The April 25 – May 2, 2022 issue of Time Magazine focused on opinions about capitalism being the cause of our climate crisis. Photo illustration on the magazine cover is by C.J. Burton.
John Bos
The media, like Time Magazine’s recent “Earth Inc.” issue, is full of opinions about capitalism being the cause of our climate crisis. I confess that until recently I shared that prevailing liberal-left critique of capitalism as espoused by Herman Daly, a leading expert in the field of ecological economics. Daly maintains that the current economic system is at the heart of the climate breakdown and outlines the policy steps that the world must take in order to achieve a sustainable future. “Sustainable” is the key word here.
My brother, a biomass facility developer, has challenged my perspective. He quotes Winston Churchill who, in October 1945 said, “The inherent vice of capitalism is the unequal sharing of blessings. The inherent virtue of Socialism is the equal sharing of miseries.” He also reminded me that in the early fifties our father conveyed to us that he believed that unregulated capitalism was the cause of the unequal sharing.
I suggest it’s not the capitalist system itself, but the people and entities that “work” that system who are responsible for our planet’s increasing inability to support the human race. This includes politicians who are dependent for their jobs upon financial support of their election campaigns from corporate “influencers.”
Capitalism is described as an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price systems, private property, property rights and wage labor. In a capitalist market economy, decision-making and investments are determined by owners of wealth, property and the ability to maneuver capital in financial markets – whereas the prices and the distribution of goods and services are mainly determined by competition in various markets.
Economic growth is the primary characteristic of all capitalist economies throughout the world. Capitalist systems, with varying degrees of direct government intervention, have become prevalent in the western world, although the rise of authoritarianism is beginning to replace some of them. That said, it is direct government “intervention” in the capitalist system (including taxation and corporate subsidies) that has changed enormously from the period 1944 to 1951 when the highest U.S. marginal tax rate for individuals was 91%, and when the economy was supporting a growing middle class. This tax rate increased to 92% for 1952 and 1953 and then reverted to 91% in 1954 through 1963. Today the highest marginal tax rate is 37%. And the middle class is declining.
We are living in a world economy based on minerals. From the buildings we inhabit to the infrastructures that supply them, from the machines that move us around to the energy networks that power them – they are all based to a large extent on materials that are extracted from the earth’s thin outer crust. Minerals that have taken millennia to form are being extracted in a tiny blip on the earth’s timeline. Despite our continued reliance on wood, modern societies rely more heavily than ever on extracted minerals.
Capitalism blossomed when the world was full of seemingly inexhaustible resources. Resource extraction has historically caused dramatic environmental damage throughout the world, but the industrial revolution is long gone. The threat to the human race of doing business as usual is increasing exponentially. With only 100 companies responsible for 71% of global emissions and many more bringing up the tail end of pollution, we must make a fundamental change IF we want the world to provide a sustainable environment for us to live in.
In the three decades since the climate crisis has become part of the global agenda, scientists, activists, and politicians have largely assumed that government would need to dictate the terms of the transition. However, legislative attempts around the world to tackle climate change have repeatedly failed. And investors and corporate executives have become keenly aware of the threat that the growing transition to renewable energy threatens their bottom line. The unregulated capitalist economic system that rewards corporate profit over the “expense” of killing everyone else should be seen as a system that encourages crimes against humanity.
Herman Daly, a former senior economist at the World Bank, in an August interview on Truthout, maintains, “A lot of ideological ink is wasted arguing over whether it is population increase or per capita consumption increase that is responsible for excessive scale.”
“Neither of these factors can be neglected,” Daly asserts. “In my lifetime, world population has quadrupled [from two to eight billion], while [highly variable and unequal] per capita consumption has grown even more, perhaps nine-fold depending on how measured.”
John Bos
Daly leads us to the concept of sustainable capitalism that is surfacing in academia, think tanks and the media these days. It is not a new concept. The roots of sustainable capitalism date back to 1999, when the term “natural capitalism” was coined by authors Amory and Hunter Lovins, co-founders of the Rocky Mountain Institute, who together with Paul Hawkens, wrote Natural Capitalism, a book that has been translated into more than 30 languages. They are calling for the reintegration of ecological (as well as economic) goals into business. Controversy, of course, surrounds the concept as it requires an increase in sustainable practices and a marked decrease in current consuming behaviors.
Can we ever become sustainable?
John Bos is a contributing writer for Green Energy Times and a columnist for the Greenfield, MA Recorder. He is the editor of a new book for children, After the Race, and lead editor of Words to Live By, a book of 50 poems by acclaimed writers embraced within images from nature created to support people diagnosed with cancer. Comments and questions are invited at john01370@gmail.com.
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