Environmental Economics, Politics, and Worldviews

1. Environmental Economics, Politics, and Worldviews Chapter 17

2. Core Case Study: Rescuing a River Nashua River � the filthiest river Marion Stoddart developed a restoration plan and won over state officials Successes Ban dumping Treatment plant Beautification Community involvement

3. Individuals Matter: Marion Stoddart

4. 17-1 How Are Economic Systems Related to the Biosphere? Concept 17-1 Ecological economists and most sustainability experts regard human economic systems as subsystems of the biosphere and subject to its limiting factors.

5. Resources Supporting Economic Systems Economics Market-based systems interact through sellers and buyers Supply and demand determines prices Three types: Natural resources Human resources Manufactured resources

6. Three Types of Resources

7. Figure 17.2: Three types of resources are used to produce goods and services. Question: In which of these categories can resources be recycled?Figure 17.2: Three types of resources are used to produce goods and services. Question: In which of these categories can resources be recycled?

8. Economic Importance of Natural Resources Neoclassical economists Ecological economists Environmental economics takes middle ground Some forms of economic growth discouraged Environmentally sustainable economy � eco-economy

9. Strategies to Transition to Eco-economy (1) Indicators that monitor economic and environmental health Full-cost pricing Eco-labeling Phase out of harmful government subsidies and tax breaks

10. Strategies to Transition to Eco-economy (2) Decrease income and wealth taxes Increase taxes on pollution, resource waste, and environmentally harmful actions Innovation-friendly regulations Tradable permits Selling of services instead of things

11. Ecological Economics

12. Figure 17.3: Ecological economists see all economies as human subsystems that depend on natural resources and services provided by the sun and earth (Concept 17-1). The earth serves both as a source for raw materials and as a sink for the resulting wastes and pollution. Question: Do you agree or disagree with this model? Explain. See an animation based on this figure at ThomsonNOW.Figure 17.3: Ecological economists see all economies as human subsystems that depend on natural resources and services provided by the sun and earth (Concept 17-1). The earth serves both as a source for raw materials and as a sink for the resulting wastes and pollution. Question: Do you agree or disagree with this model? Explain. See an animation based on this figure at ThomsonNOW.

13. Components of Environmentally Sustainable Economic Development

14. Figure 17.4: Solutions: some components of more environmentally sustainable economic development favored by ecological and environmental economists. The goal is to have economic systems put more emphasis on conserving and sustaining the air, water, soil, biodiversity, and other natural resources that sustain all life and all economies. Such a shift toward more efficient resource use, cleaner energy, cleaner production, and natural capital preservation can save money, create jobs, and be profitable. Question: What are three new types of jobs that could be generated by such an economy?Figure 17.4: Solutions: some components of more environmentally sustainable economic development favored by ecological and environmental economists. The goal is to have economic systems put more emphasis on conserving and sustaining the air, water, soil, biodiversity, and other natural resources that sustain all life and all economies. Such a shift toward more efficient resource use, cleaner energy, cleaner production, and natural capital preservation can save money, create jobs, and be profitable. Question: What are three new types of jobs that could be generated by such an economy?

15. 17-2 How Can We Use Economic Tools to Deal with Environmental Problems? Concept 17-2A Using resources sustainably will require including the harmful environmental and health costs of resource use in the market prices of goods and services (full-cost pricing). Concept 17-2B Governments can help improve and sustain environmental quality by subsidizing environmentally beneficial activities and by taxing pollution and wastes instead of wages and profits.

16. External Costs Market price leaves out environmental and health costs associated with its production Goods and services include external costs Excluding external costs Hinders development of green goods and services Promotes pollution Fosters waste and environmental degradation

17. Use of Environmental Economic Indicators Gross domestic product (GDP) does not measure environmental degradation Estimating the value of natural capital Genuine progress indicator (GPI) monitors environmental well-being

18. Genuine Progress Indicator = + -

19. Comparison of GDP and GPI

20. Include Harmful Environmental Costs in Prices of Goods and Services Environmentally honest market system makes sense Not widely used Wasteful and harmful producers would go out of business Difficult to estimate environmental costs Most consumers do not connect environmental costs with purchases Government action needed

21. Eco-labeling Encourages companies and consumers to go green Programs in Europe, Japan, Canada, and U.S. Used to identify fish caught by sustainable methods

22. Reward Environmentally Sustainable Businesses Encourage shifts Phase out harmful subsidies and tax breaks Phase in environmentally beneficial subsidies Unknowingly, Americans pay: $2,500 per year in harmful subsidies Another $1,000 in environmental degradation Additional health costs

23. Environmental Taxes and Fees

24. Tax Pollution and Waste Green taxes discourage pollution and waste Current tax system Discourages jobs and profit-driven innovation Encourages pollution, resource waste, degradation Tax shift towards green taxes needed

25. Encouraging Innovations Regulation Laws � command and control Incentive-based regulations European experience positive for innovation-friendly regulations

26. Use of the Marketplace Incentive-based model Government place caps on total pollution levels Tradable pollution Resource-use permits Shown to reduce pollution

27. Trade-offs: Tradable Environmental Permits

28. Individuals Matter: Ray Anderson Inspired by Hawken�s The Ecology of Commerce First totally sustainable green corporation Reduced solid waste 63% Reduced gas emission 46% Lowered energy consumption 28% Saved >$100 million

29. Selling Services Instead of Things Shift from material-flow economy to service-flow economy Make more money by eco-leasing Eco-leasing examples Xerox Carrier

30. 17-3 How Can Reducing Poverty Help Us Deal with Environmental Problems? Concept 17-3 Reducing poverty can help us to reduce population growth, resource use, and environmental degradation.

31. Widening Gap Between Rich and Poor Poverty � harmful health and environmental effects Reducing poverty benefits individuals, economies, and the environment Trickle-down/flow-up model unsustainable

32. Global Distribution of Income

33. Figure 17.8: Global outlook: the global distribution of income shows that most of the world�s income flows up; the richest 20% of the world�s population receive more of the world�s income than all of the remaining 80%. Each horizontal band in this diagram represents one-fifth of the world�s population. This upward flow of global income has accelerated since 1960, and especially since 1980. This trend can increase environmental degradation by increasing average per capita consumption for the richest 20% of the population and by forcing the poorest 20% to survive by using renewable resources faster than they are replenished. Question: How do you think this concentration of wealth can hinder or enhance protection of biodiversity? (Data from U.N. Development Programme and Ismail Serageldin, �World Poverty and Hunger�A Challenge for Science,� Science, volume 296 (2002): pp. 54�58)Figure 17.8: Global outlook: the global distribution of income shows that most of the world�s income flows up; the richest 20% of the world�s population receive more of the world�s income than all of the remaining 80%. Each horizontal band in this diagram represents one-fifth of the world�s population. This upward flow of global income has accelerated since 1960, and especially since 1980. This trend can increase environmental degradation by increasing average per capita consumption for the richest 20% of the population and by forcing the poorest 20% to survive by using renewable resources faster than they are replenished. Question: How do you think this concentration of wealth can hinder or enhance protection of biodiversity? (Data from U.N. Development Programme and Ismail Serageldin, �World Poverty and Hunger�A Challenge for Science,� Science, volume 296 (2002): pp. 54�58)

34. Reducing Poverty Some countries reduced poverty rapidly Developing countries must change policies, emphasizing education Debt forgiveness for developing countries Condition � debt money devoted to basic needs

35. Additional Measures to Combat Poverty Increase nonmilitary government and private aid Combat global malnutrition and infectious diseases Invest in small-scale infrastructure Encourage microloans to poor

36. Case Study: Microloans to the Poor Poor lack credit record and assets for loans Microcredit Grameen Bank, Bangladesh Repayment rate of 99% Reduces poverty, domestic violence, divorce and birth rate

37. Millennium Development Goals Reduce poverty, hunger, and improve health care Developed countries agreed to devote 0.7% of national income Average has only been 0.25%

38. What Should Our Priorities Be? (1)

39. What Should Our Priorities Be? (2)

40. Figure 17.9: Ethics: what should our priorities be? Questions: Which one or more of the expenditures in the top part of the figure would you reduce to pay for solving some of the problems listed in the lower part of the figure? Which three of the problems in the bottom half of the figure do you think are the most important priorities? Why? (Data from United Nations, World Health Organization, U.S. Department of Commerce, and U.S. Office of Management and Budget, World Bank, Earth Policy Institute)Figure 17.9: Ethics: what should our priorities be? Questions: Which one or more of the expenditures in the top part of the figure would you reduce to pay for solving some of the problems listed in the lower part of the figure? Which three of the problems in the bottom half of the figure do you think are the most important priorities? Why? (Data from United Nations, World Health Organization, U.S. Department of Commerce, and U.S. Office of Management and Budget, World Bank, Earth Policy Institute)

41. Figure 17.9: Ethics: what should our priorities be? Questions: Which one or more of the expenditures in the top part of the figure would you reduce to pay for solving some of the problems listed in the lower part of the figure? Which three of the problems in the bottom half of the figure do you think are the most important priorities? Why? (Data from United Nations, World Health Organization, U.S. Department of Commerce, and U.S. Office of Management and Budget, World Bank, Earth Policy Institute)Figure 17.9: Ethics: what should our priorities be? Questions: Which one or more of the expenditures in the top part of the figure would you reduce to pay for solving some of the problems listed in the lower part of the figure? Which three of the problems in the bottom half of the figure do you think are the most important priorities? Why? (Data from United Nations, World Health Organization, U.S. Department of Commerce, and U.S. Office of Management and Budget, World Bank, Earth Policy Institute)

42. Transition to an Eco-economy and Making Money Hawken�s rule Industries and businesses disappear or remake themselves Greatest investment opportunity of the century

43. Shifting to More Environmentally Sustainable Economies

44. Green Careers

45. 17-4 Implement More Sustainable and Just Environmental Policies? Concept 17-4 Individuals can work with others, starting at the local level, to influence how environmental policies are made and whether or not they succeed.

46. Democratic Government and Environmental Problems Complex problems � biodiversity, climate change Long-term problems need integrated solutions Lack of environmental knowledge of political leaders

47. Principles for Environmental Policies (1) Humility principle Reversibility principle Precautionary principle Prevention principle Polluter-pays principle

48. Principles for Environmental Policies (2) Public access and participation principle Human rights principle Environmental justice principle

49. Individuals Matter People create change together � grassroots Politics local at a fundamental level Be an environmental leader Lead by example Work within existing systems � vote with your wallet Run for local office Propose and work for better solutions

50. What Can You Do?

51. Developing Environmental Policy Law making Fund and implement regulations Staff environmental regulatory agencies Political pressure Industry gets their people appointed Industry offers regulators high-paying jobs

52. Case Study: Managing Public Lands in the United States (1) Federal government manages 35% of the country�s land National Forest System � U.S. Forest Service National Resource Lands � Bureau of Land Management National Wildlife Refuges � U.S. Fish and Wildlife Service

53. Case Study: Managing Public Lands in the United States (2) The National Park system National Wilderness Preservation System Contain valuable natural resources Use of lands controversial

54. Four Principles of Public Land Use Protect biodiversity, wildlife habitat and ecosystems No subsidies or tax breaks to extract natural resources Fair compensation for use of property Users of resource extractions responsible for environmental damage

55. Lands Managed by the Federal Government

56. United States Environmental Laws Under Attack Opposition Corporate leaders Individuals who feel threatened by environmental laws State and local government officials resent implementation of federal laws Recently most federal environmental laws and regulatory agencies weakened

57. Major United States Environmental Laws

58. Nongovernmental Organizations (NGOs) Range from grassroots to global organizations Bottom-up changes Citizen-based global sustainability movement Some industries and environmental groups working together

59. Students and Corporations Can Play Important Environmental Roles Student environmental awareness increasing Environmental audits � change on campuses Capitalism thrives on change and innovation to drive technology and profits CEOs and investors see profits by selling green products and services

60. Importance of Environmental Security As important as military and economic security Depletion of the natural capital leads to instability Terrorism and violence bred and fueled by poverty, injustice, and inequality

61. Stronger International Environmental Policies United Nations and other international organizations influential International Organizations Expand understanding of environmental issues Gather and evaluate environmental data Develop and monitor international treaties Provide grants and loans to reduce poverty Helped >100 nations develop environmental laws and institutions

62. Trade-offs: Global Efforts to Solve Environmental Problems

63. Shift toward Environmentally Sustainable Societies Foster cooperate to make transition Guidelines: Emphasize prevention Use well-deigned and carefully monitored marketplace solutions Cooperate and innovate Stop exaggerating � happens on both sides

64. 17-5 How Do the Major Environmental Worldviews Differ? Concept 17-5 Major environmental worldviews differ over what is more important � human needs and wants, or the overall health of ecosystems and the biosphere; different worldviews include varying mixes of both priorities.

65. Human-centered Environmental Worldviews Differing worldviews affect beliefs, behaviors, and lifestyles Planetary management worldview Other species have only instrumental value Stewardship worldview

66. Life-centered and Earth-centered Worldviews Environmental wisdom worldview Part of life community Earth does not need saving � we need to save our own species

67. Comparison of Three Major Environmental Worldviews

68. Earth Flag

69. Science Focus: Biosphere 2 Self-sustaining glass and steel enclosure Artificial ecosystems and species from various biomes and aquatic systems Unexpected problems unraveled life-support system Large-scale failure of biosphere�s species

70. 17-6 How Can We Live More Sustainably? Concept 17-6 We can live more sustainably by becoming environmentally literate, learning from nature, living more simply and lightly on earth, and becoming active environmental citizens.

71. Environmental Literacy (1) Develop respect for all life Understand how life sustains itself See the big picture � connections Think critically to gain environmental wisdom Understand and evaluate environmental worldviews

72. Environmental Literacy (2) Learn to evaluate consequences Foster a desire to make the world a better place

73. Avoid the Mental Traps Gloom-and-doom pessimism Blind technological optimism Paralysis by analysis Faith in simple, easy answers

74. Major Components of Environmental Literacy

75. We Can Learn from Nature Kindle a sense of awe, wonder, mystery, and humility Develop a sense of place Choose to live more simply and sustainably Gandhi�s principle of enoughness Reduce environmental footprint

76. Interrelated Components of Sustainability Revolution (1) Biodiversity protection Commitment to efficiency Energy transformation Pollution prevention Emphasis on sufficiency

77. Interrelated Components of Sustainability Revolution (2) Demographic equilibrium Economic, political transformation

78. The Sustainability Dozen

79. Figure 17.19: Solutions: the sustainability dozen�12 ways in which people can live more lightly on the earth (Concept 17-6). Questions: Which of these things do you already do? Which, if any, do you hope to do?Figure 17.19: Solutions: the sustainability dozen�12 ways in which people can live more lightly on the earth (Concept 17-6). Questions: Which of these things do you already do? Which, if any, do you hope to do?

80. Animation: Resources Depletion and Degradation

81. Animation: Two Views of Economics