This is a paper I wrote 2003 and sent to the UK conservative party. No idea if anyone read it, but sad to say, after this paper, the conservatives “went green”.
Although from before I knew there is no real science backing the catastrophic predictions of global warming, not too many embarrassing statements but enough to make me cringe, this one (albeit in an appendix) is particularly awful:
The biggest effect of global warming is likely to be harvest failures in all countries but particularly damaging in undeveloped countries. History shows that this results in political instability, an increase in extremists such as anti-western groupings and a rise population migration.
Sustainable Capital: The intrinsic value of society, environment and economy that remains substantially available over a 25 year period for the next generation.
A paper prepared by:
Michael Haseler BSc. MBA
©Michael Haseler 2003
Summary
Capitalism is being blamed for a wasteful society that is causing global warming.
Sustainability is simple common sense, but has received almost a religious status amongst some followers; that it is some mystical force that will “heal of the planet”, if only enough people would forsake the evil of consumption and follow the true “sustainable” way.
This report examines whether capitalism and sustainability can co-exist. It draws the conclusion that the principles have no incompatibility. Moreover, it concludes that the implementation of sustainability would be bettered by taking the long term intrinsic value encompassed in the concept of “capital” and using this as the basis for a model for our economic, social and environmental resources. This model is “Sustainable Capital”
The problem with present UK environmental policy is that it is too focused on environmental issues and ignores the wider economic and social issues. Thus, the UK incurs all the additional environmental costs, without gaining the potential economic opportunities. The result is likely to be an inability to sustain public support as the small number of additional UK jobs is unlikely to replace jobs lost as the UK switches from petroleum and gas. This is literally unsustainable.
Sustainability and capitalism share a more rigorous longer-term perspective. But, the electorate, news media and NGOs all shout about the latest, most “cuddly” and often contradictory issue and few remember the lesson that sustainability is a wider, longer perspective with equity of effort on the environment, society and the economy.
The government have proposed metrics for sustainability, which are a first step. Unfortunately, these are not developed to measure sustainability, but are a selection of “sustainable looking” metrics. The result it that they are too short term, hard to interpret, contradictory and some essential figures such as raw material resource are entirely missing.
Most noticeably, an increase in oil consumption will increase GDP, whereas in fact the raw material resource for future plastics, etc. has decreased. As oil depletion and global warming are major problems for the future, this counter-intuitive rise in “sustainability” with increased oil consumption is grossly misleading.
This report proposes a new form of metric: Sustainable Capital. Just as the asset value of a company complements the short-term metric of turnover, Sustainable Capital, the long term asset value of the whole economy, society and environment, complements current metrics such as GDP: a short term, measure of economic activity.
Measuring Sustainable capital would introduce a regular methodical account of the assets we hold in trust for the next generation. It would focus on the necessary, encouraging proactive considered measures and avoiding the environmental tokenism.
This report does not underestimate the problems of using this new metric. Accountancy overcame similar problems in valuing aspects of a company such as “goodwill”, “training & skills”, etc. and despite similar problems, a useful metric is feasible. Continue reading →
