Environment, economics and population
Toolbox
Published: February 8, 2009
The economic crisis facing us is closely related to the many environmental problems stressing the earth. It is time for a new economic model, one that better serves both the needs of people and the earth.
The economic crisis started in large part owing to the subprime mortgage fiasco which began in the Southwest. This region has seen tremendous increase in the construction of new houses as a result of population growth. More bidders have brought higher property values, huge mortgages, and a situation that spiraled out of control. At the root of the economic crisis is the myth that the economy can grow forever. This myth is even more false in a world where growth depends on cheap fossil fuels that have probably reached their peak production.
Economic growth results from an increase in the production and consumption of goods and services, which in turn relies on population growth. The problem with economic growth as an economic model is that it conflicts with the principles of physics and ecology. There is a limit to economic growth, and there is mounting evidence that global economic growth is having negative effects on the long-term health of the environment, such as climate change, loss of biodiversity, and pollution of our air and water. So even though economic growth has provided many benefits over time, it is now causing more problems than it solves.
Our food situation is one example of how economic growth is closely related to our environmental and social problems. Current food consumption in the United States requires 1.2 cultivated acres per person. As a result of population growth it is estimated that in 2050 the number of acres of farmland available for each person will be 0.6. That means more clearing of forests, diversion of water for irrigation and economic hardship for millions of people.
Fortunately there is an alternative economic system – the steady-state economy, as first envisioned by economist Herman Daly. In his book "Steady-State Economics," Daly defines steady-state economy as having stabilized population and consumption. Its key features are: (1) sustainable scale, in which economic activities fit within the capacity provided by ecosystems, (2) fair distribution of wealth and (3) efficient allocation of resources. A steady-state economy can be compared to a mature and healthy Vermont forest ecosystem, where a wide variety of fauna and flora lives in healthy balance. The forest does not grow in total volume, but it is a complex, dynamic and evolving system.
The Center for the Advancement of the Steady State Economy in Arlington, Va., is leading the transition to a different economy. CASSE states that "Environmental protection, economic sustainability, national security, and international stability are all threatened by perpetually increasing populations and per-capita production and consumption."
In Vermont we are also fortunate to have the Gund Institute for Ecological Economics at the University of Vermont. According to its Web site, "Ecological economics is the transdisciplinary study of the interaction between human economic systems and natural ecosystems." One of its fellows is Joshua Farley, Ph.D., who co-authored a book with Daly titled "Ecological Economics: Principles and Applications."
How do we transition from our present growth economy to a steady-state economy? Like any major change, this will require a paradigm shift. The same fiscal policy tools that have been used to promote an economic growth policy will need to be used to promote a steady-state economy. We will have to gradually readjust the current spending, tax, interest rate, banking, regulation, and trade policies that are currently set for growth. Additional tools such as carbon cap-and-trade and enforcement of the Endangered Species Act and other environmental laws will be required.
As individuals we can help by buying local, buying organic, vacationing as close to home as possible, limiting consumption, growing some of our own food and shifting to green energy. We can also talk with our friends and neighbors changing our cultural assumptions about economic growth. And we can get involved in one of the several community sustainable living networks organized by the Vermont Earth Institute.
According to an analysis of the Global Footprint Network's ecological footprint data, U.S. bio-capacity – domestic surface area available to produce resources and assimilate waste – provides only 48 percent of our annual subsistence. The other 52 percent must be gained through imports. It also calculates that to align population with actual domestic bio-capacity the US could support only 147 million – 158 million less than today!
Whatever one calls it – Herman Daly's "steady-state economy," the Gund Institute's "ecological economics" or Bill McKibben's "deep economy" – it is time that we as a society move towards an economy that provides economic benefit to all people and protects the ecosystems of the earth at the same time.
George Plumb is a co-founder and President of Vermonters for a Sustainable Population and author of the "Disappearing Vermont" report. He can be reached at gplumb@pshift.com.
ON THE NET
Gund Institute of Ecological Economics, University of Vermont
www.uvm.edu/giee/
Vermont Earth Institute
www.vtearthinstitute.org/
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