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Bad Technology vs. Good Technology?: Alan Rudy ISS 310 - Spring 2002 Tuesday, February 25

1. The document discusses the need to value natural capital alongside other forms of capital like human, manufactured, and financial capital. Current economic systems neglect natural capital. 2. It proposes approaches like radical resource productivity, biomimicry, service and flow economies, and investing in natural capital as better ways to achieve sustainability. These focus on reusing resources, mimicking nature's closed-loop systems, and valuing ecosystem services. 3. The document argues current subsidies promote inefficient resource use and displace workers. Alternative models could employ more people while using fewer resources through approaches like industrial symbiosis and product leasing models.

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28 views

Bad Technology vs. Good Technology?: Alan Rudy ISS 310 - Spring 2002 Tuesday, February 25

1. The document discusses the need to value natural capital alongside other forms of capital like human, manufactured, and financial capital. Current economic systems neglect natural capital. 2. It proposes approaches like radical resource productivity, biomimicry, service and flow economies, and investing in natural capital as better ways to achieve sustainability. These focus on reusing resources, mimicking nature's closed-loop systems, and valuing ecosystem services. 3. The document argues current subsidies promote inefficient resource use and displace workers. Alternative models could employ more people while using fewer resources through approaches like industrial symbiosis and product leasing models.

Uploaded by

AntonyStannis
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Bad Technology vs.

Good Technology?
Alan Rudy
ISS 310 – Spring 2002
Tuesday, February 25
Human vs. Natural Capital
Since the mid-eighteenth century, more of
nature has been destroyed than in all prior
history.
While industrial systems accumulate
human-made capital on vast levels,
natural capital, on which civilization
depends to create economic prosperity, is
rapidly declining.
Technology and its discontents
Technology seems to have kept ahead of
depletion, providing apparently ever-
cheaper inputs… they only appear cheap.
 Destroyed rainforests,
 mountain of toxic mine,
 impoverished villages,
 eroded indigenous cultures,
 environmental diseases (cancer, etc.), and
 the extraordinary volumes of pollution
 are not factored into the cost of production.
Neoclassical Economics: Capital
The traditional definition of capital is
accumulated wealth in the form of investments,
factories, and equipment.
Actually, an economy needs four types of capital
to function properly:
 human capital, in the form of labor and intelligence,
culture, and organization
 financial capital, consisting of cash, investments,
and monetary instruments
 manufactured capital, including infrastructure,
machines, tools, and factories
 natural capital, made up of resources, living
systems, and ecosystem services
Today’s Industrial System
The industrial system uses human,
financial and manufactured capital to
transform natural capital into the stuff of
our daily lives: cars, highways, cities,
bridges, houses, food, medicine, hospitals,
and schools.
Our Economy
Capitalism, as practiced today, is a financially
profitable, non-sustainable aberration in human
development.
Our economy does not fully conform to its own
accounting principles.
It liquidates its natural and human capital and
calls it income.
It neglects to assign any value to the largest
stocks of capital it employs… the natural
resources and living systems, and the social and
cultural systems that are the basis of human
capital.
The present mindset:
Economic progress comes from free-market
systems where reinvested profits make labor and
capital increasingly productive.
Competitive advantage is gained when bigger,
more efficient plants produce more goods for
larger markets.
Growth in total output serves human well-being.
Resource shortages elicit the development of
substitutes.
A healthy environment is important but must be
weighed against the need for economic growth.
Free enterprise and market forces allocate people
and resources to their highest and best uses.
But…
Human beings already use over 50% the
world's accessible surface freshwater,
have transformed 33 to 50% of its land
surface, fix more nitrogen than do all
natural systems on land, and appropriate
more than 40% of the planet's entire land-
based primary biological productivity.
And…
In the past half century, the world has a
lost 25 percent of its topsoil and a third of
its forest cover.
At present rates of destruction, we will lose
70 percent of the world's coral reefs in our
lifetime, host to 25 percent of marine life.
In the past three decades, 33 percent of
the planet's resources have been
consumed.
Natural Capitalism I
The environment is "an envelope containing,
provisioning, and sustaining the entire economy."
The limiting factor to future economic development is the
availability and functionality of natural capital… life-
supporting services that have no substitutes and
currently have no market value.
Misconceived or badly designed business systems,
population growth, and wasteful patterns of consumption
are the primary causes of the loss of natural capital, and
all three must be addressed to achieve a sustainable
economy.
Future progress can best take place in democratic,
market-based systems of production and distribution in
which all forms of capital are fully valued, including
human, manufactured, financial, and natural capital.
Natural Capitalism II
One of the keys to the most beneficial employ-ment
of people, money, and the environment is radical
increases in resource productivity.
Human welfare is best served by improving the
quality and flow of desired services delivered, rather
than by merely increasing income flow.
Economic and environmental sustainability depends
on redressing global inequities of income and
material well-being.
The best environment for commerce is provided by
democratic systems of governance based on the
needs of people rather than business.
A One, A Two
RADICAL RESOURCE PRODUCTIVITY. Radically
increased resource productivity is the cornerstone of
natural capitalism.

Using resources more effectively has three key benefits:


It slows resource depletion at one end of the value chain,
lowers pollution at the other end, and provides a basis to
increase worldwide employment with meaningful jobs.

BIOMIMICRY. Reducing the wasteful throughput of


materials and eliminating the very idea of waste can be
accomplished by redesigning industrial systems on
biological lines that change the nature of industrial
processes and materials, enabling the constant reuse of
materials in continuous closed cycles, and often the
elimination of toxicity.
A Three, A Four
3. SERVICE AND FLOW ECONOMY. In essence, an
economy that is based on a flow of economic services
can better protect the ecosystem services upon which it
depends. This will entail a new perception of value, a
shift from the acquisition of goods as a measure of
affluence to an economy where the continuous receipt of
quality, utility, and performance promotes well-being.

4. INVESTING IN NATURAL CAPITAL. This works


toward reversing world-wide planetary destruction
through reinvestments in sustaining, restoring, and
expanding stocks of natural capital, so that the biosphere
can produce more abundant ecosystem services and
natural resources.
Resouce Efficiency
When engineers speak of "efficiency," they refer
to the amount of output a process provides per
unit of input. Higher efficiency thus means doing
more with less, measuring both factors in
physical terms.
When economists refer to efficiency, however,
their definition differs in two ways.
 First, they usually measure a process or outcome in
terms of expenditure of money.
 Second, "economic efficiency" typically refers to how
fully and perfectly market mechanisms are being
harnessed to minimize the cost of production.
Fiscal/Economic Efficiency?
Some (our) governments are continuing to
create and administer laws, policies, taxes, and
subsidies that preclude real efficiency.
Hundreds of billions of dollars of taxpayers'
money are annually diverted to promote
inefficient and unproductive material and energy
use.
These include subsidies to mining, oil, coal,
fishing, and forest industries as well as
agricultural practices that degrade soil fertility
and use wasteful amounts of water and
chemicals.
Even moreso…
Taxes extracted from workers, at the same time
the corporate taxes are falling, subsidize
patterns of resource use that then displace
workers, a situation that is becoming
increasingly apparent and unacceptable in
Europe, the United States and Japan where
there is increasingly high unemployment.
Changing these social institutions is a clear
predicate to changing our anti-ecological
existence.
Alt.I: Biomimicry
In contrast, if the subsidies distorting resource prices were
removed or reversed, it would be advantageous to employ
more people and use fewer resources.
Pharmaceutical companies are managing herds of
enzymes.
Biological farming manages soil ecosystems to increase
the amount of biota and life per acre by studying food
chains, species interactions, and nutrient flows,
minimizing crop losses and maximizing yields by fostering
diversity.
Industrial engineers are creating "zero-emission"
industrial parks.
Architects and builders are creating structures that
process their own wastewater, capture light, create
energy, and provide habitat for wildlife and wealth for the
community, all the while improving worker productivity,
morale, and health.
Alt.II: Services and Flows
Rather than an economy in which goods are made and
sold, we can imagine a service economy where
consumers obtain services by leasing or renting goods
rather than buying them.
Braungart's service economy focuses on material cycles.
If a product lasts a long time but its waste materials
cannot be reincorporated into new manufacturing or
biological cycles, then the producer must accept
responsibility for the waste with all its attendant problems
of toxicity, resource over-use, worker safety, and
environmental damage.
This is intended to induce the production of high quality,
long-lasting, low-maintenance leaseable goods and
services.
Alt.IIa: Service Employment
The service economy also increases employment.
When products are designed to be reincorporated into
manufacturing cycles, waste declines, and demand for
labor increases.
In manufacturing, about one-fourth of the labor force is
engaged in the fabrication of basic raw materials such as
steel, glass, cement, silicon, and resins, while three-
quarters are emplyed in the production phase.
The reverse is true for energy inputs: Three times as
much energy is used to extract virgin or primary
materials as is used to manufacture products from those
materials.
Substituting reused or more durable manufactured
goods for primary materials therefore uses less energy
but provides more jobs.
Investing in Natural Capital
If the flow of services from industrial systems is
to be sustained or increased in the future for a
growing population, the vital flow of life-
supporting services from living systems will have
to be maintained and increased – and our use of
such materials will have to become more
efficient. For this to be possible will require
investments in natural and social capital.
We must decrease our emphasis on financial
and manufactured capital and increase our
attention to nature and society.

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