along with additional material to be tightened. And if we’re assembling things for market — quite necessary for GDP growth — we’re now assembling more of them. That leads to more transportation, storage, and retail services. More electricity all around, too, along with the wiring, fuses, bulbs and such. Plus that power plant in the background, with all the nuts and bolts therein.

Now with this type of expansion going on everywhere that the proverbial nuts are tightened (all around the world, in other words), information services help to orchestrate it all. Everybody better have a computer, cell phone, and Twitter feed. Operating at this level, you may as well start advertising, too. Banking, insurance, and other service sectors will also play an expanded role.

Notice that, in addition to not even mentioning the flow of pollution, we also haven’t mentioned the agricultural sector — farming in plain language. But of course we’re going to need plenty of it, to feed all the folks with the manufacturing and service jobs. With all the food they’ll have to produce, they’ll need cell phones and GPS units in the air-conditioned cabs of those 30-foot-wide combines. And plenty of extra nuts and bolts.

So that old ’90’s notion that we could keep growing the “Information Economy” without using more resources — and without any more environmental impact — was like a highly productive conversion of grass into bullpies. All that information, which was supposed to beam us up to Shangri-La, was nothing if not tied into the regular old economy down on the farm and everywhere else in the Land of Nuts and Bolts. The computer was nothing more than the ratcheting socket wrench of the IT sector, which was distributing marching orders for an ever-larger ecological footprint.

At a thousand words now, I’m thinking this is all the success my failure can breed. Enough for one column at least. Someday I may also find a way to convert that earlier-mentioned article, condensing concepts such as niche breadth, trophic levels, and economies of scale into plain language of a thousand words or less, refuting the macroeconomic environmental Kuznets curve and solving the Jevons paradox (which really isn’t so paradoxical) in the process.

But it’ll drive some nuts. In fact, many more nuts, albeit more efficiently.