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Despite its stuffy title, the united Nations’ just-released Millennium Ecosystem Assessment Synthesis Report will likely exert the same effect on economic policy over the next two centuries as Adam Smith and his free-market Wealth Of Nations enjoyed over the past two.
Published after four years of teamwork by some 2,000 ecologists and scientific reviewers from 95 countries, the milestone report puts the “eco” back in economics. As its insights sink in, the avant-garde are more likely to shout, “It’s the ecosystem services, stupid” than “It’s the economy, stupid.”
Expect, in the years to come, to hear less about sustainable development in social policy circles and more about ecosystem services, a code word for the recognition of nature’s productivity. And watch how environmentalism’s priorities and villains shift and change shape.
Even though World Bank chief scientist Robert Watson took a lead role in preparing the report, it was given barely 15 seconds on TV. It was spun as another victim story about nature’s brutalization by humans, old news about how a quarter of the planet’s mammals face extinction and two-thirds of the wellsprings of natural resources are set to collapse. Really, can’t nature be more innovative, entertaining and newsworthy than that?
Commentators caught up in the long-delayed death of the Pope and the long-delayed marriage of Charles and Camilla missed the long-suppressed birth of modern economics which has been stuck since Smith’s day in the scientific rut of 18th-century physics and astronomy, when objects moved in orbits governed by invisible hands.
This report brings economics down to earth into the orbit of birds and bees and the life sciences. In a nutshell, the new economics sees beyond natural resources – the same-old, same-old marketable goods like fish, lumber, spring water, medicinal plants and tourist views – and looks instead at nature’s service economy that provides free overhead for human survival.
“Regulatory services” include the pollination of food-producing seeds by bees and bugs, the control of pests that compete with humans for food and space (think how hawks gobble up mice on farm fields, birds swallow bugs in orchards and bats gorge on mosquitoes while farmers work outside in the evening), and the flood- and pollution-preventing storage and purification of water in swamps.
The UN report shows, for the first time in anything like a popular and accessible document, that the economic value of natural resources like lumber or medicinal plants is the tip of the iceberg of nature’s dispensations – about 10 per cent of the total volume of the value that lies beneath the surface. It’s the services, not the goose, that lay the golden egg.
Forests, for instance, save 57 per cent of the world’s soil from erosion by harsh rainfall. Woodlands maintain our water quality – cleaning it with carbon filters, preventing evaporation by shading it from the sun, releasing it through their leaves after the rainy season, and so on. Forest ecosystems are the main source of water for over two-thirds of the world’s people.
In the 1990s, floods increased fourfold as a result of deforestation and caused 100,000 deaths and $243 billion in economic damage, a partial measure of forest ecosystems’ value, distinct from the value of lumber. Together with the multifold economic value of forest-sourced water – for drinking, cleaning, irrigation, swimming, recreational fishing, woodland plants and herbs, habitat for pest-eating birds and the like – the sum of forests’ worth far exceeds that of one resource, lumber. Money may only grow on lumber, but economic value grows on trees.
Once attention is directed to eco-services, we will think about environmental problems in ways that challenge current enviro politics.
In agriculture, for instance, the 900-pound environmental gorilla identified by the report is the sheer amount of land taken out of eco-service production as forests, wetlands and grasslands and given over to single-purpose farming. One hectare of Canadian swamp, the report says, yields $6,000 in ecosystem value (fulfilling similar functions to those of forests), but only $2,100 when “developed” for agriculture.
When agriculture creates a life-cycle debt of almost $4,000 a hectare, attention must be paid to strategies for making it more space-efficient. Think green roofs that can turn a sixth of most urban space into foodlands, greenhouses that can double or triple the output of one unit of land, and menu choices that can be grown more intensively than most grains and livestock or harvested from wild systems, like cranberries and blueberries.
Get ready to take a permaculture workshop or gear up for energy and fibre farming employing windmills, wildlife-tolerant energy crops such as switchgrass and multiple-product plants like hemp and flax.
Likewise, the ecosystem lens shifts our view from toxic agricultural pesticides to the excessive use of artificial fossil-fuel-based nitrogen fertilizers, which are barely on the radar of non-wonk environmentalists.
As a result of industrial farming and the so-called green revolution – which made farmland more “productive” by ending crop rotation through use of nitrogen, phosphorus and potassium both from chem fertilizers – humans have literally doubled the amount of nitrogen and tripled the amount of phosphorus let loose on the world over the last 50 years.
The excess nitrogen causes skin cancers and asthma by reducing the ozone layer and increasing ground-level ozone, while nitrogen and phosphorus residues empty into waterways, creating green slime on shorelines that asphyxiates fish and destroys swimming and tourism.
Responding to such threats means finding ways to reward farmers for increasing their use of composted manure and phasing out artificial fertilizers.
Such economic realities have long escaped notice by the busy classes thanks to accounting devices such as the gross national (or domestic) product, which only records sales and has no ledger for losses of natural assets.
The UN report puts reform of this obsolete accounting technique on the top of the political agenda. Not a moment too soon, business economics is now ready to have a close encounter of a different kind with nature, but needs accounting devices and incentives that can assist the invisible hand of natural processes.
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