Ecology of Economics: Why We Cannot Have A Perfectly Sustainable Economy In Today’s World

Kodi Dolson

Kodi Dolson

Student at the New School for Social Research, Manhattan, NY.
27 years old.

Social Justice.
Class Struggle.
Internationalism.
Kodi Dolson

“I love that smell of the emissions!” Sarah Palin, 2011

When we talk about ecology and the condition of the planet, we must understand that it is all in the confines of the power structure of today. The planet is looked upon as a source of resource and something conquerable by humanity. Those who place too much importance on the life and wellbeing of the planet are considered backward or misguided. Societies that placed sufficient importance on the health of the planet as essential to their own survival have been called aboriginal, and this is really just a way of saying ‘savages.’ As humans in the modern age, we have all been taught that the planet is lower on the scale than we are, that it exists simply to serve us. We mold it to serve us in whatever way that we see fit. It is a hierarchical system that exists where natural environments exist to serve humanity for whatever it may desire for it to become. The very first revolutionary act is to understand and grasp the fact that this is not the case.

Exploitation of the planet, in fact, is just another form of the exploitation that is continuous in our modern society. Classism, sexism, racism, nationalism, and xenophobia are all instruments in this same system. Right now, many crises are being piled up on top of one another. Social crisis, environmental crisis, international crisis, the immigration crisis, terrorism crisis, and what is important to understand is that these all come from the same source. The economic order that the world currently lives by one within which the drive for profits overrides everything else like never before.

The current ecological crisis that the world faces, known as ‘Global Warming’, is directly linked to the way that our global economy functions.

The health of the planet and free-market fundamentalism are two concepts that run in contrast to one another. Both cannot succeed at the same time, one has to win and the other, lose. As of now, it is the market fundamentalism that is winning. State power is now subservient to the power of multinational corporations, and this means that even state laws don’t have the authority to enforce environmental legislation. In 1997, the Ethyl oil corporation filed a lawsuit against the government of Canada because Canadian environmental law violated their right, under NAFTA, to extract oil. Ethyl used a specific chemical, known as MMT, in the production of their gasoline that was proven to have negative effects on humans exposed to it. (NAFTA and Environmental Law. 1997.) The neoliberal economic system has given rise to weak states that simply exist to protect the flows of capital between businesses. One of the major holes in market universalization is that incentive for protection of the environment hardly exists.

“Global warming” and “climate change” have become shorthand terms that are used to describe the ecologic catastrophe now taking place. The problems with such terms are that they don’t grasp the danger and the threat posed by continuing the current track. Terms such as planet destruction or environmental plunder. But the critical question that needs to be asked is when we know so much about the environmental damage being done and what is causing it, why is it carrying on at such a tremendous pace? The answer lies in the economic structure the world has now transitioned into.

Economy rises, Earth falls.

One of the biggest issues that are presented by the current ecological crisis is that these problems are not limited by borders. This is demonstrated when we look at China’s coastal cities and the amount of smog from there that is then blown over the island Hong Kong. The smog is coming from Guangdong Province in China, directly to the north of Hong Kong, the capital of China’s manufacturing. The amount of pollution in Hong Kong’s air that is blowing from China makes up between 60 and 70% deadly chemicals in the air. 2016 saw 1,600 premature deaths in the city linked directly to the air problems. (Where the Wind Blows: How China’s Dirty Air Becomes Hong Kong’s Problem. 2017) This is not just using the worst city as the example, in fact, Hong Kong’s air quality doesn’t even fall into the 15 cities with the worst air quality. (About 80% of all cities have worse air quality than what’s considered healthy — here are the 15 with the worst air pollution. 2016.) 13 of these cities fall in countries that have rapidly developing economies, China, India, and Saudi Arabia.

What the cities with the highest rates of pollution all have in common is that they are centers of either production or transportation hubs for the movement of manufactured goods. Let us first look at the Hebei Province of northern China, which contains 6 of China’s 10 cities with the worst air quality. (Hebei has 6 of 10 most polluted Chinese cities in 2016. 2017.) Baoding, the largest city in Hebei, is right in the middle of the epicenter of the crisis and sees some of the thickest smog around the country. Residents of the city report that they can literally taste the smog and that it has a metallic flavor to it. (Welcome to Baoding, China’s most polluted city. 2015.) Hebei houses the nation’s biggest coal deposits which play a large role in the emissions that are being generated, but also this region houses outdated boiler systems within homes that burn coal and result in increased emissions. To put this in real figures, the World Health Organization (WTO) issues what is called an Air Quality Index (AQI), and they have deemed anything above a 300 to be unfit for human consumption, and yet cities in Hebei regularly surpass a rating of 500. (Air pollution in northern Chinese city surpasses WHO guideline by 100 times. 2016.)

The mining and use of these fossil fuels are not simply resulting in a change to the climate and surrounding environment but is greatly hurting a population. How can a company expect its workers to be productive when they are suffering from the effects of what they are producing and using to heat their homes? What is clear from this is that the modern world’s current addiction to petroleum is having a devastating effect on both the environment but also the population. Yet there has been no viable alternative that has ever been able to compete with these oil giants.

The response of the capitalist world to the growing crisis has been a futile attempt to merge environmental protections into the market system. This is generally known as ‘green capitalism, and it is aimed at giving incentive to private companies reducing their carbon footprint by making it more profitable. The problem with this kind of thinking is that these forces want to achieve change without really changing anything. They want to achieve radical change in the relationship between humans and nature but aren’t willing to make the systematic changes needed for this to happen. While the heart is in the right place on these theories, what is clear is how futile they are. The most prominent of these policies is the carbon credits trading schemes. This is intended to keep levels of emission at a baseline for companies, a government issues an allowance for this baseline number, but if exceeded the baseline is passed additional carbon credits are easily available for purchase. Since the launch of this scheme throughout the EU in 2005, results haven’t produced the type of change that intended. The biggest problem here is that lobbyists keep influencing nations to raise the emission caps to the point where producers haven’t had to make cuts yet, and the permits now are so plentiful that no change in practices will have to implement for quite a long time. (The EU Emissions Trading System: Failing to Deliver. 2007.)  As of 2013, the credits were being auctioned off to bidders who were willing to pay the most, with the money paid being used to invest in renewable energy. (Diversified Climate Action: The Top-Down Failure and the Rise of Emissions Trading. 2013.)

The trend of environmental consciousness has led to the rise of ‘Greenwashing’ and this is when a company attempts to draw in more customers by making claims of how it is environmentally friendly. This comes in the form of a product claiming that a soap bottle is made from recycled plastic, or a xerox machine that brags it’s made from recycled material and yet gives no information about the hazardous chemicals with which it prints. Another way in which we see this is with labels that read ‘chemical free’ or ‘eco-friendly’. In reality, nothing is chemical free. All living forms on the planet contain chemicals. A claim like ‘eco-friendly’ is so vague that it is impossible to be verified. There is no standard certification for such a claim. (The Six Sins of Greenwashing. 2007.)

In the case of Greenwashing, the practice is quite grim. Companies are using the idea of environmental conservation as a marketing ploy while continuing to pollute the earth. Nowhere have I found a bigger case of greenwashing than the oil giant, Chevron. A brief viewing of their website will offer you the option to read their self-declared ‘corporate responsibility’ reports. This will tell you about how they are committed to defending human rights, protecting natural resources, and responsibility removing their waste from oil wells. Then comes the tab about climate change and greenhouse gas emissions, and Chevron is absolutely dedicated to reducing their carbon footprint. They are so committed that they include almost zero solid numbers about their emission levels. Meanwhile, their plan for cutting future emissions by stopping random spurts from the wells. (Greenhouse Gas Management. 2015.) While Chevron does go about trying to cut emissions in their during the stages of production, and this should be accounted for, they neglect to mention they are producing the product that is the leading cause of emissions in the United States! (Sources of Greenhouse Gas Emissions. 2015.) Chevron can claim that they are acting as part of the solution, but it is absolutely the case they are causing the problem.

In a perfect world, a capitalist market economy would be able to punish those who damaged the environment while rewarding those who advanced sustainable practices. This would then make it far more profitable to be environmentally friendly, but this is a total fantasy. Multinational corporations would only relocate their base of operations. Such a plan would only be feasible on an international level, and states have sacrificed much of their sovereignty en route to ensuring non-stop economic growth.

Neoliberalism: The Bottomless Pit of Consumption

Environmental destruction by no means started with the rise of neoliberalism, but it has increased the level of devastation. We can peg the start of the neoliberal system to between 1970 and 1980, the first rounds of deregulation can be found in the Jimmy Carter Presidency and then increased under Reagan. By the 1990s, the system was going global, and the consumerism that had been present in the western world was spreading to the third world. Within this period, as reported by the Center for Sustainable Systems at Michigan State University, between 1970 and 2010, the emissions of greenhouse gases annual average increased by 83%. (Greenhouse Gases. 2016.) The rise of worldwide consumerism has meant an increase in the use of fossil fuels, and now they account for 65% of emissions.

What is neoliberalism? It’s a government strategy in which market forces and private industry are the drivers of social advancements. State power is wielded to defend market mechanisms, and services once provided by the state are turned over to the private sector. Massive privatization is met with deregulation and a lowering of corporate taxes, and state expenditure is phased out. Nik Heynen lists the following traits as the definition of neoliberalism,

  •   -regressive reforms of state taxation and rollbacks in redistributive spending;
  • – privatization of services formerly provided by and through the state;
  • -reinforcement and extension of private, exclusive, and individuated property rights;
  • – liberalization of state regulations specifically governing trade and investment across international borders, though in uneven and contradictory ways that reflect not only the ideology of free trade, but also the political interests negotiating often highly selective and confusing blends of liberalization and protectionism;
  • – emphasis on state austerity and fiscal retrenchment with an associated defunding or outright cancellation of a wide array of social services, but again, in contradictory ways that are often combined with entrenchment of so-called supply side spending, e.g. development projects, programs to support economic innovation and competitiveness, and of course military investments;
  • -workfare, and other incentive-based schemes aimed at disciplining workers and civil servants (and at least nominally at increasing productivity and efficiency), accompanied by deregulation and reregulation of labor markets;
  • – the restructuring of state regulatory apparatuses in ways that tend to enhance private and corporate authority over economic, environmental, and social action;
  • – offloading and decentralization involving both the rescaling of governance up and down from nation-states, as well as the recruitment of volunteer, civil society-based organizations to undertake many functions formerly provided by states.
  • (False Promises. 2007.)

Neoliberalism is the state model, but when it is present in the international, it creates a system commonly known as globalization. As John Quiggin describes the relationship between these two concepts in the following way, “in a globalized world economy, governments have no alternative but to adopt neoliberal economic policies of privatization, deregulation and reductions in public expenditure.” (Interpreting Globalization. 2005.) What this means is that economic sovereignty that nation states once enjoyed has become a thing of the past, and borders have no effect on the flow capital. States are simply in place to keep business flowing.

Neoliberalism looks to privatize, and thus bring market value, to as much as possible. This has extended to natural resources and basic necessities for sustaining life such as water. The privatization of water is very dangerous policy to enact because it changes the object from providing water to all citizens to providing profits for stockholders. What this means is that people no longer have a basic right to live when even the most basic needs can only be met by paying a price. Privatization is sold to the public as a way to boost quality and lower costs through the competition on the free market, but when dealing with a resource such as water, competition is hard to come by. There aren’t very many massive water sources for sale for others to compete in this market. When it comes to a choice between improving quality or cutting service to raise profits, it is the profits that win out.

With the cutbacks in social spending, investment in infrastructure has to come from private entities, and the more environmentally friendly infrastructure is more expensive than the basic roads and bridges, yet offers no profit incentive for private investors to chose this over the basic infrastructure. On this point, the forces of big capital are right. There is a need to change and improve these green technologies to make them not only better for the earth but to also create a price incentive. Infrastructure such as wind farms may cut down on pollution, however, they are far from the end all final solution for clean energy. Wind farms, collectives of turbines in a small area have also contributed to climate destruction and soil degradation. This is nowhere as prevalent as in Oaxaca, Mexico.

Oaxaca is unique in its location in that the lay of the land allows for the trade winds stream to blow through the region. Right above the Panama Canal, at the very bottom of Mexico sits this isthmus of land known as Oaxaca. This has caused many private energy companies to flock here to get into the subsidized clean energy game. Some of the world’s largest wind farms have been constructed here on what was once used as farm lands. These for profit energy companies have left the local population in the dark, literally. Many of the region’s residents are living without any electricity. The energy that is being produced by these wind farms, in fact, are not even connected to Mexico’s energy grid. (WIND DEVELOPMENT OF OAXACA, MEXICO’S ISTHMUS OF TEHUANTEPEC: ENERGY EFFICIENT OR HUMAN RIGHTS DEFICIENT? 2010.) this is what neoliberalism looks like when it meets environmentalism. It exploits the population and indigenous people who were located in this region for hundreds of years. This may be saving a few emissions from the atmosphere, but it is still existing in this capitalist mode of exploitation for power.

One of the justifications for the winds of Oaxaca was that this projects would bring about increased wealth through more job opportunities for the local population. While this is true, the jobs that were meant were not the high paying engineering jobs but jobs that would serve those professionals in their relocation. Grocery markets, shopping malls, fast food, and chain restaurants would come to the region to serve the well to do engineers coming to help construct the turbines and perform maintenance. (Aeolian Politics. 2015.) While Mexico’s intentions were good, to limit the emissions they were producing, what happened was that the energy companies saw the profit incentive of this region and used the state’s excuse to damage the community.

Within this system, how can a state protect the environment when it has no authority over the corporations who operate within their borders. As pointed out with the example of Ethyl in Canada, corporate rights are of the highest priority now. No longer the safety of the people and the environment in which they live.

State power is now in the business of assisting corporations to succeed and provide the best environment for investment. The constant growth that the world currently thrives upon just isn’t sustainable in the long run. Right now what we have seen in the past decade is many environmental groups begin to join forces with many businesses that claim to be on the side of climate revival. The opposite is also very prevalent, dropping out of society and running off to live in a secluded communal space in some far off part of the country. This is so removed from the mainstream that you are, for all intents and purposes, no longer a factor. It is a sign of submission that social-ecological is not possible. The only true solution is between these two extremes, anti the current order while standing firmly within society.

Reclaiming the Struggle

One of the biggest problems that have hampered the ecological movement is that it has never been able to unify and assert itself into a specific role. It is plagued by internal splintering and this made it unable to produce a single message and action plan. All agree global warming is a massive issue that needs serious addressing and soon, but what the action plan should be, well… that’s another story. The way to unify is to understand that the current crisis is being fueled by the new economic order where the nation states and communities are subservient to the corporations.

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