Transcript Visions of the Future Revisited

Visions of the Future
Revisited
We are mankind because we survive.
 We have come full circle.
 During our various inquiries we got
useful insights about individual
environmental & natural resource
problems
 Now, let us combine those insights and
assess the two visions
Addressing the Issue
 Issue of growth in a finite environment –
focus on 3 issues:
o How is the problem correctly conceptualised?
o Can our political & economic institutions
respond in time democratically to the
challenges presented?
o Can the needs of the present generation be
met without compromising the ability of the
future generations to meet their needs?
 In the beginning : if demand is  & supply
is finite  resources will exhaust & society
will collapse
 Price is not the only factor that retards
demand growth – ↓ population plays a
significant role too
 Characterising resource base as finite is
harsh – ignores existence of renewable
resources, focuses attention to wrong
issues – supports ill-conceived attempts to
measure size of resource base
 Resource base is not finite - “There is
energy everywhere. Choose the
renewable one. Mother earth’s resources
will never get over, as long as you do your
bit.” – wind, solar & wave energy
 Prices are going down but technology is
improving – competition ↑ and we can
afford to sell at lower prices
 Historically, very little evidence supports a
fear of impeding scarcity of minerals –
extraction costs ↓
 How long will this continue?
 Errors made by both – those who
understate adequacy of resources &
those who point to abundance
 The problem is not finiteness but it is the
way they are managed
 Either pessimistic or optimistic views are
wrong – improper incentives &
inadequate information are serious –
considering unlimited resources is
equally wrong
 Plenty are available if we are ready to
pay  price – need to transition to
renewable / recyclable resources has
already begun
Institutional Responses
 Markets have responded quickly to deal
with scarcity & showing  prices
 Substitution encouraged – recycling
growing – consumers’ habits changing
 Government intervention needed to
ensure that the firm which neglects
environmental damage in their operating
decisions do not gain a competitive edge
 Each problem to be treated case by case
 Market may automatically choose a
dynamically efficient or sustainable path for
future – imperfections in the market make
sustainable development difficult
 Left to itself market will over-exploit free
access resources – thus reducing the
benefits of the future generations
 Sustainability guarantee with falling
depletable resources requires compensation
from present to future generations – financial
payments can’t adequately compensate
future generations
 Government intervention – in controlling pollution –
firms may underprice their goods that add to
pollution – intervention to ensure that firms that
neglect environmental damage in their operating
decisions do not gain a competitive edge
 Unreasonably tough legislations are almost
impossible to enforce
 With price controls, incentives for supply reduced
and the time profile of consumption is tilted towards
present – water supply at subsidized rate
 Price control – key role in hunger problem –
undervalue agriculture – in LR imports when
foreign exchange is scarce – in developed
countries price decontrol
Sustainable Development
 Economic growth in individual nations is due to  in
inputs & technological progress – labour may not ↑ in
future at same rate – limits to tech progress - growth
 stationary state  ultimately zero
 Empirical evidence shows that
•  Environmental control – no large impact on the
economy as a whole
• Environmental policy has contributed more jobs than
it has cost
• Has triggered just a little  in the rate of inflation &
mild reduction in growth
∴ environment & healthy economy are compatible
 Respecting environment is incompatible with
healthy economy is demonstrably wrong –
economies transformed: ↑ in population & ↑
in importance of information
 ‘All people automatically benefit by growth’ is
naïve - ↑ leisure, longer life expectancy, ↑
goods & services – ecological foot-prints
 New forms of development will be necessary
 Economic incentive approach to
environment – incentives changed by fees or
charges, by liability laws or transferable
permits
 Public policy & sustainable development
should support each other – govt should
send right signals through markets
 Global problems – creative policies
 A good partnership between public &
private sectors
 Current NI accounting system is wrong
as doesn’t measure welfare – not
considering damage done to natural
resources that is irreversible
Concluding comments
 United responsibility
 Cannot catch every offender – high
degree of voluntary compliance is
necessary for smooth working of system
 Producers – safety of their products
 understand our responsibility as
consumers – purchases to reflect
environmental values in such away that
market moves in right direction
 We are at the end of an era and also at
the beginning of the other
 Future holds transformation in many
ways
 Obstacles will be there as they are today
too, but we are making progress, for
sure!!