We need to understand the nature and gravity of the collective crisis that now confronts human civilization if we are to answer the questions it poses. If we do not soon halt and reverse our current trajectory of runaway climate change, environmental degradation and widespread biodiversity loss, the global economy will suffer negative consequences on its own.
It is not ‘saving the planet’ that will kill growth. Rather, the accelerating destruction of nature will undermine not only the global economy, but it could eventually threaten many life-forms on earth, including our own species.
The scientific consensus on this fact is near-universal - and its negative economic implications are also becoming increasingly clear. A parallel can be drawn with an earlier crisis. During the height of the Cold War, when President Eisenhower’s economic advisors came to brief him on the potential impact of a nuclear war on the US dollar, he is reported to have replied: “Wait a minute, boys, [in the event of nuclear war] we’re not going to be reconstructing the dollar. We’re going to be grubbing for worms.”
Although climate change may seem to be occurring over a longer time period, on the geological scale it is happening in the blink of an eye. As important as economic growth is, the stark reality is that, like Eisenhower, if we do not head off this crisis, we will likely be concerned about different things than economic growth.
The fundamental question is thus how to save the planet, and the economy with it, from this generations-long crisis given the extremely short-term incentives of our key institutions — corporations and governments most especially, which respectively function on quarterly profits and the next election results, but also the global public who are rightly concerned with their own lives and livelihoods.
How can we incentivize leadership to make long-term decisions for the common benefit of mankind? How can we educate and activate the global public to understand and join this struggle? And how do we re-imagine the economy so that the opportunities of the green transition are not only realized, but spread more evenly among all peoples, rather than leading to increased inequality and instability?
Put simply, how we do secure our own future and that of the planet?
Three pathways for action stand out:
1) Developing more holistic indicators that better account for economic growth along with broader metrics of human and environmental well-being.
2) Incentivizing all actors in the economy to change current innovation pathways and mainstream the necessary environmental transitions for their core business models.
3) Wise leadership that can both chart a new vision for living in harmony with nature and inspire shared commitment in achieving it.
That GDP has shortcomings as a measurement of human well-being is widely acknowledged by economists. Many of these shortcomings are related to the lack of environmental indicators that account for associated benefits to human health, food and water security, and the economy.
In addition, healthy ecosystems provide services that have in many cases significant economic value. For instance, more than three-quarters of the leading global food crops rely on insect or animal pollination. Between 5-8% of global crop production, with an annual market value between $235 and $577 billion, is directly attributable to natural pollination. However, pollinators are under threat, and this can be expected to lead to significant economic losses.
Moreover, in some cases economic development can occur to the detriment of informal but nevertheless valuable economic activities. For instance, the commercial use of forests is often to the detriment of harvesting non-timber forest resources, ranging from firewood to traditional food sources. In these cases, the resulting economic growth as formally measured, for instance from a shift to timber harvesting, may not just be socially unjust, gender-biased and harmful to indigenous peoples and local communities, but would also be an illusion, due to the loss of non-timber forest resources.
Additionally, the total value of critical forests, such as the Amazon basin, ought to include both their critical role as carbon sinks and in weather formulation that enables agricultural and other production in distant geographies.
We also need to recognize and harness the vast potential for economic growth that will result from eco-innovation that both protects the environment and advances human welfare. According to the 2017 report of the Business & Sustainable Development Commission, achieving the UN’s Sustainable Development Goals (SGDs) opens up $12 trillion of market opportunities in four core economic sectors: food and agriculture, cities, energy and materials, and health and well-being. These sectors represent around 60% of the real economy — thus pointing to the significant economic opportunities associating with developing nature-based solutions.
The path ahead will not be easy or without cost. Realizing a global new deal for nature and planet, and transitioning to a green economy, will require leaving existing development paths and developing viable alternatives for the fundamental infrastructure of society. This will require visionary leadership, the unleashing of green innovations, and compensating short-term implications, especially from those who have benefited most from current modes of economic development.
Nevertheless, this type of transition is not without precedent. Just as with the transition from the Agricultural Age to the Industrial Age, or from the Industrial Age to the Digital Age, what is required is no less than a wholescale, gradual re-imagination and reconstruction of society to fit the needs of a new era. May we have the strength and wisdom to live up to this challenge.