"World on Edge details the vice closing around us: a quadruple squeeze of global warming and shortages in food, water and energy. Then it explains the path out—and how little time we have left to take that path. Got anything more important to read than that?" —Peter Goldmark, former head of the Port authority of New York and New Jersey, President of the Rockefeller Foundation, and CEO of the International Herald Tribune
Our global economy is outgrowing the capacity of the earth to support it, pushing our early twenty-first century civilization ever closer to decline and possible collapse. In our preoccupation with quarterly earnings reports and year-to-year economic growth, we have lost sight of how large the human enterprise has become relative to the earth’s resources. A century ago, annual growth in the world economy was measured in billions of dollars. Today it is measured in trillions.
As a result, we are consuming renewable resources faster than they can regenerate. Forests are shrinking, grasslands are deteriorating, water tables are falling, fisheries are collapsing, and soils are eroding. We are using up oil at a pace that leaves little time to plan beyond peak oil, or the period during which demand for oil far exceeds all available supply. And we are discharging greenhouse gases into the atmosphere faster than nature can absorb them, setting the stage for a rise in the earth’s temperature well above any since agriculture began.
Fortunately, there is a consensus emerging among scientists on the broad outlines of the changes needed. If economic progress is to be sustained, we need to replace the fossil-fuel-based, automobile-centered, throwaway economy with a new economic model. Instead of being based on fossil fuels, the new economy will be powered by abundant sources of renewable energy: wind, solar, geothermal, hydropower, and biofuels.
The throwaway economy will be replaced by a comprehensive reuse/recycle economy. Consumer products from cars to computers will be designed so that they can be disassembled into their component parts and completely recycled. Throwaway products such as single-use beverage containers will be phased out.
We can already see glimpses here and there of what this new economy looks like. We have the technologies to build it--including, for example, gas-electric hybrid cars, advanced-design wind turbines, highly efficient refrigerators, and water-efficient irrigation systems.
We can see how to build the new economy brick by brick. With each wind farm, rooftop solar panel, paper-recycling facility, bicycle path, and reforestation program, we move closer to an economy that can sustain economic progress. But there is still a long way to go and a very short time to get there. Our success will depend on learning from the changing world around us and implementing those lessons we have already learned.
China as the World’s Leading Consumer
For many years environmentalists have pointed to the United States as the world’s leading consumer, noting that 5% of the world’s people were consuming nearly a third of the earth’s resources. Although that was true for some time, it no longer is. China has replaced the United States as the leading consumer of basic commodities.
Among the five basic food, energy, and industrial commodities—grain and meat, oil and coal, and steel—consumption in China has eclipsed that of the United States in all but oil. China has opened a wide lead with grain, consuming 380 million tons in 2005, compared with 260 million tons in the United States. Among the big three grains, China leads in the consumption of both wheat and rice and trails the United States only in corn.
Although eating hamburgers is a defining element of the U.S. lifestyle, China’s 2005 meat consumption of 67 million tons is far above the 38 million tons eaten in the United States. U.S. meat intake is rather evenly distributed among beef, pork, and poultry, but pork totally dominates in China. Indeed, half the world’s pigs are now found in China.
With oil, the United States was still solidly in the lead in 2004, using more than three times as much as China—20.4 million barrels per day versus 6.5 million barrels. But U.S. oil use expanded by only 15% between 1994 and 2004, while use in China more than doubled. Having recently eclipsed Japan as an oil consumer, China now trails only the United States.
Energy use in China also obviously includes coal, which supplies nearly two-thirds of the country’s energy. China’s annual burning of 960 million tons easily exceeds the 560 million tons used in the United States. With this level of coal use, and with oil and natural-gas use also climbing fast, it is only a matter of time before China’s carbon emissions match those of the United States. Then the world will have two major countries driving climate change.
China’s consumption of steel, a basic indicator of industrial development, is now nearly two and a half times that of the United States: In 2003, China consumed 258 million tons, compared with 104 million tons for the United States. As China has moved into the construction phase of development, building hundreds of thousands of factories and high-rise apartment and office buildings, steel consumption has climbed to levels never seen in any country.
With consumer goods, China leads in the number of cell phones, television sets, and refrigerators. The United States still leads in the number of personal computers, though likely not for much longer, and in automobiles.
What if China catches up with the United States in consumption per person?
If the Chinese economy continues to grow at 8% a year, by 2031 income per person will equal that in the United States in 2004?
If we further assume that consumption patterns of China’s affluent population in 2031, by then 1.45 billion, will be roughly similar to those of Americans in 2004, we have a startling answer to our question.
At the current annual U.S. grain consumption of 900 kilograms per person, including industrial use, China’s grain consumption in 2031 would equal roughly two-thirds of the current world grain harvest. If paper use per person in China in 2031 reaches the current U.S. level, this translates into 305 million tons of paper—double existing world production of 161 million tons. There go the world’s forests. And if oil consumption per person reaches the U.S. level by 2031, China will use 99 million barrels of oil a day. The world is currently producing 84 million barrels a day and may never produce much more. This helps explain why China’s fast-expanding use of oil is already helping to create a politics of scarcity and political instability.
Or consider cars. If China one day should have three cars for every four people, as the United States now does, its fleet would total 1.1 billion vehicles, well beyond the current world fleet of 800 million. Providing the roads, highways, and parking lots for such a fleet would require paving an area roughly equal to China’s land in rice, its principal food staple.
The inevitable conclusion to be drawn from these projections is that there are not enough resources for China to reach U.S. consumption levels. The Western economic model—the fossil-fuel-based, automobile-centered, throwaway economy—will not work for China’s 1.45 billion people in 2031. If it does not work for China, it will not work for India either, which in 25 years is projected to have even more people than China. Nor will it work for the other 3 billion people in developing countries who are also dreaming the “American dream.” In an increasingly integrated world economy, where countries everywhere are competing for the same resources—the same oil, grain, and iron ore—the existing economic model will not work for industrialized countries, either.
Service Stations and Supermarkets Compete for Food
Historically, the world’s farmers produced food, feed, and fiber. Today, they are starting to produce fuel, as well. Since nearly everything we eat can be converted into automotive fuel, the high price of oil is becoming the support price for farm products. It is also determining the price of food. On any given day, there are now two groups of buyers in world commodity markets: one representing food processors and another representing biofuel producers. The line between the food and fuel economies has suddenly blurred, as service stations compete with supermarkets for the same commodities.
First triggered by the oil shocks of the 1970s, production of biofuels—principally ethanol from sugarcane in Brazil and corn in the United States—grew rapidly for some years but then stagnated during the 1990s. After 2000, as oil prices edged upward, it began to again gain momentum. (See Figure: World Ethanol and Biodiesel Production, 1980-2005) Europe, meanwhile, led by Germany and France, was starting to extract biodiesel from oilseeds.
Production of biofuels in 2005 equaled nearly 2% of world gasoline use. From 2000 to 2005, ethanol production worldwide increased from 4.6 billion to 12.2 billion gallons, a jump of 165%. Biodiesel, starting from a small base of 251 million gallons in 2000, more than tripled to an estimated 790 million gallons in 2005, more than tripling according to Earth Policy Institute figures.
Aside from the prospective use of cellulose, current and planned ethanol-producing operations use food crops such as sugarcane, sugar beets, corn, wheat, and barley. The United States, for example, in 2004 used 32 million tons of corn to produce 3.4 billion gallons of ethanol. Although this is scarcely 12% of the huge U.S. corn crop, it is enough to feed 100 million people at average world grain-consumption levels.
Governments support biofuel production because of concerns about climate change and a possible shrinkage in the flow of imported oil. Since substituting biofuels for gasoline reduces carbon emissions, governments see this as a way to meet their carbon-reduction goals. Biofuels also have a domestic economic appeal partly because locally produced fuel creates jobs and keeps money within the country. The benefits of ethanol over conventional petroleum are numerous, but if allowed to develop unwisely, the burgeoning global ethanol industry could cause as much ecological disruption as it repairs.
In an oil-short world, what will be the economic and environmental effects of agriculture’s emergence as a producer of transport fuels? Agriculture’s role in the global economy clearly will be strengthened as it faces a vast, virtually unlimited market for automotive fuel. Tropical and subtropical countries that can produce sugarcane or palm oil will be able to fully exploit their year-round growing conditions, giving them a strong advantage in the world market.
With biofuel production spreading, the world price for oil will, in effect, become a support price for farm products. If food and feed crop prices are weak and oil prices are high, commodities will go to fuel producers. For example, vegetable oils trading on European markets on any given day may end up in either supermarkets or service stations.
The risk is that economic pressures to clear land for expanding sugarcane production in the Brazilian cerrado and Amazon basin and for palm oil plantations in countries such as Indonesia and Malaysia will pose a major new threat to plant and animal diversity. In the absence of governmental constraints, the rising price of oil could quickly become the leading threat to biodiversity, ensuring that the wave of extinctions now under way does indeed become the sixth great extinction.
With oil prices now high enough to stimulate potentially massive investments in fuel-crop production, the world farm economy—already struggling to feed 6.5 billion people—will face far greater demands. How the world manages this new, incredibly complex situation will tell us a great deal about the prospect for our energy-hungry twenty-first century civilization.
Harnessing the Wind
The hunt for alternative energy sources is now gaining urgency. World wind-generating capacity, growing at 29% a year, has jumped from less than 5,000 megawatts in 1995 to more than 47,000 megawatts in 2004, a ninefold increase according to the Worldwatch Institute. Wind’s annual growth rate of 29% compares with just, 2.5% for natural gas, 2.3% for coal, and 1.9% for nuclear power and 1.7% for oil. There are six reasons why wind is growing so fast. It is abundant, cheap, inexhaustible, widely distributed, clean, and climate-benign. No other energy source has all these attributes.
Europe is leading the world into the age of wind energy. Germany, which overtook the United States in 1997, ranks as the world’s primary wind energy producer with 16,600 megawatts of generating capacity. Spain, a rising wind power in southern Europe, overtook the United States in 2004. Denmark, which now gets an impressive 20% of its electricity from wind, is also the world’s leading manufacturer and exporter of wind turbines.
In its 2005 projections, the Global Wind Energy Council showed Europe’s wind-generating capacity expanding from 34,500 megawatts in 2004 to 75,000 megawatts in 2010 and 230,000 megawatts in 2020. Fifteen years from now, wind-generated electricity is projected to satisfy the residential needs of 195 million consumers, half of Europe’s population.
After developing most of its existing 34,500 megawatts of wind-energy capacity on land, Europe is now tapping offshore wind as well. If governments move aggressively to develop their vast offshore resources, wind could be supplying all of Europe’s residential electricity by 2020, concluded the consulting group Garrad Hassan in 2004.
The push to develop wind is spurred by concerns about climate change. Europe’s record-breaking heat wave in August 2003 that scorched crops and claimed 49,000 lives has accelerated the replacement of climate-disrupting coal with clean energy sources. Other countries that are turning to wind in a major way include Canada, Brazil, Argentina, Australia, India, and China.
One of wind’s great appeals is its abundance. When the U.S. Department of Energy released its first wind-resource inventory in 1991, it noted that three wind-rich states—North Dakota, Kansas, and Texas—had enough harnessable wind energy to satisfy national electricity needs. Those who had thought of wind as a marginal source of energy obviously were surprised by this finding.
In retrospect, we now know that this was a gross underestimate of the wind-potential, because it was based on the technologies of 1991. Advances in wind-turbine design since then enable turbines to operate at lower wind speeds, to convert wind into electricity more efficiently, and to harness a much larger wind regime. In 1991, wind turbines may have averaged scarcely 40 meters in height. Today, new turbines are 100 meters tall, perhaps tripling the harvestable wind. We now know that the United States has enough harnessable wind energy to meet not only national electricity needs, but national energy needs.
When the wind industry began in California in the early 1980s, wind-generated electricity cost 38¢ per kilowatt-hour. Since then it has dropped to 4¢ or below at prime wind sites. And some U.S. long-term supply contracts have been signed for 3¢ per kilowatt-hour. Wind farms at prime sites may be generating electricity at 2¢ per kilowatt-hour by 2010, making it one of the world’s cheapest sources of electricity.
Low-cost electricity from wind can be used to electrolyze water to produce hydrogen, which provides a way of both storing and transporting wind energy. At night, when the demand for electricity drops, the hydrogen generators can be turned on to build up reserves. Once in storage, hydrogen can be used to fuel power plants. Wind-generated hydrogen can thus become a backup for wind power, with hydrogen-powered electricity generation kicking in when wind power ebbs. Wind-generated hydrogen can also serve as an alternative to natural gas, especially if rising prices make gas prohibitively costly for electricity generation.
Energy consultant Harry Braun points out that, since wind turbines are similar to automobiles in the sense that each has an electrical generator, a gearbox, an electronic control system, and a brake, they can be mass-produced on assembly lines. Indeed, the slack in the U.S. automobile industry is sufficient to produce a million wind turbines per year. The lower cost associated with mass production could drop the cost of wind-generated electricity below 2¢ per kilowatt-hour. Assembly-line production of wind turbines at “wartime” speed would quickly lower urban air pollution, carbon emissions, and the prospect of oil wars.
The economic incentives to spur such growth could come in part from simply restructuring global energy subsidies—shifting the $210 billion in annual fossil fuel subsidies to the development of wind and other renewable sources of energy. The investment capital could come from private capital markets but also from companies already in the energy business. Shell, for example, has become a major player in the world wind-energy economy. In 2002, General Electric, one of the world’s largest corporations, entered the wind business, becoming overnight a major wind-turbine manufacturer.
Some 24 U.S. states now have commercial-scale wind farms feeding electricity into the nation’s grid. Although there is occasionally a NIMBY problem (“not in my backyard”), the PIMBY response (“put it in my backyard”) is much more pervasive. This is not surprising, since a single large turbine can easily generate $100,000 worth of electricity in a year.
The competition for wind farms among farmers in places like Iowa or ranchers in Colorado for wind farms is intense. Farmers, with no investment on their part, typically receive $3,000–$5,000 a year in royalties from the local utility for siting a single, large, advanced-design wind turbine, which occupies a quarter of an acre of land. This land would otherwise produce only 40 bushels of corn worth $120 or, in ranch country, beef worth perhaps just $15.
Beyond the additional income, tax revenue, and jobs that wind farms bring, money spent on electricity generated from wind farms stays in the community, creating a ripple effect throughout the local economy. Within a matter of years, thousands of ranchers could be earning far more from electricity sales than from cattle sales.
The question is not whether wind is a potentially vast source of climate-benign energy that can be used to stabilize climate. It is. But will we develop it fast enough to head off economically disruptive climate change?
Given wind’s enormous potential and the associated benefits of climate stabilization, it is time to consider an all-out effort to develop wind resources. Instead of doubling wind capacity every 30 months or so, perhaps we should be doubling wind electric generation each year for the next several years, much as the number of computers linked to the Internet doubled each year from 1985 to 1995. Costs would then drop precipitously, giving electricity generated from wind an even greater advantage over fossil fuels.
Hybrid Cars and Wind Power
The wind energy and hybrid vehicle industries may become allies in the fight to reduce gasoline consumption. Deployed together, gas-electric hybrid engines and advanced-design wind turbines could dramatically reduce world oil use. The United States could easily cut its gasoline use in half by converting the U.S. automobile fleet to hybrid cars as efficient as the Toyota Prius. This could be accomplished without any change in the number of vehicles, or any change in miles driven. It is simply a matter of taking advantage of the most efficient propulsion technology on the market.
Shifting to gas-electric hybrid vehicles over the next decade could conceivably cut gasoline use in half. The second step to reduce gasoline use then, is to use wind-generated electricity to power automobiles. If we add to the gas-electric hybrid a second battery to increase its electricity storage and a plug-in capacity so the batteries can also be recharged from the grid, motorists could then do their commuting, grocery shopping, and other short-distance travel largely with electricity, saving gasoline for the occasional long trip. Even more exciting, recharging batteries with off-peak wind-generated electricity would cost the equivalent of 50¢ per gallon of gasoline. This modification of hybrids could reduce remaining gasoline use by perhaps another 40% (or 20% of the original level of use), for a total reduction of gasoline use of 70%.
These are not the only technologies that can dramatically cut gasoline use. Amory Lovins, a highly regarded pioneer in devising ways of reducing energy use, observes that most efforts to reduce automotive fuel efficiency focus on designing more-efficient engines, largely overlooking the potential of fuel savings from reducing vehicle weight. He notes that substituting advanced polymer composites for steel in constructing the body of automobiles can “roughly double the efficiency of a normal-weight hybrid without materially raising its total manufacturing cost.” If we build gas-electric hybrids using the new advanced polymer composites, then we can cut the remaining 30% of fuel use by another half, for a total reduction of 85%.
Unlike the widely discussed fuel-cell car and hydrogen transportation model, the gas-electric hybrid and wind model does not require a costly new infrastructure, since the network of gasoline service stations and the electricity grid are already in place. To fully exploit this technology, the United States would need to integrate its weak regional grids into a strong national one, which it needs to do anyway to reduce the risk of blackouts. This, combined with the building of thousands of wind farms across the country, would allow the nation’s fleet of automobiles to run largely on wind energy.
One of the few weaknesses of wind energy—its irregularity—is largely offset with the use of plug-in gas-electric hybrids, since the vehicle batteries become a storage system for wind energy. Beyond this, there is always the tank of gasoline as a backup.
The combination of gas-electric hybrids with a second storage battery and a plug-in capacity, the development of wind resources, and the use of advanced polymer composites to reduce vehicle weight has been discussed in a U.S. context, but it is a model that can be used throughout the world. It is particularly appropriate for countries that are richly endowed with wind energy, such as China, Russia, Australia, Argentina, and many of those in Europe.
Redesigning Urban Transport
Building a sustainable economy will also require ingenuity in our transportation systems, since they affect not only energy consumption, but also everyday quality of life. Urban transport systems based on a combination of rail lines, bus lines, bicycle pathways, and pedestrian walkways offer the best of all possible worlds in providing mobility, low-cost transportation, and a healthy urban environment. Megacities regularly turn to underground rail systems to provide mobility. Whether it is these rail systems, light-rail surface systems, or both depends in part on city size and geography. For cities of intermediate size, light rail is often an attractive option.
A rail system provides the foundation for a city’s transportation system. Rails are geographically fixed, providing a permanent means of transportation that people can count on. Once in place, the nodes on such a system become the obvious places to concentrate office buildings, high-rise apartment buildings, and shops.
Some of the most innovative public-transportation systems, those that move huge numbers of people from cars into buses, have been developed in Curitiba and Bogotá. The success of Bogotá’s bus rapid transit (BRT) system TransMilenio, which relies on special express lanes to move people quickly through the city, is being replicated not only in six other Colombian cities, but also in Beijing, Mexico City, São Paulo, Seoul, Taipei, and Quito. Several more cities in Africa and China are also planning BRT systems. Even industrial-country cities, such as Ottawa and—much to everyone’s delight—Los Angeles, are now considering BRT systems.
Taxation has also revealed itself to be an effective (though not necessarily popular) tool for encouraging more environmentally sustainable behavior among urban residents. Many cities are reducing traffic congestion and air pollution by charging a fee to cars to enter the city. Singapore, long a leader in urban transport innovation, has imposed a tax on all roads leading into the city center. Electronic sensors identify each car and then debit the owner’s credit card. This system has reduced the number of automobiles in Singapore, providing its residents with both more mobility and cleaner air than in most other cities.
Singapore has been joined by London and by several Norwegian cities, including Oslo, Bergen, and Trondheim. In London—where the average speed of an automobile a few years ago was about the same as that of a horse-drawn carriage a century ago—a congestion tax was adopted in early 2003. The £5 charge on all motorists driving into the center city between 7 a.m. and 6:30 p.m. immediately reduced the number of vehicles, permitting traffic to flow more freely while cutting pollution and noise.
During the first year after the new tax was introduced, the number of people using buses to travel into the central city climbed by 38%. Since the congestion charge, the daily flow of cars into central London has been reduced by 18%, while delays have dropped by 30%. The number of bicycles and mopeds has increased by 17%, and vehicle speeds on key thoroughfares have increased by 21%.
Contrary to the fear about falling profits, 65% of businesses in London’s inner city have not noticed any effect on their bottom line. A substantial majority of business owners think the reduced vehicle flow has had a positive effect on the city’s image. A similar tax is now being considered in Cardiff for adoption within the near future. Other cites considering the measure include Stockholm, São Paulo, San Francisco, Milan, and Barcelona. French officials are looking at a congestion charge to deal with the suffocating air pollution in Paris.
Many cities are turning to bicycles for numerous uses. In the United States, more than 80% of police departments serving populations of 50,000–249,999 and 96% of those serving more than 250,000 residents now have routine patrols by bicycle. Officers on bikes are more productive in cities partly because they are more mobile and can reach the scene of an accident or crime faster and more quietly than officers in cars. They typically make 50% more arrests per day than do officers in squad cars. For fiscally sensitive officials, the cost of operating a bicycle is trivial compared with that of a police car.
Urban bicycle messenger services are common in the world’s larger cities. Bicycles deliver small parcels in cities more quickly than motor vehicles can and at a much lower cost. As the information economy unfolds and as e-commerce expands, the need for quick, reliable, urban delivery services is escalating. For many competitive Internet marketing firms, quick delivery wins customers. In a city like New York, this means bicycle delivery. An estimated 300 bicycle messenger firms are operating in New York City, competing for $700 million worth of business annually. In large cities, the bicycle is becoming an integral part of the support system for e-commerce.
The key to realizing the potential of the bicycle is to create a bicycle-friendly transport system. This means providing both trails and designated street lanes for bicycles. These should be designed to serve both commuters and those biking for recreation. In addition, bicycle use is enhanced by the provision of parking facilities and showers at workplaces. Among the industrial-country leaders in designing bicycle-friendly transport systems are the Dutch, the Danes, and the Germans.
The Netherlands, the unquestioned leader among industrial countries in encouraging bicycle use, has incorporated a vision of the role of bicycles into a Bicycle Master Plan. In addition to creating bike lanes and trails in all its cities, the system also often gives cyclists the advantage over motorists in rights-of-way and at traffic lights. Some traffic signals permit cyclists to move out before cars. Roughly 30% of all urban trips in the Netherlands are on bicycle, compared with 1% in the United States.
Both the Netherlands and Japan have made a concerted effort to integrate bicycles and rail commuter services by providing bicycle parking at rail stations, making it easier for cyclists to commute by train. In Japan, some stations have invested in vertical, multilevel parking garages for commuters’ bicycles, much as is often done for automobiles.
The combination of rail and bicycle, and particularly their integration into a single, overall transport system, makes a city eminently more livable than one that relies almost exclusively on private automobiles. Noise, pollution, congestion, and frustration are all lessened. We and the earth are both healthier.
Building a New Economy
In ways large and small, from the growing economic costs associated with climate change to the individual costs of trying to compete for resources in an increasingly resource-scare world, it is becoming increasingly obvious that the western economic model—the fossil-fuel-based, automobile-centered, throwaway economy—is not viable for the planet. Instead, the new economy will be powered by renewable sources of energy, will have a more diverse transport system—relying more on rail, buses, and bicycles and less on cars—and will recycle materials comprehensively.
We can describe this new economy in some detail. The question is how to get from here to there quickly enough to avoid economic decline and collapse, the sad fate of numerous previous civilizations who found themselves faced with the same difficult choice. In our favor, we do have some assets that earlier civilizations did not, including archaeological records, more-advanced scientific knowledge, and, most important, a sense of how to use economic policy to achieve social goals.
The key to building a global economy that can sustain economic progress is the creation of an honest market, one that tells the ecological truth. The market is an incredible institution, allocating resources with an efficiency that no central planning body can match. It easily balances supply and demand, and it sets prices that readily reflect both scarcity and abundance.
The market does, however, have some fundamental weaknesses. It does not incorporate into prices the indirect costs of providing goods or services, it does not value nature’s services properly, and it does not respect the sustainable-yield thresholds of natural systems. It also favors the near term over the long term, showing little concern for future generations.
Throughout most of recorded history, the indirect costs of economic activity were so small that they were rarely an issue and, even then, only at the local level. But with the sevenfold global economic expansion since 1950, the failure to address these market shortcomings and the irrational economic distortions they create could be fatal.
Accounting systems that do not tell the truth can be costly. Faulty corporate accounting systems that leave costs off the books have driven some of the world’s largest corporations into bankruptcy. Unfortunately, our faulty global economic accounting system has potentially far more serious consequences. Our modern economic prosperity is achieved in part by running up ecological deficits, costs that do not show up on the books, but costs that someone will eventually pay.
Once we calculate the indirect costs of a product or service, we can incorporate them into market prices in the form of a tax, offsetting them with income tax reductions. If we can get the market to tell the truth, then we can avoid being blindsided by faulty accounting systems that lead to bankruptcy. As Øystein Dahle, former vice president of Exxon for Norway and the North Sea, has pointed out, “Socialism collapsed because it did not allow the market to tell the economic truth. Capitalism may collapse because it does not allow the market to tell the ecological truth.”
We are entering a new world. Of that there can be little doubt. What we do not know is whether it will be a world of decline and collapse or a world of environmental restoration and economic progress. Can the world mobilize quickly enough? Where will the wake-up calls come from? What form will they take? Will we hear them?
In the eyes of many, Hurricane Katrina was just such a wake-up call. Until recently, the most costly weather-related events on record were Hurricane Andrew, which struck Florida in 1992, and the flooding in China’s Yangtze River basin in 1998, each causing an estimated $30 billion in damage. When Hurricane Katrina hit the U.S. Gulf Coast in late summer 2005, devastating New Orleans, its estimated cost was $200 billion—nearly seven times the previous record. The reason? Higher surface water temperatures helped make Katrina one of the most powerful storms ever to make landfall in the United States.
In our new world, we need political leaders who can see the big picture, who understand the relationship between the economy and its environmental support systems. And since the principal advisors to governments are economists, we need economists who can think like ecologists. Unfortunately they are rare.
Some point out that mainstream economics does recognize external costs as something to be avoided. True. But do economics instructors teach their students how to tabulate those costs and analyze their effects on the earth’s ecosystem and its capacity to sustain the economy? For example, how many economic courses teach that our fossil-fuel-based, automobile-centered, throwaway economy is simply not a viable economic model for the world? And that the biggest challenge the world faces is to build a new economy that will sustain economic progress?
The challenge is to build an ecologically honest economic system and, thus, a new economy, and to do it at wartime speed before we miss so many of nature’s deadlines that the economic system begins to unravel. Participating in the construction of this enduring new economy is exhilarating. So is the quality of life it promises. We will be able to breathe clean air. Our cities will be less congested, less noisy, and less polluted. The prospect of living in a world where population has stabilized, forests are expanding, and carbon emissions are falling is an exciting one. It should inspire us to make the difficult but necessary decisions ahead.
* This excerpt first appeared as a cover story in the July/August issue of The Futurist, a magazine by the World Future Society. It has also been posted on Energy Bulletin and Truthout.org.
Adapted from Chapters 1, 2, 10, 11, 12 and 13 in Lester R. Brown, Plan B 2.0: Rescuing a Planet Under Stress and a Civilization in Trouble (New York: W.W. Norton & Company, 2006), available for free downloading and purchase at www.earth-policy.org/books/pb2.