Economic Growth: the culprit!

Economic growth is an increase in the production and consumption of goods and services. Since virtually all the goods—including all the goods required to support the services—come directly from ecosystem resources, economic growth is also an increase in throughput, or flow of natural resources, through the economy and back to the environment.¹ When the GDP goes up, invariably an ecosystem somewhere has been appropriated, polluted, or otherwise degraded and, along with it, the biodiversity it holds and the services it provides. Because humans take resources from virtually every ecosystem on the planet, the human economy grows at the competitive exclusion of wildlife. In other words, we simply out-compete them and eliminate them. This is fundamental to our understanding of biodiversity loss.

Economic growth depends upon increasing population, increasing per-capita production and consumption, or a combination of the two. It ultimately results in a larger human ecological footprint along with its attendant biodiversity loss. There is irony here in that biodiversity is integral to the functioning of ecosystems, which provide many of the ecological services that give support and substance to the human economy.

For most of our history, the human population was below 1 billion people.
It was only in the nineteenth century that we approached a billion and have
been climbing exponentially ever since. Compare this graph with that of
the St. Matthew Island Reindeer.

When the world was relatively “empty,” the abundance of nature obscured the shortcomings of an economic model that ignored basic principles of physics and ecology. Now, however, the world is “full,” and the 6.7 billion of us are beginning to see the effects of this faulty economic model in the form of climate change, endangered species,declining fisheries and a host of others, a result of the continual increase of our per-capita consumption. We can no longer ignore the fact that an economic model based on infinite growth on a planet with finite resources—a model with no connectivity to the biosphere—is fatally flawed.

Yet, the conventional or neoclassical economic model, under which much of the global economy operates today, assumes that infinite economic growth on a planet with finite resources is possible; that the economy is a perpetual motion machine that can run forever on its own output.²

But the flow of economic throughput is not circular.¹ It flows one-way from low entropy (useful) resources to high entropy (used-up-ness) waste, according to the Second Law of Thermodynamics. To grow, the economy must take evermore useful matter and energy from the finite biosphere in the form of natural resources to produce the goods and services; wastes are inevitable by-products.

Mainstream economists may think the Second Law of Thermodynamics —perhaps the supreme, physical law of the universe—can be ignored. But as Huxley observed: "Facts do not cease to exist just because they are ignored."

As the economy grows over time, it appropriates a
greater and greater proportion of natural capital from
the economy of nature for use in the human economy.
The tremendous breadth of the human niche means
that the human economy tends to grow at the
competitive exclusion of wildlife in the aggregate
(biodiversity). This is the fundamental conflict between
economic growth and biodiversity conservation. K is
carrying capacity (limits) for the human economy. A
sustainable economy would be maintained sufficiently
below the limits so that the areal extent of ecosystems
would be adequate to maintain biodiversity and allow
proper ecosystem functioning.^3,1

As long as the economy continues to grow under this current model, more and more biodiversity will be lost through competitive exclusion. Czech³ uses an ecological analogy derived from Liebig’s law of the minimum, and suggests economic growth is the limiting factor for biodiversity conservation. A limiting factor is a factor whose presence or absence controls a process such as the success of an organism. It is a factor that, if not addressed, will affect the success of the organism in a negative manner no matter what other benefits are provided.

If economic growth is the limiting factor to biodiversity conservation—and we at the Qualicum Institute are convinced it is—economic growth is what has to be addressed. Failing to do so means that everything else we do to try and conserve biodiversity will be for naught, as the economy continues to steamroll over more and more ecosystems further reducing biodiversity and the ecosystem services that support all life on the planet. Sadly, addressing symptoms rather than the cause is where most energies are now being directed.

Even if we continue to address the symptoms (i.e., the non-limiting factors) with extra vigilance, the best of intentions, super technologies, and an ever-increasing budget, it is clear that such actions alone will have little effect on biodiversity conservation because they do not address the limiting factor or the root cause of the problem.

For example, if we focus our energies on the symptom, climate change, but ignore the root cause, economic growth, the economy will continue to roll over more and more ecosystems which not only puts us in danger from the loss of biodiversity but also exacerbates climate change further. Whereas, if we focus on economic growth then we not only reduce consumption and population growth but we stop the onslaught of the destruction of our global ecosystems which help us better control climate change through their ability to sequester CO₂.

In other words, a focus on economic growth will affect solutions to climate change, and many other environmental problems, positively; however, the current focus on climate change will not likely affect economic growth, the real culprit, which will continue its onslaught to the ecosystems of the planet.

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