The Dangerous Disconnect Between Economics and Ecology

The world economy is depleting the earth’s natural resources, and economists cling to models that make no reference whatsoever to the biophysical basis that underpins the economy. That’s why ecological economics is needed, says William Rees in this INET interview.

Standard economics portrays the economy as a circular flow: households pay money to firms in exchange for goods and services, and firms pay wages to households in exchange for labor. Textbooks describe this circular flow as self-perpetuating, capable of infinite expansion. William Rees argues that the textbooks get it wrong; he says the production of our goods and services depends on the extraction of material from ecosystems, causing resource depletion on the one hand, and excess pollution on the other.

William Rees, best known in ecological economics as the originator and co-developer of ‘ecological footprint analysis’, says the United States is using four or five times its fair share of the world's total bio-capacity. In order to bring just the present world population up to the material standards enjoyed by North Americans, we would need the biophysical equivalent of about three additional planet earths.

There has been no time in history where income growth hasn't been accompanied by increased material and energy consumption, Rees cautions. He says technologies exist that would enable us to enjoy our current lifestyles with perhaps as little as 20 percent of our current energy and material consumption, but we do not have the incentives in place to force that decoupling to take place.

Rees is as pessimistic on current culture and politics as he is optimistic on the technology. The global culture remains in denial, and people with vested interests in the status quo wield enormous power.

Brilliant! This coalesces a number of concepts that I’ve wished could have been better expressed. But – so what? Without that extension into the practical, the political, the human, it stays as little more than academically interesting thesis-fodder. (Sorry.) In a federal election that we held about 20 years ago, I was involved in a new party as one of about 170 candidates. Our environmental platform was written by David Suzuki, our cultural platform was written by an eminent writer, Pierre Berton, our financial platform by a (conservative) former head of our Wage-and-Price Controls Commission, plus we had many other leading lights in our group. We had the best political platform that intelligent people could devise. And we lost miserably.

It was like herding cats. Each one of us knew, without a doubt, in area of expertise, exactly what needed to be done. Which usually conflicted with at least a quarter of the other strong-willed members of our intelligencia. And it conflicted with the day-to-day lives of everybody else.

Now that’s the real problem to solve!

A charismatic leader – whether an Athenian tyrant, or a one of our current benevolent dictators – is a problematic solution.

Do we solve it through process, through education, genetic mutation, or what?

The answer to that will either make us or break us.