Cri­sis could shift fo­cus to en­vi­ron­ment

CO-OR­DI­NATED ACTION Coun­tries came to­gether to kick­start econ­omy, and green is­sues could be next

Montreal Gazette - - Business - THE GAZETTE

The fi­nan­cial cri­sis and its af­ter­math could help set the stage for the trans­for­ma­tive changes ur­gently needed to help the planet sus­tain life, a dis­tin­guished U.S. en­vi­ron­men­tal­ist said yes­ter­day.

The melt­down of fi­nan­cial mar­kets gal­va­nized gov­ern­ments and a con­cerned pub­lic watched as they acted in con­cert, ad­just­ing their poli­cies in re­sponse to emerg­ing lead­er­ship, James Gus­tave (Gus) Speth said in an in­ter­view.

“The cen­tral role of gov­ern­ment in reg­u­lat­ing the econ­omy and pro­tect­ing peo­ple has cer­tainly been con­firmed – and dra­mat­i­cally con­firmed – dur­ing this cri­sis,” said the dean of the School of Forestry and En­vi­ron­men­tal Stud­ies at Yale Uni­ver­sity.

“And I would hope the im­por­tance of gov­ern­ment and pow­er­ful in­ter­ven­tion in the econ­omy won’t be lim­ited to the fi­nan­cial sec­tor but will ex­tend to con­sumer and en­vi­ron­men­tal af­fairs also.”

Speth, who is to de­liver McGill Uni­ver­sity’s an­nual Beatty Memo­rial Lec­ture this morn­ing, ar­gues that rad­i­cal changes to mod­ern cap­i­tal­ism are needed if en­vi­ron­men­tal sus­tain­abil­ity is to be achieved.

Cap­i­tal­ism, as it is now con­sti­tuted, pro­duces an econ­omy and pol­i­tics that are highly de­struc­tive to the en­vi­ron­ment, said Speth whose lat­est book is ti­tled The Bridge at the Edge of the World: Cap­i­tal­ism, the En­vi­ron­ment and Cross­ing from Cri­sis to Sus­tain­abil­ity.

Laws, in­cen­tives and gov­er­nance struc­tures un­der which cor­po­ra­tions op­er­ate need to fo­cus on stake­holder pri­macy rather than share­holder pri- macy, said Speth, not­ing that U.S. bailout pack­ages place re­straints on the salaries, ben­e­fits or op­tions of se­nior ex­ec­u­tives of com­pa­nies re­ceiv­ing aid.

In re­cent years, cor­po­ra­tions have been parad­ing their “green” prod­ucts or com­mit­ment to the en­vi­ron­ment, but “the only re­li­ably green com­pany is one that is re­quired by law to be so,” he said.

The fi­nan­cial cri­sis has also height­ened aware­ness of the U.S.’s “grow­ing in­come gap,” and there could be a move­ment to deal with so­cial eq­uity is­sues which do have an im­pact on en­v­i­ron- men­tal pro­tec­tion, Speth said.

But per­haps more im­por­tantly, the cri­sis “may help us cure our cen­tral dis­ease, ‘af­fluenza,’” said Speth, who coined the term to de­scribe the U.S.’s ex­trav­a­gance and waste­ful­ness.

The au­thor has also chided main­stream en­vi­ron­men­tal groups, say­ing they too of­ten work within the sys­tem.

“I think the en­vi­ron­men­tal com­mu­nity has put off-lim­its ... a chal­lenge to con­sumerism, a chal­lenge to life­style, a chal­lenge to cor­po­rate dom­i­na­tion of our pol­i­tics,“ said Speth, who has a rep­u­ta­tion as a con­sum­mate Wash­ing­ton in­sider. He worked in the White House un­der Pres­i­dent Jimmy Carter as head of the Coun­cil on En­vi­ron­men­tal Qual­ity, co-founded the Nat­u­ral Re­sources De­fence Coun­cil and served as head of the United Na­tions De­vel­op­ment Pro­gram.

Un­for­tu­nately, the eco­nomic cri­sis could also serve as an ex­cuse to slow the bat­tle against cli­mate change, he said.

That is hap­pen­ing in Europe, a re­gion that has pro­vided lead­er­ship on the en­vi­ron­men­tal front, he said. East­ern Euro­pean coun­tries and Italy have ex­pressed op­po­si­tion to parts of a plan that aims to cut Europe’s car­bon diox­ide emis­sions 20 per cent by 2020 from 1990 lev­els.

“If deal­ing with this cli­mate emer­gency were op­tional, then you would want to weight the eco­nomic costs very care­fully, but it should be un­think­able that the things we need to do to save the planet – quite lit­er­ally – are post­poned or not done for eco­nomic rea­sons. That should be off-lim­its,” Speth said.

PETER MCCABE SPE­CIAL TO THE GAZETTE

James Gus­tave Speth, a for­mer U.S. pres­i­den­tial ad­viser, says the fi­nan­cial cri­sis should not pro­vide an ex­cuse to slow pro-en­vi­ron­ment ini­tia­tives.

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