The current food crisis gripping the planet put me in mind of former US Treasury Secretary Lawrence Summers infamous World Bank memo on pollution that cost him his job. In the memo (http://en.wikipedia.org/wiki/Summers_Memo), Summers appears quite bluntly to advocate for the export of pollution to poor countries on purely economic grounds. I think the economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that, wrote Summers in the 1991 memo. The memo is often cited as an extreme example of how the the dismal science puts people off (to put it mildly) by expressing the value of human life in dollar terms.
Summers memo was clearly repugnant, but is there a kernel of truth in it? Intentionally sending pollution to any place is preposterous. But within the note there nevertheless lies a nagging question: are pretty air and vast, untainted wilderness parks the mere baubles of luxury when compared the gnawing pangs of hunger biting those in abject poverty? The demand for a clean environment for aesthetic and health reasons is likely to have very high
income elasticity, Summers wrote, implying the rich can afford to be environmentally scrupulous whereas the poor are more likely to be concerned with more basic needs such as food, water and shelter. Can the current food crisis be linked to the Wests greedy demands for clean everything?
My favourite Canadian gas vendor Mohawk (its Regular gas has Premium level octane) bills itself as Mother Natures Gas Station. Why? Up to 10% of Mohawks gas is ethanol, which burns cleaner than petrol, is renewable, and therefore allegedly more sustainable. Ethanol and other bio fuels are often touted as the environmentally friendly alternative to fossil fuels. As is now widely reported, the amount of corn required to create enough ethanol for one gas tank is enough food for a person for a year. The tremendous demand for corn and other grains is a key factor driving up food prices worldwide. The Economist reports that for every 20% increase in the price of food, 100 million new people are reduced to the absolute poverty level of $1 per day in wages. Is a slight reduction in greenhouse gases worth the corresponding starvation of thousands? Is anyone doing the math?
The dominant pop culture cause celeb of the 1980s and 1990s was undoubtedly world hunger. We are the World rings the quintessential anthem proclaiming our public responsibility to feed the poor. Now undeniably the overwhelming mind-share consumer is Global Warming. Witness the recipient of the 2007 Nobel Peace Prize and an Oscar. Ironically, the meteoric rise of environmental issues in the public consciousness is well correlated to the rise in standards of living and wealth. Could it be that our desire to stop Global Warming has strengthened because now we can afford it? To Summers point, the demand for low pollution rises and falls with income. With a recession in the wind, a fair prediction is that, over the next two years, the fever-pitched push to reduce carbon emissions will slow, and the problem of hunger will re-emerge as the number one focus of celebrity fund raising. Reducing ones carbon footprint seems rather trite compared to reducing child starvation deaths.
Despite the uncouth flavour of Summers remarks, the undeniable reality is that rich countries like Canada place a high premium on pollution reduction, whereas up and comers like China, and poorer countries in general have more lax environmental standards. Can the export of dirty industries to poorer countries be simply attributed to corporate greed, or should it attributed to the countries who allow more pollution than others do so because their need for the basics of life outweigh their need for a nice environment?
One is reminded of Maslows hierarchy of needs pyramid, with basic physical needs such as food and shelter at the bottom, followed by love and belonging, and self actualization at the top. Once we have met our lower order needs, we are free to grow and become our true selves, Maslow hypothesised. Deep down, no one, rich or poor, can deny the beauty and mystery of the creation, as we humans too are one of its glorious manifestations. Deep down, no one wants a dirty planet. But our survival instinct cannot be extinguished, and we will choose a genetically modified, non-organic, Styrofoam encased apple from the other side of the planet over hunger, every time.
Is there a solution to this conundrum? Arguably, the richer a country becomes, the more its citizens will demand clean air, clean water, and a healthy, beautiful, unpolluted environment. The proven route to wealth creation is free markets and low government intervention. Ironically, low government regulation is often cited a major cause of pollution. So we are faced with a paradox: low environmental regulation can lead to pollution generating financial success, which success in turn drives demand for high environmental regulation and pollution reduction. Lets pray that Smiths invisible hand operates to the benefit of the environment as well as the people living in it.
So let us rich be carefull about preaching the environmental gospel to the poor, remembering the Book of James (2:15-16): “Suppose a brother or sister is without clothes and daily food. If one of you says to him, “Go, I wish you well; keep warm and well fed,” but does nothing about his physical needs, what good is it?” Amen.