Making Markets Work for the Natural World

 This article was published in BusinessGreen 07/10/19

It feels like barely a week goes by without another dire environmental news story breaking. One day the IUCN reports that 60% of the world’s wildlife has been wiped out in the last 40 years, the next the UN warns of the potential loss of a million species. Recently that large tracts of the species-rich Amazon rainforest are burning with severe potential consequences for CO2 release and wildlife. Now we hear climate change is moving much faster than expected. In truth, these destructive processes have been going on for decades, and a large number of organisations have been campaigning and working hard to save wildernesses, protect species, control waste and cut carbon emissions and pollution since as far back as the ‘60s. But the environmental winds have changed: suddenly the public have become ultra-sensitised to such news, and all over the world they are demanding with great passion that governments do something dramatic about them. The unlikely figure of a Danish schoolgirl, Greta Thunberg, has taken centre stage – a modern day Joan of Arc for the environment. Equally unlikely perhaps, at the other end of the age spectrum a 90+-year-old – the revered broadcaster, Sir David Attenborough - has found himself thrust into the midst of this new fever.

Yet for those of us like me who have been following the spiral of world decline for the past 40 years or more, there is no real sense of the tide turning, of impending victory over the destructive economic forces that underlie all these problems. Why? Because although tens of thousands of highly qualified and experienced economists and ecologists have been concentrated on it, world environmental decline continues at an angle resembling the BP share price after the Deepwater Horizon oil spill. There have been successes here and there, certainly, but the overall numbers tell a story of abject failure. Why is this? It is surely vital to understand, or the world will just go on throwing mud at the wall in the hopes some of it might stick, hardly a recipe for success.

The reason for this failure is that the “plan” Sir David, Greta, Extinction Rebellion and so many others are calling for simply doesn’t exist. There is still no core economic strategy to restructure the world economic order to conserve natural capital. There are innumerable excellent micro-plans and brilliant new technologies, many of which Business Green readers will be closely involved with. But no core macro-economic strategy – no master plan.

Yet I believe that this plan is all around us – in Nature. The consilience between ecology and economics has long been recognised, but never have the lessons of ecology – specifically ecosystems, been applied methodically to environmental economics. If we want to stop panic-firefighting problems one-by-one and get to grips once and for all with these humungous problems, it’s time some solid science was injected into it.

We can start with the basics: all things human that give rise to environmental decline have one thing in common - one way or the other they can be laid at the door of free markets. Markets are at the epicentre of the human world, after all. They built it; they maintain it; they continue to develop it, and we have everything to thank them for. But all too often they also degrade and destroy it. Just as happens in Nature, where creatures that overextend themselves eventually get knocked back, all the signs are that without a radical re-think, the same will likely happen to us, or rather to the children to whom we bequeath the potentially dire consequences of our inaction.

There’s a logical reason for our ostensibly suicidal exploitation of the natural world, though. An ancient and immensely powerful instinct impels all species to acquire and control resources – it’s a survival thing, and it drives the evolution of species. It’s why you find life exploiting resources everywhere from inside solid rock more than 2 miles beneath South Africa’s Tau Tona gold mine, all the way up to the cumulus clouds in the sky above. This is why we humans are doing precisely the same thing – feverishly exploring, exploiting and expanding the economic dimension - the economic ecosystem. It’s why we now have our eyes set on other planets. Looked at it this way, we can perhaps begin to understand why we strip the Earth of its resources despite the inevitable consequences – it’s in our genes.

But that doesn’t mean we can’t do anything about it – far from it. While we can’t change our genes, we can, through smart economics, redirect this universal drive so that it protects the natural world instead of destroying it. How? By changing existing markets and creating new ones specifically designed to make “good” behaviour profitable, and “bad” ever more costly. In economics, as in Nature, what provides survives; what costs is lost. I yearn for the day when the Brazilian rainforests are worth more standing than burned; when clean cars are cheaper than dirty ones; when organic food is cheaper than pesticidal food; when clean energy is cheaper than pollutive energy, when tigers are worth more alive than dead. It’s crazy economics that they aren’t already when we know full well their true worth. The bottom line is that Nature doesn’t care a fig about what happens to us, but it does show us how to create the balanced economic ecosystem the world needs.

But this change won’t emerge from grass roots at anything like a sufficient scale in the narrow time window available. It demands a brand-new form of ecology-inspired, neo-Keynesian macro-economics, which means only governments can make it happen. But with vision and a renewed political will inspired, activated and energised by Greta and her supporters, the big plan that is “Ecosystem Economics” could be born the very next day.

Simon M Lamb

Author of Junglenomics: Nature’s Solutions to the world economic crisis: a new paradigm for the 21st century and beyond