While it will not be smooth or simple to build, I believe we are at the start of a sustainable or green economy. My reasoning here is not simply naive optimism, but recognition of necessity. The false wealth of the period ending has focused many of us on the need for a solid, understandable basis for our economy. One part of a solid economy is found in free market capitalism where investors risk their wealth to create a valued product or service. The success of this enterprise produces wealth, and some people get rich and some people do not. Along with capitalism comes the recognition that a certain amount of income inequality is not only acceptable, but also desirable.
The question is how much inequality should there be? The answer is not so much inequality that people on the bottom of the ladder cannot live a decent life. Not so much inequality that there is hunger, hopelessness, untreated disease, violence and inadequate access to education. We’ve learned that a large middle class makes societies wealthier and can contribute to political stability. But without public policy to encourage a middle class, the logic of the unregulated market leads to greater and greater inequality. A second part of a solid economy is one that creates and maintains production and wealth over the long term. A concern for the long term is central to the definition of sustainability.
If a nation achieves wealth by oppressing its people or damaging ecological resources, it eventually pays a price for its misdeeds. In the United States we paid the price of oppression under slavery with a brutal civil war and its racist aftermath. We have also spent hundreds of billions of dollars to manage and clean the poisons we released into the environment and still release in the name of industrial production. China has only started to learn the environmental and financial cost of rapid development. In the end they will pay, and here in the United States we will continue to pay as well. Short-term gains are often bought at the price of long-term pain. This is a concept that is gaining currency. Landing on a carrier in a pilot’s outfit does not mean you accomplished your mission. Sometimes a fund that pays off the same high return year after year is too good to be true and turns out to be an unsustainable Ponzi scheme. On the other hand, an experienced pilot who knows his stuff and is humble and dedicated just might manage to land a jet plane on a river. Most people can distinguish solid from shaky. Sustainable means solid, dependable stuff that is designed to last for the duration.
What do we need to develop a sustainable planet? There are a number of prerequisites:
• Reduce the destructiveness of competition between people and nations.
• End the growth of the human population, end poverty and eliminate extreme levels of income inequality.
• Develop renewable, non-fossil fuel based energy.
• Learn how to reduce the damage we do to our environment.
Peace. With the presence of weapons of mass destruction, we need to develop a system of international law that reduces the probability that these weapons will be used. Our current system of international law, balance of power and diplomacy has failed from time to time, but has at least prevented unimaginable disaster from taking place. We need to improve these international institutions.
Population and Poverty. The human population continues to grow. Last month, the world’s population grew by about six million. This growth was uneven across the globe. In developed countries such as Japan, that do not encourage immigration, population is declining. Last year Japan’s population went down by 50,000. In the developed world, population growth would end if not for immigration. In developing nations the population is still growing. The reason for these different growth patterns is simple. In the developing world, a parent cannot be sure that their child will grow to be an adult, and in the absence of social security, children are the best form of old-age insurance. Moreover, in an agrarian world, children are needed to grow and harvest food. In the developed world, children are typically economic liabilities. They cost a great deal to raise and educate. We love and value our families, but do not raise children for the economic benefits they bring.
People who study economic development and population talk about something they call a demographic transition. This is what happens when a developing country makes the transition to full economic development. Children are no longer perceived to be economic assets, but economic liabilities; and the population stops growing. The best way to end population growth is to end poverty.
Ending poverty also leads to sustainability in two other ways. First, poverty breeds political conflict. People without an ownership stake in society have less to lose and may be drawn to conflict. Parents who can provide for their children and realistically hope for a better life for them will favor peace over war. Second, some of the best brains that will one day invent a new technology or the cure for cancer may very well be trapped in a life of poverty and will never get the education they need to help us think our way to a sustainable future.
Energy. To reduce damage to the biosphere, reduce global warming and reduce the cost of energy, we need to transition our economy to renewable, non-fossil fuels. While there are plenty of fossil fuels left on the planet, extracting those fuels will only get more difficult and expensive in the future. Burning fossil fuels will continue to damage our ecology and atmosphere. Renewable energy is the key to the green economy. Without it such an economy will never be achieved. The Obama administration’s energy initiative is a critical first step in developing this new energy economy.
Ecological Footprint. The year 2007 was a turning point in world history – for the first time a majority of the world’s population lived in cities. One of the great paradoxes of modern life is that given the size of the world’s population, it is better for the planet’s ecosystems if people live together in cities than if they are dispersed throughout the countryside. By living in cities we make it easier to preserve natural environments outside of cities. New York City is much more energy efficient than most other places in the United States. As we learn to more effectively manage our energy, water and waste through increasingly sophisticated technology, we can reduce our impact on the planet and gradually transition to sustainability.
Can we do it? Can we get from here to there? Let’s put it this way, if we don’t learn to grow our economy while protecting our environment, we may survive, but to paraphrase Nikita Khrushchev, “the living will envy the dead.” While the human species has some irrational tendencies, we don’t tend to be suicidal. The opposite of sustainable development is short-term wealth that can’t be maintained. Sounds a little like Wall Street at the start of the 21st century. I like to think we are a teachable species. Let’s hope we are.