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When More Cancer Is Good for GDP Growth, We're Measuring Things Wrong

12/23/2013 09:17 EST | Updated 02/22/2014 05:59 EST

Environmentalists have been asking some pretty tough questions of economists for the last 50 years.

In Natural Capitalism Amory Lovins, Hunter Lovins and Paul Hawken point out that of every 100 units of raw material that goes into our industrial system only 6 per cent is still in use after six months. So 94 per cent is waste!

Or think about this: with just 5 per cent of the population, North Americans consume 33 per cent of the world's resources. So if everyone else in the world consumed as much as we do, we'd need another six planets to provide!

Clearly we can't have infinite growth on a finite planet. As one of my mentors, Thomas Berry used to say: Economics, as it is currently practised, is a form of pathology:

Ask any economist and they will tell you that GDP growth is good. So if more people get cancer, that's great, because spending on health care increases. When BP's rig in the Gulf of Mexico spills 4.9-million barrels of oil that's great because BP has to spend billions cleaning it up -- so GDP grows.

And when the U.S. goes to war in Iraq and Afghanistan that's FANTASTIC because the lifetime spending due to that war will be somewhere between 2.7- and 6-TRILLON dollars, according to Nobel Economist Joseph Stiglitz. But you don't have to be a rocket scientist to know that more cancer, catastrophe and war are not good.

Herman Daly, the former Senior Economist for the World Bank asks, is GDP measuring wealth or ilth?

Can any economist say that more cancer, more childhood asthma, more oil spills, more pollution in China, more species extinction, more tropical rain forest destruction, and more war represents more prosperity?

All this is the prelude to the topic today: Prosperity without Growth.

Tim Jackson wrote Prosperity without Growth and Peter Victor wrote Managing without Growth. You can see the common interest they share in their book titling. Together they teamed up to write a report of the Metcalf Foundation, Green Economy at Community Scale. The report was presented at the Canadian Society for Ecological Economics (CANSEE) conference in November 2013 at York University in Toronto. Most work on the green economy has been done at the macro level, so this report was working to bring it down to the local level.

Greening the economy at the local level creates jobs, strengthens the local economy, creates resilience and helps address the environmental challenges. That is the finding of Green Economy at Community Scale, by these two leading ecological economists and thinkers on issue of environmental sustainability and economic growth.

A truly green economy requires rethinking work and productivity, and developing a new vision of enterprise, investment, and a money economy that can support a shared and lasting prosperity.

It's about providing the capabilities for people to flourish in their community -- socially and psychologically -- without destroying the ecological assets on which our future prosperity depends.

The Truth About Jobs

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Tar Sands vs. Energy Efficiency

The Tar Sands is very capital intensive and job poor. To make the point, think about $5 million truck for carrying Tar Sands bitumen for processing and a single driver. But when business, municipalities, home owners embark on energy efficiency it's mostly labour and a bit of weather stripping they're paying for. In fact energy efficiency creates 3.7-times more jobs than spending on the oil industry per dollar invested, according to a report by the Centre for American Progress.. Because the Tar Sands is even more capital intensive and job poor than the oil industry in general efficiency creates an even higher multiple of jobs.

The same argument applies to Ontario's decision to refurbish nuclear power plants: focusing on energy efficiency is THE CHEAPEST, easiest, and fastest way to free up power on Ontario's electricity grid. And pursing a policy of energy productivity insulates homeowners and business from future rises in energy prices.

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