Monday, August 29, 2005

Ecological Economics 101

“If the earth must lose that great portion of its pleasantness which it owes to things that the unlimited increase of wealth and population would extirpate from it, for the mere purpose of enabling it to support a larger, but not a happier or a better population, I sincerely hope, for the sake of posterity, that they will be content to be stationary, long before necessity compels them to it.”
-John Stuart Mill, 1857
I was a diligent college freshman; I attended my classes regularly, studied hard, and never let my weekend party binges interfere with my coursework. There was, however, one exception of note: Macroeconomics 101. No matter how I tried, I just couldn't remain awake for the class's duration. After months of embarrassing head jerks and dropped pencils, my attendance became sporadic.

The somnolent state induced by Macroeconomics was not the result of an uninspiring professor, as is so often the case. On the contrary, my professor was colorful and loud. Built like Batman's nemesis, The Penguin, with a red-face and a propensity for excessive perspiration, the man was given to stomping around his stage like a petulant Napoleon. Unfortunately, even his theatrics failed to keep me involved with the subject at hand.

Most of Macroeconomics is common sense. The core lesson, that economic growth results in more jobs and a higher standing of living, is popularly accepted as gospel. The formulas and names seemed designed, I believed at the time, to encourage economists to delude themselves into thinking their profession a "hard science" rather than the marriage of philosophy and sociology that it is. Furthermore, when dealing with "the big picture," as macroeconomics does, the mathematical component is almost irrelevant. A mathematical moron, I signed up for the class with this in mind, so I was discouraged to learn that the bulk of the syllabus in fact dealt with microeconomics. Presented with word problems involving sock production, staff wages and consumer demand, I quickly lost interest.

Ten years later, I no longer find economics a bore. I much admire James Surowiecki, writer of "The Financial Page" column for The New Yorker. He offers readers a sensible, sociological approach to money matters. Surowiecki’s columns served as a gateway for me; they allowed me to realize the obvious: the economy is interesting, even important.

My father stresses the explicit connection between the words "ecology" and "economy" by returning to the shared Greek root of these words. "Ecology" translates as "study of the household" and "economy" as "management of the household." Any good scientist (or thoughtful citizen, for that matter) should study the household before managing it. Thanks in no small part to my father’s influence, I began to see many ecological issues as economic concerns (and vice versa). Given my environmentalist leanings, I suppose my confrontation with economic theory was inevitable. It was also inevitable, or at least quite likely, that I would become disenchanted with our current boom-and-bust paradigm.

In his excellent book, Shoveling Fuel for a Runaway Train, Brian Czech picks apart neoclassical economic theory, the dominant force in contemporary economics and the impetus for the misguided assumption that economic growth is always good. This surprisingly light read is not the first text of the steady state economy movement or even the most profound, but Czech’s conversational style and humble tone ingratiate it to even the uninformed reader. Czech is President of the Center for the Advancement of the Steady State Economy (CASSE), an organization with three principal objectives:
-Educate citizens and policy makers of the fundamental conflict between economic growth and environmental protection, economic sustainability, national security and international stability

-Promote a steady state economy of stable and mildly fluctuating size as a sustainable alternative to economic growth

-Study the means conducive to the establishment of a steady state economy
An earlier HH post, “Striving for the Steady State Economy,” will give you more detail on the generalities of the movement, but I encourage visits to the following sites as well.

Center for the Advancement of the Steady State Economy (link)

The International Society for Ecological Economics (link)

The Gund Institute for Ecological Economics (link)

Over the course of the last two hundred years, our vices and competitive natures have come home to roost in the form of increasing population pressure and the associated push for perpetual economic growth. In the era of globalization, such pressures are no longer localized. As William Cronon writes in his 1983 Changes In The Land, “anthropologists are increasingly aware, as historians have long known, that the development of a world capitalist system has brought more and more people into trade and market relations which lie well beyond the boundaries of their local ecosystems.”

Homo sapiens dubbed themselves the “wise” species. We now have an opportunity to prove the taxonomists right. Will the First World be able to accept a more modest standard of living in order to strive for sustainability?

At the turn of the 21st century, this question is urgent. Denialists argue that evolution “demands change,” that the passage of time “will bring what it will bring.” They tell us not to worry, that we will confront (and solve) new challenges as they materialize. But such attitudes are fatalistic and thoughtless. Of course we have the option of taking our hands off the steering wheel, pushing the gas pedal to the floor and seeing what the passage of time will bring, but why would a rational person opt for such an approach? Why act irresponsibly when there are other, more ethical choices? More important still, why cede to future generations the problems caused or exacerbated by contemporary missteps?

In Part II of his book, Czech offers advice for building a healthy alternative to unrestrained, free-market capitalism. In the steady state economic paradigm, growth (or, as Czech calls it, bloating) is discouraged; a balance is sought instead. This balance requires a more simplistic lifestyle, one driven by the quest for "self-actualization," a term Czech borrows from Abraham Maslow's "Hierarchy of Needs," rather than self-esteem, which, in today's culture of celebrity and distraction, is tied to bling-bling displays of real estate, clothing, vehicles, expensive dining and so on.

Later this week, I hope to examine Czech’s prescription in more detail. For now, though, I just wanted to recommend his book to any readers interested in the intersection of economics and ecology.

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