Right Relationship: the new eco-economic model -- Peter Brown

In a 50 min video and powerpoint, Dr Peter G. Brown (McGill Environmental Studies) explains to Concordia business school students how the core Quaker principle of "right relationship"—respecting the integrity, resilience, and beauty of human and natural communities—can serve as the foundation for a new economic model. See the written article just published by Peter and others online: Kosoy N et al. "Pillars for a flourishing Earth: planetary boundaries, economic growth delusion and green economy".  In the book Right Relationship: Building a Whole Earth Economy, he and co-author Geoffrey Garver propose new economic policies that combine science and morality. They will both be involved in the 13-19 May 2012 international Degrowth conference in Montreal.

Unsustainable development -- by Lester Brown

(reprint of interview by Greg Ross in American Scientist)

Since founding the Worldwatch Institute in 1974, environmental analyst Lester Brown has been monitoring the effects of unsustainable development and forecasting their possible consequences. He sees signs that we've entered what ecologists call an "overshoot-and-collapse" mode, in which demand exceeds the sustainable yield of natural systems. This effect has toppled earlier civilizations; now, he says, it is occurring at the global level.

Brown's book, Plan B 2.0 (Norton, 2006), updates a first edition that appeared three years ago. In it, he argues that the first signs of economic decline appear in the environment, and he sees worrisome omens in today's forests, fisheries and grasslands. His prescription is a remodeled global economy that fosters education and sustainable methods to support the planet's growing population.

A MacArthur Fellow, Brown holds more than 20 honorary degrees and an honorary professorship in the Chinese Academy of Sciences. His books have appeared in more than 40 languages. He currently leads the Earth Policy Institute, a nonprofit, interdisciplinary research organization based in Washington, D.C. American Scientist Online managing editor Greg Ross interviewed him by e-mail in February 2006.

You address a number of issues in the book—the oil peak, water shortages, global warming. How are they related? Is there a root cause?

The oil peak, water shortages and global warming are related in the sense that they are all driven by the enormous growth in world population and economic activity. With oil we are depleting a resource that is not renewable in a relevant human time frame. Water shortages are the result of ever-growing demands for water, primarily to produce food. Global warming is the result of the enormous growth in the use of fossil fuels and the associated rise in carbon emissions to the point where they exceed the Earth's capacity to absorb them.

At the beginning of the last century, growth in the world economy was measured in billions of dollars. Today annual growth is measured in trillions of dollars. The sad fact is that the environmental trends that we monitor—shrinking forests, expanding deserts, falling water tables, collapsing fisheries, deteriorating grasslands, eroding soils, rising temperatures, melting ice, rising seas, dying coral reefs and disappearing species—are all manifestations of a civilization that is putting more demands on the Earth than it can bear.

The overriding challenge facing our generation is to restructure the global economy so that economic progress can continue. This means replacing the fossil fuel-based, automobile-centered, throwaway economy with one that is powered by renewable sources of energy, that has a much more diversified transport system and that reuses and recycles virtually everything.

How is China's emergence affecting the global scorecard?

China's emergence as the world's leading consumer of natural resources can best be understood by comparing it with the United States, which was for decades the leader in consumption. Among the basic commodities—grain and meat in the food sector, oil and coal in the energy sector and steel in the industrial sector—China now consumes more than the United States of each of these except for oil. It consumes nearly twice as much meat (67 million tons compared with 39 million tons) and more than twice as much steel (258 million to 104 million tons).

These numbers are about national consumption. But what if China reaches the U.S. consumption level per person? If China's economy continues to expand at 8 percent a year, its income per person will reach the current U.S. level in 2031.

If at that point China's per capita resource consumption were the same as in the United States today, then its projected 1.45 billion people would consume the equivalent of two-thirds of the current world grain harvest. China's paper consumption would be double the world's current production. There go the world's forests.

If China one day has three cars for every four people, U.S.-style, it will have 1.1 billion cars. The whole world today has 800 million cars. To provide the roads, highways and parking lots to accommodate such a vast fleet, China would have to pave an area equal to the land it now plants in rice. It would need 99 million barrels of oil a day. Yet the world currently produces 84 million barrels per day and may never produce much more.

The Western economic model—the fossil fuel-based, auto-centered, throwaway economy—is not going to work for China. If it does not work for China, it will not work for India, which by 2031 is projected to have a population even larger than China's. Nor will it work for the 3 billion other people in developing countries who are also dreaming the "American dream."

And, perhaps most important, in an increasingly integrated world economy, where all countries are competing for the same oil, grain and steel, the existing economic model will not work for industrial countries either. China is helping us see that the days of the old economy are numbered.

Sustaining our early-21st-century global civilization now depends on shifting to a renewable energy-based, reuse/recycle economy with a diversified transport system. Business as usual—Plan A—cannot take us where we want to go. It is time for Plan B, time to build a new economy and a new world.

Doesn't our globalized economy make us more resilient than, say, the Sumerians?

Our globalized economy makes us more resilient in some ways and less resilient in others. The advantage of a global economy is that different parts will be affected by varying combinations of environmentally damaging trends, some much more than others. Nonetheless, in an integrated global economy, the effects anywhere will be felt to some degree everywhere. The destruction of forests or the depletion of aquifers in any part of the world will affect the entire world.

The principal weakness of our global economy is that we do not have a global governing body to manage our response to the environmental trends that are undermining the global economy. The lack of a global governing structure to mount an effective response to the environmental trends that are undermining our future is definitely a weakness.

What about new technologies? Can we invent our way out of these problems?

New technologies will play a central role in the energy transition, the shift from fossil fuels to renewable sources of energy. For the U.S. automotive fuel economy, the key to greatly reducing oil use and carbon emissions is gas-electric hybrid cars. The average new car sold in the United States last year got 22 miles to the gallon, compared with 55 miles per gallon for the Toyota Prius. If the United States decided for oil security and climate stabilization reasons to replace its entire fleet of passenger vehicles with super-efficient gas-electric hybrids over the next 10 years, gasoline use could easily be cut in half. This would involve no change in the number of cars or miles driven, only a shift to the most efficient automotive propulsion technology now available.

Beyond this, a gas-electric hybrid with an additional storage battery and a plug-in capacity would allow us to do most of our short-distance driving, such as the daily commute or grocery shopping, with electricity. This could cut U.S. gasoline use by an additional 20 percent, for a total reduction of 70 percent. Then if we invest in thousands of wind farms across the country to feed cheap electricity into the grid, we could do most short-distance driving with wind energy, dramatically reducing both carbon emissions and the pressure on world oil supplies.

Using timers to recharge batteries with electricity coming from wind farms during the low-demand hours between 1 and 6 a.m. costs the equivalent of 50-cent-a-gallon gasoline. Not only do we have an alternative to dwindling reserves of oil, but it is inexpensive, inexhaustible, and it is ours. The supply cannot be disrupted.

In effect, advances in the design of gas-electric cars and wind turbines has provided the technological foundation for creating a new automotive fuel economy in the United States and in much of the world as well. Other technologies that will facilitate the shift to renewable sources include photovoltaic cells, solar-thermal power plants, solar-thermal water and space heaters, devices to harness wave power, devices for harnessing geothermal energy and processes for converting cellulosic material into automotive fuel.

Ultimately, you say, the key is to "get the market to tell the ecological truth." What steps do you recommend?

The key to building a global economy that can sustain economic progress is the creation of an honest market, one that tells the ecological truth. The market is an incredible institution, allocating resources with an efficiency that no central planning body can match. It easily balances supply and demand, and it sets prices that readily reflect both scarcity and abundance.

The market does, however, have some fundamental weaknesses. It does not incorporate into prices the indirect costs of providing goods or services, it does not value nature's services properly, and it does not respect the sustainable-yield thresholds of natural systems. It also favors the near term over the long term, showing little concern for future generations.

Accounting systems that do not tell the truth can be costly. Faulty corporate accounting systems that leave costs off the books have driven some of the world's largest corporations into bankruptcy. Unfortunately, our faulty global economic accounting system has potentially far more serious consequences. Our modern economic prosperity is achieved in part by running up ecological deficits, costs that do not show up on the books, but costs that someone will eventually pay.

The first step is to calculate the indirect costs of the various goods and services we buy. Since we are all economic decision-makers as consumers, corporate planners, government policymakers and investment bankers, we rely on market prices to guide our decision-making. The problem is the market is giving us bad information. The result is bad decision-making.

Let me illustrate this point. A study from the Centers for Disease Control and Prevention (CDC) in the United States calculated the social cost of smoking cigarettes, including two costs: the cost of treating smoking-related illnesses and the loss of productivity associated with these illnesses. They concluded that the cost to society of smoking a pack of cigarettes was $7.18. If we assume that the cost of growing the tobacco and manufacturing the cigarettes is roughly $2 a pack, then the price of cigarettes should be roughly $9 per pack. This not only justifies raising taxes on cigarettes, which claim 4.9 million lives per year worldwide, but it also provides guidelines for how much to raise them.

If the cost to society of smoking a pack of cigarettes is $7.18, how much is the cost to society of burning a gallon of gasoline? Fortunately, the International Center for Technology Assessment has done a detailed analysis, entitled "The Real Price of Gasoline." The group calculates several indirect costs, including oil industry tax breaks, oil supply protection costs, oil industry subsidies and health care costs of treating auto exhaust-related respiratory illnesses. The total of these indirect costs centers around $9 per gallon, somewhat higher than the social cost of smoking a pack of cigarettes. Add this external or social cost to the roughly $2 per gallon average price of gasoline in the United States in early 2005, and gas would cost $11 a gallon. These costs are real. Someone bears them. Now that these costs have been calculated, they can be used to set tax rates on gasoline, just as the CDC analysis is being used to raise taxes on cigarettes.

In the summer of 1998, China suffered record flooding in the Yangtze River basin for an extended period of time. Eventually the flooding racked up $30 billion worth of damage, a sum equal to the value of China's annual rice harvest.

For some weeks the government referred to the flooding as the result of an act of nature, which indeed it was. But in mid-August they held a press conference in Beijing acknowledging that there was a human contribution, that the deforestation of the upper reaches of the Yangtze River basin was also contributing to the flooding. The government then took an unusual step. It banned the cutting of trees in forests throughout China. Officials justified this action by pointing out that the value of trees standing was three times that of those cut. What they were recognizing was that the flood control services provided by forests were three times as valuable as the timber in those forests. In the scientific world, this is known as an "aha" moment. The Chinese government was recognizing the ecological truth in the market. It is, in a sense, what the entire world needs to do across the board with all goods and services.

Do you foresee a tipping point, a deadline for action? What happens if we miss it?

In looking at the fast-changing relationship between our early-21st-century global civilization of 6.5 billion people and the natural systems and resources on which we depend, we think about thresholds, tipping points and deadlines for action. Unfortunately, since these thresholds are natural phenomena and since the deadlines for action are set by nature, we are handicapped in responding. We may not know that we are missing a deadline until it is too late. One of the best-known examples of failing to recognize a key threshold was in the management of the huge centuries-old cod fishery off the coast of Newfoundland, Canada. Some marine biologists warned that the overfishing and the shrinking stocks were jeopardizing the fishery. But when the decision was finally made to ban fishing for cod, the stocks had shrunk to the point where they could not recover. Today, more than a decade later, there are no signs of recovery. This fishery may have been lost for good.

Another example would be the melting of Arctic Sea ice. The melting of this ice in its own right will not affect sea level because the ice is already in the water, but if this vast, continent-sized area of ice, which has shrunk by more than 20 percent in the summertime over the last three decades, should eventually all melt, it will profoundly alter the climate in the region.

When incoming sunlight strikes snow and ice, roughly 80 percent is reflected back into space and 20 percent is absorbed as heat. Once the snow and ice melt and the incoming sunlight hits open water, this ratio is reversed, with only 20 percent being reflected back into space and 80 percent being absorbed as heat. This is what modelers refer to as a positive feedback loop, a situation where a trend, once under way, tends to feed on itself.

The melting of Arctic Sea ice concerns scientists because it could lead to a warming in the region and the melting of the Greenland ice sheet. If this were to occur it would likely take a few centuries, but it would raise sea level by 23 feet. Some scientists think that the melting of the Greenland ice sheet could raise sea level at a rate of 1 meter for each half-century. If warming in the arctic region has reached the point where the Greenland ice sheet is doomed, then we are looking at a future where many of the world's coastal cities will be partly or entirely under water. The rice-growing river deltas and floodplains of Asia will also be inundated, depriving the region of part of its rice supply.

Some scientists think we have already reached the point of no return. Others think if we move quickly to cut carbon emissions we might be able to save the Greenland ice sheet. The reality is that this deadline is set by nature. We will know if we have failed only when we learn that it has become irreversible.

If a few years from now it were to become clear that the arctic ice melting is indeed going to lead to the melting of the Greenland ice sheet and that we cannot save it, then we may face, for the first time in history, a fracturing of societies along generational lines. We have experienced social fracturing along racial, religious and ethnic lines, but never before along generational lines. The next generation, which will have to cope with the rise in sea level that we have set in motion, will be asking us why we did not act. How, they will ask, could you do this to us? They will be able to read the same scientific literature and the warnings from the scientific community that we now read.

There is a further question, namely, how will we feel about ourselves if it becomes clear that our generation is responsible for the melting of the Greenland ice sheet?

New Energy Economy Emerging in the United States - Lester Brown

Learning to think about the future poster by Trinifar

Excerpts from Lester Brown's full text at Earth Policy Institute:

"A new US energy economy based on wind, solar, and geothermal energy is emerging at a pace and scale that could not have been imagined a year ago.

"Wind appears destined to become the centerpiece of the new U.S. energy economy, eventually supplying several hundred thousand megawatts of electricity. Texas has overtaken California... [with] nearly 6,000 megawatts of wind-generating capacity online and a staggering 39,000 megawatts in the construction and planning stages... (think 45 coal-fired power plants). Other leaders among the 30 states with commercial-scale wind farms are Iowa, Minnesota, Washington, and Colorado. In South Dakota, Clipper Windpower and BP are teaming up to build the 5,050-megawatt Titan wind farm, the world’s largest. Already under development, Titan will generate five times as much electricity as the state’s 780,000 residents currently use [and feed Illinois]. In Wyoming... Philip Anschutz is developing a 2,000-megawatt wind farm, a 900-mile high-voltage transmission line to California [ and another line to] Colorado cities of Fort Collins, Denver, and Colorado Springs. Wind-rich Kansas and Oklahoma are looking to build a transmission line to the U.S. Southeast to export their wealth of cheap wind energy. California is developing a 4,500-megawatt wind farm complex in the Tehachapi Mountains northwest of Los Angeles.... Maine—a wind energy newcomer—is planning to develop 3,000 megawatts of wind-generating capacity, far more than the state’s 1.3 million residents need. Delaware is planning an offshore wind farm of up to 600 megawatts, which could satisfy half of the state’s residential electricity needs. New York State, which has 700 megawatts of wind-generating capacity, plans to add another 8,000 megawatts, with most of the power being generated by winds coming off Lake Erie and Lake Ontario. And soon Oregon will nearly double its wind generating capacity with a 900-megawatt wind farm in the wind-rich Columbia River Gorge.

"Solar power is also expanding at a breakneck pace.... California, with its Million Solar Roofs plan, is far and away the leader. New Jersey is also moving fast, followed by Nevada. The largest U.S. solar cell installation today is a 14-megawatt array at Nellis Air Force Base in Nevada, but photovoltaic electricity at the commercial level is about to go big time. PG&E has entered into two solar cell power contracts with a combined capacity of 800 megawatts. Together, these plants will cover 12 square miles of desert with solar cells [with] peak output comparable to that of a large coal-fired power plant. Solar power plants are appealing in hot climates because their highest output coincides with the peak demand for air conditioning. The United States has the world’s only large solar thermal complex, a 350-megawatt project completed in 1991, [but] 10 large solar thermal power plants are under construction or in development... Eight of the plants will be built in California, one in Arizona, and one in Florida. Within the next three years, the United States will likely go from 420 megawatts of solar thermal generating capacity to close to 3,500 megawatts—an eightfold jump.

"96 geothermal power plants now under development in twelve western states are expected to double U.S. geothermal generating capacity....

"It is historically rare for so many interests to converge at one time and in one place...

• No one can cut off the supply of wind, solar, or geothermal energy.
  
• It also avoids the price volatility that has plagued oil and natural gas in recent decades... the price is stable since there is no fuel cost.
  
• [It will] dramatically cut carbon emissions, moving us toward climate stability and thus avoiding the most dangerous effects of climate change.
  
• It will staunch the outflow of dollars for oil, keeping that capital at home to invest in the new energy economy, developing national renewable energy resources and creating jobs here.
  

"At a time of economic turmoil and rising joblessness, these new industries can generate thousands of new jobs each week. Not only are the wind, solar, and geothermal industries hiring new workers, they are also generating jobs in construction and in basic supply industries such as steel, aluminum, and silicon manufacturing. To build and operate the new energy economy will require huge numbers of electricians, plumbers, and roofers. It will also employ countless numbers of high-tech professionals such as wind meteorologists, geothermal geologists, and solar engineers.

"To ensure that this shift to renewables continues at a rapid rate, national leadership is needed in one key area—building a strong national grid....

"[We are] now tapping energy sources that can last as long as the earth itself. Oil wells go dry and coal seams run out, but for the first time since the industrial revolution we are investing in energy sources that can last forever. This new energy economy can be our legacy to the next generation."

*****

For more information on Earth Policy Institute’s plan to cut carbon emissions 80 percent by 2020, see Chapters 11-13 in Plan B 3.0: Mobilizing to Save Civilization (PDF)