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Jewish World Review August 20, 2002 / 12 Elul, 5762

James K. Glassman

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Moving on from 'sustainablity'

http://www.NewsAndOpinion.com |
The aims of the World Summit on Sustainable Development are laudable. Cleaner air and water, better stewardship of global resources, the eradication of poverty and disease no one can argue with such objectives. The question is how to get there from here.

Let me offer a prescription for sustainable development that begins with a simple and powerful idea - an idea which, unfortunately, will often be at odds with what delegates, journalists and other observers hear in Johannesburg. The idea is that economic growth leads to levels of wealth and income that, in turn, inevitably produce societies that are cleaner, healthier and more stable and that use global resources more efficiently.

It is an idea that has been validated in academic studies and by centuries of history, an idea that is especially important at this time and in this place. Since developing nations will improve their environments as they grow richer, the major thrust of a global conferences like Johannesburg should be to help them grow richer not to place restrictions upon them (and on other countries) that will ultimately thwart their growth.

The idea of economic growth stands opposed to the idea of impending scarcity, a notion that is gaining currency again today, just as it did more than 200 years ago with the writings of the Rev. Thomas Malthus and 30 years ago with the success of The Club of Rome's book, "Limits to Growth." Malthusianism is a repudiated concept that will not die. It creeps on.

The latest manifestation is a pre-conference report by the World Wildife Fund which, in the words of British publication The Observer, "warns that the human race is plundering the planet at a pace that outstrips the capacity to support life." If current consumption levels continue, says the WWF report, two extra planets the size of Earth will be "required by the year 2050 as existing resources are exhausted."

This bit of sensational hokum is grounded in the theory that, as population grows, the natural resources of Earth will be exhausted and we will starve or be forced into other deprivations. In fact, the ways and means to sustain and enhance life are increasing, rather than decreasing, and the environment for the vast majority of people is getting better.

Why? "Human beings are not just more mouths to feed, but are productive and inventive minds that help find creative solutions to man's problems, thus leaving us better off in the long run." That's a quotation from the late Julian Simon, the University of Maryland economist who was the most articulate opponent of Malthusianism. In 1980, Simon made a famous $1,000 bet with scientist Paul Ehrlich that five resources (of Ehrlich's choosing) would be cheaper in 10 years - the best evidence that their supply had not declined. Simon won; each of the resource prices had declined, by an average of 40 percent.

Still, in many circles, pessimism reigns. We are told how humans are despoiling the planet and how global assets are severely limited. We hear how the human "footprint" is growing - an idea that neglects the effects of innovation, efficiency and productivity (or doing more with less, a principle of all productive societies). Gloomy views, unfortunately, will dominate Johannesburg and may prevent real progress on relieving poverty and improving the environment. While Matlhusianism is seductive, it is also ahistorical. It has been flat-out wrong.

Why are doom and gloom so seductive? My colleagues, Steven F. Hayward and Christopher DeMuth of the American Enterprise Institute, draw a disinction between two kinds of environmentalism - practical and romantic. It is the practical sort that has produced the environmental successes we enjoy today - specifically, cleaner air and water. But romantic environmentalism will almost certainly be the prevailing ethos at Johannesburg.

Hayward and DeMuth write, "Romantic environmentalism is a strong and uncompromising environmentalism that holds that environmental values should always or almost always trump other values, especially those associated with economic development and growth. The movement has strong roots in American intellectual and political history and many accomplishments to its credit (without John Muir the Yosemite Valley might today be known as the San Francisco Reservoir). Romantic environmentalism now consists largely in denying or confusing the realities of practical environmentalism. Its modus operandi is the dramatic claim of impending catastrophe and the moralistic attack on anyone who makes a compromise in the pursuit of environmental progress, [and it] prefers government bans and commands over markets and private property, and it demands centralized government and national or even global regulation rather than state and local regulation."

Today, some 300 years after the Enlightenment, the appeal of Romanticism remains powerful. It is undeniable and not completely unwelcome, but, if it dominates world conferences on environmentalism - as it has since Rio - the romantic impulse will crowd practical and ideas solutions out and, in the end, arrest progress.

The most practical of all practical environmental ideas is the one with which I began: that economic growth is the foundation stone on which a clean, healthy environment must be built.

This idea may sound unremarkable, but it is at the root of all attempts to improve the lot of people on the planet and to make the planet itself a better place to live. While they mean well, sweeping programs meant to preserve, conserve, freeze and even "sustain" global assets often have the opposite effect. Because they deter economic growth, such programs can actually make the Earth less clean and less healthy - and certainly less free of poverty. Virginia Postrel calls such an approach "stasis," and, unchecked, it will likely lead us back to the conditions described by the political philosopher Thomas Hobbes in the 17th century: a world where lives are "solitary, poor, nasty brutish and short." Dynamism - the result of policies that encourage economic growth - will literally and figuratively enrich the planet.

The danger at Johannesburg is a conference carried away by vague, romantic aspiration - without practical guiding principles to inform decision-making. Among the principles that need to be enshrined by such an important convocation are an unswerving belief in sound science and rationalism, a strict weighing of costs against benefits for any policy on the table and, finally, an understanding that the people of the world grow richer, they also grow healthier, live longer, can protect themselves against calamity more effectively and, almost certainly, find it easier to pursue the spiritual goals that make life satisfying and productive.

Let's apply this idea of economic growth to one of the most contentious environmental matters: the use of energy. I contend that cheap, abundant energy leads to a better environment.

There is a direct, close and logical correlation between economic prosperity and an improved environment. You can see this through simple observation: few, if any, rich countries have environments as poor as the poorest countries. The U.S., Canada, Australia, Europe and Japan have the cleanest environments; nations like Haiti, China and India have the worst. Thirteen of the 15 most polluted cities in the world are in developing Asia. Academic studies have found, not simply that wealth makes environmental health, but more specifically that pollution rises in poorer countries until their inhabitants acieve an average per-capita income of about $5,000. Then, pollution begins falling rapidly. If we plotted pollution vs. income on a graph, the resulting line would be called a Kuznets Curve, a bell-shaped curve. It makes sense for public policy to be directed toward getting nations over the $5,000 hump and onto the downslope of the this curve.

An important new paper in the Journal of Economic Perspectives called "Confronting the Environmental Kuznets Curve," by Susmita Dasgupta of the World Bank and three other researchers, demonstrates the link among economic growth, rising living standards and environmental health. And the distinguished climate scientist, Jack M. Hollander of the Lawrence Berkeley Laboratories, will elaborate on the theme in a book to be published in January, "The Real Environmental Crisis: Why Poverty, Not Affluence, Is the Environment's Number One Enemy" (University of California Press).

With prosperity comes a desire to improve one's air and water - and, in addition, a greater moral awareness of the dangers and evils of pollution. Think of clean air and water as goods that a society can purchase - but only after it has satisfied its basic needs for food, shelter and rudimentary income. It is unfair for developed countries to deny developing countries the tools with which to improve the lives of their citizens. Those tools sometimes pollute - temporarily. But pollution per unit of production drops sharply once citizens receive a comfortable income. Advances in recent years - thanks to technology, greater wealth and education - have produced spectacular reductions in air and water pollution in richer, and even in poorer, nations. For example, lead emissions have dropped 95 percent in the U.S. in the past two decades. New Delhi and Beijing today are less polluted than London in the 1930s and 1940s. SO2 and smoke levels in London today are below those in the 16th century. None of this should be surprising because of the link I noted at the outset: Poverty has been relieved more in the past 50 years than in the preceding 500.

In fact, economic growth is a relatively new phenomenon - only about 200 years old. Before the early 19th century, economists estimate that global growth was about two-tenths of one percent a year. In a typical span of 200 years before 1800, wealth barely doubled. But over the past 200 years, global growth has averaged about 2 percent annually, and wealth has risen about 60-fold. So far, economic growth has been inextricably tied to environmental progress. There is no reason to believe that this connection will not continue.

The essential element in economic growth has been energy. By themselves, individual humans generate very little energy - roughly the power to light a 100-watt bulb. But by using non-human sources of energy, the typical person in a developed nation has the power of 200 to 250 light bulbs at his or her disposal. By contrast, a resident of India can harness the power to light just 15 bulbs. Energy also has extreme leverage. A little of goes a long way. Energy consumption represents just 2 percent of Gross Domestic Product in a country like the United States, yet, without it, no modern economy could exist. The leverage works down as well as up. Restrict energy use, and you cripple economies - especially poor economies.

The source of nearly nine-tenths of the energy we use today is almost miraculous. It comes from the waste products of vegetable matter, decaying in the Earth over millions of years - that is, fossil fuels: coal, gas and oil. These fuels are surprisingly abundant and inexpensive. The inflation-adjusted price of gasoline has fallen by half over the past 20 years, and it is lower today than it was in 1973, when the modern era of OPEC-led price increases began.

But, then again, the prices of nearly all raw materials have fallen over the past century - in reproach to those who claimed that the Earth was "running out" of resources. When anything grows scarce, its price rises, but a commodity prce index, developed by The Economist magazine, has fallen 80 percent since it was launched in 1845.

Will we run out of copper or oil someday? Almost certainly - but that day is far into the future, long after we have replaced these resources through the natural process of innovation. The Stone Age did not end because we ran out of stones, and the Oil Age will not end because we run out of oil. It will end when some other source - wind, sun, nuclear energy - outperforms oil in its low price, efficient distribution, safety, or other factors that consumers desire.

We need to be honest and practical. In 2000, the world used about 400 quadrillion BTUs of energy. By 2020, that figure will grow to about 600 quads - an increase of 50 percent. Overall, in North America, Europe and industrialized Asia, the growth will be far lower - about 25 percent. But in developing Asia, Central and South America, Africa and the Mideast, it will be about 100 percent. It is wrong to deny countries like Bangladesh and Honduras the means to do what the U.S. and France have done - that is, to use energy to boost economic growth.

The bulk of the increase in energy use will occur in China and India, which will account for about one-quarter of all such use by 2020. These countries have no choice today. They can't erect tens of millions of windmills. They need to use fossil fuels now. Practical environmentalists understand these facts of life and see an obvious area of mitigation - transfers of clean-coal technology and other technical improvements that will make energy use more efficient and clean in the short term and that will also speed China and India toward the kind of wealth that will dramatically improve environmental health in the long term.

The Kyoto Protocol, which the U.S. Senate rejected even before it was signed in 1997 and which President Bush turned down as "fatally flawed" in March 2001, has become a fierce battleground for practical and romantic environmentalists. Kyoto proposed that, since a warming planet poses health and environmental risks and since there is evidence that human activity has contributed to warming, an international regime must reduce emissions of greenhouse gases, mainly carbon dioxide. At this stage in history, reducing CO2 means, very simply, reducing energy use. And reducing energy use means slowing economic growth. Objective studies, including one by the Clinton Administration's own Energy Department, show that the cost, in terms of Gross Domestic Product, is huge - about $300 billion to $400 billion annually in the United States alone. And, while Kyoto exempts developing nations from its strictures (even though such nations will be the venue for the greatest increases in emission rates over the next 20 years), falling growth in the U.S. and other rich countries will have damaging consequences for poor countries - since developed nations provide customers and markets for goods from developing nations and since developed nations are the main investors in developed nations.

My own view from reading the literature is that the science of global warming remains unsettled. The role of anthropogenic forcing is unclear, and it may be dwarfed by the effects of clouds, solar cycles and other elements still unknown. Also, the drastic and swift reductions in energy use necessary to meet Kyoto targets will, if climate models are correct (a big "if"), reduce temperatures only marginally a century from now.

But even if one accepts the premise of Kyoto - human-induced climate change - the best antidote is resilience, and resilience can come only through economic growth. Whether the Earth gets warmer or cooler (as scientists warned it would in the 1970s) and whether changes are non-human or human, richer countries will be better able to withstand the difficulties, and perhaps even turn them to advantage. Again, the aim should be to adopt policies to spread prosperity to developing countries - not to cripple their economies through no-growth or anti-growth constraints.

Does economic resilience work in the face of natural disasters? Here is clear evidence that it does: So far this year, according to the Center for Research of the Epidemiology of Disaster (CRED), more than 17,000 people have been killed by natural disasters.

Another 44,000 have been injured and 100,000 have been made homeless. My colleague Nick Schulz of TechCentralStation.com recently wrote: "These numbers are tragic, but what's truly distressing is to look at where the people are who have been severely affected. Of the 30 biggest natural disasters this year in terms of fatalities, almost half occurred in Africa. Another nine occurred in South Asia (India, Afghanistan, Iran, etc.), but not one of the 30 most fatal took place in North America or Europe.

"Why the disparity? It's not that developed countries don't have destructive weather, floods, fires, hurricanes, or other natural calamities. CRED lists 17 natural disasters in the U.S. alone this year (including a sizeable earthquake) - more than double the number of disasters in any other country."

But, as Schulz points out, "the worst of the natural disasters in the United States killed two dozen people" while disasters in India and Burkina Faso killed thousands. Again, why the difference? Africa and other developing areas of the world lack the adaptive capacity, the resilence, that comes with wealth. The U.S. has terrible hurricanes, but it also has the wealth and technology to build stronger buildings and better dikes, the communications capability to spread word of impending high winds and floods, and the facilities to evacuate those in the storm's path. Where does adaptive capacity come from? Simply, from wealth, which in turn comes from economic growth.

In the last 10 years, reports the Red Cross, poor countries "have accounted for just one-fifth the total number of disasters, but over half of all disaster fatalities. On average, 13 times more people die per reported disaster in [poor] countries than in [wealthy] countries."

Romantic environmental regimes like Kyoto will keep poor countries poor longer, exposing them to natural catastrophe and, ironically, damaging, not improving their environments.

This is where Johannesburg should focus: on improving the economies of developing nations. This means not simply building roads and encouraging technology transfers and business investment. It also means making water safe to drink and eradicating a disease like malaria, which, studies say, has reduced Africa's GDP by one-third. And it means promoting democracy and the free exchange of goods and services throughout the world.

I will admit that the word "sustainable" bothers me. While imprecise, it carries connotations of constraint, of limits to growth. The best way to improve the well-being of the people of the world and to improve the environment of the world is to eliminate constraints - especially on the human achievement and imagination. A goal of sustainable development sells the world short. We can do much better. My hope is that Johannesburg is remembered as the environmental conference where, at long last, dynamism and confidence triumph over stasis and fear.

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JWR contributor James K. Glassman is the host of Tech Central Station. Comment by clicking here.

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