Prosperity and the Environment

It is easy to become overwhelmed by the way these two concepts rub up against each other, usually destructively.

At first it seems that environmental concerns, fears, hopes and practices must be the enemy of prosperity. A little later it seems unavoidable that the idea of prosperity cannot survive without responding to urgent environmental concerns. But then we are back to the fear that addressing those concerns must inevitably be incompatible with prosperity.

It is absolutely necessary to square this circle. But how?

The First Hard Truth: It's Real

And where to start? Let's start at the hard bit, the bit which acknowledges the reality and urgency of environmental concerns. Paradoxically, it is easy to ignore the hard realities. For many, the environmental movement and its cheerleaders all too often are willing to sacrifice rigour, and even truth, for propagandistic effect. When the public is assured by environmentalist cheerleaders that every hot day, every cold day, every storm is all the proof we need of the reality of climate change, they roll out a welcome mat for sceptics everywhere. It is, I think, profoundly counter-productive.

Also needless, since a sustained monitoring of global greenhouse gas concentrations can leave no-one in any doubt of their unchecked upward trajectory. Similarly, although the conceptual and practical difficulties of measuring a 'global' temperature are daunting, and their presentation too often opaque and sometime baldly bogus (think'hockey stick'), the available evidence paints a convincing picture of long-term warming. The precise linkage between the rising greenhouse gas concentrations and rising temperatures may be more uncertain and tenuous than propagandists assert, but some sort of linkage seems overwhelmingly plausible.

Moreover, the relentless focus on CO2 emissions distracts from other current environmental disasters which are plainly ongoing and disastrous in ways we probably cannot even yet understand. Massive and rapid deforestation and the broad-spectrum spoilation of the oceans are both profoundly worrying, as they represent a smash and grab raid on the natural capital of the world accumulated over billions of years. Once spent, it seems unlikely that capital can be replaced, and the human processes, habits and habitats which rest upon them will consequently be jeopardised. The speed at which this is happening is startling.

This situation undermines prosperity in two ways. First, a realization of the trajectory undermines the very 'hope' which is the essential core of 'prosperity'. It is perfectly rational that the younger part of the population is more concerned than the older demographic - if there is a 'finish line' to using up environmental capital, they are likely to living nearer it than their elders. But that very fact, and the reality of the environmental worries, means also that the measures deployed to push that finish line further away, will also have a negative impact on the medium and long term prospects for material prosperity. If we're going to save the environment, we'll all have to learn to do with less, and to rein in our habits of consumption.

The Second Hard Truth: We Can't Solve It

If the first hard truth is one directed at sceptics, the second has to be faced by environmentalists, particularly those in the UK. It comes in two parts. First, no amount of reduction in the UK's CO2 emissions, including their entire elimination, can make any difference at all in the world's CO2 picture. Contrary to environmentalist propaganda (and fears) the UK has been active and successful in scaling down its CO2 emissions - currently, per capital CO2 emissions in the UK are lower than they were in the 1850s. Paradoxically, this means we are no longer relevant to the global picture, since we now contribute less than a percentage point in annual global emissions - a tiny fraction which gets smaller and less significant every year.

Efforts to drive CO2 from the UK economy are practically pointless. And because they are practically pointless, the ethical basis for demanding or imposing curbs on economic activity or ambition in their name (for example, by pushing people's electricity bills ever higher) is, at best, very shaky.

Which brings us to the second part of the Second Hard Truth: current global policies and agreements, despite the billions spent on them, despite all the conferences and political commitments have failed, are failing and will continue to fail. The proof of that failure can be summed up in the fact that not only are CO2 concentrations still increasing, that increase still has an accelerating trend. Frequent and frantic injunctions that we 'have to do more', or 'get serious' about CO2 are not only pointless in the UK context, in a global context they are reminiscent of World War 1 generals demanding 'one more big push'. And about as successful, and probably not much less damaging in terms of immediate human damage. Their failure is guaranteed because nowhere in human history can we find an example where humanity has chosen not to grow, not to expand, not to deploy its ingenuity and efforts to secure what it sees as its material improvement. Those campaigning for humanity en masse to limit voluntarily and for ever its consumption, its production, its material ambitions, are placing bets on human salvation. As others have before, with no single instance of enduring success, ever. If you bet on salvation, I believe you will first meet apocalypse.

The plan to 'tackle climate change' by collapsing what most people see as 'prosperity' isn't actually a plan. It is an evasion, displacement activity in the face of genuine threat.

So far, this has been a terrible piece, painful to write, and painful to contemplate. We cannot have prosperity without facing up to our environmental disaster; we cannot face up to our environmental disaster without curbing prosperity.

Surf and Turf Opportunities

Acknowledging these hard truths at least allows us to see what we should not do. In turn, that opens up potential new openings, goals and policies. I would like to suggest two, both of which would be genuinely positive contributions to the problems, and both of which I believe are practical and possible.

First, the UK's main contribution to addressing environmental problems necessarily cannot be centred on CO2, and actually should not be centred on CO2 directly. As an quite densely populated and anciently cultivated island, it has unusual responsibility for two other important environmental disasters: marine and forest. In both cases, physical realities and shared history make these two aspects of environmental care our distinct and characteristic responsibility.

The UK's responsibility for marine care is a function of being an island: it has an exclusive economic zone covering 6,805,586 km2 - which is the fifth largest in the world - of which 773,676 km2 is directly offshore of the UK, and the rest offshore of crown dependencies. (Within Europe, UK, 773,676; Greece 505,572 km; France 334,604; Portugal 327,667, km; Denmark 105,989, Germany 32,982 km.) The spoilation of the UK's marine waters is not merely a matter of systemic over-fishing: other sources of pollution degrade and destroy a broad spectrum of marine habitats. Protection and restoration of Britain's marine habitats will depend on developing cleaner onshore practices to eliminate non-point source pollution (such as agricultural run-off,) as well as point-source pollution (for example, sewage disposal), and the impact of offshore oil & gas production and maritime discharges.

The benefits go far beyond generating healthier beaches, waters and fish. Protecting our waters goes hand in hand with protecting our onshore environment too. Since large swathes of the world's oceans are now degraded or under threat of degradation, the successful development of marine technologies and practices to protect our waters can be expected to generate significant employment and export opportunities.

The UK has left in the EU, and is in the process of reclaiming its rights over the 773,676 km2 of its Exclusive Economic Zone maritime resources. It does so at a time when Britain's own fishing industry is small in terms of the UK's economy, and in terms of the recent historic total fishing catch from those waters. As a result, this is an extremely propitious time to shift our maritime focus from fishing to environmental protection and restoration.

Onshore, Britain's environmental focus should be on woodland and forestry. There are two reasons for this: first, globally, deforestation is profoundly threatening on multiple fronts: unchecked elimination of biodiversity, dwindling CO2 absorption, and world-wide soil erosion/exhaustion are all the by-products of de-forestation. This is, perhaps, the most urgent of all our environmental problems, since at the current rate of logging, the last rainforests will have been cut down within 100 years. Forests are old and slow: their giant eco-systems are what very slowly build soil, foster bio-diversity in ranges and multiplicities still unexplored, and of course, are major agents in creating and sustaining climate and atmosphere. They take millions, possibly billions, of years to fully develop.

Cutting them down has been likened to cashing in a billion years of premium bonds and spending it on bling.

Britain should be at the forefront of forestry/woodland protection and, if possible, restoration because of its landscape. Not only is that landscape unusually diverse, but it is also one which has been most extensively shaped by human habitation over thousands of years. Precisely because it is not one of the wild places of the earth, Britain is a place which has a great opportunity to discover and demonstrate how societies can flourish whilst extending forestry and woodland coverage.

Needless to say, this will require changes in policy in at least two aspects. First, the nature of Britain's 'forestry' must itself change, since the combination of mono-cultural planting followed by rapid harvesting is in many ways the antithesis of forestry, since it provides no protection to the underlying woodland ecology, and actively contributes to eroding the soils which are an integral part of that ecology. So second, it involves a reconsideration of the use of this harvested wood in our economy. It seems particularly perverse, for example, to see woodchip-fired power stations as being environmentally friendly: their feedstock is the degradation of soil, the destruction of genuine woodland habitat. Commercial forestry is not looking after the woodland environment: we can and should do better.

Circular Economy: An Industrial Revolution Waiting in the Wings

The second opportunity for which the UK is well-suited is the development and discovery of how to build and operate a Circular Economy. Describing in detail what a Circular Economy would look like is currently impossible: or rather, any such description would be a necessarily flawed exercise in imagination. That is because a Circular Economy is, necessarily, a holistic venture, and currently all efforts to evolved Circular Economy approaches in individual companies can only be partial and, only partially successful.

Nevertheless, the fact that companies in many sectors in many parts of the world are trying to put Circular Economics into practice tells us that the idea itself is powerfully appealing. At the heart of Circular Economics is an aspiration that resource usage should be as efficient and circular as possible. In its industrial interpretation, this means that everyone by-product of every industrial process should be engineered to be the input to another industrial process. By extension, when an industrial product comes to the end of its useful life, its components should be able to be recycled for the next cycle of product: this is 'cradle to cradle' resource usage. This vision of industrial process involves recycling, but its ambition goes far beyond that, to involve Circular Economics not merely in how something is made, but also how it is designed, how it is distributed, and, ultimately, how it is financed and the legal underpinnings of its ownership. By its very nature, Circular Economics can only be holistic.

It is also an Industrial Revolution in waiting, promising a step-change in resource efficiency which ultimately allows growth and prosperity to be compatible with environmental stewardship.

Britain is unusually well-suited to discovering and developing such an Industrial Revolution, not least because historically it has the world's best track-record in managing such fundamental and dramatic changes in economic structure whilst avoiding intolerable social trauma. If the Circular Economy is the next Industrial Revolution waiting in the wings, the UK is supremely well-positioned to host it.

But by its very nature, the discovery of Circular Economics cannot be made by a single company alone, or even by a single sector alone: it's very nature and description is a tangle of horizontal, vertical and circular linkages across an entire economy. Yet no national economy, including Britain's, will dare to attempt to implement it. And no political party, including the SDP, will dare to implement such an experiment at national level.

However, it is possible to construct - or rather allow - a Special Economic Zone entirely and exclusively dedicated to developing Circular Economy forms, practices, services and products. Within that SEZ, it would be possible to repurpose VAT to zero-rate inputs of products and services which are themselves certifiably part of the Circular Economy. For example, when a company uses recycled plastics as a key input, those inputs would be zero-rated for VAT purposes. A wholly-circular product would, in theory, then enjoy a 20% price advantage over its non-Circular competitors.

More, having an entire SEZ dedicated to developing Circular Economics would also have to involve not merely production and distribution, but all the infrastructures needed to develop these economics: this would encompass design, legal, accounting, distribution and financial services. For example:

• designers would be needed to design products compatible with Circular Economics cradle-to-cradle needs;
• auditors responsibilities would include accountability for correct attribution of Circular Economy inputs;
• new financial services would also be needed: for example, Circular Economy manufacturers could probably benefit from a working Recycled Plastics market; financiers of all types would have to learn how to assess the economic viability of Circular Economy projects;
• distributors of all sorts would be need to learn how they can earn money from end-of-life/recycling services for the products they distribute.

These are only a few of the developments which seem immediately imaginable within a Circular Economy enclave. We should, however, expect to be surprised regularly.

A couple of other developments are also predictable: first, that a sufficiently sizeable Circular Economy SEZ will attract investment from the range of companies currently working in isolation to develop Circular Economy practices; and second, that the SEZ will attract a talented workforce from across all sectors among those who have a vision of squaring the circle between prosperity and the environment.

What will bring them is 'hope'. What they may generate is 'prosperity'.