[Fwd: Rachel #629: When Growth Stops] consumption tax et al
Wed, 23 Dec 1998 11:55:27 -0500
> =======================Electronic Edition========================
> . .
> . RACHEL'S ENVIRONMENT & HEALTH WEEKLY #629 .
> . ---December 17, 1998--- .
> . HEADLINES: .
> . WHEN GROWTH STOPS -- SUSTAINABLE DEVELOPMENT, PT. 6 .
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> WHEN GROWTH STOPS -- SUSTAINABLE DEVELOPMENT, PT. 6
> Here we wrap up our discussion of sustainable development, based
> on the excellent book BEYOND GROWTH by Herman Daly.
> Sustainable development means, first, setting physical limits on
> the "throughput" of the human economy. Throughput means all the
> materials and energy flowing through the economy -- all the
> things we make and use, and all the energy required to do so.
> Another phrase for "throughput" is "total consumption," which is
> total human population multiplied by per-capita consumption.
> The total throughput of the human economy must be kept small
> enough to avoid exceeding two physical limits of the ecosystem:
> its capacity to regenerate itself, and its capacity to absorb
> our wastes. Each year now, scientists report new evidence that
> the human economy has exceeded both of these ecosystem limits.
> For example, nature creates (regenerates) new topsoil each year,
> but in much of the world (particularly in the U.S.) humans are
> destroying topsoil faster than nature can create it. Loss of
> topsoil reduces our future farming capacity in a fundamental
> way. Topsoil destroyed today is topsoil taken from our children
> and grandchildren.
> Pesticides provide an example of humans producing wastes faster
> than nature can absorb them. If nature could absorb pesticide
> residues as fast as humans created them, then there would be no
> buildup of toxic residues. But there has been a measurable
> buildup of pesticides at the north and south poles, at the
> bottom of the deepest oceans, in the drinking water of much of
> the midwestern U.S., and in the breast milk of women worldwide.
> We have clearly exceeded nature's capacity to absorb pesticide
> wastes, thus denying our children their rightful share of
> nature's detoxification capacity.
> In sum, there really are "limits to growth" and we have already
> exceeded some of those limits. This means that, at some point,
> continued economic growth (growth of throughout) will create
> bads faster than it creates goods (an economist would say
> "marginal costs will exceed marginal benefits"). Daly (pg. 40)
> argues, for example, that the U.S. chemical industry may have
> already passed the point at which its toxic discharges are
> costing society more than the benefits provided by its products.
> If this were the case, then society would receive net benefits
> by shrinking the chemical industry instead of promoting its
> Unfortunately, we have no way of measuring whether our economy
> has passed the point at which costs have begun to exceed
> benefits because, in our national accounting system (in which we
> measure "gross domestic product"), we count all production of
> goods and services as "goods." In tallying up gross domestic
> product (GDP) we never subtract any bads. Chemicals are counted
> as goods and the products they allow us to make are counted as
> goods. This makes sense. But when our chemical factories
> produce chemical waste dumps that must be cleaned up at huge
> public expense, those costs are counted as "goods" too, instead
> of being subtracted as bads. If a few hundred or a few thousand
> children get cancer from exposure to chemical wastes, their
> hospitalization, their radiation treatments, their chemotherapy,
> and their funeral expenses are all counted as "goods" in our
> total GDP. If their parents sue, all the resulting court
> expenses are counted as goods, not bads. In sum, the nation's
> brightest economists maintain our national accounting system
> with a calculator that has a plus key but no minus key.
> Therefore we have no way of knowing whether the costs of
> economic growth have exceeded the benefits. The nation's
> economists (and politicians and business leaders) simply assume
> that if GDP is rising, our standard of living is rising too.
> But, as the song goes, it ain't necessarily so. (For substantial
> evidence on this point, see REHW #516.)
> Historically, growth is an aberration; a steady state economy is
> the norm. Only during the past 500 years has growth begun to
> seem like the normal condition for human economies. The
> physical limits to growth (which we are now perceiving because
> we have exceeded some of them) require us to return to the
> steady state sooner or later. If we do so by choice, we may be
> able to guide the process and achieve a steady-state economy
> with a reasonable approximation of the "good life" for most
> people, world without end. On the other hand, if we continue
> to blindly accept the ideology that growth is good, then natural
> limits will reduce our numbers with an ecological meat axe and
> the suffering will be immense.
> Why do we have so much trouble imagining a no-growth economy?
> Daly believes there is one central reason: because a
> steady-state economy, one that is no longer physically growing,
> will force us to confront the problem of inequality, which is
> another name for the problem of poverty. So long as the total
> economic pie is growing we can say, "The poor will be lifted out
> of poverty by growth, so we need not take any special steps to
> alleviate their condition -- in fact we hardly need to think
> about them at all because the market will take care of them."
> In a steady-state economy, we will have to decide what is a fair
> distribution of the benefits of the economy because, in the
> steady state, as the rich get richer the poor must get poorer.
> In this situation, the only way to make sure that a fair share
> is available for everyone (whatever society decides "a fair
> share" means) is to set a limit on how much the powerful and the
> predatory can take for themselves. Daly says simply, "In a
> steady state, if the rich get richer the poor must get poorer,
> not only relatively but absolutely. If the total [throughput of
> the economy] is limited there must be a maximum limit on
> individual income."
> Daly believes this is the key reason why we refuse to confront
> limits to growth: we cling to the path of unsustainable growth
> so that we will not have to think about limiting inequality.
> (pg. 215)
> Daly argues that establishing the principle of limited
> inequality is a necessary (but not sufficient) condition for
> achieving a modern steady state. He argues that the precise
> range of inequality that we allow is not as important as
> establishing the principle that inequality should be limited.
> If inequality is to be limited, this implies that there will be
> a maximum allowable income and a minimum income. (These
> standards would have to be developed within each society because
> needs are culturally determined.) Daly argues (pg. 210) that
> the minimum income "would be some culturally defined amount
> sufficient for food, clothing, shelter, and basic health and
> education." The maximum income might be four times as great as
> the minimum (which is what Plato advocated), or it could be 10
> or 20 times as great. The exact number isn't terribly
> important. The point is that there must be a limit on
> inequality -- the precise limit can be worked out in practice.
> (The overarching goal would be to provide sufficient incentive
> so that all necessary jobs are filled voluntarily by qualified
> Daly argues that limiting inequality (in a steady-state economy)
> is a way to achieve 3 things:
> 1) It is a way to keep the rich from leaning too heavily on the
> 2) It is a way to keep the present generation from leaning too
> heavily on future generations;
> 3) It is a way to prevent humans from "leaning too heavily on
> other creatures whose habitats must disappear as we convert more
> and more of the finite ecosystem into a source for raw
> materials, a sink for waste, or living space for humans and
> warehouses for our artifacts."
> In addition to the matter of fairness (the meaning of which each
> society or culture must decide for itself), in a steady-state
> economy we would need to limit inequality for another reason as
> well: to limit total human consumption, which is total
> population multiplied by per-capita consumption. It is total
> human consumption that stresses the ecosystem.
> Because total consumption has two parts (human numbers and
> per-capita consumption), to limit total consumption, we would
> need to limit inequality AND limit total human numbers. In a
> steady-state economy (one whose total size is established by the
> Earth's limits), the more people there are, the lower their
> average standard of living must be. Controlling growth requires
> us to limit both human consumption AND human population. Both
> limits are ESSENTIAL if we aim to control the total size
> (throughput) of the global economy.
> In recent decades we have invented several technological fixes
> aimed at circumventing the natural limits of ecosystems, so that
> growth can continue. The "green revolution" tried to speed up
> the growth rates of the edible portions of wheat and rice
> plants -- but these changes were achieved at the expense of
> stability, resilience and resistance to disease. The latest
> technical fix is genetically engineered crops. The hidden costs
> of this latest agricultural gimmick have yet to be measured, but
> we can be sure that they will become apparent as time passes.
> Daly says, "It is for now certainly better for us to slow down
> our own biological growth rate than to attempt to speed up the
> growth rates of all the species we depend upon." (pg. 85)
> It seems logical that we in the northern hemisphere must
> confront (and achieve) the limits to growth first be-
> Individual countries will find it more difficult to limit their
> consumption as the "free trade" ideology is imposed on them by
> powerful traders like the U.S. "Free trade" hides the
> ecological costs of consumption. If Americans are doing the
> consuming but the related ecological limits are being exceeded
> in Mexico or in Indonesia, Americans can feel no incentive to
> reduce their consumption. Free trade even makes it difficult to
> keep relevant accounts because benefits are being enjoyed in one
> locale while costs are being created in another, thousands of
> miles apart.
> There is considerable evidence that free trade doctrines are
> increasing inequalities within and between countries. As Herman
> Daly says (pg. 156), free trade will bring with it "a further
> writing off of the laboring class in this country, an increasing
> disdain toward uneducated and rural people by the corporate and
> university elite, and an increasing devotion by the former to
> the one thing about themselves that at least vaguely concerns
> the latter -- their growing arsenal of guns."
> Within countries, great inequality creates civil conflict.
> Between countries, in a full world, high rates of consumption
> create international conflict. To the extent that free trade
> makes nations less able to control their rates of consumption,
> to that degree it will promote war within and between countries.
> To promote peace, nations need to become more self-sufficient
> and to consume less.
> We have said before and we say again: We know of only one
> organization committed to tackling every part of the
> "sustainable development" problem: Sustainable America. We urge
> all our readers to join and support Sustainable America. This
> is important. Please do it. Telephone (212) 269-9550; fax
> (212) 269-9557; or www.sanetwork.org.
> Happy new year!
>  Herman E. Daly, BEYOND GROWTH (Boston: Beacon Press, 1996).
> ISBN 0-8070-4708-2.
>  Gary Hardner, SHRINKING FIELDS: CROPLAND LOSS IN A WORLD OF
> EIGHT BILLION (Washington, D.C.: Worldwatch Institute, 1996).
> ISBN 1-878071-33-5. Worldwatch can be reached at 1776
> Massachusetts Avenue, Washington, D.C. 20036-1904. Telephone:
> (202) 452-1992; fax: (202) 296-7365.
>  Lincoln Anderson, "Gross Domestic Product," in David R.
> Henderson, editor, THE FORTUNE ENCYCLOPEDIA OF ECONOMICS (New
> York: Warner Books, 1993), pgs. 203-207. ISBN 0-446-51637-6.
>  Daly (cited above in note 1) never precisely defines the
> "good life" but on pg. 14 he says, "...most would agree with
> [British economist Thomas] Malthus that it should be such as to
> permit one to have a glass of wine and a piece of meat with
> one's dinner. Even if one is a teetotaler or a vegetarian that
> level of affluence is desirable, and would serve by itself to
> rule out populations at or above today's level."
>  Vandana Shiva, STAYING ALIVE; WOMEN, ECOLOGY, AND
> DEVELOPMENT (London, England, and Atlantic Highlands, New
> Jersey, USA: Zed Books, 1989). ISBN 0-86232-823-3.
> Descriptor terms: sustsinable development; herman daly; economy;
> inequality; poverty; growth; free trade;
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