2.-The economic crisis will mean a welcome change to the totally unsustainable increase of CO2
emissions of the last few years. The very moderate EU Kyoto objectives will be
fulfilled more easily, and the carbon trade will collapse unless lower caps are
adopted. Indeed, an economic crisis affords an opportunity to put the economy
on a different trajectory as regards material and energy flows. It might also
give an opportunity for a restructuring of social institutions: the objective
in western countries should be to live well without the imperative of economic
growth. It seems that happiness is not related to income growth, above a
certain level of income. Moreover, economic accounting does not take properly
count environmental damages and the exhaustibility of resources. Now it is the
moment to substitute GDP by social and environmental indicators at the
macro-level. The discussion on /décroissance soutenable/ or socially
sustainable economic de-growth, that Georgescu-Roegen started thirty years ago,
should reach a wide audience at this congress.
3.-The critique of conventional economic accounting begins in the TEEB process by emphasizing the forgotten current values of environmental services from ecosystems. This approach is good but it is insufficient in order to grasp the relations between economy and environment. Our economy depends on the photosynthesis of millions of years ago for our main energy sources, it depends on ancient biochemical cycles for other mineral resources that we are squandering without replacement. In the case of oil, the extraction peak will be reached soon. We are now taking 85 mbd -- in terms of calories, the world average is equivalent to about 20,000 kcal per person/day (ten times the food energy intake), and in the USA it is equivalent to 100,000 kcal per person/day. In exosomatic energy terms, oil is then far more important than biomass. Climate change is a threat to biodiversity. But the immediate threat is the increase of the HANPP, the human appropriation of net primary production.
4.-The present economic crisis is not only a financial crisis, and it is not caused only by a supply of new houses that exceeded the demand that could be financed sustainably. The crisis was also triggered by high oil prices, due not only to the OPEC oligopoly but also to the approaching peak-oil. In fact, economic theory does not say that an exhaustible resource should be sold at the marginal cost of extraction. Oil at 120 US$ a barrel is in fact cheap from the point of view of its fair inter-generational allocation and the externalities it produces. As the crisis deepens, the price of oil will go down to some extent but it will recover when the economy grows again. However, the historic trend is towards increasing energy costs of obtaining energy (a lower EROI). Coming down from the peak the Hubbert curve will be politically and environmentally difficult. Appeal to some other energy sources (agrofuels, nuclear energy) will compound the difficulties.
5.-Conventional economic accounting is certainly misleading. The experience that Pavan Sukhdev (with Haripriya Gundimedia and Pushpam Kumar) gained in India trying to give economic values to non-timber products from forests, and to other environmental services (such as carbon uptake, water and soil retention), has been an inspiration for the TEEB process (The Economics of Ecosystems and Biodiversity) sponsored by DG Environment of the European Commission and by the German Minister of Environment. As the TEEB team states, a monetary representation of the services provided by clean water, access to wood and pastures, and medicinal plants, does not really measure the essential dependence of poor people on such resources and services. In National Income Accounting one could introduce valuations of ecosystem and biodiversity losses either in satellite accounts (physical and monetary) or in adjusted GDP accounts ("Green Accounts"). The economic valuation of losses might be low compared to the economic gains of projects that destroy biodiversity. However, which groups of people suffer most by such losses? In their project "Green Accounting for India" they found that the most significant direct beneficiaries of forest biodiversity and ecosystem services are the poor, and the predominant impact of a loss or denial of these inputs is on the well-being of the poor. The poverty of the beneficiaries makes these losses more acute as a proportion of their "livelihood incomes" than is the case for the people of India at large. Hence the notion of "the GDP of the Poor".
6- Toxic Assets
and Poisonous Liabilities. The assets that take the form of claims to debts
that will remain unpaid, have been given the funny name of Toxic Assets. Our
accounting conventions are false because they do not deduct damages to the
environment. An enormous "carbon debt" is owed to future generations,
and to the poor people of the world who have produced little greenhouse gases.
Large environmental liabilities are due by private firms. Chevron-Texaco is
being asked to pay back 16 billion dollars in a court case in Ecuador. The Rio
Tinto company left behind very large liabilities since 1888 in Andalusia where
it got its name, also in Bougainville, in Namibia, in West Papua together with Freeport
McMoran... debts to poor or indigenous peoples. Shell has a large liability in
the Niger Delta. Don't worry. These poisonous debts are in the history books
but not in the accounting books. Decisions may indeed be improved by giving
money values to environmental resources and services which are undervalued or
not valued at all in conventional economic accounting. But there are other
considerations. First, don't forget our uncertain knowledge about the working
of ecosystems, and about the impact of technologies. Second, do not exclude
non-monetary values from decision making processes. Don't practice the
fetishism of fictitious commodities.
8.- Look at the
current case of Vedanta mining bauxite in the Niyamgiri hill in Orissa. The
decline in the price of aluminium as the economic crisis deepens might save the
Niyamgiri hill. We may still ask: how many tones of bauxite is a tribe or a
species on the edge of extinction worth? And how can you express such values in
terms that a minister of finance or a Supreme Court judge can understand?
Against the economic logic of euros and cents, the peasant and tribal languages
of valuation go unheeded. These include the language of territorial rights
against external exploitation, the ILO convention 169 which guarantees prior consent
for projects on indigenous land, or in India the protection of the adivasi by
the Constitution and by court decisions. Appeal could be made to ecological and
aesthetic values. The Niyamgiri hill is sacred to the Dongria Kondh. We could
ask them: How much for your God? How much for the services provided by your
God?
8.- In
decision-making processes, economics becomes a tool of power. The question is:
who has the power to simplify complexity and impose a particular language of
valuation? The world conservation movement should indeed criticize conventional
economic accounting and push for the introduction of an economic language that
reflects better our relations with nature, while not forgetting the legitimacy
of other languages: territorial rights, environmental justice, livelihood,
sacredness. This is essential for an alliance between the conservation movement
and the environmentalism of the poor, as proposed in the official booklet for the
World Conservation Congress, /Transition to Sustainability/, by Bill
Adams and Sally Jeanrenaud.
