I’ve said numerous times before how much I love Tim Jackson’s work. His book is easily the best growth dilema work to date. And the report the book is based upon is equally as good, just quicker to read. Heck, if you don’t have time for that there is even a summary (pdf) of the report! Needless to say, I think everyone should read his work.

Here’s a great video of a TED Talk by Tim Jackson on the Economics of Climate Change:

Special thanks to Growth Is Not Sustainable for first posting this video.

Related posts:

1. Climate Change Follow-Up: Wake Up!
2. Climate Change v. Global Warming v. AGW
3. Climate Change: Do Something Already!

Ideas for a Sustainable Economy

This year we saw the first Steady State Economy Conference held in Leeds, UK and hosted by the Center for the Advancement of the Steady State Economy (CASSE) and Economic Justice for All. While the reports from conference goers afterward were good, for those of us that couldn’t attend there was hope for something tangible to come out of it. Luckily for us, that happened to be one of the goals of the event.

Today is the release of a seminal paper, Enough Is Enough: Ideas for a Sustainable Economy in a World of Finite Resources, a 130 page report that not only addresses why we need an alternative to growth, but outlines policies to achieve such an alternative: a steady state economy.

Part One of the report covers the problems with growth, and the concept of enough. It open’s with a great quote from Tim Jackson, author of Prosperity Without Growth, and keynote speaker at the conference:

“Here is a point in time where our institutions are wrong. Our economics is not fit for purpose. The outcomes of this economic system are perverse. But this is not an anthem of despair. It’s not a place where we should give up hope. It’s not an impossibility theorem. The impossibility lives in believing we have a set of principles that works for us. Once we let go of that assumption anything is possible.”

Part Two of the report contains the real guts of the report, outlining the most complete collection of policy ideas, tools and reforms in one place. This section has the most weight to it and will make the biggest splash, but Part Three helps to combine these policies with the reality present in Part One: how to get the economy functioning and transitioning to a steady state economy.

The problems are real, the studies numerous, and the evidence richly points to the need for an alternative to growth. A steady state economy represents the best of many solutions: providing a sustainable scale to the economy, as well as providing more prosperity for everyone. This report states the facts, outlines the way out of our economy of “more” and into an economy of “enough.”

Check out the Enough Is Enough page, download the report pdf or the report summary, and watch the many videos also available from the conference.

Related posts:

1. Sustainable Scale
2. Post Growth Reading List
3. Steady State Economy: An Overview

Our Natural Accounts Run Red

Today is the official day of Earth Overshoot: the first day of the year our natural capital spending is in the red. This type of natural debt is far more destructive than its monetary counterpart (natural debt meaning debt owed of natural capital, not a debt that is natural – there is no such thing). Instead of being able to pay back this loan, we’re actually making it harder to pay our bills next year and the year after.

Overshoot is a term used often by biologists to describe a population that consumes more than the system can support. This could be a pack of grey wolves in the Northern Territories that is eating more deer than can possible be born and grow within the year. What does that mean? With less deer this year to breed, there will be less deer next year to eat. The deer the wolves eat next year will deplete their reserve even further. Eventually no deer will be around to eat and the wolves will starve.

We’re doing the same thing today with the Earth. As the Global Footprint Network puts it,

“For most of human history, humanity has been able to live off of nature’s interest – consuming resources and producing carbon dioxide at a rate lower than what the planet was able to regenerate and reabsorb each year.

But approximately three decades ago, we crossed a critical threshold, and the rate of human demand for ecological services began to outpace the rate at which nature could provide them. This gap between demand and supply – known as ecological overshoot – has grown steadily each year. It now takes one year and six months to regenerate the resources that humanity requires in one year.“

The bummer here is that we can’t migrate to a new territory: there’s only one Earth. There will only ever be one Earth. One Planet. That’s how much we’ve been given, best we figure out how to use it well. We need to create a sustainable scale to our society and economy.

Maxed Out: Earth Doesn't Have Give Out Credit

Overshoot is directly related to carrying capacity – and biologists know that when a population consumes more than the system can renew, this overshoot often leads to a mass die-off.  We’re already watching the most massive extinction since the dinosaurs, our biological diversity is dwindling at unheard-of rates. Perhaps this should be seen as a warning to our own existence? After all, we are part of nature.

Celebrate Earth Overshoot Day by donating your car and buying a bike, calling your congressman, writing the president, trading your oil company job for a green job, building resiliency in your local community and supporting your local economy. Have a great anti-Holiday!

See my cross-post on Post Growth and out my guest post on Green Growth Cascadia about Earth Overshoot Day. Image Credits: Global Footprint Network.

Related posts:

1. Natural vs Man-Made Capital
2. The Earth Bleeds Out
3. Carrying Capacity And Overshoot

Taxation is an interesting facet of our society. Economists view taxes as a disincentive in a free market, and rightly so. Taxes increase the price of a product or service, making it less desirable. Yet, when you think about what we tax in this country, it’s mostly things we desire more of – income, profits, sales, et cetera. This odd behavior should be questioned, even more so today when every budget (state, city, federal) seems to be facing seriously tenuous times.

I took the train down to Oregon this last weekend to see my sister graduate from college. While there I stayed with Rob Dietz, Executive Director of CASSE and a good friend of mine. He handed me a very modest looking magazine called Sockeye. I am sure I will be drawing material from this one issue for some time (check it out, amazing articles). For now I want to talk about tax shifting, as mentioned in the article by Alan Durning and Amy Chan, “Making Prices Tell The Truth: Shifting Taxes from Bads to Goods.” (pdf)

The Imbalance of the Free Market

Taxes have the power of acting as a means of balancing what are called “market inefficiencies,” things in the free market system that generate negative externalities. These are unwanted side effects that are not taken into account in a product, service or activity. A great example of this is any fossil fuel, let’s take Coal for instance.

Let’s imagine a coal power plant starts leeching mercury into a watershed and a city water planet down river takes it in (coal accounts for most of the mercury in our waterways). The coal power plant is not paying to filter this mercury out, nor is it paying for all the damage that could occur from the toxin leeching into the ecosystems. Because the producer does not pay for the negative externalities it is left out of the decision to pursue coal power.

If these externalities were eliminated by charging or compensating for them, then they could be factored into the decision making process. This is especially important as all too often these become costs placed upon the society instead of the producer (e.g. the city water plant in the above example has to filter out the mercury from its water source). If these prices were added into coal’s price they would eventually make coal production to costly to be worthwhile.

One of the best ways to internalize these negatives into our free market is to increase their expense with taxes to help offset costs like oil spill clean ups, health care or water treatment.

More Taxes, Less Cuts

Instead of cutting important, meaningful services like education, health care, welfare, police and fire departments we should be looking at new sources of income. No one is looking forward to more taxes, so this leads us to the need to consider something – I know when I say it, politicians everywhere will wince – out of the box. The conventional isn’t working, hasn’t worked and only seems to make things worse as we go forward into the future.

Here are some of the tax/income ideas that I think have great potential:

• Tax Pollution – We have the systems to monitor pollutants, so we should tax everything on a global warming potential basis. Carbon costs $1 per unit, so methane (which has a GWP of 12 times that of CO2) would cost $12 per unit.
• Toll Roads – If we want to be serious about transitioning to sustainable means of travel, we need to start tolling more roads here in the states. These funds should go directly into funding more transit, maintenance, et cetera and keeping state transit workers employed.
• Tax Gasoline/Propane/Diesel – Here I have the same sentiment as the last point. The “true cost” of gasoline, when you add in all the externalities that can be priced, is around $12 per gallon. Now, a $12 gallon of gasoline would take a while to work up too – but it shouldn’t be seen as ridiculous (Europeans pay over $7 per gallon), especially since it will get there eventually on its own. However, if we start now we gain a better reward and help fight climate change along the way.
• Tax Resource Extraction – If you harvest anything unsustainably, it should be taxed. This goes doubly so for non-renewable resources like oil, natural gas and coal.
• Tax Advertising – This is a blight on human psyches and generally accepted by most as a nuisance. Personally, I think we should ake São Paulo’s route and outlaw advertising in public spaces. All others should be taxed as the public nuisance they are!
• Tax Banks – Banking is screwed up. Private banks and their CEOs make exorbitant amounts of money doing something provides comparably little service to society. As the current state of economic affairs is a great example of, banking is actually more detrimental to society than we thought just a few years ago. We need a small percentage tax on all banking transactions. This “Robin Hood Tax” could raise billions to fund education, social services, climate mitigation and aid in eliminating poverty and hunger.
• Tax Corporations - If anyone is to blame for most of the worlds problems, I could surely name more large corporations than individual people. Why don’t we tax them when they get “too big to fail”?
• Fuel Efficiency “Feebates” – A feebate is a combination of fee and rebate, often proposed as a means to improve fuel efficiency in vehicles. It works rather simply: for every mpg below the average on a new car purchase you pay a fee. For every mpg above the average on a new car purchase you get a rebate. This creates an incentive for both consumer and manufacturer to purchase/make more fuel efficient vehicles, thereby increasing the average. A study done at UC Berkeley showed that a $70 per mpg feebate would increase fuel efficiency about 1 mpg per year.
• Tax the Rich – People making more than 20 times the average wage should be taxed on their income. They are promoting inequality, which have been linked to a range of social and economic problems. Take this a few steps further, increase the taxes the further away you get from the average national income and subsidize the income of those 20 times below the average. This is more Robin Hood than the bank tax even: it supports equality and actually lifts people out of poverty. Basically, this could be a feebate for wage equality.

That’s all I got for now, though I am sure we could come up with a few more ways to generate income. All of these taxes could be instituted in small levels, gradually increased as we deem appropriate, and eventually should lead to the elimination of taxes on median-level incomes, profits and sales. This levy on taxing the goods would help offset the trickle-down of price increases that would likely occur with instituting this new types of taxes. Plus, we get a double-whammy: income for our ailing budgets and discouraging bad behavior.

Related posts:

1. Tax The Wealthy, They’re Asking For It
2. Fair Distribution: Ending the Wealth Gap
3. Ethical Banking Systems

In January I was privileged enough to be able to join in at the New Green Economy Conference put on in DC. There I met a number of amazing people, many heroes of mine, and joined in some great discussion about the future of our society and economy. The breakout session I attended was led by my friend Rob Dietz at The Center for the Advancement of the Steady State Economy and Jon Erikson, Director of the Gund Institute for Ecological Economics at the University of Vermont.

I talked briefly with Jon about possible education opportunities, and one that he mentioned was the online course available in Intro to Ecological Economics. This course can be taken to earn credits towards their distance learn program or can be taken for free online, to learn more about the topic. Whilst I have done tons of reading and writing on the topic, I have not done anything structured like this course. I also have yet to completely read, cover to cover, Daly & Farley’s landmark textbook Ecological Economics, which is one of the main texts in this online course.

So far this textbook has served as a great reference for me and I have certainly read many portions, but it has been on my list of things to completely read for some time. That being said, I am placing a goal of finishing this online course over the summer. I will be updating the blog as I go along, writing posts on topics and hopefully furthering one of my goals with this blog: teaching myself and others the concepts of the steady state economy.

The Goal

I will complete the Gund Institute’s online Introduction to Ecological Economics over the summer, the next four months, June through September. The course is split into four modules, which means I will need to finish one module a month. Each module has sub modules, around 3-4 each. This gives me an almost weekly goal of reading to complete, videos to watch, and posts to write!

Hopefully I will expand my knowledge a bit, but along the way I hope you’ll gain something as well. I would really like to encourage you to engage me via comments as I explore this course. You can also join in online and do the course yourself – you just need a couple of textbooks, the rest of the content is online.

Reader Survey Feedback & Blog Direction

Thank you to the few of you who responded to my readers survey. It seems most of you like where this blog is going and would like to see medium-sized posts on a more steady frequency. I also heard that apparently I can ramble a little and might be a bit too optimistic – I will work on the rambling, while the optimism you’ll have to live with.

I will also work on worrying less about superior arguments and content to the point of obsession, and instead focus on posting at least 1-2 times a week with good content, news, thoughts, et cetera. This will still give me time to develop the slightly longer, content driven posts. However, this blog is probably going to get a little more laid back and personal in content. Basically, I need to not stress out so much about what I’m posting, it’s starting to actually make me write less.

A few people on the recent reader’s survey thought their knowledge or clout wasn’t sufficient enough to comment on the blog. That’s just silly – I’m not an economist, I’m just another person trying to understand how to create a sustainable society. It just happens that I write about it here, but that doesn’t mean that you don’t have ideas or questions that are worthy of being here either! My largest goal with this blog was to inspire discussion and learning about this topic – so please, comment!!

Thanks again for the feedback, and if you haven’t already you can still fill out that short survey here. If you’re looking for some more discussion about sustainable economics and a post growth society, check out my new side project, a collaborative blog called Post Growth.

Related posts:

1. Post Growth Institute
2. Vote For CASSE!
3. Add It Up

A few months ago I wrote about the myth of decoupling – how you cannot separate economic growth from environmental impact. I touched on a topic in that post that is critical to the argument against continued economic growth: the limits of efficiency and the physical constraints of thermodynamics on the economy. That post received a lot of good feedback, as well as a few requests to talk about efficiency limits in more detail.

Neoclassical Arguments Defy Natural Laws

Gravity is a basic law of our existence. To hear someone claim that gravity is a myth would be astounding. A large group of people believing such a claim would be even more ridiculous (sounds like climate change deniers, actually). Yet, anyone trumpeting infinite economic growth does just that: makes a claim that violates basic laws of nature.

You might be asking yourself how I can make such an accusation when we are obviously still growing as an economy. Well, sure we are, but this is actually uneconomic growth, false growth, and debt-driven growth. All that debt is expanding while our natural resources do not – which spells C-O-L-L-A-P-S-E, if you’re curious.

The most common argument for economic growth continuing indefinitely without undermining the environment is “technological progress.” This really means technological efficiency, or our ability to do more with less and less. Neoclassical economists, policy makers, politicians, and even the average citizen today all believe technology will save us in the end. The thought is that we’ll move to an “information economy” or to a “space economy” and produce growth by using less resources.

The basic claim is we will continue to make leaps in technological progress that will maintain economic growth at the same level of ecological impact (resource use, waste, etc). We can make more today with less material per unit and less energy per unit than we could two decades ago. However, as a pointed out in my earlier post, this relative decoupling is weak in comparison to the growth of the economy as a whole. That is besides the point. The matter at hand is efficiency.

We can get better and better at production only to a certain point. Efficiency cannot improve infinitely, therefore the economy cannot rely on it for infinite growth. Period.

Physical Laws of the Universe

The scientific community is always challenging itself. This is the very purpose of research and institution of the scientific method. When someone develops a theory it is challenged by experiments designed to support or disprove that theory. Some of these lucky ideas will be supported with such strength that they are no longer considered theories, but laws.

Laws of nature are the building blocks of scientific advancement. Future theories are based on current laws. We all (should) know the laws of gravity, of basic physics, of thermodynamics, et cetera. The last is a set of laws that govern the exchange of energy, expansion of entropy, limits of efficiency and rules regarding temperature.

Before I go forward I really want to drive home a point here: these are physical laws of the universe that cannot be altered or subverted. There is no way around physical laws and any hope for a scientific break through in that department is not a credible vision of the future (aka it’s pure fiction).

The Ultimate Crux To Growth: Thermodynamics

The laws of thermodynamics are very clear: everything wears out (creates entropy) and there cannot be a system that reaches (or exceeds) 100% efficiency. Herman Daly makes a note of this in his revolutionary book Steady State Economics, by pointing out it is important “to recognize that the entropy law is the basic physical coordinate of scarcity. Were it not for the entropy law, nothing would ever wear out; we could burn the same gallon of gasoline over and over, and our economic system could be closed with respect to the rest of the natural world.”

Not only does this sound impossible when common sense is applied, but we know it to be against the laws of the physical universe. Yet, we continue to clamor for economic growth. We cannot grow forever on a finite planet. There are not enough resources. Our technology has limits, most of which, I would argue, we have met – at least in terms of being able to have any large expansion of production, consumption, and waste absorption (the economy) on our tiny planet. We’re pushing forward on debt, running out of our savings (natural capital), and heading towards collapse.

Because we cannot improve our efficiency to combat the environmental degradation caused by economic growth (in fact, we cannot even come close, according to history), we are left with the same fact that economic growth cannot continue. It no longer matters if it is an “information economy,” which still relies on real-world, consuming people and technologies; or if it is a “space economy” that will rely on resources to get us off the surface of the planet and build ships. Everything has a limit, including economic growth. We’ve hit that limit on growth in the developed world. Now we need to think about our post growth society.

Related posts:

1. The Opportunity of Limits
2. Social Business and Limits to Growth
3. No-Growth Economics and You