Hahnel - Green Economics: Confronting the Ecological Crisis

GREEN

ECONOMICS

GREEN

ECONOMICS

CONFRONTING THE ECOLOGICAL CRISIS

ROBIN HAHNEL

First published 2011 by M.E. Sharpe

Published 2015 by Routledge
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Library of Congress Cataloging-in-Publication Data

Hahnel, Robin.
Green economics : confronting the ecological crisis/Robin Hahnel.
p. cm.
Includes bibliographical references and index.
ISBN 978-0-7656-2795-7 (cloth : alk. paper)ISBN 978-0-7656-2796-4 (pbk. : alk. paper)
1. Environmental economics. 2. Sustainable living. I. Title.

ISBN: 9780765627964 (pbk)

ISBN: 9780765627957 (hbk)

This book is dedicated to Kristen Sheeran, who gave up tenure at the University of Maryland to become Executive Director of Economics for Equity and the Environment because she knew the ecological crisis we face must be confronted more quickly than wheels turn in ivory towers.

This book is written in desperation. The human species has launched the planet on a trajectory that threatens to make all previous environmental disasters pale by comparison. Despite the fact that more and more people do get it, our leaders, and the current political and economic systems we labor under, have proved unable to make any progress whatsoever toward heading off climate change disaster.

The much-anticipated climate meetings in Copenhagen in December 2009 ended in disaster, threatening to undo diplomatic progress that had consumed decades of precious time. And as Bill McKibben, cofounder of the campaign to stabilize atmospheric concentrations of greenhouse gases at 350 parts per million, recently lamented, after the planet has just come through the warmest decade, the warmest 12 months, the warmest six months, and the warmest April, May, and June on record in late July, the U.S. Senate decided to do exactly nothing about climate change. They didnt do less than they could havethey did nothing, preserving a perfect two-decade bipartisan record of no action (TomDispatch.com, August 4, 2010).

This book is not written because the author thinks he has all the answers we need. Quite the contrary, I believe it may be some time before anyone provides a grand theoretical synthesis suitable to analyzing all facets of the relationship between human economic activity and the natural environment. While we can build from insights provided by various heterodox approaches as well as by mainstream economics, unfortunately all schools of economic thought fall short of what is needed in one way or another. And while the efforts of those who advocate on behalf of the environment have often been inspirational and heroic, unless political strategies improve there is little reason to expect the environmental movement to achieve better results in the future.

After acknowledging pioneering work by environmental, ecological, institutional, Marxist, and other economists, it may appear unseemly to proceed to criticize them. But improvements will not come without criticism, which should not be confused with pointing the finger of blame at those we owe a debt of gratitude for all they have done. Those who study and work to protect the environment are not the reason the environment is in serious danger, even if better analyses and more effective political strategies will be required to better protect the environment.

I want to thank all the students in my environmental economics classes over the past decades at American University, Lewis and Clark College, and Portland State University who worked with me to separate the wheat from the chaff in received wisdom. I thank my editors at M.E. SharpeLynn Taylor, who rescued this project when it was all but lost, and Henrietta Toth and Laurie Lieb, who labored mightily to make the book more readable. But mostly I thank Kristen Sheeran for teaching a long-time radical economist that he needed to take environmental issues more seriously.

As much as I owe to these and others, the views expressed here are entirely my own responsibility.

Green Economics: Confronting the Ecological Crisis is an attempt to provide environmentalists and progressives with the kind of economics that suits their needs today. It is written by a professional economist who has taught environmental economics, mainstream economic theory, radical political economy, institutional economics, and post-Keynesian economics at the graduate and undergraduate levels for more than thirty-five years in one of the few economics departments in the United States with a PhD program that features heterodox as well as mainstream schools of thought. The author of Green Economics has also worked as an activist in a variety of progressive and environmental campaigns and organizations for more than forty-five years. He understands why activists mistrust economists, yet desperately need helpful economic analysis.

Unfortunately, there is no grand synthesis for analyzing economics and the environment. There are useful insights from mainstream economics when its theories are properly interpreted, and ecological economics and several other heterodox schools of economic thought provide important ideas as well. However, every theoretical framework for analyzing the relations between our economic activities and the natural environment remains incomplete and flawed. As a result, there is no single place to turn for someone seeking to understand what is necessary to protect the environment in ways that are effective and fair. Green Economics does not pretend to provide the grand synthesis that, unfortunately, still lies beyond our reach. However, those who struggle to protect the environment can ill afford to wait for a grand synthesis. Green Economics gathers together useful insights available from many sources and dispels debilitating myths independent of origin. The three brief sections that follow in this introduction offer a glimpse of where mainstream economics can be helpful, where mainstream economics can be misleading, and where heterodox ideas can provide important insights but also create unnecessary confusion.

Americans had put a price on carbon? Of course, nobody understood 250 years ago that carbon emissions from burning fossil fuels were going to destabilize the earths carbon cycle and that increasing concentrations of greenhouse gases in the atmosphere would threaten to unleash cataclysmic changes in the earths climate systems by the end of the twenty-first century. But now, with the benefit of hindsight, we do know that we should have imposed a tax on carbon emissions as far back as colonial days when the market system was just getting up a head of steam in the New World. One place mainstream economics can be useful is helping us understand how much damage getting an important price wrong can cause in a market economy.