Balancing Global Sustainability: Addressing Allocation Challenges in a Changing World

1. Local Politics of Global Sustainability

2. Review: Allocation Matrix Excludable Non-Excludable Market Good: Ecosystem structure, Waste absorption capacity (e.g. SO2) Open Access Regime: Unowned ecosystem structure, waste absorption capacity (e.g. CO2) Rival Tragedy of the non-commons: patented information Pure Public Good: Street lights, national defense, most ecosystem services, unpatented information Non-rival Non-rival, congestible Club or Toll Good

3. Private property and ecosystem structure • Inefficient: Owner ignores critical ecosystem services • Unjust: Ecosystem services are public goods, destroyed for private gain • Unsustainable: Profit maximization may still lead to extinction

4. Example: Brazil’s Atlantic Rainforest • Ecosystem services of rainforest valued at $2006/ha/year • World’s highest biodiversity humid forest converted to pasture yielding $20/ha/year • Causes droughts, floods, erosion, biodiversity loss, microclimate change, etc. • Greedy self interest creates invisible foot

5. Private property and information • Inefficient: • Creates artificial scarcity • Patent = monopoly • Research ignores public goods • Unjust • Knowledge is cumulative • Raises costs for research that promotes the public good or serves the poor • Example: Golden rice, AIDS medicine

6. Patents and distribution (cont.) • Samuel Slater, “Father of American Industry” • Developed countries own 97% of all patents

7. The “Tragedy of the Non-Commons” • Occurs when private ownership is ecologically unsustainable, socially unjust, and/or economically inefficient • Any privately owned resource that provides non-rival benefits • Sustainability is a non-rival benefit of healthy ecosystems

8. What is the Solution?

9. It’s the system, stupid • How do we create a system that allocates non-rival and/or non-excludable resources? • Must be fair • Must be sustainable • Be nice if it was efficient, too (policy lecture)

10. Capitalism vs. socialism • Ownership by the individual or ownership by society? • What is appropriate depends on the nature of the resources and desirable ends • We need a hybrid system: • Market allocation works for rival/excludable goods and services that only affect individual well-being • We need another allocative mechanism for non-rival and/or non-excludable goods/bads that affect public well-being

11. Can Science Tell us How to Allocate? • How much natural capital needs to be left for future generations? • How do we deal with uncertainty? • How do we deal with needs vs. wants? • Values matter • If the market economy can’t do it, and science can’t do it, what is left?

12. Can the Political Process do it? • As many types of political systems as economic systems

13. What we have • Representative democracy (?) • Defends our rights and freedoms (?) • Is it participatory? • Feeling of participation • Participation levels • Would you opt out of participating in the market? • Is it democracy?"We can have concentrated wealth in the hands of a few or we can have democracy, but we cannot have both." -Justice Louis Brandeis

14. What we Have (cont.) • Economic sphere (wealth) dominates political sphere (power) and public sphere (participation) • Public sphere: “psychic and political space and process within which people, acting as citizens, consider their common dilemmas and seek solutions” • We are consumers first, citizens second • Unregulated capitalism destroys the means of production

15. What we need • Participatory, democratic decision making processes – “strong democracy” • E.g. town meetings

16. What this requires • Equal political rights • One person one vote vs. one dollar one vote • Can’t let economic sphere influence political sphere • Nature abhors a vacuum • Educated public • What do we learn and where do we learn it? • Who owns the airwaves? • We must educate each other in public dialogue • Engaged public • Empowered public

17. Strong democracy and the political condition • Action • Participatory democracy is not a spectator sport. We need to opt in. • Publicness • Must continually answer question “when do private acts become public?” • Necessity • “events have lives of their own. To refuse to act is also to act”

18. (cont.) • Choice • Citizens set the agenda. • Reasonableness • We must both talk and listen. Dialogue not debate • Conflict • We must “transform conflict into cooperation through citizen participation, public deliberation, and civic education.” • Absence of an independent ground • E.g. divine will, rights, freedoms

19. PDMP and sustainability

20. PDMP and built capital • How do we supply public goods such as roads, bridges, streetlights, sewage systems? • What would happen if we applied PDMP to urban sprawl? • How does this relate to Diane Gayre’s and Melinda Moulton’s lectures? • What is the impact of unregulated capitalism? (e.g. electricity)

21. PDMP and natural capital • What belongs to the public (THE COMMONWEALTH) and what belongs to individuals? • How do we deal with parks, air quality (SO2), water quality, etc.? • The public determines scale, scale determines price • We decide as a society how to allocate natural capital between ecosystem services and economic production. • Market can decide how to allocate among different sectors of economy.

22. PDMP and social capital • Continual process of education into citizenship • “community is fostered by participation, and participation by community” • Working with people to solve common problems transforms them into a community • E.g. US senate (in a good year) • Builds institutions, networks and trust • What is the impact of unregulated capitalism on social capital?

23. PDMP and human capital • Participatory dialogue educates us on the critical issues • Appropriate technologies and government sponsored research • National health care • Mandatory education • Whatever happened to civics?