Is Capitalism Bad for the Environment? Part 2

0:00Welcome to Sanity Check, brought to you by the Cornell Alliance for the Stewardship of Creation. If you came here for a creative terrain, despite the new look, you are in the right place. We are bringing you the same thoughtful experts, vital topics, and biblical perspective you've come to expect, now just with the new look and fresher feel. So be sure to stay tuned and subscribe if you haven't, so you don't miss out on all we're bringing you this year. Now back to the episode. In my last contribution to this podcast, I argued against the claim that capitalism is bad for the environment by pointing out that its chief competitor, socialism, is much worse. Yet, if capitalism's best recommendation is that it's not killing people in the planet quite so fast as socialism, then we'd better find an alternative. Citizens and environmental critics have honest concerns that deserve honest direct answers.

1:01And this and later, we'll look at some of those concerns. Welcome to the podcast of the Cornell Alliance for the Stewardship of Creation. I'm Cal Bisoner, president of the Cornell Alliance, and today I'm going to refute claims that capitalism is bad for the environment because it's indifferent to nature and depends on unending growth. But first I must set a boundary. Ever since Rachel Carson's book Silent Spring was published in 1962, filled with scientific errors, as documented in Roger Miner's and Remoris and Pierre De Rocher's book Silent Spring at 50, the false crises of Rachel Carson, ever since Carson's book launched the modern environmental movement. There have been widespread claims of environmental catastrophes present. Most are badly exaggerated, many simply fall since some fraudulent.

2:01Others have refuted such claims, such as in the book The State of Humanity, edited by Julian Simon and Indergo Plannies, the improving state of the world. My purpose now is to focus specifically on claims that capitalism, not economic production or industrialization, per se, whether under capitalist or socialist or other economic orders, is bad for the environment. While many make this claim, one of the best cases is by Gustav Speth in his book The Bridge at the Edge of the World, capitalism, the environment, and crossing from crisis to sustainability. I focus on Speth's charges for two reasons. First, his book is comprehensive and systematic. Second, Speth has impeccable credentials. He was an environmental advisor to President Carter and Clinton, founder of the Natural Resources Defense Council and the World Resources Institute, administrator of the UN Development

3:03Program, Dean of the Yale School of Forestry and Environmental Studies, professor at Vermont Law School and distinguished senior fellow at Demos, the ultimate insider is what you might call him. Speth's charges fall into four categories. One, capitalism is bad for the environment because it is indifferent to nature. Two, capitalism is unsustainable in the long run because it promotes consumerism and unending economic growth. Three, capitalism leads to resource depletion and ecosystem damage. Four, capitalism harms both people and the environment because capitalist enterprises force others to bear environmental costs while firms only reap profits. In an article adapted from his book, Speth stated his concerns concisely. And I quote, the environmental crisis is the result of a system of political economy today's capitalism that is profoundly committed to profits and growth and profoundly indifferent

4:09to nature and society, unquote. In addition to those four concerns which I'll address in this in the next episode, I'll address one other claim that capitalism's short term focus blinds it to long term costs, causing it to undervalue long term environmental harm or the long term benefit of present environmental protection. So we begin with Speth's claim that capitalism is indifferent to nature. This is the weakest of Speth's charges. It imputes motive to or more precisely blames the absence of motive on an impersonal economic system, but only persons have motives. Insofar as a given economy comprises dozens, hundreds or millions of persons, we can in the abstract speak of that economy's having motives, though even there we're on shaky ground, but a system of economy truly has no motives.

5:12Are some capitalists insensitive to nature? Certainly. So are some socialists and so were some feudalists and mercantilists. But some capitalists and socialists are also deeply concerned about nature. There's a whole movement, free market environmentalism, dedicated to using the incentives and creativity of capitalism to restore, improve and protect the natural environment. Nonetheless, I sympathize with the widespread concern that many businesses make little effort to minimize the harm they impose on the environment, let alone improve it. But nothing about capitalism requires them to do so. Indeed, the opposite is the case. After a bureaucratic regulatory system, one more socialist than capitalist, if government sets an upper limit for affirms emissions, a business is exempt from liability for harm that its emissions cause so long as they stay below that limit.

6:13But capitalism as a system points in the opposite direction. It holds that while people are pursuing their own interests, they may not commit fraud, theft or violence. Now capitalism sees pollution as an instance of violence, harming people of their property without their consent. Capitalism offers a theory, strict liability, that uses common law court action rather than regulation to limit pollution. Under strict liability, even if it means for going billions of dollars in profit, a firm may not impose even very slight harm on someone else's person or property without his or her consent. People may enter into agreements to accept some harm to their property or even their health in exchange for compensation, but no matter how many people enter into the agreement, neither they nor the polluting businesses may impose that harm on anyone who doesn't enter into it. The result is a price on pollution that reflects the free choices of the people affected,

7:18and it's difficult to think of a better way to handle the problem. So no, capitalism is not indifferent to nature. But does it as speth asserts, assume unending growth, which in turn is environmentally harmful, is it unsustainable in the long run because it inherently promotes consumerism and unending economic growth without regard to resource depletion and ecosystem damage? Speth's discussion of this charge is nuanced, some of his concerns every question should share. Speth does not oppose all economic growth. As former administrative of the United Nations development program, he sees the need to reduce poverty. He believes, quote, economic growth is urgently needed in the developing world. The alleviation of poverty will not get very far without it. End quote. But he also believes continued economic growth in developed countries is unnecessary or even harmful. It's worth looking carefully into why and considering where and why we agree or disagree.

8:23Speth cites psychological and sociological studies that conclude that beyond a certain point, greater wealth, the possession of more things, no longer adds to people's satisfaction with life, that is to their happiness. Although more careful studies find that continued economic growth does lead to greater life satisfaction, thoughtful Christians should sympathize with spest conclusions. Anyone who appreciates the wisdom of Proverbs 30 verses 8 and 9 give me neither poverty nor riches, feed me with the food that is needful for me, lest I be full and deny you and say, who is the Lord or lest I be poor and steel and profane the name of my God, should embrace Speth's point in principle. We need to learn with the Apostle Paul how to be brought low and how to abound. In any and every circumstance, the secret of facing plenty and hunger, abundance and need as he puts it in Philippians 412. Christians can also sympathize with the critique of envy or covetousness, which Paul calls

9:24idolatry in Colossians 3.5 as a main motivation for pursuing economic growth. Westerners are almost unimaginably rich by comparison to about three-fourths of their neighbors around the world. So why do so many report low levels of life satisfaction? One reason is that they aren't as wealthy as their near neighbors whom they therefore envy. That, of course, is spiritual disease, recognizable even by non-Christians who might not honor the 10th Commandment, you shall not covet, as God's law, but do see it as a sound prescription for psychological health. The pursuit of economic growth for its own sake, whether by individuals or by whole societies, is spiritually harmful. Speth is right. Quote, when basic needs have been met, human development is primarily about being more not having more. Unquote. With some points we might sympathize with some of Speth's objections to economic growth

10:24in developed countries, but not with others, such as restrictions on advertising, new ground rules for corporations, greater income and social equality, including genuinely progressive taxation for the rich and greater income support for the poor. All three of these increase state power, which is dangerous, and the third cannot be achieved consistently with biblical justice, which, as I argue in my booklet, social justice versus biblical justice, requires impartial treatment of rich and poor. For instance, Deuteronomy 117 says, you shall not be partial enjudgment, you shall hear the small and the great alike, you shall not be intimidated by anyone. I don't mean to endorse unending pursuit of greater wealth, whether by individuals or by societies. It is as true today as it was in the first century that those who desire to be rich fall into temptation, into a snare, into many senseless and harmful desires that plunge people into ruin and destruction, and the love of money is a root of all kinds of evils.

11:29It is through this craving that some have wandered away from faith, and pursed themselves with many pangs, 1 Timothy 6, 9 through 10. What I question is the wisdom and safety of asking political bodies to define how much is enough, and empowering them to prohibit getting more than enough, and punish those who do, including by imposing higher tax rates upon them than on others. At any rate, speth's belief that continued economic growth in developed countries isn't needed because it doesn't add to human happiness or life satisfaction seems unproven. But speth's other reason remains to be considered. Economic growth in developed countries is bad for the environment, he says, and as he puts it, quote, the drive to grow is inherent in capitalism, so a challenge to growth is close to a challenge to capitalism, unquote. But speth's argument is indirect, what is bad for the environment is not so much capitalism

12:31itself as the growth capitalism necessary pursues. Now, three objections, first, if other economic systems such as socialism or a mixed economy are equally prone to pursue growth, then capitalism is no more at fault than they are. And if capitalism does other things better, like raising people out of poverty, a clear lesson of history, then we should still prefer it. Second, if capitalism can function without necessitating economic growth, this argument that capitalism is bad for the environment fails. Third, if other systems make less efficient use of resources than capitalism, capitalism by this standard is the least bad among alternatives. Let's consider these three points more closely. First, it is by no means clear that capitalism alone requires economic growth to function. If indeed it does. In any economic system, borrowing from the future demands continued growth.

13:32Notorious examples are social insurance programs like Social Security and Medicare, and even simple deficit spending. Whether these are truly socialist or not, they certainly can't be described as capitalist. What's clear is that they cannot survive unless the economic base from which they draw continues to grow, when that base stagnates or shrinks, those policies head toward bankruptcy. The lesson, not capitalists, but politicians who want to buy votes now and make you and your descendants pay later, make unending economic growth necessary. Second, it's also not clear that capitalism requires continued economic growth to survive. The standard environmentalist argument is that never-ending growth requires infinite resources. Of course, resources aren't infinite, therefore growth must one day end, and then capitalism must die. There are two problems with that idea. The first is that growth doesn't require using more physical resources, and even perpetual

14:36growth therefore doesn't require infinite resources. Both can occur, even while the quantity, measured in volume, weight, or mass, of resources consumed, remains the same or even declines. All that's necessary is that efficiency continues to increase, and there is no particular reason to think it won't. The second problem is that the argument assumes its conclusion. The point to be proved is that capitalism must die if growth ends, but the last step in the argument is that growth must one day end, and then capitalism must die. That's circular reasoning. As Noah Smith put it, ask any economist of the free market persuasion to justify capitalism, and the word growth probably won't even be part of his spiel. The simple econ 101 theories that are used to justify free markets don't even have growth in them. In econ 101, capitalism works because people gain from trade, not because they have more and more to trade over time.

15:36Efficiency, not growth, is the gold ring. End quote. So his capital is in bad for the environment because it is indifferent to nature, requires unending growth, neither is true. Thank you for listening. If you've enjoyed this podcast, please give it a five star rating on Spotify or Apple podcasts. Tell your friends about it and share it on social media. Cornwall Alliance is a nonprofit ministry supported by private donations. As our way of saying thank you, when you donate any amount and request it, we'll send you a free copy of the booklet on which this series is based. To request your copy, go to cornwallaliance.org slash donate, that's cornwallalaliance.org slash donate, and use capitalism as the promo code. My next episode will answer Speth's charge that capitalism leads to resource depletion. Until then, may you learn more and more to take captive every thought to the obedience of Christ.