Conventional economics: a severe form of brain damage – via Lars P. Syll

I’m extremely fond of scientists like David Suzuki. With razor-sharp intellects they immediately go for the essentials. They have no time for bullshit. And neither should we.

via Conventional economics — a severe form of brain damage — LARS P. SYLL

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Falling cost of renewables will challenge Trump’s plan for coal jobs

This short interview from the Real News Network illustrates the progress of clean energy generation in the US, compared with dirtier sources. The argument is that the cost of renewables is falling fast, such that they are becoming cheaper than coal-fired generation, which Mr Trump has promised to support. Cleaner sources also have positive spillover effects on health, known in economics as a positive externality.

The logic of market forces has probably been helped along by industrial policies, from Obama’s Clean Power Plan to the Chinese government, which has promoted the development of its solar panel industry. But if clean energy becomes cheaper than dirty energy, surely a Republican president looking for a good deal can’t argue with that.

Ecological economics: human progress as part of nature

599px-The_Blue_Marble“The term ‘ecological economics’ should be a little redundant, as both words share the Greek root oikos (household) and together mean something like household-study household-law. It is telling that the two fields of ecology and mainstream economics have grown so far apart in the century and a half since they were named that they now represent completely different sets of principles.

The basic idea of ecological economics can be summarised by [Herman] Daly‘s argument with the World Bank economists: when you draw the box for the economy, you have to put it in a larger box called the environment. The human economy is a subset of the world system. Our inputs, in terms of natural resources, and outputs, including pollution, are like the metabolism of a kind of super-organism. We can analyse it using the same kinds of tools as we use to analyse other living systems, such as a cell, or a beehive, or a complete ecosystem.

Instead of being a closed system, like a machine, the economy is open to the environment. Attention therefore shifts from the inner mechanics of the economy to big-picture questions related to things like scale and timing and the flow of energy. Is the economy becoming to big relative to its environment? Is it consuming resources at too fast a rate? Is it adequately disposing of its own waste? Is it endangering the food chain on which it depends for its survival?”

David Orrell (2010), Economyths: How the science of complex systems is transforming economic thought

But remember, it’s all just models within models within models. They are all we have, so if we are to sustain human progress, we need to build better ones: better at explanation, and better at laying out the options for responding to change.

Divisions between the economy, society and the environment are a simplification, and a potentially dangerous one. Ecological economics offers useful ways of thinking about the state and direction of humankind as part of nature, rather than its master. So too does sustainable development. In my view we also need a political economy approach to the environment which studies how the costs and benefits of change lead to potential conflict and particular distributions of power in society. These processes require management by governments working with each other and with civil society. Such issues are surely the most urgent of our times.

Sustainable development: economy, society, environment

sustainable_development

An illustration of the concept of sustainable development

I have blogged far too little on sustainable development, a pattern which I hope to redress. This blog started out back in 2008, when I was beginning to turn my attention from the more traditional concerns of economics and development, towards incorporating environmental concerns. Not long afterwards I studied a masters-level module on SD with CeDEP, which runs excellent distance learning courses for postgraduates. This opened my eyes to new ways of looking at development and the environment, and how much can be learned from studying the two together.

Concerns about climate change, biodiversity loss, natural resource depletion and the health of the biosphere are ever-present. Sadly, the more immediate focus among politicians across the capitalist world has been restoring growth in the aftermath of the financial crisis. The issue of inequality within many of the richest nations has also been more to the fore, even if little has yet been done about it on the policy side. But in times of recession, the environment tends to take a back seat. Mainstream debates focus on growth at all costs. Continue reading

Sustainability and Sustainability

I am reading parts of the book ‘Deforesting Malaysia’ by Jomo et al. at the moment. In the context of producing palm oil, some companies as well as the government of Malaysia, pay various degrees of lip service to the idea of ‘Sustainable Palm Oil‘. What does this mean? In the book, one of the authors distinguished between two kinds of sustainability. The first would mean producing at a level and in a way that allows this level to be sustained into the future. The second would take into account biodiversity and the wider environmental impact. The author argued that no modern agricultural production methods were sustainable in this second sense.

In the very long term, the neglect of this second form of sustainability could well impact on the production of other commodities, manufactures and services in the region of production of the original commodity (palm oil) if, for example, climate change and soil erosion make such production difficult. A more macro-environmental approach, taking account of wide-ranging externalities, not simply a focus on the narrower production of one particular commodity, while more difficult to analyse and draw clear predictions from, should be taken into account when formulating environmental policy. While the conflict between planetary ecology and economic production is clear, some middle ground could and should be found. Increasingly, the environment needs to be managed and cared for by humanity. To coin a cliche, with knowledge comes responsibility. We are aware of the problems, and it is an imperative to find the solutions.