“What we are doing to the forests of the world is but a mirror reflection of what we are doing to ourselves and to one another.” Mahatma Gandhi
In this post I have taken several comments out of my Sustainable Living Text. Why do we accept the flawed GDP measure as the health statement of our national and global economies, which economists and politicians then make the quantum leap to the assumption that it measures our own health? Most people know that manufacturing creates much pollution, but accept it simply a side-effect to accept for the sake of the economy. That is why a singular focus on profit sees environmental protection as too economically costly. The goal of sustainable development is to best balance the demands of economic development with the demands of environmental protection and social equity and to create a better quality of life while still providing for all the basic needs of a population. “Many organizations and financial institutions have manipulated ingenious mechanisms to guarantee large benefits and bonuses for top executives, regardless of a company’s or corporation’s actual performance.”
If we are going to change the economic system, we must have ‘transparency’ be a central component of any measurement system. Transparency won’t cure economic problems overnight, but it will allow people to see clearly how the economy is being manipulated thus promoting more equity and trust in any new measures that are adopted. “Transparency is a key point of a sustainable living system. If the bottom line of corporations is to create profit and benefits for those who already have much money, then the money must come from consumers. To this end, the business-as-usual system is set up to keep money flowing upward by convincing people to continue buying things they might not need, usually at the expense of real personal needs, which are ignored or downplayed. This process is the basis of consumerism, which is about a modern fundamental human relationship—the relationship with things (stuff).” Our preoccupation with stuff is the primary reason we now live in a ‘debt society.’ Until the last century debt was always seen as a problem with debtors’ prisons being common. But especially since WWII debt is now seen as a social expectation. “Today, credit cards make purchasers quick and easy with rolling monthly balances. While this has made being a consumer easy, it has created a whole new set of problems, not the least being that it allows people to spend beyond their means with the illusion that they can somehow pay off the debts in the future.” We are in essence now becoming neo-serfs where desperation means you fear losing your job causing you to lose everything you think you own. (Defn: A serf was a person who was forced to work on a plot of land, especially during the medieval period when Europe practiced feudalism, when a few lords owned all the land and everyone else had to toil on it. Now think corporation instead of some royalty.)
Understanding the ‘quad stack’ (see previous post) or nested ‘Triple Bottom Line (TBL)’ (thinking social, environmental, economic together) helps in identifying when economics is being used solely for profit or to reach a sustainable end goal with overall and equitable well-being of all humankind. When you encounter economic arguments, you must assess whether the social and environmental consequences are also being reviewed and considered in the decision making for the economic rationale – the TBL. There are already economic measures being used that try to level the playing field on which economics is played.
The Index of Sustainable Economic Welfare (ISEW), While not perfect, it is one of the early attempts to measure the positive against the negative aspects of GDP to find the net benefit or loss with human welfare. More importantly, it includes calculated costs for environmental services (narrowly: refers to economic and non-economic assets of land, water and air, including related ecosystem, and all biota as it benefits humanity – all services that nature gives us for free that we will have to pay for through technology if we ruin them). Since 1974, when the ISEW was first used by economic researchers, the costs involved in the correcting for economic externalities (defn: a side effect or consequence of an industrial or commercial activity that affects other parties without this being reflected in the cost of the goods or services involved, such as the pollination of surrounding crops by bees kept for honey) increased faster than the GDP indicating that environmental problems were now escalating beyond manageable control.
The Genuine Progress Indicator (GPI) was created in 1995 to help policy makers understand economically and social benefits (or lack of) for their communities. The indicators used in the GPI measure the positives of value such as household and volunteer work from the negative costs of factors like crime and pollution – in GDP only money spent on crime and pollution cleanup would be counted. “The main ten indices are: 1) income distribution because it gauges when the poor are improving; 2) housework, volunteering, and higher education since much non-market valuable community based work (mostly unpaid) is done that isn’t measured in the GDP; 3) crime imposes huge economic negative costs on society from legal fees, to medical expenses, and damage to property; 4) resource depletion is a much needed measure since loss of resources detracts from future generation benefits; 5) Pollution is measured as harm to human and environmental health. Notably, the GDP counts this twice as a positive when it created and then when it creates employment to clean it up; 6) long-term environmental damage and carbon emission are all classed as a negative instead of ignoring them as done in the GDP; 7) changes in leisure time are classed as positive if there is the ability to choose between work and leisure activities and negative if free time has been eroded by economic realities and the need to work more; 8) defensive expenditures are treated as costs and not benefits. They include money spent on factors that erode quality of life such as accidents, and the need to protect against mishaps; 9) lifespan of consumer durables & public infrastructure is a reflection on what has been termed ‘built in short-term obsolescence’ of household appliances and systems, and the need to keep replacing products frequently; and 10) dependence on foreign assets is a positive if it adds to capital or borrowed money is used for investment and a negative if capital has to be borrowed to finance consumption, meaning the country is living in debt.”
We are no longer looking at diminishing returns, but at negative ones. Much of the reason for this is that more and more money is being retained by the monetary elites with less ‘filtering down’ to the wage and salary earners. The global economy is now seeming to run backwards because even though goods and services are consistently increasing (GDP is climbing) we now spend more and more money each year to keep global ecosystems functioning and to compensate for the environmental damage done. In a nutshell, despite the apparent increase in global Standard of Living, the diminished ecosystem services means we are literally wrecking our home while we live in it.
At least some business organizations are beginning to recognize this and there is a big push in business to talk green and about sustainability. Is this a real solution with real intention or just lip service to further increase profits from a gullible public? Getting past the conditioning and indoctrination means to understand how business, one of the greatest change agents in the world, is reacting to public demand for environmental and human sensitivity. See the next post…..
0 Comments