|
|
 |
|
51.8%ANMag Issue 22 Public Surveillance
Economic Growth Must Have Its Limits
By Yousef Salama, Staff Writer
Toronto, Canada − For decades, economic growth and increased trade were viewed as perilous to society. Although they resulted in higher living standards, rising incomes, and new jobs, they also came with a price tag: an environmental one. Consequently, today’s policy-makers struggle to integrate economic growth and environmental protection. Just as growth has created prosperity in the economic sphere, it has created paralleled disparity at the expense of our environment. We can no longer view economic growth and trade as infinite because they depend upon a finite environment.
The current context in which economic growth and trade prosper fails to include the hidden costs to our environment and communities. This paradigm needs changing in order for the economy, the environment, and development to sustain them. All over the world, abuses on the environment from economic growth and trade have taken their toll. We live as if we have no children, as if there will not be a next generation. Ironically, without government support to reverse trends that are threatening future food security, the atmosphere, and the environment, the resulting political instability and environment degradation, will ultimately disrupt the economic progress our society so desires.
Rather than follow the current neoclassical economic model in which the economy is the total system and nature its subsystem, we need to adopt the notion of a steady-state economy in which the economy is an open subsystem in a finite, non-growing and materially closed ecosystem. Unfortunately, this view is not accepted by most economists; instead, they view freer trade as the solution to the environment’s problems. For years now, free trade advocates have argued feverishly that freer trade helps the environment rather than hurting it, since economic growth enables governments to tax and raise revenues which could be utilized to protect it. In fact, our model does not work that way. Any additional revenue the government takes in simply pays the additional costs suffered by the environment, so in the end, neither the government nor the environment are better off − instead, they are both impeded by freer trade. It is worth noting that freer trade actually imposes lower environmental standards worldwide, and this leads countries in a race to the bottom in search of growth − and corporations in search of further profits. Where freer trade has become an economic reality, the environment surrounding it has become its nightmare. And the culprit behind much of this has been the World Trade Organization (WTO).
Initially, the WTO promised a world where trade, growth, and sustainable development could be achieved, but more importantly, its plan included environment protection. They even created a Committee on Trade and Environment to demonstrate their commitment to the issue. But more than five years later, all those promises have only produced talk and no concrete action. Rather than fostering sustainable development and protecting the environment, the WTO has supported a paradigm in which free trade and economic growth are priorities at any cost. Repeatedly, the WTO dispute panels have ruled in favor of countries using environmentally dangerous practices. In 1991, the panel sided with Mexico, despite the fact that its fishing nets were depleting the waters inhabited by dolphins. In 1998, the WTO ruled against a U.S. measure aimed at reducing unintended sea turtle mortality as a byproduct of shrimp trawling. In both cases, the panel ruled in favor of the General Agreement on Trade & Tariffs (GATT) to accommodate the economic free market, but subsequently ignored its own environmental agreements. The Committee is clearly not doing its job.
Another vital organization impacting policy making in the environmental realm is the OECD − the Organization for Economic Co-Operation and Development. The OECD does not put the blame on globalization, but rather condemns the lack of organization and regulation concerning environment protection. The OECD recognizes that at the pace our economy and trade are growing, sustainable development will be hard to achieve. But rather than faulting globalization, the OECD preaches a myriad of unviable solutions from increased investment in infrastructure, technology transfers, the adoption of alternative forms of energy, restructuring tax policies, and strengthening a price system that reflects the full costs of economic degradation. In the end, the problem with these solutions is the unavoidable amount of time and cost it will take before they can be implemented. While the OECD does acknowledge the issue, rather than simply slowing down and putting restrictions on trade mechanisms, it proposes that governments throw money at the problem. Most countries do not have money or time to implement these solutions. No political leader of an industrial country, no matter how affluent, has yet announced plans to stabilize demand for the Earth’s ecosystem. Why would the OECD believe that any leader should choose their expensive and illogical proposal? No one really knows.
What we do know is that our environment cannot sustain the damages our society imposes. The WTO and OECD need to recognize that economic growth is not the only proof of a prospering society. They need to accept the realities currently facing our world and its future, for if we continue forward in the manner we have conducted ourselves in the past, Mother Nature will indeed assure that economic growth is the least of our worries.