Monday, April 03, 2006

The Rational Environmentalist: Economics as a Tool

sorry for the long post this week...

At first it seems a contradiction in terms. Rational environmentalist. Environmentalists, who for decades have been associated with impassioned speeches and desperate acts of heroism (some would say stupidity) in the name of saving the environment, but very few people would make the leap to call them rational. I think that this irrationality on the part of the environmental movement is a large problem, one that will undermine their future effectiveness as protectors of the natural world. For too long have the public waded through shock therapies designed to jolt us into a compassionate viewpoint of the world, and steel our reserve to do all things necessary to prevent degradation wrought by other groups. However, there are far too many who do not respond with the arduous vigor that was hope, and yet environmentalists continue to bray into the wind. Even the Democratic Party, long a stalwart supporter of the environmental movement, has begun to take steps away from the green fringe. Why? Because they have lost their touch with reality, in numerous ways.

Ask anyone to describe an environmentalist and the response is uncannily similar: a hippie-ish figure opining fervently about some nature issue, or about the evils of an industry, company, or individual. Large, grandiose gestures on the part of the environmentalists have become a major perception of the entire group. Groups like Greenpeace have furthered this image, throwing themselves into admirable yet ultimately futile gestures. Chaining themselves to trees, blockading bulldozers, rafting against oilrigs and tankers, these scenarios have become so banal they now fail to arouse the least bit of curiosity in the general public, let alone a zealous response of indignation. These tactics, while once persuasive, have lost their effectiveness in the face of modern society.

So what recourse do environmentalists have? To where should they turn when the irrational spew they are so accustomed to churning out is lifeless? I would postulate that moving in the other direction would be the best course of action. By rationalizing their pro-environment arguments, they will strengthen their positions as well as widen their own listening base, and in turn raise their own coalition to a new level. For too long has the heated rhetoric isolated those people who are most important to the environment’s cause. Because everyone has the possibility to play a part in this issue. It is not merely a white problem, or an atheistic problem or a rural problem; the health of the environment, and all the trappings that go with it, is everyone’s concern. That is a challenge to environmentalists: to engage all sectors of our society. And loud speeches or futile displays are no longer sufficient. We need to reach them on a level they can relate to and empathize with. And this involvement will open them up; bringing the issues closer to home will establish beyond a shadow of a doubt why the everyman must also champion the environment.

The inevitable question that follows is where do environmentalists find that common language, the means with which they will reach out and rally others to their cause? The answer lies in the language of all modern societies: economics. The very power environmentalists are accused of disrupting could prove to be a powerful ally.

For years, it has been assumed that the environmental movement is counter-economic growth. A common viewpoint is that it is necessary to utilize our natural resources to their fullest extent at the risk of losing out in economic development against the rest of the world. It is apparent even in today's politics, when our president refuses to join the Kyoto Protocol because it would endanger American businesses and would impose too great costs to our federal budget. Ditto for his decision to weaken mercury emission requirements despite EPA reports suggesting otherwise.

In this world, and especially in a capitalist-driven country such as this, a great number of times, the dollar is the bottom line. And it is to this that environmentalists must also address when they are enhancing their communication with other factions of this nation. Environmentalists need to highlight the practical nature of strong green policy; that it makes good economic, as well as social, sense to protect the wilderness. Overly aggressive harvesting of our natural resources is an economically unsound policy that will drain our economy faster than we would like to believe.

A very relevant article appeared in the March 2005 issue of Outside magazine. In this article, it went on to describe several examples of how economics can work to benefit the environment. One such example: when New York State had allocated $8 billion to construct and $300 million annually to maintain a new water purification system. Instead of building an entirely new treatment plant, they decided to spend $2 billion of that improving the health of the Catskills Mountains, a natural watershed for the state. The state found, after this restoration, the watershed alone was purifying the water enough so they did not have to alter any additional existing infrastructure of their urban system. In effect, preserving the Catskill Mountains saved New York State $6 billion plus the annual costs. This, in effect, makes those mountains worth in excess of $6 billion in assets just for water purification. This does not include recreation, possible carbon sinks, quality-of-life improvements, a plethora of other points that healthy ecosystems add to an economy. It is an interesting article to read, and this is just one example they give. Another example is the CAFE standards put in place by Carter in the late 70s. While reducing foreign oil imports by 87% and raising the fuel efficiency of the American fleet by 6mpg, the economy still grew by 27%, greater than 4% a year. And in 1995, the US Forestry Service studied the value of their land holdings and discovered the national forests of this country create nearly $94 billion in recreation-based economic activity annually. In comparison, these lands generated less than $20 billion in timber and mining revenue combined.

Economics is predominant in the minds of Americans, whether the environmental movement wants to believe it or not. One of the greatest issues facing them now is addressing these concerns, and making the general public realize it makes sense, economically as well as environmentally, to preserve the land for long-term use. It will have benefits that are far-reaching. With this new economics coming to bat for us, we have a new weapon we can use to educate and illuminate others to our cause.

The use of economics by the environmental sector is more than an educational tool. While the numbers, figures, and charts can work towards convincing people that the environment matters as much as their pocket books matter, the principles of economics provide the green movement with a new weapon. As money is the blood flow of the world, its constriction or dilation by organizations can prove useful motivation to achieving an end. And by applying this pressure judiciously, wilderness organizations can reap large benefits geared towards achieving their goals. One of these economic tools is an effective boycott.

You must qualify a boycott as effective because it has become another nominal threat from the environmental community. In response to any number of perceived slights, the environmental community jumps into action, calling for “boycotts” of the offending member. Whether these slights are real or not is not the subject of this article; the fact is that they are begun, word is spread to a few similarly-fervent people, and it ends up a 5pm news story at the boycott site. However, it rarely makes any sort of difference to the individual or company or industry that they are trying to impact. Why is this? To investigate what makes an effective boycott, we’ll examine one of the most influential boycotts in American history: the 1955 boycott of the Montgomery bus service after Rosa Parks refused to give up her seat. What attributes of this boycott made it so prominent in the American psyche, and had such far-reaching effects for the civil rights movement?

The first aspect that becomes apparent of the Montgomery boycott is the size. Contrary to many of the more modern, half-hearted boycotts, the Montgomery bus service witnessed a drop-off in a large number of riders. The scope of the boycott took the bus service, and the country, by surprise. And a boycott requires such a force in order to make itself truly effective. A boycott carried out by a grand total of a few dozen, maybe even a few hundred, is not able to put a dent into the economics of major organizations like the bus service. It needs a mass of people willing to carry out the boycott en masse.

The second noticeable difference that the Montgomery bus boycott possessed compared to modern boycotts is the duration. There have been some people who have called for oil boycotts, to demonstrate the public’s displeasure of the oil industry and their tactics in pricing or environmental stewardship. However, most of these boycotts ask for a measly week’s worth of boycotting. The problem with this is that people will effectively countermand their own boycott by stocking up before or immediately after the week-long boycott. People reason, “I’ll boycott, but I still need to drive, so I will fill up the tank before the boycott starts, then I can participate.” The oil company does not feel it is in any danger, for it knows that fact. Deferred purchases do not make any sort of impact against these mega-corporations. In contrast, the Montgomery bus boycott lasted over a year. This length brought the bus company to its knees, depriving it of a great source of revenue and eventually forcing it to capitulate to the boycott’s demands. This length serves two purposes. One is to systematically work against the aggressor financially, and the duration is necessary for the company to feel the effects of what you’re trying to achieve. And with the distinct large-ness of modern corporations, it has become a longer timeframe in order to effect these realizations. The second aspect of the time length is to grow the boycott. A week’s boycott is difficult to educate enough people and have enough participants to make it effective. There had actually been bus boycotts before the 1955 one; they lasted from one week to three months, but never had a significant influence in achieving their ultimate goal: desegretation of the bus system. However, as the time goes on, and people become attracted to the cause, they can join and multiply the effects to an even greater magnitude. Yet another reason for an effective boycott to have a long duration is psychological. Being able to abstain, to put the cause above petty personal desires, reflects the deepness of the value which one places in the actions they are espousing. It is easy to pick up a boycott for a week, and then go back to a normal life without a second thought. More difficult, and much more impressive, to maintain a boycott for six months. It proves that this is something cared about ardently enough to sacrifice for long periods of time. It is this which gets attention, and helps drive media frenzy around a boycott to educate even more possible participants and grow the boycott to maximize efficiency.

There is one facet of an effective boycott that makes it impossible to fail: the dedication of the participants. This will be discussed at some length in a later article, but it is necessary to have the boycotters committed to the cause. There is a need for a measure of personal sacrifice on the part of the participants. Boycotts, and making changes, does not come easy, and with the time involved, can impose some hardships on the persons involved. In the continuing example of Montgomery, it resides in the inability for a great number of people to use personal transit in order to get to their jobs, schools, and daily errands. But this was endured, and the results speak for themselves. I seriously doubt any of the boycotters would look back and feel that it was a waste of their time and inconvenience. (In an interesting, ironic twist, the iconographic environmental boycott of refusing to buy gasoline would require people to subsist on public transportation, rather than shunning it.) But this sacrifice, this resolve, is an integral part of a boycott, something without which no action would bear fruit.

There are other aspects of economics that can be utilized to help bring about changes to existing environmental conditions. A lot of these also involve economics’ twin brother, politics. Tax subsidies/penalties, mandatory standards of emissions/quality control (mostly political, but can still have wide-spread economic consequences for the companies involved), even something as simple as a refund for aluminum can recycling has economic implications for the betterment of the environment. These are economic powers that can be positive or negative, depending on the influence one wishes to implement. But they still constitute a broadening region that the environmental movement can make use of to expand their own interests to great effort.

However, the sword that stands to be inherited by environmentalists is double-edged. While it can be used with great possibility to force change in industries that have thus far proved to be beyond governmental control (either by campaign contributions or sheer brute political force), economics also will force the environmentalists to evaluate their own priorities and better focus their efforts. The economics that drives the world brings the priorities of a society into sharp relief. These will invariably be industries that are more or less valuable to the economy, just as these sectors will have varying levels of negative environmental impact. While it is a natural desire to eliminate all of the evils the environment is currently facing, in an economic sense it is not possible to address all issues simultaneously. The environmental movement must prioritize their agendas, though this may seem counter-productive. By using economics they are able to evaluate where their efforts would yield the greatest returns. This article is not about enumerating these choices; rather, it is about the necessity to implement this method of thinking. A lot of environmentalists have unrealistic expectations of large, sudden changes in a given society’s growth and/or consumption patterns. But the truth is these adjustments must always be gradual. Nothing can really be achieved overnight. By looking at all the implications of a particular industry’s errors and the measures necessary to redress the problems, the environmentalists can work towards effective yet also realistic accomplishments. To ignore the other facets of reality leaves the movement as a whole out of touch and ultimately sterile. An example is the forest industry. There are a great number of activists who decry any use of timber in modern society. They would prefer to close down all major forest harvesting projects. The reality is that lumber, paper, and other forest products are vital portions of modern living and consumption. It is impossible to grind all that to a halt immediately. And since there is this high demand for their products, shutting down American forest harvesting will only shift the problem elsewhere in the world, moving to new possible suppliers. Rather, the gradual management and reduction of logging will elicit a greater result, be easier to motivate other citizens to follow, and generate greater acquiescence from industry. Investing their energies in recycled paper products, alternative building technologies/materials, and sustainable harvesting management plans will produce gradual yet continuous positive improvements. This is the way that, thankfully, a lot of environmental organizations have chosen to follow, and I sincerely hope they use this judicious evaluation and attack process towards all of their endeavors. It remains that the fringe needs to get with this program, for it is their unusually harsh and loud voices that are creating detrimental roadblocks for progress.

If this sounds like an MBA talking, that is good. The people environmentalists are most directly working against are business leaders. The public is secondary in this matter. The public always states, in pre-election polls, that the environment is high in their minds and electoral considerations. But when the day actually arrives, more practical concerns take over their minds. The economy, foreign trade, job growth, federal budget and deficit, all preoccupy the citizens’ collective interest when the ballot is cast. For too long has the environment been viewed as antithetical to economic prosperity. For too long have companies and governments used financial statistics to beat down environmental policy. The tide is turning; those same statistics are beginning to prove the point that wilderness and consumption patters matter. And in order to make the argument stronger, iron-clad, environmentalists need to trade the soapbox for the cost-analysis study. By becoming rational environmentalists, we inherit the power to make our most irrational dreams come true.

You can find the Outside magazine article on the internet at

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