There are many people who believe that we are approaching the end of growth, notably Jeff Rubin and Richard Heinburg. They believe that the current perpetual growth-based economic system cannot support itself in a world of finite resources. That is, energy is needed to support economic growth and in turn economic growth is needed for a stable growth-based economy. They argue that finite resources means finite energy and therefore, the end of growth – and perhaps the economy as we know it.
But maybe that isn’t so bad?
Perhaps that means that we are entering an era of collaborative commons, open source innovation, renewable energy, food sovereignty and security, less consumption, and stronger community. Maybe we can create a culture where information and ideas are available to all and an economy that thrives on environmental protection and regeneration.
Ok, we have a long way to go - but it’s possible.
Can we find a way to drive economic growth through not just sustainable - but restorative land-use? If we value ecosystem services – the clean air, water, flood protection, drought protection, and the countless other benefits that nature provides to society – we can start to build an economy that puts value on the growth of natural capital in its natural and living form, rather than just the products that natural resources provide.
A business-minded person may use a cost-benefit analysis to determine if an endeavor is economically viable. In other words, they ask, “will money returned be greater than money spent?”. This can be a short-sighted approach that often does not account for external costs, or ‘externalities’ – sometimes negative (costs unaccounted for) and sometimes positive (profits/benefits unaccounted for). For example, what is the ecological cost of production compared to the benefit to society? How will ecological costs affect the economy in the future? These critical questions too often do not get asked at all. Even if we account for negative externalities, the full cost to society now, we may still fail to assess the future cost to society. The issue is, we do not currently put an accurate monetary value on the cost of degrading ecological systems – but maybe we should because we certainly have the ability to do so.
But how do we value the ecological cost of production?
Under the current paradigm we ignore or downplay the future costs of diminishing our resources today and we often derive current profit at the expense of future profits. In other words, we regularly degrade our ecosystems to the point where we will not be able to profit from them in the future. If we cut down all the trees in a forest now and replace it with a monoculture plantation (all the same type of tree), we will receive higher profits today. In the future however, those plantations will have smaller trees, be more subject to insect infestation, have less stored carbon, have reduced soil fertility and therefore be less resilient (generally less able to take what nature throws at it). A monoculture is subject to greater risk, more loss and potentially smaller profits compared to the first harvest of a diverse, intact and thriving forest.
Unfortunately human psychology is such that we would rather take $50 now than $100 a year from now even though the profits are higher if we wait - let alone forgoing profit altogether today for the benefit of a future beyond our lifetime. There are many psychological studies that prove this to be true. We tend to put higher value on benefits now and tend to ignore the long-term costs that negatively affect not only the environment but also future society. In this sense, valuing our ecosystems, conserving them, maintaining them and supporting them now makes long-term economic sense – but unfortunately short-term “loss”. It is only considered loss because the current economic paradigm does not value ecological services: the protection, habitat, clean air and water that only an intact ecosystem can provide. The current paradigm instead values goods and services – the products and services that can be bought and sold at the market. It makes sense to degrade natural habitat in a capitalist society that values products and services for all our "needs" while forgetting where those products actually come from.
There is already a shift happening where we are starting to evaluate and account for negative externalities of production, i.e environmental degradation, as a cost and the benefits of restorative and regenerative land use as a “profit”.