Collapse: How Societies Choose to Fail or Survive by Jared Diamond
>...The more important reason why Diamond's rhetoric doesn't play well
any longer is that it presents only one side of the balance-sheet: it
ignores the human benefits that accompany environmental damage. You
build a road, but that destroys part of the local ecosystem; there is
both a cost and a benefit and you have to weigh them up. Diamond shows
no sign of wanting to look at both sides of the ledger, and his
responses to environmental sceptics take the form of 'Yes, but . . .'
If someone were to point out that chemical fertilisers have increased
food production dozens of times over, he would reply: 'Yes, but they
are a drain on fresh water, and what about all that phosphorus
run-off?' Diamond is like a swimmer who competes in a race using only
one arm. 'In caring for the health of our surroundings, just as of our
bodies,' he writes at one point, 'it is cheaper and preferable to
avoid getting sick than to try to cure illnesses after they have
developed' – which sounds wise, but is simply misleading bombast.
Technology brings out the worst in him. At one point he claims that
'all of our current problems are unintended negative consequences of
our existing technology,' to which I felt like shouting in
exasperation that perhaps at some times, in some places, a few of the
unintended consequences of our existing technology have been
beneficial. Reading Diamond you would think our ancestors should all
have remained hunter-gatherers in Africa, co-evolving with the native
flora and fauna, and roaming the wilds in search of wild berries and
the occasional piece of meat.
Here I should put my cards on the table. I am an economist who shares Diamond's worries, but I think he has failed to grasp both the way in which information about particular states of affairs gets transmitted (however imperfectly) in modern decentralised economies – via economic signals such as prices, demand, product quality and migration – and the way increases in the scarcity of resources can itself act to spur innovations that ease those scarcities. Without a sympathetic understanding of economic mechanisms, it isn't possible to offer advice on the interactions between nature and the human species.
Here is an example of what I mean. Forests loom large in Diamond's case studies. As deforestation was the proximate cause of the Easter Islanders' demise, he offers an extended, contrasting account of the way a deforested Japan succeeded, in the early 18th century, in averting total disaster by regenerating its forests. Now consider another island: England. Deforestation here began under the Romans, and by Elizabethan times the price of timber had begun to rise ominously. In the mid-18th century what people saw across the landscape in England wasn't trees, but stone rows separating agricultural fields. The noted economic historian Brinley Thomas argued that it was because timber had become so scarce that a lengthy search began among inventors and tinkerers for an effective coal-based energy source. By Thomas's reckoning, the defining moment of the Industrial Revolution should be located in 1784, when Henry Cort's process for manufacturing iron was first successfully deployed. His analysis would suggest that England became the centre of the Industrial Revolution not because it had abundant energy but because it was running out of energy. France, in contrast, didn't need to find a substitute energy source: it was covered in forests and therefore lost out. I'm not able to judge the plausibility of Thomas's thesis – there would appear to be almost as many views about the origins, timing and location of the Industrial Revolution (granting there was one) as there are economic historians – but the point remains that scarcities lead individuals and societies to search for ways out, which often means discovering alternatives. Diamond is dismissive of the possibility of our finding such alternatives in the future because, as he would have it, we are about to come up against natural bottlenecks. We should be persuaded by the evidence that has been gathered over the years by environmental scientists that he is right, but simply telling us that we are about to hit bottlenecks won't do, because environmental sceptics would reply that discovering alternatives is the way to avoid them.
If the future is translucent at best, what about studying the recent past to see how the human species has been doing? The question then arises: how should we recognise the trade-offs between a society's present and future needs for goods and services? To put it another way, how should we conceptualise sustainable development? The Brundtland Commission Report of 1987 defined it as 'development that meets the needs of the present without compromising the ability of future generations to meet their own needs'. In other words, sustainable development requires that each generation bequeath to its successor at least as large a productive base as it inherited. But how is a generation to judge whether it is leaving behind an adequate productive base for its successor?
An economy's productive base consists of its capital assets and its institutions. Ecological economists have recently shown that the correct measure of that base is wealth. They have shown, too, that in estimating wealth, not only is the value of manufactured assets to be included (buildings, machinery, roads), but also 'human' capital (knowledge, skills health), natural capital (ecosystems, minerals, fossil fuels), and institutions (government, civil society, the rule of law). So development is sustainable as long as an economy's wealth relative to its population is maintained over time. Adjusting for changes in population size, economic development should be viewed as growth in wealth, not growth in GNP.
There is a big difference between the two. It is possible to enumerate many circumstances in which a nation's GNP (per capita) increases over a period of time even as its wealth (per capita) declines. In broad terms, those circumstances involve growing markets in certain classes of goods and services (natural-resource intensive products), concomitantly with an absence of markets and collective policies for natural capital (ecosystem services). As global environmental problems frequently percolate down to create additional stresses on the local resource bases of the world's poorest people, GNP growth in rich countries can inflict a downward pressure on the wealth of the poor.
A state of affairs in which GNP increases while wealth declines can't last for ever. An economy that eats into its productive base in order to raise current production cannot do so indefinitely. Eventually, GNP, too, would have to decline, unless policies were to change so that wealth began to accumulate. That's why it can be hopelessly misleading to use GNP per head as an index of human well-being. Recently the World Bank published estimates of the depreciation of a number of natural resources at the national level. If you were to use those data (and deploy some low cunning) to estimate changes in wealth per capita, you would discover that even though GNP per capita has increased in the Indian subcontinent over the past three decades, wealth per capita has declined somewhat. The decline has occurred because, relative to population growth, investment in manufactured capital, knowledge and skills, and improvements in institutions, have not compensated for the decline of natural capital. You would find that in sub-Saharan Africa both GNP per capita and wealth per capita have declined. You would also confirm that in the world's poorest regions (Africa and the Indian subcontinent), those that have experienced higher population growth have also decumulated wealth per capita at a faster rate. And, finally, you would learn that the economies of China and the OECD countries, in contrast, have grown both in terms of GNP per capita and wealth per capita. These regions have more than substituted for the decline in natural capital by accumulating other types of capital assets and improving institutions. It seems that during the past three decades the rich world has enjoyed sustainable development, while development in the poor world (barring China) has been unsustainable.
-- Michael Pugliese
-- Michael Pugliese