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Sustainable economics

May 08, 2008

The worst and the of best corporate efforts on climate change

Climate Counts, a non-profit that scores the commitment to reversing climate change of 56 major corporations in well-known consumer sectors–from apparel to electronics to fast food–today released their second annual company scorecard (read the full report here and the summary here).

Climate Counts gives scores from 0 to 100, based on 22 criteria used to determine if companies have measured the carbon footprint, reduced their impact on global warming, supported progressive climate change legislation, and publicly disclosed their climate action.

According to the Climate Counts web page, "our goal is to motivate deeper awareness among consumers-not only that the issue of climate change demands their attention, but also that they have the power to support companies that take climate change seriously - and avoid those that don't."

The worst of the companies (scoring 5 or less): Amazon, 5; Burger King, 0; Darden (owner of Red Lobster, Olive Garden and other chains), 0; eBay, 5; Jones Apparel Group (Anna Klein, Nine West and many other brands), 0; VF Corporation (Lee and Wrangler jeans and others), 4; Viacom (4), Wendy's (0), Yum! Brands (KFC, Taco Bell, Pizza Hut and many more), 1.

The best of the companies (scoring 65 or more): Canon, 74; General Electric, 71; Hewlett-Packard, 68; IBM, 77; Motorola, 66; Nike, 82; Proctor & Gamble, 69; Sony, 68; Stonyfield Farm, 78; Toshiba, 70.

The good news is that the Climate Counts scoring approach attracts a lot of press attention, effectively rewarding those companies that make worthy efforts and chastising those who don't. Last year, for example, Climate Counts was among the organizations that helped bring attention to Apple's slow start when it comes to environmental commitment (the company scored a lowly 2 last year and only 11 this year).

According to Wood Turner, Director of Climate Counts, this kind of scrutiny, through Climate Counts or by other means, can encourage corporations to make real efforts. In an email to me, he told the story of how Levi's made the effort to climb from a score of 1 in 2007 to 22 in 2008:

We got their attention with a score of 1 pt (out of 100) on June 19 [2007] and got a call from them late that afternoon.  They were bewildered but motivated.  They acknowledged that they were behind on climate change and that the score had very much gotten their attention.  They said simply, "You got our attention. What can we do?"  And we were more than happy to take them through our 22-criteria scorecard and our key benchmarks. 

They quickly moved to begin reporting much more openly about their concrete activities and future plans, expanding their environmental reporting on their website including information about their efforts to measure their climate impact and set goals to reduce it.  These are clearly just first steps, but on the pathway toward deeper corporate climate responsibility, they are absolutely important ones because they indicate a willingness to face even greater scrutiny from an increasingly engaged consumer -- to us, that's one of the hallmarks of climate leadership.

You can read what others think of the Climate Counts report at the Wired blog and the Environmental Leader. I'm thinking the Climate Counts approach is no replacement for legislation and a regulated cap and trade system, but until we get some politicians with backbones, by finding a way to focus and aggregate the power of consumers, Climate Counts is making a start.

What do you think?

May 02, 2008

Is there a U.S. candidate with the backbone to do something about climate?

Back in February, I wrote about about what the U.S. presidential candidates' said about  mitigating climate change. At that time, McCain's proposals were the weakest while there wasn't much air between what Clinton and Obama proposed.

The question remained, however, about what each of the candidates, if they won the presidency, would actually do about climate change. Good climate policy will mean standing up to special interests and leading us through some potentially unpopular policy changes.

And we all know, that when it comes to politicians, there are those who will spend their political capital to help them do what is right and, on the other hand, there are those who will do what is wrong thing to help them win political capital. The question, when it comes to the issue of climate change, was which candidate was which type of politician.

Well, this week, it became clear.

As the New York Times said today in an editorial (with my emphasis):

Senators John McCain and Hillary Rodham Clinton have hit on a new way to pander to American voters: a temporary suspension of the federal gasoline tax between Memorial Day and Labor Day. The proposal may draw applause and votes from Americans feeling the pain of nearly $4-a-gallon gasoline. But it is an expensive and environmentally unsound policy that would do nothing to help American drivers... Fortunately, Mr. Obama has not caved to the rising calls for cheap energy and has refused to follow his rivals down this misguided path...

Joseph Romm, a progressive, who worked for the Clintons as acting assistant secretary of energy for energy efficiency and renewable energy, writing critically of the gas tax on his blog, Climate Progress, says (again with my emphasis):

I write this post with some sadness. I would not have expected a major progressive politician who obviously cares about global warming to propose a gas tax holiday, which has no public benefits whatsoever, but at the same time undermines the entire rationale behind a national climate strategy that includes, as it must, a pricing mechanism for greenhouse gases. I try, however, to be as consistent as possible — and if such a proposal was cynical and hypocritical for Sen. McCain, it is equally cynical and hypocritical for Sen. Clinton. Kudos to Sen. Obama for opposing this absurd proposal — double kudos because it might cost him a few votes.

According to the Washington Post, meanwhile:

Harvard professor N. Gregory Mankiw, who has written a best-selling textbook on economics, said what he teaches is different from what Clinton and McCain are saying about gas taxes. "What you learn in Economics 101 is that if producers can't produce much more, when you cut the tax on that good the tax is kept . . . by the suppliers and is not passed on to consumers," he said.

Which makes the move by Clinton and McCain all the more cynical. While the measure will cost the federal government $9 billion and send entirely the wrong message on climate change, McCain and Clinton know as well as anyone else that oil companies won't pass the price break onto consumers but instead will pocket it.

They are paying $9 billion in our money, in other words, to make a false promise. They are trying to trick voters into voting for them.

Environmentalists said, according to the Post:

[that] stoking ire about the cost of gas undermines efforts to build a case for limiting carbon emissions, which could raise prices at the pump. "It sends a confusing message," said Kevin Knoblauch, president of the Union of Concerned Scientists. "What's more helpful is if [politicians] help consumers understand that this isn't about near-term gas prices, it's about a comprehensive and smart approach to energy policies."

The sad news is that this whole mishigas is a first indication of how McCain or Clinton would treat the climate issue if they became president. The good news is that it is also and indication of how Obama would treat it.

PS You might also read Sam Stein's critique of the gas tax vacation at the Huffington Post.

April 15, 2008

How to solve climate change and end poverty

Nicholasstern_3 When I posted yesterday about my disappointment in the public infighting by the climate change policy wonks I turn to for guidance, Greenpa left behind a comment saying, "What you have here, I think, is THE argument in favor of individual action, instead of 'policy.'"

The problem is, of course, that in 2050 there are going to be 9 billion people on the planet and only 1 billion of us will be in the currently developed economies.

It's not just that we have to find a way to consume less in the developed world. We must also find ways for the developing world to consume more sustainably. And that means developing ren ewable technology and finding ways to transfer that technology to economies that can't afford it.

Further, we have to find ways to make the halting of deforestation economic acceptable to the developing economies, like by forgiving debt so they don't have to cut down trees to service it.

These are goals that can't be accomplished by personal action here in the United States or elsewhere. We need political action to push forward the climate mitigation agenda, too, and even that is the wrong way to put it, because involvement in the democratic process *is* individual action.

But that still leaves open the question of a vision for how global climate change mitigation should be achieved. What policy should we be fighting for?

On the one hand, there is no point limiting climate emissions here in the United States if industry will just move to developing countries--taking their jobs with them--and carry on their emissions happily ever after. On the other hand, China says that it is not fair to cap emissions in developing economies like theirs before their citizens achieve European-style standards of living.

Meanwhile, back here in the good old USA, policy people argue amongst themselves as to whether we have sufficient technology to solve the climate change problems across the globe. Therefore, should we make our first priority regulations limiting emissions or investment in technological development?

A conundrum of impasses.

But according to the Business of Green:

...there are signs that medium-sized polluting nations including Britain and Germany are beginning to favor one possible solution to this impasse that would allow the rich world to cut back on its pollution gently, and allow the developing world to increase polluting until it reaches improved levels of prosperity.

In Britain this idea is known as Contraction & Convergence, so-called because the process would aim to equalize the levels of emissions — measured on a per capita basis — between rich and poor nations.

The website of the British Prime Minister Gordon Brown has posted a paper on this "Contraction & Convergence" by British economist Sir Nicholas Stern (pictured above) that points to the benefit of both solving the climate crisis and alleviating world poverty (and if that's not an example of happier planet, happier people, I don't know what is!). It also integrates the deployment of current technologies with investment in new technologies.

[Thanks to prompting from Sharon Astyk, let me say that I don't mean to endorse this plan but to bring it up as a discussion piece. What I like about it is that emphasizes both deployment in current technology and investment in new and that it suggests that developed economies shouldn't get a larger share of per capita carbon emissions and that it attempts to send wealth into emerging economies. On the other hand, it's numbers are not aggressive enough since we actually need to reduce carbon in the atmosphere to 350 parts per million.]

Here is the thesis of the paper, and if you don't read the rest of this admittedly overlong post, read this:

"The priority for poorest countries [meaning their own policy priorities] is to get more access to energy and consequently to emit more carbon, even though, a long term preference for a low carbon economy has to be integrated if only for energy security reasons. Africa will host 1.4 billion people in 2050, most of them living in cities. To overlook such developments can produce unsustainable ways of life conducting to further impoverishment. Developing models of an integrated, climate resilient and low carbon path of development is therefore an urgent task."

I thought summarizing  some of the paper's key points might be useful, both in their own right but also to familiarize readers with some of the key issues that come up in climate policy discussions:

  • Global emissions should be halved by 2050 to give us a reasonable chance of averting the most dire of climate change consequences.
  • Implicit in an equitable arrangement would be the idea that all world citizens are entitled to the same carbon emissions and therefore the allowable per capita emissions should be the same for all countries (an average of about 2 tonnes or 2.2 imperial tons a year).
  • This will require 80% reduction by developed Western European economies and significant reductions in emissions trajectories of emerging economies like China but it will give room for developing economies to grow.
  • Since developed economies like the US emit much more per capita carbon than this arrangement would allow and developing economies still emit much less, developed countries like the US, in order to achieve their targets, would have to buy emissions rights (carbon credits) from developing economies.
  • This would have the effect of helping to alleviate poverty in developing countries and to improve standards of living by funding the acceleration of low carbon growth and purchase of renewable energy technology.
  • Emissions targets can be met, in part, by adopting efficiency measures to ensure energy is not wasted with positive economic effects.
  • Increases in efficiency are limited, however, "so ultimately the control of energy emissions must come through the decarbonisation of energy sources--moving from unabated fossil fuels to renewables, nuclear and the capture and storage of fossil carbon."
  • Within each nation it is likely that carbon pricing--the levying of a charge on industries for carbon emissions--will help spur the shift of carbon abatement, though this is not sufficient.
  • Policy guidance in each economic sector will also be required--for buildings in urban areas, for land use planning, for transportation and infrastructure.
  • Carbon pricing alone will not make renewable energy solutions cost competitive enough fast enough to avoid the building of, for example, new coal plants in the developing economies. The technologies to bring about the near-complete decarbonisation of our energy supply do not yest exist at commercial scale and cost.
  • Public support for huge growth in the research and development of large-scale renewable energy is needed to quickly bring down the price or renewables to make the most economically sustainable choice for growing economies.
  • Deforestation contributes 15 to 20% of greenhouse gas emissions. A program to stop up to half the deforestation could be constructed for $10 to 15 billion a year. Sustainable forestry policies are required as well as changes to international financing which requires small economies to harvest their forests to service debt.
  • Even if all these measures are taken, adaptation to the effects of the unavoidable planetary temperature rise of 1 to 2 degrees Celsius which will be particularly difficult for the poorest and most vulnerable.
  • Developed economies have a moral obligation to help emerging economies in this regard since the existing carbon in the atmosphere was put there by the developed nations. Discretionary funding is unlikely to work and a system of global taxation of should be examined.

April 14, 2008

We can save the world or we can fight

The good news about global warming in the United States, I think, is that the "deniers," as they're called, have now been relegated to the fringe. The candidates from both parties have mitigation strategies (which isn't to say they are equally good--see this chart). The debate about whether or not there is such a thing as anthropogenic (is there a reason why a scientist can't just say man made?) global warming is over.

Now the question is: what do we do?

Now, I have no special expertise in these issues and I don't have the answers, but I will tell you this: when I went tonight to the blogs of the people I like to think might, I got my month's second big disappointment (read about the first here). I discovered that U.S. climate change mitigation policy wonks seem to be wasting their time in ad hominem attacks on each other.

Of course, there are some very legitimate policy questions to be debated. But instead of just debating them, Joe Romm of Climate Progress and Michael Shellenberger and Ted Nordhaus of the Breakthrough Institute, all of whom I greatly respect, have, in the last week, fallen into a bout of name calling on their blogs (look especially at the comments in this post).

Some of the top brains in the country are literally burning precious hours arguing about "who started it."

The way I figure it, the executives at Exxon are rubbing their hands together. The more everybody fights about what to do, the more the world's journalists get confused and write about the fights instead of the issues, the longer we take to change, the more gas Exxon gets to sell.

Apparently, the big insult among climate change policy wonks is to be called a "delayer"--meaning to delay doing anything about climate change. Well, while the wonks argue instead of synthesize, in my book, they're all delayers. Where's a Karl Rove type to keep people from airing dirty laundry when you need him?

The pity of it all, from what I can tell, is that the pugilists on  both sides of the fight believe in investment to develop new renewable energy technology, deploying existing renewable technology immediately, and capping allowable carbon emissions to help spur the previous two. It's just one side wants invest, deploy, cap, in that order, and the other wants cap, deploy, invest.

Now, I'm just a schlub and I'm not sure who's right and I sure don't know "who started it." But from where I sit downstream of the conversation, the name calling in public, if the object is to focus political will on doing something about climate change (an object the different camps clearly share), does nothing but damage.

Because in my view, the main challenge, in the United States, is still convincing our fellow citizens that climate change should be one of our top three agenda items. Public bickering by the messengers who should be delivering this message will not attract voters to the cause.

So no more of this in the future, you guys, and get back to your excellent work.

PS Thankfully, they do seem to have hugged it out.

March 28, 2008

First to green wins, Clorox decides

Green_works_3I've written before that the big companies should make enviros the target market. To be enviro, these days, is to be cool, ethical, caring and driven by values. And as people become aware that enviro-concerns are really human concerns, that toxins in our environment mean toxins in our bodies, and that a happier planet makes for happier people, the importance of green products in the marketplace is only going to increase.

Whoever gets there first is going to win in the long term.

I don't say this because I approve of greenwashing, the practice of making products seem green as a cynical marketing tactic. Of course, I abhor the practice and think, from a business point of view, it is an ultimately short term way to work, because it will backfire when customers realize they have been betrayed.

But what I want to say to the designers and product managers who come across this blog is that investment in truly sustainable product design is going to pay off and pay off big. Treating the earth kindly is not a philanthropic exercise but a profitable one (I give a few guidelines, by the way, for what I think will win enviro-customer loyalty, here and here).

And if Clorox's introduction of the Green Works line of biodegradable home cleaners is anything to go by, I'm not the only one to think so. When such a huge consumer brand thinks green is the way to go, you better worry whether it might be the way to go for your business, too.

Back when Clorox took over Burt's Bees, I wrote that I was suspicious of the giant corporation's intentions to maintain the brand's environmental credentials. I wrote that some sort of certification or transparency was needed in order to allow customers to reassure themselves.

Marketing on the basis of environmental ethics requires more than just a product. It requires a way for customers to reassure themselves that you remain true to those ethics. Indeed, I suspect that the skepticism of enviros like me is one reason big corporations have shied away from the market, fearing it could end up working against them.

Clorox appears to have overcome the transparency problem and potential customer skepticism with the endorsement of Green Works by the Sierra Club (see New York Times story here).

That the Sierra Club is taking an undisclosed amount of cash for the endorsement is potentially problematic. By profiting from Green Works sales, Sierra Club finds itself in the position of both running with the foxes and hunting with the hounds. And schemes like this can get watered down if they become widespread.

But I still think this is an important step forward.

This partnership between an environmental organization and a corporation big enough to get green products into the mass market means that a huge amount of toxic cleaning products will be displaced and demonstrates that a major corporation can move green out of the niche. The agenda of the environmental organization moves forward, money is made, and all of us end up with a safer water supply and a happier planet.

This a victory all around, and I hope brand managers and CEOs of the major corporations take notice. If you aren't, like Clorox, the first to introduce truly sustainable products to the mass market in a trustworthy fashion, you're going to lose. If you are the first, you'll win.

Meanwhile, here's the Sierra Club's rationale for making the endorsement:

  • Until now, a big stumbling block for families who want to live a greener lifestyle has been the high cost of "green" products. However, Green Works is priced anywhere from 30%-50% lower than the price of other natural products currently available.
  • Research indicates that people will likely be more willing to give an eco-preferable product like Green Works a try because they trust that the Clorox name means that it will clean well.
  • While most consumers do not have access to green cleaning products because they do not shop in the specialized stores where they are distributed, Green Works products will ultimately be found on the shelves of approximately 24,000 stores, giving most of the public access to these cleaners.

PS All the same, out of loyalty and sentimentality, and because it uses fewer plastic bottles and is completely organic and has no chemicals in it whose names I don't understand, I am still sticking with my Dr. Bronner's based cleaning regime.

March 18, 2008

Environmentalism and social justice

Vanjones The environmental advocate should strive to be the social justice advocate's identical twin. That is not to say that they should be the same entity, but that environmentalism should proceed as though they come from the same egg.

Social justice and environmentalism are born together. They have the same DNA. At best, the environmentalist shares the blood and guts of the social justice activist: compassion (our race's highest function and most glorious capacity).

What gets called "environmentalism" is often associated with saving future generations from catastrophe, it's important to remember that many in the current generation are already suffering from present-day environmental and social catastrophes.

That is, the true challenge facing us is not just to preserve the planetary habitat that we depend on for our health, happiness and security, but to do so while ensuring a dignified quality of life for all peoples around the world and around the United States. We need to reduce our dependence on unsustainable resources, increase our development of renewable resources, and increase equality of access to resources in general.

To hell with the polar bears, I once wrote on this blog (though, of course I think they are wonderful). Caring about animals or the people of the future more than the children of today seems absurd. "Is a green economy only about reclaiming throwaway stuff," said Van Jones, co-founder and board president of the Ella Baker Center for Human Rights, "or is it also about reclaiming throwaway communities, throwaway people, throwaway children?"

Van Jones is a modern American hero for his ability to articulate and promote the natural alliance between environmentalists and advocates for social justice.

To quote Sun Magazine writer David Kupfer's recent synopsis of Jones' achievements:

"Recently Jones has been connecting two issues that have largely been seen as separate worlds: the abysmal conditions of U.S. inner cities and the need for a healthier planet. To stem global warming, Jones argues, the mainstream environmental movement must make itself relevant to low-income Americans; why should a single parent working two jobs care about greenhouse gases if there are far-more-immediate concerns at hand? Jones calls for the creation of a 'green-collar' job corps that will train urban youth of color to retrofit U.S. cities so that they are environmentally sustainable."

What follows are some excerpts of Kupfer's Q&A with Jones (thanks to No Impact Man reader Karin Sullivan for alerting me to it):

The stake people of color have in the environmental movement: "It’s the people of color who are disproportionately affected by bad food, bad air, and bad water. People of color are also disproportionately unable to escape the negative consequences of global warming. Look at Hurricane Katrina. People of color need equal protection from the worst environmental disasters and equal access to the best environmental technologies..."

The call to arms needed to avert catastrophe:
"...even now, during the presidential campaign, you don’t hear a full-throated call for the sort of World War II–level mobilization that it’s going to take to avert ecological catastrophe. If you look at the scientific data on global warming, you can see that we can’t avoid a wholesale disaster unless we put this country back to work — putting up solar panels, weatherizing buildings, and constructing wind farms on a massive scale...

...We can’t rely just on markets and technologies and consumer behavior. That sort of eco-elitism is a dead end. Eco-populism is a better model for dealing with these problems. We need a greater faith in communities, government action, voters, and work."

Ensuring that sustainability benefits and is supported by all economic classes:
"...you can’t have a sustainable economy when only 20 percent of the people can afford to pay for hybrids, solar panels, and organic cuisine, while the other 80 percent are still driving pollution-based vehicles to the same pollution-based jobs and struggling to make purchases at Wal-Mart...

"...As we move toward a sustainable economy, if we do not take care to minimize the pain and maximize the gain for the poor, they will join forces with the polluters to derail the green revolution...

"...It’s important from both a moral standpoint and a purely crass political point of view that we create a 'new-deal' coalition among green businesspeople, labor, the poor, and people of color. You unite groups by offering immediate, as well as long-term, benefits for each constituency. For poor people, that could take the form of job opportunities, better mass transportation, and free bus passes..."

Promoting successful environmental policies through the politics of inclusion: "Environmentalists sometimes don’t understand that what motivated them to get involved in political activism and change their lifestyle isn’t going to inspire everyone else. It’s not just a matter of their explaining louder and louder why everyone should be like them. That’s not the politics of inclusion; that’s the politics of elitism. The reality is that working people will support ecological solutions, but not for the same reasons that the eco-elites support them...

"...most low-income people and people of color I know had no interest in seeing [An Inconvenient Truth]. They already have enough problems. They don’t need new crises to worry about. Around here we say that the people who already have a lot of opportunities are the ones who need to hear about the crises. So if you have a house and a car and a college degree, then, yes, you should hear about global warming, or peak oil, or dying species.

"But poor and low-income people need to hear about opportunities. They need to hear about the expected reduction in asthma rates when we reduce greenhouse gases. They need to hear about the wealth and health benefits of moving to a sustainable economy. Otherwise you are just telling people who are already having a bad day that they should have a worse one."

The link between the huge U.S. prison population and environmentalism: "To me it’s no surprise that the country that has the world’s biggest pollution problem also has the most prisons. We’ve got a disposable mind-set: disposable products, disposable species, disposable people. We don’t see our sisters and brothers, much less all the animal species, as sacred. The failure to honor the sacred is at the root of both problems.

"Most of our prison-population growth has come from convictions on nonviolent drug offenses...Drug users need treatment, not jail time. We know how to take care of people who are in trouble with drugs, because we do it for rich kids. We should do the same thing for poor addicts, because it’s the right thing to do and we’d save money doing it."

To read the entire, excellent article, go here.

Photo Courtesy of Arnold Creek Productions.

March 17, 2008

An argument for a zero impact culture

Alex Steffen, of WorldChanging, writes:

"The idea of zero impact ought to be non-controversial. It is simple common sense that practices which are unsustainable cannot continue, and we know that it is true that propping up unsustainable practices with non-renewable resources has even more dramatic consequences. And we are currently growing rapidly less sustainable, and using more and more non-renewable to keep the ecological consequences at bay. This must stop. All of this is just plain speaking, and ought to be obvious to any informed observer...

"...I, for one, do not believe that we must be worse off for this transition. Under most models, the economy will continue strong growth even if we push hard on reducing emissions -- indeed, many of the things we need to do will actually improve productivity, more than paying for themselves. (This is true, by the way, not just for carbon emissions, but for toxics, waste reduction, water conservation, ecosystem service preservation, greater access to education and health care and host of other sustainability priorities). On pure GDP terms, making this transition quickly may be a huge winner.

"And, of course, GDP isn't everything. There are a whole host of human security, moral happiness and quality of life questions that tackling this crisis will help us answer. If we move quickly, we could not only have staved off disaster by mid-century, but built a profoundly better world. And that is far more than nothing."

Yet another voice extolling the fact that making the planet happier will make the people happier.

February 19, 2008

Sustainable consumption's "double dividend"

[First off, let me say sorry about yesterday's post of a revamped version of the national anthem. Like so many people commented, I couldn't hear the lyrics. I thought that only the melody had been adapted. I would never have posted it if I had realized that the lyrics had been changed. But onwards...]

One method of making consumption sustainable is to modify material and product production, distribution, use and disposal methods so that the consumption is less damaging. Another method, and the one that I often write about, has to do with just reducing consumption.

I like this approach because no new technology is required. It is simply a matter of habit change. And I like it because I don't believe the two-job, credit card debt up to our necks, don't have time for our friends and families approach to life makes us happy.

I believe, as Professor Tim Jackson of the University of Surrey discussed in his 2005 paper "Live Better by Consuming Less?," that there is a "double-dividend" to reduced consumption. One dividend is that it helps maintain our health, happiness and security as it depends on our planetary habitat and the other is the increase of happiness that can come with a lesser emphasis on accumulating stuff.

What I like about Tim Jackson's paper is that he clearly articulates the arguments both for an against this position, and then comes to a conclusion about how the double-dividend argument might actually be achieved, given the complexity of human nature:

  • A starting point for conventional economics is that, "in some simple sense, the consumption of goods and services is an attempt to provide for our individual and (at the aggregate level) collective well-being."
  • "What emerges from this assumption is the idea that the more we consume (in economic terms) the better off we are...The equation of economic consumption with well-being goes a long way toward explaining the primacy of measures such as GDP in public policy terms."
  • In contrast, "the environmental lobby has been particularly vociferous in denouncing the economic model both for its failure to to protect the environment and for the oversimplicity of its underlying conception of human nature."
  • "The assumption of insatiability at the heart of economics is directly counter to certain classical conceptions of human well-being. Pleonexia, the insatiable desire for more, was regarded in Aristotle's day as a human failing, an obstacle to achieving the 'good life.' In the modern consumer society, it is encoded in both the ideological foundation and the institutional structure of the market economy."
  • Jackson goes on to ask if consumption does not offer us the good life, why would we consume so much? This is a strong contradiction to the idea of pleonexia as a pathology. Jackson demonstrates that consumption is actually rooted not so much in the need of the products we consume, per se, but in deep psychological needs.
  • "Among the behaviors suggested by the evolutionary psychology of consumerism are those concerned with display and status... That certain kinds of consumption are used to advertise status, power, and social position has been explored extensively in the sociological discourse on consumption."
  • This is not pathological but an "expression of behavioral traits that have been successful in ensuring the survival of the species for generations."
  • Furthermore, status-based decisions, such as to buy a big house, then lock us into other consumption decisions, like to buy the oil to heat the house.
  • Beyond that, "in addition to their purely functional characteristics, material commodities possess vitally important symbolic properties... One of the most obvious applications of this broad thesis lies in the role of material commodities in constructing and maintaining personal identity." In other words, as our culture is constructed, consumption lies at the heart of expressing our style and individuality.
  • "We consume in order to communicate. Through consumption we communicate not only with each other but also with our pasts, with our ideals, with our fears, and with our aspirations. We consume in pursuit of meaning."
  • "But where do these arguments leave the double dividend argument? How should we now construe the idea that it is possible to live better by consuming less?"
  • Jackson goes on to say that the needs for status, identity and meaning do not preclude their being decoupled from what we own. That, in fact, what we learn is that if we want to reduce consumption than we need to find ways to replace the communication that consumption achieves. We need to find better ways to achieve that same communication.
  • Furthermore, "the insight that a certain amount of consumer behavior is dedicated to an (ultimately flawed) pursuit of meaning opens up the tantalizing possibility of devising some other, more successful and less ecologically damaging strategy for pursuing personal and cultural meaning."
  • "It remains a very real possibility that we could collectively devise a society in which it is possible to live better (or at least as well as we have done) by consuming less and becoming more human in the process."

To read the whole 19-page paper, in PDF, go here.

February 12, 2008

When economic growth isn't progress

Gpigraph

Policy makers and even the voting public make the mistake of thinking that growth in gross domestic product (GDP) is an indicator of societal progress. In reality, though, GDP is nothing but an indicator of national spending with no distinctions between those transactions that add to our well-being and those that diminish it.

  • Chop the top off the mountain to take its coal, and you'll get economic growth in the area. Question is, if you taint the water to the point where people can't even touch it safely, can you call that progress? (By the way, there's a great, new film on this subject called Burning Our Future)
  • If community earnings rise 20%, but the time parents can spend with their children drops 40%, can you call that progress?
  • If the washing machine industry grows by 20%, but that is because their products are engineered to last only 50% as long, can you call that progress?

All of these scenarios would contribute to a growth in GDP, but a decline in human happiness and well-being. That's why Redefining Progress developed the Genuine Progress Indicator (GPI).

GPI starts with the same personal consumption data that GDP is based on, but then adjusts it by assigning monetary values to factors that affect human happiness and well-being. Those factors include, among others:

  • The impact of economic growth on happiness, depending on how much of it actually ends up in the hands of the poor people who need it
  • The amount of "leisure time" available within the culture for things like childcare, housework, volunteer work, etc.
  • The negative costs of crime-associated legal fees, medical expenses and property damage. Perversely, an increase in crime, because of these costs, can actually increase the GDP, a clear case of economic growth not indicating an increase in happiness.
  • The economic externalities like long-term environmental damage associated with carbon emissions, ozone depletion and deforestation.

The point is that if policy-makers adopted a metric like GPI, they would be guided toward adopting agendas that much more tightly focussed on the happiness of the electorate than on far-less-meaningful growth in the economy.

"We believe," Redefining Progress says on its website, "that if policymakers measure what really matters to people—health care, safety, a clean environment, and other indicators of well-being—economic policy would naturally shift towards sustainability."

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