If Mother Nature does most of the work, why is she not paid?

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Still on the subject of a sustainability-interested layman’s hobby of delving into Capitalism, and before I define Capitalism, I would like to stay on the subject of what Capital is, or rather not what it is worth but how it is used.

DEFINING NATURAL CAPITAL

Natural Capital is easy to define in terms of ecological maturity.This is the way it works: an ecologically  mature natural area retains nutrients, has a large biomass, keeps  water loss to a minimum and captures sunlight effectively. (A table from one of my eco-heroes, Odum is given below)

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ECOLOGICAL MATURITY = CAPABILITY TO DELIVER ECO SYSTEM SERVICES

It just so happens that an ecologically mature area is one that provides the best ecosystem services.  Eco system services were given prominence in the work done for the Millenium Assessment in their Guide to the Millennium Assessment Reports. What the report elegantly reminds us of is that for our life on Earth, nature does most of the work. As you can see, from the diagram below, eco systems support, provide and regulate giving us what we need to eat, clothe, house and make ourselves secure. That is not forgetting the cultural and aesthetic experience.

If you consider the left hand part carefully you will see that the more mature an eco-system is, the higher its capability to provide the eco system services we need. As I said, natural capital is easy to define in terms of ecological maturity. Firstly, there are plenty of eco-system mathematical models that define the maturity of any given area. From this you get a starting point. Secondly, the models can predict what out-take from the areas is possible without impacting the regenerative ability of the area. (A good example is out-take of wood – in an ecologically mature area wood grows slowly. If you remove wood the young trees that replace it grow fast.)  So it is possible to calculate an out-take that will not affect the capability of the area to remain at a certain level of maturity. On the other hand, it is also possible to speed up the maturation of an eco-system, giving it a helping hand so to speak.

CREATING A STOCK-MARKET INDEX FOR NATURAL CAPITAL

You could take an arbitrary measure of say 100, and give it to each defined eco-system and area. I would leave it to the cartographers and geographers and ecologists to decide on a system, but land ownership boundaries would be a good start.You would then have an index of ecological maturity of the whole country,  each area with 100 points.This might sound random, but at least it is a start. After a while you could analyse the trend. If maturity fell, the index would fall below 100 a percentage that could be calculated by ecologists, and if it rose, ecologists could award percentage points for the increase.Actually, you would get a kind of a stock market report

UK NATURAL CAPITAL REPORT

We could, having created a “stock market index” for natural capital start to contrast it with the performance of the economy. Normally they talk about the stock market but this is a mere distraction. What is more interesting is the performance of the economy in providing services. If nature provides ecosystem services through, let us say natural activity, then the economy should provide societal services through human activity. Again, let us start with a measure of 100

UK ECONOMY SERVICE PROVISION

It does not take much engagement of expertise to work out the percentage of the population that are homeless or without decent food. You could have another sort  of stock market report. What gets really interesting is to see the manufactured base of homes as capital and the food producing capability of the system as well. You could start to produce all kinds of interesting analyses, much more exciting than the business news furnishes us with.

Economic performance evaluation

The matrix below, just one of many possibilities, shows how natural capital can develop compared to societal services development. There are four possibilities based on services being acceptable or not, and capital growing or not. The worst case is where standards are not achieved and natural capital is depleted. I call this the tragedy of management.If standards are achieved but eco system services depleted, this is unsustainable management.If standards are not achieved but natural capital is increased this is eco-sacrifice. Finally, society in harmony is where standards are achieves and natural capital is retained or increased.

I started off asking why Mother Nature was not paid. Of course, you can throw money on the ground but food will not come up. But you CAN pay nature. What humans can do is contribute to the faster maturation of ecosystems. Most biologists and many gardeners will tell you how to do that! I will leave that for a later post.

THE DISCUSSION AND REFLECTION
1) General reflections. I am struck by how simple it is to define a clear, human, effective environmental / management model. If capitalism is so good why can’t it do these simple things?2) I am disappointed that professionals who can create indices for ecological maturity, food security, housing performance have not done that
3) It is so disappointing that the media do not take on a reporting framework along the lines of the one I proposed above. I guess it is because of reflection (2) – no professional organization has produced one.
4) How can nations put a price on nature without considering maturity? This is like putting a price on a car without considering how fast it runs. This point was covered already in the 1800s by economist Henry George who pointed out that owning land was the problem with the modern economic system.THINGS TO LOOK INTO FURTHER

More references:

I recommend you read Henry George – he was really clear about land value and economics!

Odum, E. P. 1969. The strategy of ecosystem development. Science, 104:262-270.

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