INTRODUCTION
Chapter 1. The Economy and the Earth
Lester R. Brown, Eco-Economy: Building an Economy for the Earth
(W.W. Norton & Co., NY: 2001).
In 1543, Polish astronomer Nicolaus Copernicus
published "On the Revolutions of the Celestial Spheres," in which
he challenged the view that the Sun revolved around the earth, arguing
instead that the earth revolved around the Sun. With his new model
of the solar system, he began a wide-ranging debate among scientists,
theologians, and others. His alternative to the earlier Ptolemaic
model, which had the earth at the center of the universe, led to
a revolution in thinking, to a new worldview.1
Today we need a similar shift in our worldview, in how we think
about the relationship between the earth and the economy. The issue
now is not which celestial sphere revolves around the other but
whether the environment is part of the economy or the economy is
part of the environment. Economists see the environment as a subset
of the economy. Ecologists, on the other hand, see the economy as
a subset of the environment.
Like Ptolemy's view of the solar system, the economists' view is
confusing efforts to understand our modern world. It has created
an economy that is out of sync with the ecosystem on which it depends.
Economic theory and economic indicators do not explain how the economy
is disrupting and destroying the earth's natural systems. Economic
theory does not explain why Arctic Sea ice is melting. It does not
explain why grasslands are turning into desert in northwestern China,
why coral reefs are dying in the South Pacific, or why the Newfoundland
cod fishery collapsed. Nor does it explain why we are in the early
stages of the greatest extinction of plants and animals since the
dinosaurs disappeared 65 million years ago. Yet economics is essential
to measuring the cost to society of these excesses.
Evidence that the economy is in conflict with the earth's natural
systems can be seen in the daily news reports of collapsing fisheries,
shrinking forests, eroding soils, deteriorating rangelands, expanding
deserts, rising carbon dioxide (CO2) levels, falling water tables,
rising temperatures, more destructive storms, melting glaciers,
rising sea level, dying coral reefs, and disappearing species. These
trends, which mark an increasingly stressed relationship between
the economy and the earth's ecosystem, are taking a growing economic
toll. At some point, this could overwhelm the worldwide forces of
progress, leading to economic decline. The challenge for our generation
is to reverse these trends before environmental deterioration leads
to long-term economic decline, as it did for so many earlier civilizations.
These increasingly visible trends indicate that if the operation
of the subsystem, the economy, is not compatible with the behavior
of the larger systemthe
earth's ecosystemboth
will eventually suffer. The larger the economy becomes relative
to the ecosystem, and the more it presses against the earth's natural
limits, the more destructive this incompatibility will be.
An environmentally sustainable economyan
eco-economyrequires
that the principles of ecology establish the framework for the formulation
of economic policy and that economists and ecologists work together
to fashion the new economy. Ecologists understand that all economic
activity, indeed all life, depends on the earth's ecosystem-the
complex of individual species living together, interacting with
each other and their physical habitat. These millions of species
exist in an intricate balance, woven together by food chains, nutrient
cycles, the hydrological cycle, and the climate system. Economists
know how to translate goals into policy. Economists and ecologists
working together can design and build an eco-economy, one that can
sustain progress.
Just as recognition that the earth was not the center of the solar
system set the stage for advances in astronomy, physics, and related
sciences, so will recognition that the economy is not the center
of our world create the conditions to sustain economic progress
and improve the human condition. After Copernicus outlined his revolutionary
theory, there were two very different worldviews. Those who retained
the Ptolemaic view of the world saw one world, and those who accepted
the Copernican view saw a quite different one. The same is true
today of the disparate worldviews of economists and ecologists.
These differences between ecology and economics are fundamental.
For example, ecologists worry about limits, while economists tend
not to recognize any such constraints. Ecologists, taking their
cue from nature, think in terms of cycles, while economists are
more likely to think linearly, or curvilinearly. Economists have
a great faith in the market, while ecologists often fail to appreciate
the market adequately.
The gap between economists and ecologists in their perception of
the world as the new century begins could not be wider. Economists
look at the unprecedented growth of the global economy and of international
trade and investment and see a promising future with more of the
same. They note with justifiable pride that the global economy has
expanded sevenfold since 1950, raising output from $6 trillion of
goods and services to $43 trillion in 2000, boosting living standards
to levels not dreamed of before. Ecologists look at this same growth
and realize that it is the product of burning vast quantities of
artificially cheap fossil fuels, a process that is destabilizing
the climate. They look ahead and see more intense heat waves, more
destructive storms, melting ice caps, and a rising sea level that
will shrink the land area even as population continues to grow.
While economists see booming economic indicators, ecologists see
an economy that is altering the climate with consequences that no
one can foresee.2
As the new century gets under way, economists look at grain markets
and see the lowest grain prices in two decadesa
sure sign that production capacity is outrunning effective demand,
that supply constraints are not likely to be an issue for the foreseeable
future. Ecologists, meanwhile, see water tables falling in key food-producing
countries, and know that 480 million of the world's 6.1 billion
people are being fed with grain produced by overpumping aquifers.
They are worried about the effect of eventual aquifer depletion
on food production.3
Economists rely on the market to guide their decisionmaking. They
respect the market because it can allocate resources with an efficiency
that a central planner can never match (as the Soviets learned at
great expense). Ecologists view the market with less reverence because
they see a market that is not telling the truth. For example, when
buying a gallon of gasoline, customers in effect pay to get the
oil out of the ground, refine it into gasoline, and deliver it to
the local service station. But they do not pay the health care costs
of treating respiratory illness from air pollution or the costs
of climate disruption.
Ecologists see the record economic growth of recent decades, but
they also see an economy that is increasingly in conflict with its
support systems, one that is fast depleting the earth's natural
capital, moving the global economy onto an environmental path that
will inevitably lead to economic decline. They see the need for
a wholesale restructuring of the economy so that it meshes with
the ecosystem. They know that a stable relationship between the
economy and the earth's ecosystem is essential if economic progress
is to be sustained.
We have created an economy that cannot sustain economic progress,
an economy that cannot take us where we want to go. Just as Copernicus
had to formulate a new astronomical worldview after several decades
of celestial observations and mathematical calculations, we too
must formulate a new economic worldview based on several decades
of environmental observations and analyses.
Although the idea that economics must be integrated into ecology
may seem radical to many, evidence is mounting that it is the only
approach that reflects reality. When observations no longer support
theory, it is time to change the theorywhat
science historian Thomas Kuhn calls a paradigm shift. If the economy
is a subset of the earth's ecosystem, as this book contends, the
only formulation of economic policy that will succeed is one that
respects the principles of ecology.4
The good news is that economists are becoming more ecologically
aware, recognizing the inherent dependence of the economy on the
earth's ecosystem. For example, some 2,500 economists-including
eight Nobel laureates-have endorsed the introduction of a carbon
tax to stabilize climate. More and more economists are looking for
ways to get the market to tell the ecological truth. This spreading
awareness is evident in the rapid growth of the International Society
of Ecological Economics, which has 1,200 members and chapters in
Australia/New Zealand, Brazil, Canada, India, Russia, China, and
throughout Europe. Its goal is to integrate the thinking of ecologists
and economists into a transdiscipline aimed at building a sustainable
world.5
ENDNOTES:
1. Nicolaus Copernicus, De Revolutionibus Orbium Coelestium, Libri
VI (Six Books on the Revolutions of the Celestial Spheres) (1543).
2. Growth in global economy from historical series compiled by Worldwatch
Institute from Angus Maddison, Monitoring the World Economy 1820-1992
(Paris: Organisation for Economic Co-operation and Development,
1995), using deflators and recent growth rates from International
Monetary Fund (IMF), World Economic Outlook (Washington, DC: October
2000).
3. Grain prices from IMF, International Financial Statistics (Washington,
DC: various years); share of global population fed by grain produced
by overpumping aquifers calculated using grain consumption from
U.S. Department of Agriculture (USDA), Production, Supply, and Distribution,
electronic database, Washington, DC, updated May 2001, and annual
water deficit of 160 billion cubic meters in Sandra Postel, Pillar
of Sand (New York: W.W. Norton & Company, 1999), p. 255.
4. Thomas Kuhn, The Structure of Scientific Revolutions (Chicago:
University of Chicago Press, November 1996).
5. The International Society for Ecological Economics, , viewed 31 July 2001; Redefining Progress, "2,500 Economists
Agree That Combating Global Warming Need Not Necessarily Harm the
U.S. Economy Nor Living Standards," press release (Oakland, CA:
29 March 2001).
Copyright
© 2001 Earth Policy Institute
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