From greed to green
If there is a silver lining to the increasingly ominous specter of a global financial meltdown and the far-reaching implications of Great Depression-like scenarios, it should be the opportunity to move from “greed economics” toward a global green economy. Global capitalism as we know it has imploded with the collapse of Lehman Brothers, Bear Sterns, Merrill Lynch and such other giant investment and insurance houses, and the future is frighteningly uncertain.
But if out of this mess the global economy is more decidedly weaned from the financial world’s propensity to “make money from the movement of money” (what, pray tell, do “derivative contracts” and other exotic futures instruments mean to the average citizen?) and shift it to the creation of new, real value — new technologies, innovative materials and industrial products that sustainably meet energy needs and address eco-efficiencies — then there is hope for economic renewal, and, indeed, a real chance to curb global warming. Jacques Attali, founding president of the European Bank for Reconstruction and Development, would call it a “Global New Deal.”
Countries with powerful reserves — China, Russia and other oil-producing countries — could well finance “greener” infrastructure projects, especially in sustainable and renewable energy, in the developing world to be built among others, by leading American companies. This would ignite broad growth in the “real economy” of actual production and human invention, argues Attali, who recently wrote the trenchant book “A Brief History of the Future.”
It is time leaders took the Herculean challenge of restoring balance in the larger economy and the underlying factors of ecology with the “urgency of now.” The $700-billion bailout of Wall Street is touted by the Bush government as “pivotal for Main Street jobs and homes.” But as several scientists would propound, such a bailout sum — or a fraction of it — will go a long way in “bailing out nature.”
Just think what wonders a hundred billion dollars can do to repair damaged ecosystems, restore biodiversity loss, curb pollution, support technological innovations and renewable energy use, and put in place mitigation measures for climate change — especially in the vulnerable regions of the developing world. Such environmental threats to human health, food security and continued access to clean water, after all, are inextricably tied to poverty indices and the incapacity of millions around the world to meet basic needs and attain higher standards of living.
The contradictions of global capitalism have led to the crisis of overproduction, or as social scientists would have it, “overaccumulation” and “overcapacity” — the buildup of “tremendous productive capacity that outruns a population’s capacity to consume,” given widespread poverty and inequalities around the world that limit purchasing power and reduce overall profitability. Moreover, the financial economy of unbridled speculation or “squeezing value out of already created value,” as sociologist Walden Bello would describe it succinctly [Read Bello’s column], has only exacerbated volatilities in the world economy, such as crippling oil and food price crises; and have ultimately added to the ruin of the earth’s vital life-support systems of fresh water, clean air, the seas, forests and land.
In the wake of the largest financial collapse since 1929, this crisis should perforce move economic planning and activity toward what environmental/eco-efficiency advocates Dan Esty and Andrew Winston refer to in their book “Green to Gold”: the locating of sustainability and new green technologies at the center of business strategy and government policy. The future of humanity surely depends no less on how society embarks on a sustainable track with regard to both energy needs and environmental requirements.
This requires nothing short of folding environmental stewardship into corporate culture and the running of businesses. This likewise calls for increased and more effective global governance mechanisms and, yes, supranational responses. By necessity, governments and civil society actors will have to take larger roles, and what may have been a heretofore near-absolute faith in the self-correcting nature of free markets will require serious revisiting.
These interventions will have to come in various forms — whether in terms of clear country and regional targets for the United Nations Millennium Development Goals or the accountability and commitments of nation-states and governments in global stewardship instruments like the Kyoto Protocol, among others. The world’s economies and the world’s six billion inhabitants deserve no less.
Only then will new social contracts emerge, or a Global New Deal forged, with greed economics supplanted by a global green economy that drives long-term growth … and heals a battered planet.
Neric Acosta was Liberal Party congressman of Bukidnon province from 1998 to 2007 and principal author of the Clean Air Act and Clean Water Act; he is now a professor at the Asian Institute of Management.