Bill Totten's Weblog

Wednesday, January 13, 2010

Visions of Herman E Daly (August 05 2007)


Well, I think in the long run future, it will have to be more solar energy. I think we will have to scale our activities to the limits of our ability to capture solar energy in benign ways. I'm not averse to using fossil fuels, but I think we need to use them slowly and with great respect for the capacity of the Earth to absorb the waste, something we've certainly not done. As for nuclear energy, that I consider very dangerous, given human frailties and, well, the problem of evil. It gives a large leverage, not only to mistakes, but to bad intentions.

Natural Resources

I think our relationship with the world, from which we get natural resources, we're going to have to think more and more of ourselves, as a subsystem, a part of the natural world and that we depend upon it in two ways: we'll have to take from the natural world resources at a rate at which the natural world can regenerate and we'll have to throw back the wastes from using those natural resources at a rate the natural world can assimilate and reconstitute and make use of. So, we have two limits on the natural world, on the scale and the scope of our activity, you might say the source limit (how fast we take things out) and the sink limit (how fast we throw things back in.)


I think we will use money. I think money is sort of like the wheel or fire; it's just a fundamental invention without which modern society would have a hard time functioning. But, like with the wheel and fire, people get hurt by money. Well, it is grown the monetary sector, the financial sector of the economy has grown so much faster than the real goods and services production sector, that it's almost like a pyramid sitting on its point. And I think that the most important reform we could make would be to bring money back to a more local level, first to a national level, and not have so much in the way of international flows of money, and also get away from this fractional reserve banking system, which most countries have, which allows the private banking sector to create money out of nothing and lend it at interest. Now, I think we need 100% reserve requirements would bring money much more under the control of society and the community and I think we should move back in that direction. That used to be a hot topic among economists but it dropped out of consideration and everyone just treats the fractional reserve banking now as if it were part of the way the world must always be.


I would think that we're not going to abolish corporations but in a sense I would like to see a whole lot more corporations, but much smaller. I think the corporation has allowed far too much concentration of economic power and I think it is become the major obstacle to policy nowadays, particularly in the so-called globalizing world because as the world moves to globalization and the nation state becomes less powerful in its policies, it is the corporation that is less controlled and that is more free and it goes into the global space without any control because there's no global government to control it. And so I think this is a real difficulty and the corporations need to be reduced in power, relative to national governments.

Mass Media

If the media becomes more and more concentrated in the hands of a small number of corporations, as has been happening in my country, I think there are about four corporations that dominate about eighty or ninety percent of the media, then the media is going to become more and more of a tool of profit maximization and political manipulation as I think is happening. If you can break up the media, and that's the great hope of the Internet, is that it's going to be common property and provide a direct way for individuals to communicate without going through the filter of the corporate interests in order to get on the air. So I have a lot of hope in the Internet as a kind of replacement for mass media, which has become dominated by a small number of corporations.


As with most resources, water, as the scale of economies grows and our demands are, it will be more and more scarce. As it becomes more scarce it will become more expensive. As it becomes more expensive we have to use it more carefully. So, I think that's going to be our future with water; we're going to have to be much more careful with the use of it in the future.


I think the design criterion in the future, for what constitutes a good design, is going to be more and more efficiency in the use of materials. So how do you do more with less, in the way of resources and materials - that kind of design which is more service, more satisfaction of needs per unit of resource spent.


Everybody, I believe, is in favor of world community; we all like the idea of world community. But I think we're very confused, we've got two different models of what world community is or could be. One model of world community is globalization, by which I mean, here is basically the erasure of national boundaries. So you have one big direct global community. The other vision of global community is internationalization. You still have nation states with boundaries but the relations across those boundaries become more and more important. So you have international trade, protocols, United Nations, so forth, but the fundamental unit remains the nation's state with its boundaries and it controls trade of goods, trade of capital, flow of people. In the other model, the globalization model, boundaries are basically erased, so internationalization, you have a community of communities that builds up to a federation of a global world, global community. In the other vision of globalization you erase national boundaries, you basically destroy or undercut national communities in the interests of building up an immediate total global community. But that total global community has no historical roots, it doesn't really exist and so I think what happens is that you fundamentally destroy the real institutions of community, of mutual caring that exists within national boundaries, in the interests of a rather fictitious and badly thought out idea of a single global. You know, a world without boundaries, a world without borders that makes a very nice song lyric but is not a very good basis for policy and for taking mutual care of one another in institutions of community.


Well, we talk all the time about economic growth, is there such a thing as uneconomic growth. And what do I mean by that? Uneconomic growth is growth that increases costs faster than it increases benefits. So you're worse off if you do that. Well, we recognize uneconomic growth in microeconomics at the theory of the firm, you know a firm stops producing more and more and more, it stops growing if its costs begin to rise faster than its revenues. So it stops - the optimal scale is where you stop to avoid uneconomic growth. Well, we would separate out of the national accounts. Those activities which are really costs, we would rather not have to do them but they're necessary because of pollution, depletion, the negative things of growth from those things which are truly good and beneficial and we want more of. And so we would keep two separate accounts instead of adding them together. And then we could compare them at the margin, as we got bigger. In the United States, we developed something called the Index of Sustainable Economic Welfare; John Cobb, and I, and some others. And we discovered that, in the US, that since about late 1970s, early 1980s, according to our measure costs have increased in the US faster than benefits. Prior to that time, benefits were increasing faster than costs, we had economic growth. Beyond that time we entered a period of uneconomic growth.


It's a matter of, "what are our goals?" Now if we really want to aim for sustainability, I think it's so simple what we could do. We could have a very, very strong carbon tax which would reduce the rate at which we use oil and coal and would give a big boost to the development of alternative technologies. At the same time it would capture an enormous amount of revenue which we could then return to people in the form of abolishing the worst taxes: the payroll tax, other regressive taxes. We have to raise public revenue somehow, so instead of taxing value added, that which we want more of, why don't we tax that to which value was added and which is really scarce - resources - and we want to use less of, put the tax on that, raise the revenue, redistribute that revenue in the interest of equality or greater equality. I mean, this seems to me, a very reasonable policy which could be done but there is, as I see it, too many interests whose short-run profitability would stand in the way. Well, this is a long-afforded persuasion and teaching, I think.


Transportation is very energy intensive and it uses a lot of resources. I rather expect that because we, or at least my hope, is that we move in the direction of decentralization and localism and when you add to that the communications revolution of the Internet, I'm rather hopeful that transportation will become less important and we will devote less resources to transportation and it will become a smaller sector of the economy just moving people around. Move around conversations and ideas and so forth. Oh, people now and then but not so much transportation.


You know I worked for the World Bank for a number of years and one question that I raised, always raised at the World Bank, is "what is the best thing the North (the wealthy countries) can do for the South (the poor countries)?"

(1) They can grow and consume, evermore, to be a better market for the South to sell their resources and to accumulate more capital to invest in the South, that's one answer, that's the World Bank's answer.

(2) The best thing the North can do consume less, level off, free up economic and ecological space for the South to grow into. To grow into, up to a level of sufficiency, not wealth but good sufficiency, or at least not luxury, but sufficient. So which is the answer?

Well, the World Bank has clearly chosen the first and they don't even want to do a research project on the second. They don't even want to talk about it. So here's an institution which could be a kind of broker in the North/South relationship but has really failed to even consider the question.


I think technology in the past has been aimed at increasing the productivity of labor and of capital. In the future, technology is going to be more aimed at increasing the productivity of resources. So in the past, to get the productivity of labor up or capital up, we use resources lavishly. In the future, I think we're going to focus on the productivity of resources and we're going to have to use labor and capital more abundantly and resources more carefully. That will imply a different technology than the one that we have pushed in the past.


I think human beings have kind of gotten away from the evolution that has been explained by Darwin. We now evolve exosomatic organs, that is organs outside of our body. If we want to fly, we don't wait until our arms grow feathers and turn into wings, you know? We develop an airplane. So that airplane is our exosomatic wings and we develop these and we develop them rapidly, compared to endosomatic. And whereas our internal organs and our natural evolution depends upon solar energy, which is abundant, our exosomatic evolution depends upon natural resources which are not abundant - terrestrial, low-entropy sources of materials and energy. So we've shifted our dependence in evolution away from what is abundant and towards what is scarce. Furthermore, in natural evolution everybody owns their own internal organs; that wealth is evenly distributed. But when you get to exosomatic evolution, not everyone owns the airplane and so we have an inequality that emerges from this dependence upon resources, the terrestrial resources, those other than sunlight, in this shift in evolution.


I don't know about that. Single houses might be too expensive in terms of use of materials and energy. We may have more in the way of buildings and apartments.


I think the best we can do is to try to preserve habitat, and to say, "We human beings, we don't know really how much of the world ought to go to you and how much for (us). We're going to reserve a certain space for non-humans and we're going to leave you alone - more or less." So, evolution in its natural way, takes place within a habitat, we don't try to manipulate that, we kind of leave that alone, "laissez faire" in economists terms, and then deal with our own sector more.


The trend, up until recently I think, has been against religion. The science has undercut, particularly Darwinism has very much undercut traditional religion. I think that's likely to change, I think the whole Darwinian view, although there are many things about it of course that are quite legitimate. Well, put it this way, in the nineteenth century you had Marx, Freud and Darwin as the three big deterministic thinkers. I think Marx is pretty well dead, Freud is considered pseudo-science now, Darwin is still riding high. Everyone thinks Darwin is, but I think Darwin is the third determinist, which will eventually come under criticism. Not for the idea that human beings are kin to other species. No. I mean, we're all creatures, that's even consistent with Orthodox Christianity, if well understood. But, the idea among the Neo-Darwinists is that everything is the result of chance: random mutation, natural selection according to random changes in the environment. If everything is reducible to chance, then you've undercut the reason to do most anything. And I think some scientists have been very, very slow to understand the nihilistic implications of their theory at a broader social level. So I think that's going to come under attack and people are going to start thinking more clearly and critically about some of the scientific dogma that they've accepted too easily.


Herman E Daly is an ecological economist and professor at the Maryland School of Public Affairs. Prior to his work at the Maryland School of Public Affairs, he worked at the World Bank, where he was Senior Economist in the Environment Department, helping to develop policy guidelines related to sustainable development. While there, he was engaged in environmental operations work in Latin America. He is co-founder and associate editor of the journal, Ecological Economics. His interest in economic development, population, resources, and environment has resulted in over a hundred articles as well as numerous books. His awards include the Grawemeyer Award for ideas for improving World Order, of the Honorary Right Livelihood Award, the Heineken Prize for Environmental Science from the Royal Netherlands Academy of Arts and Sciences and the Sophie Prize awarded by Norway.

Bill Totten


Post a Comment

<< Home