Sustainable Development
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URL: http://www.nauticom.net/users/russ/susdev/susdevcontents.txt
"Sustainable Development" WESTON WAY April/May 1995
TABLE OF CONTENTS
Part 1 -- Message from Management
Part 2 -- Sustainable Development: To Better Understand the Concept
WESTON founder and Chairman Emeritus Roy F. Weston offers an approach
for identifying the constraints and depicting the means for
implementing sustainable development. Attaining and maintaining a
necessary balance among resource accessibility, the requirements and
capacity to meet requirements, plus maximizing economic effectiveness
and efficiency, is essential for establishing community requirements
for meeting survival "needs" and "wants".
Part 3 -- Metrics of Human Terrestrial Systems Management for Food
Creation/
Consumption - Two Examples
Ben Tencer, retired WESTON Executive Vice President, traces the
natural evolution of land-based biomass creation systems and the
development of human management variants to increase output. The
dramatic effect of the use of fossil fuel energy derivatives on food
system energy input/output ratios is examined in terms of natural
system analytics and metrics. In the process, several of the
philosophical terms examined by Mr. Weston are quantified, and the
unsustainable U.S. and world practices are discussed.
Part 4 -- Sustainable Development: Integration of the Free Market
Economic System
into the Natural Economics System
Mr. Weston summarizes the pertinent attributes of the natural
economics system and the free market system and discusses a means for
effectively and efficiently integrating them to ultimately achieve
sustainable development. He shows how the integration of a full-cost
accounting and free market pricing system into the natural economics
system will provide a scientifically and morally sound economics
system.
Part 5 -- Sustainable Development Makes Good Business Sense
Andrew L. Ullman and James A. Fava, both of WESTON's Management
Systems Division, explain how to integrate environmental improvement
systems, objectives, business targets and practices into an
enterprise to help ensure good decisionmaking.
Part 6 -- ISO 1400: A Building Block for Redefining Environmental
Protection and Moving Toward Sustainable Development
Robert B. Biggs, Manager of WESTON's Environmental and Health
Sciences Division, and Glenn K. Nestel, who is responsible for the
company's Management Systems Project Development Department, explain
the importance of the emerging ISO 1400 environmental standards and
how they promise to reshape the way the private and the public
sectors view environmental protection.
Part 7 -- Sustainable Development: The Economic Model of the Future
Roy F. Weston, P.E., D.E.E., Chairman Emeritus, Roy F. Weston, Inc.
(Reprinted with permission from "The Weston Way," April/May 1995, Roy
F. Weston, 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston,
Phone 610-701-3551, Internet Address: henrym@rfweston.com)
"Sustainable Development" WESTON WAY April/May 1995
Part 1 of 8
MESSAGE FROM MANAGEMENT
Sustainable Development: "Depoliticking" the Environment and Making
It a Matter of Natural Economics
by A. Frederick Thompson, Ph.D., P.E., Chairman of the Board, Roy F.
Weston, Inc.
As we acknowledge the 25th anniversary of Earth Day, the environment
remains a hotly debated topic. State and federal legislators alike
seem to be easily caught up in the specifics. But, truth is, concern
for environmental quality has never been the exclusive province of
any political affiliation -- Democrat, Republican, American, G7 or
Third World.
Here, in the United States, environmental advances and disasters
occurred over the past 30 years regardless of political
administrations. In the 1960s, for example, there was a general
awakening of the American environmental consciousness with passage of
the first clean air and water quality legislation. It was also a
time for expanded use of open pits, ponds and lagoons for storing and
presumably treating hazardous waste.
The 1970s saw the dawning of the ecology movement, creating the U.S.
Environmental Protection Agency and enacting strict laws closing the
loop on water, air and land pollution control. But, Love Canal and
Three-Mile Island made the news.
Cleanup priorities accelerated during the 1980s, spurred by Superfund
legislation and public emphasis on human health and safety. The
decade's environmental downsides included the Exxon Valdez oil spill,
Bhopal and Chernobyl.
SUSTAINABILITY SURFACES
Also during the 1980s, the concept of sustainable development was
introduced. It gained global visibility at the Earth Summit in Rio
de Janeiro in 1992 by focusing worldwide attention, and some degree
of passion, on our planet's environmental frailties.
The debate, dialogue and political discourse aside, what happened in
Rio was a unanimous, international agreement on the prominent role
sustainable development plays in our global progress. Without it, all
concurred, there is simply no future.
But what is it? As many definitions emerged as there were Earth
Summit conferees. And, how do we get it to work? Again, a multitude
of hypotheses.
Briefly paraphrased from Our Common Future, a 1987 publication of the
United Nations World Commission on Environment and Development,
sustainable development essentially means meeting our present needs
and aspirations without compromising the ability of future
generations to meet theirs.
A PROCESS OF CHANGE
But, often overlooked is a crucial preface that specifies a process
of change in order for sustainable development to work.
Specifically, changes are required in the direction of our financial
investment, in the orientation of our technology, in the allocation
of world resources and in our basic economic mindset.
You need not be an environmental scientist to understand the folly of
our present course. We are exhausting nonrenewable resources like
fossil fuels and other minerals used as products or by-products.
Simultaneously, on some continents we're over-harvesting our
renewable assets, consuming, for example, the forest for the trees.
Becoming obvious, too, is the degrading environmental quality around
the world -- PCBs, CFCs, auto emissions, pesticides, nuclear waste,
just to name a few catalysts. All contribute to increasingly
deleterious environmental responses: global warming, acid rain, the
extinction of species and greater risks to our own health and safety.
Also clouding our environmental future is the accelerating world
population, as well as the increasing disparity in living standards -
- from household to household and from nation to nation.
Sustaining, let alone raising, standards of living is environmentally
resource-intensive. Continuing many of the current practices we
employ to satisfy our present needs and aspirations clearly endangers
the ability of future generations to meet theirs.
THE ECONOMICS OF NATURE
To reverse that course, we need to emulate the economics of nature.
It's the straightest path toward stimulating the crucial changes
needed to make sustainable development work.
Nature is the quintessential supply sider, with its resource reserves
not readily available on demand. Through systematic recycling and
reuse, moreover, nature doesn't push its inventory of renewable and
nonrenewable resources beyond critical limits for sustainability.
It's a natural economics system with "rules of the game" that govern
the interrelationships among all things -- energy, matter, space,
time and life -- and their most efficient and effective use.
Far-thinking business and government people have already begun to
recognize the priorities those rules demand in their daily
undertakings. They are evolving from an unlimited to a limited
resources mindset that champions pollution prevention and waste
minimization as good business. And, they know it's good not only for
today's bottom line, but also for long-term sustainability.
THE 1990'S AND BEYOND
This is a pivotal decade for igniting the momentum sustainable
development needs and deserves. Admittedly, the very principles of a
free market economy may help assure its continued journey over time.
But, right now, we need a National Sustainable Development Policy
that would make sure our free market rules are scientifically and
morally sound. Furthermore, that policy would focus crucial public
and private sector attention on positively changing perspectives and
encouraging behaviors consistent with a sustainable society.
Leadership is the accelerator to catch up with a world already in a
logarithmic phase of environmental change. There's little time left
for political rhetoric or electioneering -- locally, nationally or
internationally.
It is time, though, for unilateral statesmanship. For us and for our
future generations, it's a matter of natural economics.
ABOUT ROY F. WESTON, INC.
Pioneering the industry since 1957, WESTON has become a leading
international environmental management, design and consulting firm
working in the public and private sectors to preserve, protect and
restore vital air, land and water resources. Nearly 2,800 WESTON
people specialize in analytical laboratory services, engineering,
facility construction and operations, remediation and large-scale
turnkey programs. Based in West Chester, Pa., WESTON has 60 offices
and laboratories across the U.S. with international operations in
Europe and the Asian Pacific.
(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston,
Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone
610-701-3511, Internet Address: henrym@rfweston.com)
"Sustainable Development" WESTON WAY April/May 1995
Part 2 of 8
SUSTAINABLE DEVELOPMENT:
To Better Understand the Concept
by
Roy F. Weston, P.E., DEE,
Chairman Emeritus
Roy F. Weston, Inc.
THE CALL FOR SUSTAINABLE DEVELOPMENT
The concept of sustainable development was introduced in a 1987
report entitled Our Common Future by the World Commission on
Environment and Development of the United Nations. This report has
been referred to as "the Brundtland Report" in honor of the
Chairperson, Dr. Gro Harlem Brundtland, Prime Minister of Norway.
The Commission defined sustainable development as: "...development
that meets the needs of the present without compromising the ability
of future generations to meet their own needs."1
For most of us, development means progress or change for the better.
Development involves maximizing the efficiency of resource allocation
to meet needs - which is the dominant paradigm in economics at the
present time. Thus, for most of us, sustainable development is, and
should be, an economic concept.
The Commission integrated sustainable development into the world's
economy as follows: Sustainable development is "... a process of
change in which the exploitation of resources, the direction of
investments, the orientation of technological development ...
institutional change and the ability of the biosphere to absorb the
effects of human activities are consistent with future as well as
present needs."
The Commission cautioned, however, that "sustainable development can
be pursued more easily when population size is stabilized at a level
consistent with the productive capacity of the ecosystem." This
statement expanded the role of economics in meeting the needs of the
current "reality."
Observations that led to a description of "reality" and the call for
sustainable development are summarized in Table 1 (at the end of this
paper).
Sustainable development holds humankind responsible for existing
circumstances and challenges humankind to accept responsibility for
instituting the changes necessary to attain sustainability. This
challenge was reinforced at the United Nations Conference on
Environment and Development (UNCED) held in Rio de Janeiro in 1992.
The conference's principal product (endorsed by the more than 100
heads of state and close to 10,000 delegates) was an agenda for
change, called Agenda 21, a description of perceived needs and
proposed actions to bring humankind into harmony with the finite
resources of the earth by the middle of the twenty-first century.
This concept of sustainable development consists of the following
four interrelated but separate ideas:
* Meeting both present and future needs -- which establishes the goal
for sustainability.
* Meeting needs -- which defines the goal for development.
* Maintaining consistency between population size and ecosystem
productive capacity -- which recognizes that there are limits and
requirements for balance.
* Implementing a process of change -- which acknowledges that the
definition of needs and the requirements for attaining a sustainable
balance will change with situations, conditions and time.
The concept is open-ended because people have different needs to
survive, different aspirations for their standards of living and
quality of life, and different ecosystem, productive and absorptive
capacities. Therefore, to better understand the concept of
sustainable development, it is necessary to think in terms of global
objectives, local goals, the circumstances under which individuals
live and make their living, and their capacity to adapt to and change
their circumstances to their advantage.
The concept presumes that the purpose of the human race is to sustain
human life on Earth. In that case, the goal of the different peoples
would be to continually meet survival needs and aspiration exactions.
There are finite requirements to ensure survival under different
environmental situations and conditions (i.e., base-case) and more
restrictive finite requirements (i.e., exactions) to attain a
standard of living and quality of life better than survival.
Therefore, I believe that the physical and emotive needs for living
and making a living to survive should be the "base case" for all
evaluations. In any case, the concept of sustainable development
challenges present generations to stabilize their development needs
so that they are consistent with the Earth's future, as well as its
present productive and absorptive capacities. Because the Earth has
finite productive and absorptive capacity, the concept raises issues
of equitable allocation of resources among present generations and
between present and future generations.
AN APPROACH TOWARD A BETTER UNDERSTANDING
As exemplified by Agenda 21, many of us believe we should recognize
the importance of and need for individual action. Unfortunately, in
the haste to "do something," people often try to solve the problem
before the basic philosophical and technical elements of the problem
have been identified and characterized.
We first need to simplify the complex by identifying and
characterizing the basic objectives of and the constraints to
implementing sustainable development.
I propose a process that can characterize the circumstances, identify
the constraints and depict the means by which sustainable development
can be implemented. The process approaches sustainable development
implementation from a multidisciplinary, interdisciplinary systems
perspective. The process can assist each of us in determining how we
can become participants.
This paper is restricted to developing an approach for identifying
constraints and depicting the means by which sustainable development
can be implemented. It does not deal with implementation per se.
I propose a problem-solving approach using personal beliefs (a few of
which will be called hypotheses), as well as generally accepted
scientific truths and reality, to develop philosophical ideas,
guidance principles and an operational definition to aid in better
understanding the constraints and solutions to sustainable
development. Each hypothesis is presumed to be logical and to
represent reality. My challenge is to strive to be holistic and as
objective and scientifically sound as I can be in presenting what I
believe is reality.
My problem-solving philosophy is:
* All that has occurred, all that exists, and all that is about to
be, is logical. (This means that outcomes can be correctly and
logically explained when the reality of the circumstances is known.)
* Outcomes are the result of the decisions and/or actions of
individuals in response to circumstances. (For this hypothesis to be
true, the individual may be any form of energy, matter or life, and
the circumstances must include the attributes of the individual, the
applicable "rules of the game", and environmental situations and
conditions.)
* The circumstances for which sustainable development is to be
attained are those of the human individual living on planet Earth.
(This statement is presented as a hypothesis because it does not
presume that sustainable development is either good or bad or is do-
able. It clearly states the limits of the system.)
The proposed approach requires asking and answering the right
questions. Two right questions are:
* Why are the circumstances what they are?
* What is required to correct the outcomes of the ineffectiveness and
inefficiency of the past and to avoid ineffectiveness and
inefficiency in the future?
To confidently predict, I must understand!
HUMAN CIRCUMSTANCES
Situations and Conditions
Planet Earth consists of a lithosphere, a hydrosphere, an atmosphere
and a biosphere. Respectively, the primary constituents of the
spheres are solid, liquid and gaseous matter, and matter activated by
life. The four spheres are integrated in such a way that life forms
inhabit each sphere. In the biosphere, there are life forms that
inhabit other life forms. Hereafter, I will refer to the biosphere
as the life system.
Planet Earth is a part of a solar system consisting of a sun and nine
planets. The sun radiates energy from a nuclear fusion process and
that energy actuates the Earth's hydrologic, climatic and life
systems. Of the nine planets, only Earth has life as we know it. It
is estimated that planet Earth was formed about 4.55 billion years
ago and that the situation and conditions on Earth permitted the
creation of life about 3.8 billion years ago. Scientists can only
speculate about how matter became activated by life. Scientific
evidence, however, indicates that first life evolved from
microscopic, single-celled individuals to today's hierarchy of plant
and animal multicelled life forms. Currently, the number of cells per
individual plant or animal may range from one to multiples of tens of
trillions. The human individual consists of tens of trillions of
cells, needing air (i.e., oxygen), water, food, shelter, energy and
other resources to survive.
As I consider a more detailed description of the human circumstance
on Earth, I find I am constrained by language and the perceptions
associated with language. For instance, I must use the words
"individual," "community" and "system." These terms can become
confusing because the circumstances of humans on Earth involve
interrelationships among individuals, communities and systems, each
differing significantly in terms of scale (e.g., number and size) and
attributes. Because of this hierarchy of scale and attributes, there
can be systems within communities and individuals, and communities
within individuals and systems. Consequently, to use these words in a
consistent way, I must carefully define the pertinent system, its
interacting parts and the "rules of the game." It will require the
coining of terms to facilitate unambiguous representation of
reality.
Interacting Parts and Rules of the Game
Knowledge of the human circumstance has been acquired over time.
Scientists have learned that:
* The human circumstance is associated with the basic resources
of energy, matter, space, time and life.
* Energy and mass are mutually interchangeable in accordance with
Einstein's mass-energy equation.
* Matter consists of mass, mass consists of elements, and elements
are made up of atoms. Atoms are made up of protons, neutrons and
revolving satellite electrons. Elements combine to form compounds.
* The total and relative quantity of the different elements that make
up planet Earth was established at the time of the Earth's formation.
The quantity was finite and is known. The loss of elements to space
and their concentration in specific areas through biological and/or
physical chemical activity are also known.
* Every life form -- plant and animal -- contains the compound DNA
(deoxyribonucleic acid), which provides reproductive capabilities
and which combines to form the genes that determine the attributes of
the individual life form.
* Energy flow governs the interrelationships among all system
components -- from elements and compounds to life. The Earth
receives a finite amount of energy from the sun. Energy dissipates in
accordance with natural law. This law places limits on the
integration of energy, matter and life, in space and time.
These "rules of the game" are self-enforcing. They provide a
hierarchy of individuals of different attributes and scale. The
interrelationships and interdependencies among these individuals
govern all of Earth's circumstances.
Life System Attributes
Evolution from microscopic single-cell life forms to the hierarchy of
species we know today was neither smooth nor orderly. Scientists
believe that, over time, there were at least five massive global
extinctions. The first confirmed massive extinction occurred about
438 million years ago, and the last, about 65 million years ago. The
first massive extinction was followed by an explosion in the
evolution of new species. The "rules of the game" governing this
evolution and present circumstances are self-enforcing, self-
organizing and self-regulating. Scale is an ever-present factor
influencing outcomes (i.e., size varies from an individual fragment
of DNA to an individual consisting of tens of trillions of individual
cells).
The life system is composed of communities of individuals. Each
individual is a member of a hierarchy of species. Each species is
interrelated with and dependent on other species in support of their
community. Each species fulfills a role as a producer (plant) or a
herbivore, carnivore, scavenger or decomposer (animal) in sustaining
life on Earth.
The system is actuated by the individuals within a community.
Individuals are opportunists and compete with other individuals to
acquire the resources needed to survive and to sustain their species.
Each individual must pay a price in energy, time and bother to meet
its concerns and requirements (i.e., needs). Routinely, the system
permits sacrifice of the individual for the benefit of the community
(i.e., selective extinction). The system will permit massive
extinction of individuals or the sacrifice of a species if the
individuals and species exhaust resources essential to them or
otherwise cannot adapt to their situations or conditions.
Massive extinction is part of the quality of life regulation
strategy. The life system "rules of the game" sustain life on Earth
and achieve the diversity of species (i.e., balance) that will
maximize the biomass productivity from accessible resources and
environmental conditions and situations.
Attributes of the system that influence attaining the system's
objective and maximizing economic effectiveness and efficiency (my
definition of the "objective function" for achieving a sustainable
society within the systems' constraints) are those of self-
organization and self-regulation, as described in Table 2 (at the end
of this paper).
It should be obvious that Mother Nature's purpose is to sustain life
on Earth. In accordance with her scheme, each individual is born
into an organized resource supply system and each is afforded an
opportunity to contribute toward sustaining the system. The
individual is guaranteed neither long life expectancy nor
reproductive opportunity. The individual must adapt to its
circumstances, with only the most adaptive (e.g., fittest) surviving
to contribute. An implied philosophy appears to be "from each in
accordance with ability, to each appropriate to contribution." This
system changed the earthly circumstances so that they were acceptable
for the human presence.
Human Attributes
There is strong scientific evidence that humans are an integral part
of Earth's life system, governed by the same basic physical and life
systems' "rules of the game" applicable to other forms of life.
Nonetheless, there are obvious differences among different life
forms. The primary difference, of course, is that of intellectual
capacity. As the Earth's most intellectual species, humans are
boundary condition creatures and are obliged to provide their own
rules for interpersonal relationships and for adapting to the Earth's
circumstances. Like other animal life forms, humans are born with
instinctive knowledge and a capacity to acquire knowledge. Humans
have a tremendous capacity to learn. They use this attribute to
acquire information, to organize it into knowledge and to learn from
both personal experiences and the communicated experiences of others.
Over time, humans developed a conscience because, in order to
survive, individuals needed community acceptance. For acceptance,
they had to pay a price, in terms of energy, time and bother, to meet
their concerns and requirements (i.e., needs) and to maximize their
satisfaction from their expenditure of time and energy. Humans
bother themselves about meeting their requirements and about concerns
such as peace and happiness, self-esteem, compatibility with others,
freedom, fairness, justice, opportunity, uncertainty and risk. The
level of their bother determines their acceptance by others and their
capacity to meet their own needs and to contribute toward the welfare
of the community. Bother is a differentiator. It differentiates the
doers from the non-doers.
Unfortunately, humans strive to gain personal advantage relative to
their peers and will take advantage of others. Thus, humans have
endeavored to develop codes of moral behavior. Western humans
rejected nature's "absolute" (i.e., life or death) system in favor of
establishing more humane limits. To date, they have been
unsuccessful in establishing and holding to "finite limits" for
acceptable behavior. The U.S. culture emphasizes freedom and de-
emphasizes adherence to rules with "finite limits." In fact, we have
established organizations, like non-profit organizations, and legal
systems to challenge such limits.
Humans have the capacity to organize themselves to more efficiently
meet their needs. They have established cultures and systems of
governance, education and economics. They have established their own
"rules of the game" relative to those cultures and systems. The
resulting cultures and systems and "rules of the game" have
encouraged the discovery of Mother Nature's "rules of the game".
Thus, science and technology were born and developed. Through
science and technology, in which the rules of the game have finite
limits, the productivity of the individual human has been increased
by orders of magnitude.
The discovery, characterization and practical application of nature's
"rules of the game" have made it possible for humans to enhance their
effectiveness and efficiency in the use of the Earth's resources.
They have used their knowledge of nature's self-enforcing laws to
improve their standard of living and quality of life. However, human
attributes; humans' lack of knowledge of interrelationships and
interdependencies within the life system; and inconsistencies between
human organization and policy, and Mother Nature's organization and
"rules of the game", have contributed toward inefficiencies and many
of the unsustainable circumstances referred to in Table 1 (at the end
of this paper).
It appears that humans have difficulty in agreeing on how issues
should be resolved; and even with agreement they are reluctant to
change course.
Community indecision on important issues could be based on the lack
of clear goals and direction. It is difficult for citizens to take
decisionmaking seriously when they cannot see how it fits into a
worthy master plan. In the absence of this master plan, each issue
is perceived as an opportunity for special interests to jockey for
advantage.
A NATURAL ECONOMICS SYSTEM
The allocation of resources within the dynamic system that has
sustained life on Earth requires a viable natural economics system.
The human circumstance is that of being a part of that system.
Subsystem "Rules of the Game"
The natural economics system is made up of three subsystems --
physical, life and human. These subsystems are described as follows:
* The physical subsystem is governed by self-enforcing "rules of the
game" (e.g., laws of physics and chemistry, and system attributes
such as magnetism, gravity, tides, daily and seasonal cycles, climate
and weather). These "rules of the game" also govern basic resource
transactions and allocations in the life system and its human
subsystem.
* The life subsystem is governed by self-organizing and self-
regulating "rules of the game," which include the laws of biology,
ecology, sociology, psychology, etc. Self-organization establishes
the means, and self-regulation balances the quality and quantity of
the means, within the constraints of the circumstances, to ensure
that the system is sustained.
* The human subsystem includes systems of culture, governance and
economics. The physical and life subsystems' laws govern the human
subsystem. The human subsystems are also governed by laws drafted by
humans, which may be characterized as self-exalting, self-deceiving
and self-indulging, when, for example, they designate themselves as
the Earth's superior creatures; adhere to a contrived, deficient,
economic system; and advocate the "right" of humans to exploit the
Earth's natural resources.
We, of the United States, use the democratic system of governance.
Our laws of governance tend to micromanage and, generally, are poorly
enforced. These laws have avoided making it clear that all people
must exercise personal accountability to protect the rights of others
if any are to enjoy rights. Our present political system, in my
opinion, makes it very difficult to make hard decisions, to develop
sound policy and to provide strong leadership.
Our free market economic system is highly self-organizing and self-
regulating. In this regard, it is similar to the life system. It is
the best "cross cutting" and "integrating" system of human design and
may be the most efficient in the world at supplying current wants.
The economist's preoccupation with the efficient allocation of
resources in the short run, without regard to long-term capacity
issues and human propensities, has directly resulted in unacceptable,
unsustainable "realities."
The concept of natural economics remedies this condition by proposing
that all that happens on planet Earth involves one or more of the
basic resources. It proposes that each and every human activity
involves energy, matter, time, space or another life, plus the
human life attributes of initiative, learning, thought, preference,
emotion and morality. Therefore, everything that happens on planet
Earth is and should be recognized as a natural economics transaction.
Earth System "Realities"
I have postulated ten planet Earth system realities that should
influence human rule-making. These are shown in Table 3 (at the end
of this paper).
Natural Economics Impact Assessment
The complex task of maximizing the global system effectiveness and
efficiency by actions at the subsystem levels (e.g., nation,
industry, firm, citizen communities, individual) leads to the need to
design and conduct Natural Economics Impact Assessments for existing
unsustainable development conditions and for proposed changes.
Assessments will be structured to the individual and circumstances
model, and will require the elements outlined in Table 4 (at the end
of this paper).
The process will provide the analytical tools and methods for
balancing the effectiveness and efficiency of the segments, within
the primary objective of maximizing the natural economics'
effectiveness and efficiency of the overall system.
Dynamic modeling would be used as appropriate. Alternative scenarios
would be evaluated. Monetary evaluations would be made after the
most economically efficient and effective scenarios had been
established. The processes will be standardized for like assessments.
The Natural Economics Impact Assessment approach forces the process
to identify and to ask the right questions. Sustainably correct
answers to the right questions make it possible to better understand
reality, natural law and the system constraints to implementing
sustainable development.
DIFFERENCES BETWEEN HUMAN AND LIFE SYSTEM PRACTICES
The Earth's life system provides a sustainability model for humans to
emulate. Identification of differences between the presumed
objectives and goals of the life system and its human subsystem
assists in understanding what humans must do to provide a better, yet
humane and sustainable, system.
A preliminary assessment of the life system and the human free market
economic system reveals significant similarities and differences
relative to the potential for attaining sustainable development.
Both systems strive to attain their objectives through organization
and policy, with strong emphasis on enforcement of "rules of the
game". For instance, it is obvious that the objective of the life
system is to sustain life on Earth. An obvious goal is to maximize
biomass productivity for local and global circumstances. To
accomplish this goal, the life system provides the organization to
maximize the productivity potential from the circumstances, including
keeping essential resources accessible to its economy. This
capability has not always been available; it has evolved. Human
endeavors at the "base-case" level are covered by this capability.
The system produces no residual that is harmful to the community. It
accomplishes its objective and goals through strict enforcement of
the organization's (i.e., system's) "rules of the game".
Beyond the idea of maximizing personal well-being for the present,
which is natural, it is not clear whether a generally accepted human
objective exists. In the United States it appears that the national
goal is to maximize the creation of wealth, as measured by Gross
Domestic Product (GDP), to continually increase GDP, and to
distribute created wealth as uniformly as the political process will
permit. This is similar to the life system goal. A free market
economic system has been developed to achieve these goals. This
system emulates the life system. Different skills and processes are
used to ensure the completion of tasks essential to the community,
and outcomes are dependent on conformance with the "rules of the
game".
The system has used the humanp priority propensity to increase the
rate of consumption of resources at levels that are orders of
magnitude greater than the "base case." This increase in consumption
has occurred without establishing the necessary organization to
ensure the continued accessibility of resources to the system's
economy. In fact, the system's process for establishing price has
encouraged wastage and provided a disincentive to keeping essential
nonrenewable resources accessible to the economy. Our successes have
put us on a fast track toward exhausting our finite resources and
toward massive extinction. Discouragingly, human propensities,
combined with human intellectual capacity to exploit natural
resources, have built a world economy that is highly dependent on the
accessibility of a nonrenewable, finite resource that is destroyed
when used (i.e., fossil fuels). It is obvious that in the absence of
leadership and sound common goals, humans will follow their
individual priority propensity. The dilemma is how to provide
leadership and common goals in a society with a political system that
has failed to provide such leadership.
The drive for the survival of both the nonhuman and human members of
the life system is strongly dependent on the individual's
reproductive, priority and completive propensities. The life system
regulates its quality and quantity outcomes from these propensities
by selective and massive extinction. Its members either live off the
interest from natural capital -- or die. The life system ensures
that every individual -- alive or dead -- contributes toward the well-
being of the community. Individual obedience to the "rules of the
game" and the need for prudent behavior are absolute. Thus,
prevention and living within prudent limits are less costly than the
final outcome of illness and extinction.
Human "rules of the game" hold human life sacred regardless of
quality or quantity. We strive to postpone selective extinction, and
we are outraged by massive extinction. The outcome has been an eight-
fold increase in population in 250 years. Also, human "rules of the
game" and the group dynamics governing their enforcement, relative to
reproduction and death, welfare and crime, have increased the
relative size of the population unable to support themselves. The
human dilemma is that people are unable to agree upon, establish and
enforce freedom-restrictive rules for reproductive behavior, and that
the natural outcome from exercising unwise individual freedom can be
massive extinction.
Free market enterprises have fostered the development of science and
technology which, in turn, have increased human productivity and
capacity to extract resources from the environment and to process,
use and return resources to the environment. The increased capacity
to extract resources has degraded the quality of the environment and
decreased the accessibility of resources for future generations. Our
growth in production capacity and population has increased the
world's Gross National Product about 100 times in the past 250 years.
In the United States, the per capita consumption of energy is 60
times the 3,700 kilocalories per day used to sustain our extravagant
food consumption life style (base case food consumption is about
2,000 kilocalories per day). Growing metropolitan areas have
increased the runoff from rainfall and have depleted wetlands,
wildlife habitat and farmland. This development has greatly increased
the rate of conversion of solar radiation to heat. There is
evidence that global climatic change has increased the violence of
hurricanes, tornadoes and other energy-dissipating atmospheric
disturbances.
I know of no large city, and only a few countries, that are
sustainable from resources within their limits. Thus, equity among
peoples requires conservation of all resources acquired through
"free" trade.
A preliminary assessment indicates that behavioral change is needed,
from the individual to the global population level, to improve
economic effectiveness and efficiency and to attain the balance
required to meet the needs of sustainable development. Humans have
reached the present unsustainable earthly circumstance by behaving
naturally. Thus, to avoid unsatisfactory natural outcomes (e.g.,
massive extinction), humans must determine what unnatural behavior is
necessary to avoid such outcomes and to wisely self-impose "rules of
the game" for meeting that objective.
THE NEW REALITY
Present reality is that the outcomes shown in Table 1 (at the end of
this paper) are the result of ignorance, propensities, mismanagement
and the consumption of about 80% of the Earth's resource production
by about 20% of the Earth's population. The new "reality" is that the
other 80% of the Earth's population want to alter their life style
such that they will probably consume resources at the same rate as
the present 20%.
I believe that the results of Natural Economics Impact Assessments
will indicate the wisdom of sustainable development. I believe that
humans must recognize that, to maximize their future freedom,
standard of living and quality of life, they must self-impose "rules
of the game" that will counterbalance the propensities that prevent
sustainable development. The new realities are shown in Table 5 (at
the end of this paper).
OPERATIONAL STRATEGY DEFINITION OF SUSTAINABLE DEVELOPMENT
The question is, "What must be done differently, and what must we
bother about, to maximize our satisfaction while attaining and
maintaining a better and sustainable future?" The question is
pointless unless it is presumed that the purpose of human life is to
sustain itself on Earth, as part of a viable natural environment. I
presume that:
* The purpose of the human species is to sustain human life on Earth,
humanely, and
* The objective of the present generation is to attain the capacity
required to meet its "needs" and exact its "aspirations," through
maximization of natural economics' effectiveness and efficiency in
the use of accessible basic resources, without foreclosing the
opportunity for future generations to attain an equivalent capacity
to meet their own "needs" and exact their own "aspirations."
This kind of an objective forces a systems approach and a recognition
of limits and of necessary balances.
On the basis of the new "reality," I endeavored to simplify the
complex and to define a global operational strategy for achieving
sustainable development. A definition and implementation guidance
principles2 were prepared earlier and are shown as a single-page
document at the end of this paper.
The defined strategies for achieving sustainable development include
the following two concepts:
* Maximize natural economics' effectiveness and efficiency.
* Attain and maintain a necessary balance.
Maximizing natural economics' effectiveness and efficiency in the use
of resources is required to achieve the highest productivity and best
use among alternative uses and to attain the highest utility from
that which is used. Thus, maximizing effectiveness and efficiency can
achieve the best use of accessible resources and can better ensure
sustainability.
Attaining and maintaining a necessary balance among resource
accessibility, the community's requirements and capacity to meet its
requirements, plus maximizing economic effectiveness and efficiency,
is essential for meeting survival "needs" and exacting aspiration
"wants." The necessary aspect of balance is to ensure that
requirements to meet survival needs do not exceed resource
accessibility or community capacity to meet "base-case" requirements.
Such balance is necessary if humans truly believe in the sacredness
of human life and aspire to voluntary rather than life system self-
regulation of population. Thus, population size, individual
requirements, and the mean fitness of the population to meet
requirements through personal accountability, the appropriate use of
locally accessible resources or the "free" trade acquisition of
essential resources become major factors for community decisions in
implementing sustainable development.
Sustainable development is more than doing something that is
perceived to be good at this time. Sustainable development cannot be
attained by using a single formula but only by using a fundamental
systems approach. Each set of circumstances and objectives will have
its own set of sustainable solutions.
The definition and guidance principles provide fundamental criteria
for establishing the direction of a Natural Economics Impact
Assessment and for screening the acceptability of sustainability
alternatives. Although the foregoing discussion was based on the
human individual, the concepts involved can be adapted to any
individual and circumstances model. The definition and guidance
principles can provide the basis for developing a hierarchy of more
detailed assessment criteria.
SUMMARY
Humans have endeavored to establish their own "rules of the game".
The outcomes from human activities, in accordance with these rules,
have not been completely satisfactory. This is because human rules
and their enforcement have not appropriately counterbalanced the
inconsistencies among human wants, their rules, the rules of nature
and reality. Thus, we have an opportunity to change -- an
opportunity to harmonize our behavior with reality.
I believe that an understanding of the real requirements of
sustainable development can provide that change.
I believe that the approach toward understanding those requirements,
as presented herein, is an essential part of the process to determine
the changes necessary to achieve sustainable development.
I believe that wise behavior is necessary to achieve sustainable
development. Wise behavior includes abiding by self-imposed economic
"rules of the game" to manage the human priority and completive
propensities, and exercising personal accountability to control the
reproductive propensity. Thus, prudent, "unnatural" behavior is
necessary to exact human aspirations.
I believe that the most effective instrument for implementing
essential change will be an altered free market economic system. The
system's self-organization and self-regulation features motivate self-
interest decisions and actions that will benefit other members of the
system. I believe that the initiation of change toward sustainable
development is do-able and will provide greater personal
satisfaction, a more effective and stable economy, and a more
acceptable and efficient system of governance. I believe that
understanding the issues and knowing what to do are not enough --
there must also be a will to act. I believe that building that will
requires leadership by "agents of change." I hope that what I have
presented will encourage and assist agents of change to bother to
understand and initiate sustainable development.
1Quoted from Our Common Future, World Commission on Environment and
Development Report to the United Nations General Assembly, Chairperson
Gro Harlem Brundtland. Oxford University Press, 1987.
2"Sustainable Development, The Economic Model of the Future, Definition
and Guidance Principles," Roy F. Weston, November 1991. Published in
"The Weston Way," Summer 1992. Revised and republished in "The Weston
Way," September 1993.
Table 1
Conditions Leading to the Call
For Sustainable Development
* Increasing population densities.
* Concentration of populations in urban areas.
* Increasing rates of per capita resource use.
* Overharvesting of renewable resources.
* Exhaustion of nonrenewable resources.
* Mismanagement of natural capital.
* Degradation of environmental quality.
* Extinction of species.
* Greater risks to individual human health, safety and security.
* Increasing disparity in living standards.
* Escalating terrorism, local warfare and threats to national security.
Table 2
Life System Attributes
Self Organization
A life system is a hierarchial system of plant and animal species that
are interrelated, interdependent, instinct driven, adaptable, time-
dependent and fragile. This system initiates and sustains a food
chain, provides diversity in scale and functions, and permits a large
disparity among species in their capacity to contribute, but a minimal
disparity between individuals of a species in capacity to contribute
toward the well-being of the communities. This system has the
following features:
* Provides an omnipresence of life, including alternative and redundant
means for accomplishing necessary tasks.
* Maximizes biomass productivity from accessible resources through
diversity of species in a competitive environment.
* Keeps nonrenewable resources, essential to the survival of individual
members, accessible to the system's economy.
* Ensures that the individual, alive or dead, contributes toward the
well-being of the community.
* Actuates the system through the drive of the individual members to
live, to reproduce (i.e., reproductive propensity), to maximize
personal gain from expended effort (e.g., priority propensity), and to
adapt to and to change their environmental situations and conditions.
Self-Regulation
Self-regulation (policy) involves the following:
* Endows individual members with instinctive knowledge and with the
capacity to acquire knowledge.
* Reproduces life forms in the likeness of their immediate ancestors
with characteristically finite life spans (e.g., mutation).
* Subjects life forms to predators and/or environmental, genetic or
microbial disease and accidents (i.e., selective extinction).
* Enforces fully the "rules of the game," including absolute
accountability for personal outcomes (e.g., selective and/or massive
extinction). (Note: Selective extinction is minimal during the
exponential growth phase of life forms).
Table 3
Earth System Realities
* Resources are finite quantitatively and limited spatially.
* The Earth's finite surface area is used to meet geo-physical,
climatic, hydrologic cycle and life system requirements, to which
humans must adapt.
* Scale influences outcomes as a result of the relative mass and
numbers of individuals and the significance of the relationships and
dependencies among individuals, communities and systems (e.g., micro-
decisions and/or actions, although individually insignificant,
collectively determine the outcome; seemingly insignificant
dependencies can control outcomes).
* All individuals (inanimate or animate) are born into circumstances
over which they had no control. All individual life forms, however,
have a capacity to choose and, thereby, to alter their circumstances.
* Like individuals (whether inanimate or animate) are not created equal
and will conform to a defined circumstance in a typical probablistic
variation from a mean.
* Individuals and systems are constrained by limits and enhanced by
balance (e.g., oxygen content of air-saturated water; a balanced
aquarium; ignorance and bias preclude wisdom).
* No transaction can occur without a change in the quality or state of
energy and the elapse of time.
* Ignorance of the specific outcomes resulting from self-enforcing
natural law and materials employed in or wasted into the environment
(e.g., materials that are foreign to nature, are hazardous to life,
bioconcentrate, mutate disease-producing organisms, convert light
energy to heat) may create risk to human well-being.
* Maximization of the natural economics' effectiveness and efficiency
of a system, to meet stakeholder objectives, requires a necessary
balance among subsystem effectiveness and efficiency outcomes (i.e.,
maximization of system effectiveness and efficiency requires a clear
and definable system objective).
* Status quo cannot persist (e.g., circumstances change).
Table 4
Assessment Requirements
* A statement of the purpose, objective and goals for the proposed
change (or existing situation) to be evaluated.
* A broad investigative method to determine the statement's conformance
with reality.
* A system and subsystems description, appropriate for the analysis, to
include interrelationships, interdependencies, basic energy and matter
flows, etc.
* An objective function to include the needs and desires of the
identified stakeholders (who themselves are resources).
* The limits and balances that constrain and enhance the analysis and
determine the boundaries of the solution space.
* The assessment of the effects of the proposed changes on all of the
significant stakeholders.
Table 5
New "Realities"
New "realities" are:
* The world's population continues to increase, and the present "low
consuming" 80% of the Earth's population are rapidly increasing their
per capita natural resources appetite. Thus, the world is entering a
phase of accelerated resources use with a mature technology-production
base and a resource base depleted in both quality and quantity.
* The need exists to change human attitude away from that of conquering
or fighting nature toward that of adapting to and leveraging the value
of the free goods and services that nature provides.
* Prevention is less costly than cure, whether it be environmental
protection, preservation of resource stock, floodplain use, earthquake
zone use, crime control, sustaining a healthy population or maintaining
an effective and efficient economic system.
* Economists rely on the same human propensities to actuate the free
market economic system that Mother Nature relies on to grow and then to
cull her species.
* The objectives of advocates of system components such as legal,
health care and welfare have become inconsistent with the performance
capacity of the system as a whole.
* The power of the individual to do harm (through knowledge of science
and technology, the general desire for individual freedom and the
inadequate moral behavior standards of a few) creates undue risks for
communities.
* The need exists to provide incentives for good behavior and
disincentives for bad behavior.
* Sustainable development concepts provide a mix of economics and
morality that should stimulate education in moral behavior as an
economic issue.
(Reprinted from "The Weston Way," April/May 1995,Roy F. Weston, Inc.,
1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-
701-3511, Internet Address: henrym@rfweston.com)
About Roy F. Weston, Inc.
Pioneering the industry since 1957, WESTON has become a leading
international environmental management, design and consulting firm
working in the public and private sectors to preserve, protect and
restore vital air, land and water resources. Nearly 2,800 WESTON
people specialize in analytical laboratory services, engineering,
facility construction and operations, remediation and large-scale
turnkey programs. Based in West Chester, Pa., WESTON has 60 offices
and laboratories across the U.S. with international operations in
Europe and the Asian Pacific.
"Sustainable Development" WESTON WAY April/May 1995
Part 3 of 8
METRICES OF HUMAN TERRESTRIAL SYSTEMS MANAGEMENT FOR FOOD
CREATION/CONSUMPTION
Two Examples
by
Ben Tencer, Ph.D., P.E.(1)
Executive Vice President (Retired)
Roy F. Weston, Inc.
BACKGROUND
Natural terrestrial systems for biomass creation have evolved over a
long period of time.(2) It has been more than 4.5 billion years since
our planetary system congealed from a cloud of gas and dust in a
remote spiral arm of the Milky Way Galaxy. Terrestrial rock, the
initial source for soil creation, dates back 3.8 billion years.
Beneficial use of this evolving soil by plants and animals was
delayed for another 3 billion years, awaiting land mass colonization
by higher plants and the transition of animal life from the sea to
land. Seed plants appeared 350 million years ago, at the time that
the first animal, the reptile, transitioned to land. Reptiles were
equipped with an amniote egg capable of development on dry land.
Flowering plants, which today total about two-thirds of all plants,
had their evolutionary origins 120 million years ago. Primates, our
Order, first appeared 6 to 7 million years ago.
Humans began managing terrestrial systems, in many separate locations
on the globe, about 7000 B.C. They started by domesticating animals
and cultivating and irrigating grains. Natural system management
variants for animal domestication, plant varieties, methods for
cultivation, and mechanical methods for irrigation and harvesting all
took part in changing agricultural output over the centuries. Even
with all of the changes, in England in the 1720s, almost 80% of the
population of 5.5 million still directly supported the agricultural
process. The number of people alive at any one time was still
primarily controlled by nature, i.e., ultimately dictated by the
weather.
The turning point in the history of terrestrial management resulted
from work conducted in the world's first analytical chemistry
laboratory, founded in Germany in 1840 by John Justus von Liebig.
Using the contemporary economic theories of Adam Smith, he developed
a physical balance sheet model to evaluate agricultural yield and
discovered plant requirements for growth, in the form of inorganic
fertilizers. The later exploitation of fossil fuels as a source of
not only mechanical power, but also feedstock for fertilizers and
pesticides, led to explosive changes in yields in the twentieth
century.
SUSTAINABILITY ISSUES
During the twentieth century, the world population increased from 1.6
billion in 1900 to approximately 6 billion in 1995 and is forecasted
to reach more than 8 billion by 2025. The industrialization,
sustained material development and feeding the nations of the
nineteenth and first half of the twentieth century were based on a
world that was still "empty".(3) There appeared to be an almost
limitless amount of domestic natural resources per capita, such as
land, minerals and fossil energy. In cases where resources were
domestically expensive or scarce, there were limitless opportunities
in international trade. It seemed that there would never be
ecological or economic constraints to continuous expansion that human
economics could not resolve.
Contrast this with the "full" world condition that we currently face.
In this world, fish catches are not limited by human capital
investment in fish-catching paraphernalia, but by the reproductive
capacity of fish populations; lumbering is not limited by the
availability of saw mills, but by the availability of suitable
forests; agricultural output is not limited just by the availability
of natural systems, but also by the availability of fossil energy
derivatives. Underdeveloped lands with large resource bases and small
populations are in short supply. In this world, because advances in
technology reduce per unit costs to ultimate depletion, price is no
longer a key indicator of scarcity.
Under current circumstances, it is easy to understand why citizens of
advanced, industrialized, free market nations have difficulty
envisioning "limits and balances" of "rules of the game" associated
with sustainability. Pictures from space show our isolation in the
planetary system, but to the individual citizen, even with a
supersonic transport, the world appears quite large relative to the
impacts of his/her micro-decisions and actions.
We are thus left with questions on how to feed the burgeoning human
population, without further degrading our natural systems, and on
what a "suitable" or "appropriate" quality-of-life food basket looks
like.
In his papers on sustainable development(4), Roy F. Weston suggests
that to maximize global effectiveness and efficiency by actions at
the subsystem level (e.g., agriculture and the food distribution
system) is a complex task. Natural Economics Impact Assessments need
to be conducted to determine existing unsustainable development
conditions and to propose changes. Requirements for conducting an
assessment are spelled out in Table 4 and clearly involve a full
understanding of the analytic and metric character of the system(s)
and subsystem(s) under investigation. Their metrics, and that of the
objective function and limits and balances, must be in natural
systems terms.
Two examples of the importance of metrics, and preliminary
conclusions that can be drawn from them, are discussed in the
following sections.
EXAMPLE 1: ENERGY FLOWS IN THE U.S. FOOD SYSTEM
In conducting a Natural Economics Impact Assessment for the U.S. food
creation/consumption system, one needs to understand the nature and
efficiency of energy flows of both the supply side and the demand
side of the system.
THE SUPPLY SIDE
The supply side of American nutrients is dominated by wheat, corn and
soybeans (with soybeans coming into their own as a high protein
animal feed in the mid-twentieth century). Figure 1 (at the end of
this paper) displays the changes in energy yields per acre that have
occurred in the last 125 years.
At the turn of the century, agricultural yields were not
significantly more than those attributed to the Sumerian agriculture
of 3000 B.C. "In modern environmental units, wild cereal in Galilee,
early millet in China and wheat in Medieval Europe all yielded one-
half to three-quarters of a ton per hectare [which is 1.8 to 2.7
million kilo-calories (kcal) per acre]."(5) Small gains in yield were
made in the first half of the century. Most of the increased output
came from significant acreage released from the feeding of horses and
other draft animals.(6)
Starting mid century, with the Green Revolution, yields increased
dramatically (6 times for corn, 2 times for wheat and 4 times for
soybeans), coinciding with (and driven by) large increases in world
and U.S. populations and the changing quality and quantity of
nutrient intake.7
By 1990, the kcal output (yield/acre times acres harvested translated
to kcal/capita/day) was over 14,000 kcal/capita/day. In a simplistic
"base-case" scenario, this raw energy harvest is almost four times
the 3,700 kcal/capita/day average nutrient intake for the U.S.
population. The human propensity to increase both the quantity and
quality of nutrient consumption reduced the energy output "coverage"
to a balance of supply and demand.
At the start of this century, commercial energy requirements to
support the production and distribution of food energy were minimal;
by 1980, they had risen to more than 10 kcal of commercial energy for
each kcal of food energy consumed (see Figure 2 at the end of this
paper).
The first significant reduction of the rate of increase of the energy
ratio occurred in the 1980-1990 time frame. This resulted from
changes on both the supply and demand sides. On the supply side,
fertilizer and pesticide (and associated water usage) leveled off and
has remained flat.9 (Available varieties of grain lack the physiology
to effectively use more fertilizer, and the overuse of pesticides had
led to pesticide-resistant species.) On the demand side, in the
American diet, the proportion of calories from fat decreased from 42%
to 40% and the amount from animal sources decreased from 59% to 52%.
(As will be shown below, it takes six times more energy to obtain a
unit of fat from animal than from vegetal sources.)
The Demand Side
From 1940 to 1990, food energy consumption more than doubled to 925
billion kcal per day, excluding the additional export load placed on
U.S. agriculture. This was the result of population growth, which
increased from 133 million to 250 million, and the growth in the
average nutrient intake from 3,300 kcal/day to 3,700 kcal/day. Figure
3 (at the end of this paper) shows in stark relief the commercial
energy inputs to the food system, as both supply and demand increased
from 1940 to 1990. (The ratio of the two trends determines the
input/output energy ratio of Figure 2.)
Mr. Weston's problem-solving philosophy suggests the requirement for
"... asking and answering the right questions...," one of which is,
"Why are the circumstances what they are?" The answer relative to the
nutrient-demand impact on natural systems begins with an
understanding of one of the Earth System Realities, which states that
micro-decisions and/or actions, although individually insignificant,
collectively determine outcomes -- the result of the relative mass
and numbers of individuals and the significance of relationships and
dependencies.
A simple picture of the impact of micro-decisions on nutrient intake
could be the statement of the U.S. Department of Agriculture (USDA)
that "... evidence suggests that a change has occurred in consumer
tastes and, hence, in the demand for beef. Interest in convenience
and health has altered consumer meat choices. Hamburger that can be
prepared quickly accounts for 45% of the beef consumed in 1992,
compared with 35% in 1985, and 26% in 1970... Roasts, which take
longer to prepare, were down sharply. In addition, a shift has
occurred toward eating away from home, especially in fast food places
that emphasize hamburgers, fries, and, increasingly in the last
decade, chicken and pizza."11
The complete picture of the impact of the micro-decisions and/or
actions of the hundreds of millions of U.S. food consumption
decisionmakers, on the natural system, is shown in Table 1 (at the
end of this paper). U.S. food energy consumption is constructed in
terms of the macro-nutrient building blocks (fats, proteins and
carbohydrates) and their food group sources (starting with vegetal
and animal). This reconstruction of the food demand/consumption
pattern for 1990 can be tracked back, step by step, to its natural
system supply implications.
First, some salient features of the U.S. food consumption pattern. Of
the 3,700 kcal daily food intake of the average U.S. citizen in
1990, 31% came directly as a product or indirectly as a byproduct
of the animal kingdom, and the remaining 69% came from raw and
processed vegetal sources. In relation to fat intake, 52% came from
animal sources and the remaining 48% from vegetal sources. Close to
20% of total food intake (much larger than is necessary or desirable
for both human and natural systems' health) was in the form of
vegetal sugars and sweeteners.
Energy Flows
As the metrics of energy flows is constructed for the U.S. food
supply system, recall the economist who deals in human system
monetary terms: "The economist's preoccupation with the efficient
allocation of resources in the short run, without regard for long-
term carrying capacity issues and human propensities, has directly
resulted in unacceptable, unsustainable 'realities'." The reality is
that, as energy inputs to the food system increased, the monetary
costs for "Food and Tobacco" as a percentage of personal expenditures
went from 24% in 1970, to 20% in 1980 and 17% in 1990.13
Energy flow in the nutrient system is easier to follow when described
from the top down. The energy flow analysis, however, must be
conducted from the bottom up.
Top-Down Process Description
From the top down then, the energy flows necessary to create 1 kcal
of human energy intake (using 1990 structural data) start with:
* The input to agriculture of 350 kcal of photosynthetic sunlight and
about 3 kcal of commercial energy (over 90% fossil-derived), which in
combination with other natural systems (including the photosynthetic
process, the hydrologic, nitrogen, carbon), generates more than 7
kcal of field biomass.
* Adjusting for crop residuals left in the field and edible net
exports, we arrive at the more than 5 kcal of food, feed and fiber
[see (e) in Figure 4 at the end of this paper] that, when augmented
by another 7 kcal of commercial energy and processed either through
animals or directly to humans, will result in the availability for
human consumption of 1 kcal, 31% derived from animal origins and 69%
directly from vegetal origins.
Bottom-Up Analysis
The energy flow analysis of Figure 4 (at the end of this paper)
starts at (a) with a representative 1 kcal food intake, and the Table
1 (at the end of this paper) determined values of animal at 31% and
vegetal at 69%.
To calculate (b), the vegetal feed necessary for the animal kingdom
to supply the 0.31 kcal, one must examine each animal species for its
feed conversion efficiency related to metabolism (pound of feed/pound
of gain), its harvest index (pound of edible biomass/ total weight)
and the resultant productive efficiency (kcal feed/kcal edible
biomass). Several examples will illustrate the nature of the
calculation.
For beef, 12 pounds of vegetal feed input is required to obtain 1
pound of edible biomass; for milk, eggs and poultry, 3 pounds of
vegetal feed input is required to obtain 1 pound of edible byproduct.
Using the animal nutrient product and byproduct mix from Table 1 and
applying the respective productive efficiencies, it takes an average
of 4 pounds of vegetal input for each pound of edible biomass.
Converting to energy terms, the result is an 8% efficiency of
conversion or, to obtain the 0.31 kcal of animal biomass, an input of
3.83 kcal of vegetal material is required.
To calculate (c), the vegetal feed necessary to supply the 0.69 kcal,
only the harvest index and manufacturing modification are applied,
because no prior metabolism occurs. Using an intake consistent with
the consumption pattern in Table 1 (at the end of this paper), the
result is a 48% efficiency of conversion or, to obtain the 0.69 kcal
of vegetal biomass, an input of 1.44 kcal of vegetal material was
required.
In (d), the commercial energy inputs required are calculated for the
farm and food marketing system. (The USDA refers to all nonfarm food
activity as being in the marketing system -- processing, wholesaling,
distributing, retailing and preparation at home and away from home.)
As a benchmark, it is worth noting that in monetary economic terms,
the farmer receives 22 cents out of each dollar spent, with the
remaining 78 cents consumed in the marketing system.14 A number of
studies have concluded that the farm and food marketing system uses
about 17% of total U.S. energy consumption, 5% on the farm and 12% in
the marketing system. U.S. energy consumption in 1990 was 20.45x1015
kcal, with 17% at 3.48x1015 kcal. That value, when divided by annual
nutrient intake, is consistent with the ratio shown in Figure 2 (at
the end of this paper). Distribution of the over 10 kcal/kcal is
shown in the hatched areas of Figure 4 (at the end of this paper)
(limited data are available to allocate the marketing portion between
animal and vegetal; therefore, 50-50 was used).
At (e), an adjustment is made for the net of edible exports and
imports. The net value for 1990 was $17 billion (with exports just
over $40 billion). Exports of grains and soybeans were 27% of
national production. In addition, the United States sold or disposed
of, as gifts, 1.72 million metric tons of vegetal oils and 162
thousand metric tons of milk.
900 millions pounds of red meat were net imports (3-4% of total
consumption).15 This is a distortion of the systems analysis because
the energy inefficiency of vegetal to meat conversion is borne by the
exporting country, and the U.S. input/output ratio is understated by
that amount. An energy flow analysis of Japan would show how large
this distortion can get -- in 1993, the Japanese imported 660,000
tons of beef, just above the domestic production of 595,000 tons.16
The net energy impact for export/import is shown as the difference
between the sum of value for (b) and (c) and the value of (e).
At (f), account is taken for crop residues left in the fields after
harvest. This averages 25% across the mix of vegetals.
Finally at (g), an estimate is made of the amount of photosynthetic
energy needed to create the field biomass. A number of different
sources and approaches were taken, and the range of results, on an
"efficiency of capture" basis, was from 2-3%. (48 kcal of
photosynthetic energy per kcal of biomass was ultimately selected.)
Summary
* To produce 1 kcal of nutrient requires a natural system input of
350 kcal of direct solar energy and more than 10 kcal of other energy
(primarily fossil, which is simply a concentrated, stored form of
solar energy).
* Because no discernible change in photosynthetic sunlight occurred
over the last century, the changes in agricultural yields (Figure 1,
at the end of this paper) have to be a result primarily of fossil
energy inputs in various forms (allowed by a hybrid seed). It is
clear that the yield leverage in agriculture for fossil fuels is
enormous (recall that less than a third of the 17% of the national
energy budget is used on the farm). This places us on the horns of a
dilemma: the use of fossil fuels has allowed us to feed a rapidly
increasing population (ours and others because the United States is
one of the world's largest exporters of grain), but we know it is not
sustainable. It is not fanciful to suggest that, without modification
in our energy policies, a future tradeoff between eating and driving
could be required.
* The "demand" drive for quick and easy nutrients has dramatically
increased the energy content of the overhead system -- the marketing
system uses more than two-thirds of the 17% of the national energy
budget. Resource subsidies and price/value distortions, especially in
fossil fuels and irrigation water, allow California, for example, to
supply 40% of U.S. produce, even though it takes three times more
energy to transport a head of lettuce from California to New York
than it takes to grow it. Apples, formerly grown in New York State,
are now grown in Washington State, kept in cold storage and then
transported to New York for consumption.
* In energy availability terms, the tradeoff of expanding human
energy resources and shrinking fossil energy resources requires
reexamination.
* The metrics of energy in the nutrient equation is only one of
several likely sustainability constraints. Another, for example, is
groundwater -- the annual overdraft of the Ogallala aquifer located
under the U.S. Midwestern Great Plains "breadbasket" is currently
130% to 160% above replacement, a rate that will cause the aquifer to
become nonproductive in 40 years.17 Soil erosion and groundwater
pollution are also possible limits to sustainability.
EXAMPLE 2: GLOBAL RESOURCES AND PRODUCTS
The United States, Canada and Australia stand out in world
comparisons as among the few countries that currently have an
"overage" of natural resources capital per person. Choices in these
currently richly endowed countries can still be made that are within
(rather than pressing against) the limits in natural economics'
effectiveness and efficiency analyses. This is not true for most of
the rest of the countries of the world. As populations and
nonrenewable resource consumption continue to grow all over the
world, the portions of natural systems that are able to be
beneficially and sustainably managed (versus those that are adversely
affected) continue to shrink.
Table 2 (at the end of this paper) compares the U.S. and world
averages for many key indicators of quality of life and
sustainability. Averages always present a problem, especially when
the mix goes from countries with great riches to countries with great
poverty -- resulting in a bimodal rather than single peak
distribution. The Food and Agriculture Organization (FAO) of the
United Nations notes the difference between averages in kcal/day food
consumption of 3,400 in developed countries and 2,500 in developing
countries; between the highest, the Benelux countries at 3,725, and
the lowest, the Comoros Islands at 1,760.18
The vegetal-animal source values in Table 2 (at the end of this
paper) indicate that rich nations consume a higher proportion of
animal biomass and animal byproducts in their diet. The values shown
represent more than a 40% difference in the necessary vegetal input
to obtain the nutrient mix (based on the 6:1 ratio of animal to
vegetal efficiency).
In his papers, Mr. Weston discusses the desirability of having an
international government organization act as a "Prudent Person
Surrogate" to protect global resources in support of sustainability.
Several items in Table 2 (at the end of this paper) fall into this
category -- fossil energy, land and water resources -- all critical
to maintaining an appropriate quality of life for present and future
generations.
Fossil Energy Derivatives
The use of inorganic fertilizers and pesticides, their associated
energy-intensive irrigation requirements, and other industrialized
energy-intensive agricultural practices are being mirrored in many
countries facing population pressures. Agricultural yield analyses
indicate that close to 40% of global food production is currently
attributable to the Green Revolution application of energy
derivatives. The character of the industrial revolution that preceded
this latest revolution is also dependent on the use of fossil fuel.
More than 90% of the energy that supports the U.S. economic way-of-
life is fossil-derived. Table 2 (at the end of this paper) ratios
show that the average American consumes more than 5 times the world
average for commercial energy and has close to 5 times more machine
energy available to him (in pre-industrial societies, the ratio was
close to 5:1). The United States currently imports almost 65% of its
fossil fuels, and domestic and global reserves continue to dwindle.
Arable Land
The global land surface (not covered by ice) is just over 32 billion
acres. Arable land, which is defined as land with soil that has the
potential to produce farmed crops, is 10% of that total. Some 40% of
arable lands are not used for reasons such as the lack of sufficient
water, the difficulty of clearing or disease control. The remaining
approximately 2 billion acres is the source for almost all global
edible biomass and more than 90% of the protein consumption. See
Figure 5 (at the end of this paper).
Studies have indicated that each acre of useable arable land will
support 2 1/4 persons (0.45 acre/person) with an "average" nutrient
energy basket.19 The current U.S. reality, with a diet that includes
a variety of fruits and vegetables, a large supply of animal protein,
and in general a diversity of other foods, uses about 1.24
acres/person of the current domestically available 1.83
acres/person.20 At a 1 1/2% population rate of growth (and no loss
of topsoil), the reserve of arable land available will disappear in
under 30 years. The world in total is dangerously close to the 0.45-
acre/person floor, with significantly large population increases
unavoidable. The United Nations has predicted that, under current
agricultural practice, significant portions of forests and woodlands
will, ill advisedly, be turned into crop production early in the
twenty-first century.21 Forest and woodlands, critical for CO2 uptake
(considered by some as the key to controlling global average
temperature) are shown in Figure 5 (at the end of this paper).
Water Resources
The Earth contains 326 million cubic miles of water: 97% is sea
water, 2% is locked in ice caps, and a little under 1% is underground
-- too deep to pump. Figure 6 (at the end of this paper) shows the
amount of global water resources available for beneficial
agricultural use. The hydrologic cycle circulates an amount for
beneficial use, of which globally 65% is used in agriculture, 25% in
industry and 10% for other uses.22 The continued heavy use of water
with Green Revolution crops is straining not only surface waters, but
also underlying aquifers. The annual overdraft of the Ogallala
aquifer was discussed earlier. Large dam construction to obtain
additional irrigation water is disrupting ecosystem activity in South
America, China and India.
Conclusion
Debates about the future of world agriculture usually end up with
technological optimists arrayed against the neo-Malthusian
pessimists. The debate could be better framed when all recognize the
turning point between the "empty" and the "full" world that emerged
in the last half of the twentieth century. We are now pressing
strongly against the ecological limits of the biomass creation
system, using tools (non-renewables) that do not have staying power
and whose side effects reduce the long-term health of the systems
that we depend upon for survival. This is not tomorrow's problem; it
is today's problem! Solutions will have to be deliberate and
considered, and approaches taken will need to simplify the complex by
identifying and characterizing the basic objectives of, and the
constraints to, implementing sustainable development.
Footnotes
1Dr. Tencer is a consultant to Mr. Roy F. Weston; adjunct professor in
the School of Engineering and Applied Science, University of
Pennsylvania; and a member of the Board of Directors and the Executive
Committee of the Ben Franklin Technology Center of Southeastern
Pennsylvania.
2The management of aquatic systems is not treated in this paper. They
produce only 1% of the caloric intake for humans; however, they are a
significant protein source for many peoples in poorer nations and are
renewable systems being pushed to the edge of unrenewibility by
overexploitation. As such, they will be examined in other forthcoming
WESTON publications.
3Daly, H.E. 1992. "From Empty-World Economics to Full-World Economics:
Recognizing an Historical Turning Point in Economic Development." In:
R. Goodland, H.E. Daly and S. El Serafy (Eds.). Population, Technology,
and Lifestyle. Island Press, Washington, DC, pp. 23-27.
4Weston, Roy F., "The Weston Way," April-May 1995 "Sustainable
Development: To Better Understand the Concept," "Sustainable
Development: Integration of the Free Market Economic System into the
Natural Economics System." pp. 12 and 13.
5Waggoner, P.E. 1994. How Much Land Can Ten Billion People Spare for
Nature? Council for Agricultural Science and Technology, February
1994, Figure 7.2.1.
6In the United States between 1910 and 1960, 90 million acres devoted
to fueling horses and other draft animals were converted to crops for
direct human consumption and livestock feed.
7The Green Revolution involves the planting of a monoculture of
scientifically bred plant varieties and then applying large amounts of
inorganic fertilizers, pesticides and irrigation water. The concepts
in the Green Revolution ultimately were taken up by most of the nations
of the globe. The increase in farm energy yield has fed the greatly
increasing population.
8(Figure 1) U.S. Agricultural Productivity Sources
(1)Agricultural Statistics. 1993. U.S. Department of Agriculture,
National Agricultural Statistics Service, GPO, Washington, DC 1993.
Wheat: Figure 1, page 5 converted from bushels/acre to kcal at 60
lb/bushel and 4,010 kcal/kg - or 109,000 kcal/bushel.
Corn: Figure 2, page 32, converted from bushels/acre to kcal at 56
lb/bushel and 3,910 kcal/kg - or 100,000 kcal/bushel.
Soybeans: Figure 5, page 116, converted from bushels/acre to kcal at 60
lb/bushel and 4,030 kcal/kg - or 110,000 kcal/bushel.
(2)Additional data points from Waggoner, 1994, Figure 7.2.1.
9Brown, L. et al. 1994: Vital Signs. Worldwatch Institute, W.W. Norton
& Company, NY, pp. 43 and 93.
10(Figure 2) Energy Subsidy Sources:
(1)Steinhart, S., and C. Steinhart. 1974. "Energy in the U.S. Food
System." Science, Vol. 184, 19 April 1974, pp. 307-315. For 1910-
1930, Figure 4, page 311.
(2)For 1940-1990, see sources for Figure 3, listed in footnote 12.
11Putnam, J.J. 1993. "American Eating Habits Changing: Part 1 Meat,
Dairy, Fats and Oils". Food Review, September-December 1993, page 4.
12(Figure 3) Energy Flows -
For Food Consumed:
(1)Gerrior, S., and C. Zizza. 1994. Nutrient Content of the U.S. Food
Supply 1909-1990. U.S. Department of Agriculture, Home Economics
Research Report No. 52, pp. 51-53 for kcal/
person/day.
(2)U.S. Bureau of Census, Statistical Abstract of the United States:
1992. 112th Edition. Washington, DC, GPO, page 6 for population.
For Input to the Food System:
(1)Steinhart. 1974. Table 1, for 1940-1970.
(2)World Almanac and Book of Facts. 1994. Funk & Wagnalls, St.
Martin's Press. For 1980-1990 national energy consumption, page 150.
13See Footnote 12 (2): Statistical Abstract, 1992. Table 681.
14Elitzak, H. 1992. "Marketing Bill Is the Largest Chunk of Food
Expenditures." Food Review, July-September 1992, page 13.
15Agricultural Statistics. 1993. Tables 438 and 441.
16Brown, L. et al. 1994, page 30.
17Pimentel, D., and M. Giampietro. 1994. "Food, Land, Population and
the U.S. Economy." Carrying Capacity Network, Washington DC, Released
21 November 1994, page III-11.
18Food and Agricultural Organization of the United Nations. FAO
Yearbook - 1992. Rome, pp. 237, 239.
19Bryson, R. 1986. "Environmental Opportunities and Limits of
Development." Leopold Centennial Lecture, June 1986, Madison Center
for Climate Research, University of Wisconsin, Madison.
20Lal, R. 1989. "Land Degradation and Its Impact on Food and Other
Resources." In: Pimentel, D. (Ed.), Food and Natural Resources.
Academic Press, San Diego, pp. 85-140.
21The World Environment 1972-1992 - Two Decades of Challenge. 1992.
Tolba and El-Kholy (Eds), Published by Chapman & Hall, London, on
behalf of the United Nations Environmental Programme.
22Postal, S. 1992. The Last Oasis - Facing Water Scarcity. Worldwatch
Environmental Alert Series, W.W. Norton & Company, NY.
(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston,
Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone
610-701-3511, Internet Address: henrym@rfweston.com)
About Roy F. Weston, Inc.
Pioneering the industry since 1957, WESTON has become a leading
international environmental management, design and consulting firm
working in the public and private sectors to preserve, protect and
restore vital air, land and water resources. Nearly 2,800 WESTON
people specialize in analytical laboratory services, engineering,
facility construction and operations, remediation and large-scale
turnkey programs. Based in West Chester, Pa., WESTON has 60 offices
and laboratories across the U.S. with international operations in
Europe and the Asian Pacific.
"Sustainable Development" WESTON WAY April/May 1995
Part 4 of 8
SUSTAINABLE DEVELOPMENT:
Integration of the Free Market Economic System
into the
Natural Economics System
by
Roy F. Weston, P.E., DEE,
Chairman Emeritus,
Roy F. Weston, Inc.
WHY BOTHER?
All the things that surround us, everything that happens, and
everything that we must adapt to or otherwise do to live and make a
living are part of a natural economics system. Nature has provided
the resources and the "rules of the game" that govern all past,
present and future outcomes. The natural economics system has
sustained life on Earth for billions of years. To maximize our well-
being, we must maximize the effectiveness of accessible resources and
the efficiency with which we use them in accordance with the natural
economics "rules of the game." Our free market economic system is
the best of human design. Nevertheless, our unsustainable
circumstances provide ample evidence that the system does not
maximize natural economics' effectiveness and efficiency and does
permit unsustainable development. Therefore, any endeavor that can
integrate the self-organizing and self-regulating features of the two
systems (the natural economics system and our free market system)
will increase the possibility of attaining sustainable development
and will be worth the bother. To achieve integration, it is
necessary to understand the attributes of each system and to identify
those attributes of the free market system that contribute to
ineffectiveness and inefficiency. The purpose of this paper is to
summarize pertinent attributes of each system and to discuss means
for integrating them to ultimately achieve sustainable development.
ATTRIBUTES OF THE NATURAL ECONOMICS SYSTEM
The natural economics system "rules of the game" govern everything
that happens on planet Earth. That means they govern every
transaction involving the exchange of any of the basic economic
resources -- energy, matter, space, life and time. Thus, the natural
economics system is complete and is integrating and cross-cutting. It
deals only with reality. Transactions include those associated with
geological aging, geophysical situations, climate, the hydrologic
cycle and the life system's self-organization and self-regulation
attributes. Humans must adapt to these circumstances. The "rules of
the game" include Mother Nature's physical system self-enforcing
laws, her life system self-organizing and self-regulating laws, the
Earth system "realities" and human-enforced laws. Also, there is
self-enforced "full-cost" accounting.
The life system, of which humans are a part, has an organizational
structure and "rules of the game" that conform to the physical
system's "rules of the game." The life system is a hierarchy of
species made up of individual stakeholders with different, specific
attributes. Those attributes determine the resource needs of the
individual to survive and the price, in terms of energy, time and
bother that the individual must expend to meet survival needs. The
life system organization establishes the interrelationships and
interdependencies among the various species to effectively use
energy, matter, space and time to sustain the system, and includes
species with appropriate technological attributes to conserve and
keep essential nonrenewable resources accessible to the system's
economy. The system has the capacity to meet all human specific
survival needs. The system is actuated by the individual. The
individual has a desire to live, a capacity to be an opportunist to
adapt to or alter its situation or condition, and the propensity to
reproduce (i.e., reproductive propensity), to consume needed
resources by maximizing gain from expenditures (i.e., priority
propensity), and to continue to reproduce and to consume resources
until the resources are exhausted (i.e., completive propensity).
While all individuals have a prudence propensity, a few are more
strongly endowed with that propensity than the others. These are the
few most likely to survive.
The "rules of the game" for individual behavior, the impact of time,
and the variation in environmental situations and conditions provide
a dynamic diversity in species population that varies around a
carrying capacity mean. The attributes of the system's members
permit selective and massive extinction strategies for self-
regulating the quality and quantity of the members of the system. In
human parlance, we would call this "pruning" and "downsizing." In
fact, the propensities of the system's members drive the system
towards imbalance and massive extinction. Thus, massive extinction
of one or more species occurs locally, frequently, and, in some
cases, globally. Balanced systems (i.e., those with diverse species)
provide a dynamic balance among species that maximizes the system's
biomass productivity (i.e., carrying capacity) from accessible
resources and environmental situations and conditions.
ATTRIBUTES OF THE FREE MARKET SYSTEM
Organization and Policy
The organization and policies of the free market economic system
reflect the values (e.g., freedom, fairness, and justice) of the
people who designed it. Organization and policy are clearly the most
significant instruments for maximizing economic effectiveness and
efficiency; organization provides the means and policy provides the
"rules of the game" for achieving the desired objective. Government
reflects the will of the people in providing "rules of the game" for
establishing and operating economic system organizations. Generally
speaking, economic organizations can beclassified as "for profit,"
"not for profit" (e.g., non-government organizations) and
"government." These classifications establish the taxpaying status
and other "rules of the game."
The freedom of the free market economic system provides considerable
flexibility in establishing organization (e.g., kind and purpose) and
policy within the formal constraints provided by governmental law.
This freedom has provided the opportunity for citizen, special and
vested-interest groups to organize voluntarily funded, "not for
profit" organizations. Historically, such organizations have been
adversarial toward "for profit" organizations. Recently, however,
they have been moving toward a problem-solving relationship. If such
organizations can move from a "where we don't agree" to a "where we
do agree" mindset, they can provide a valuable and efficient
educational service to the general public, "for profit" organizations
and government. They are a viable part of the private sector. They
can be the community's conscience and the community's watch person.
They can make a positive contribution toward maximizing community
economic efficiency.
Nevertheless, it is the "for profit" private sector segment of our
free market economic system that has the greatest impact on the
quality of our lives and therefore should be of greatest concern to
us. A preliminary assessment of the free market economic system
reveals that its organization and policies are based on:
* Concepts (theories) of freedom of choice for consumers in meeting
their needs and wants.
* Free markets in which to make choices.
* Freedom for entrepreneurs to form the enterprises that supply the
markets.
* Free competition among the enterprises.
* Freedom to manage private enterprises within the constraint of the
necessity to make a profit.
* Governmental "rules of the game" designed to protect the interests
of consumers, employees and shareholders by establishing limits on
the degree of freedom of enterprises.
Within the free markets, goods (i.e., the basic resources or products
and services derived from those resources) are offered by enterprises
to satisfy consumer needs and wants. Consumers purchase goods on the
basis of satisfaction for the price paid. Enterprises compete to
sell their goods at a profit. A system of accounts and accounting
procedures tracks economic transactions, accountability and ownership
to determine profit and to establish financial status.
The system is driven by consumer demand and the rewards (i.e.,
profits) to entrepreneurs for providing goods efficiently and
satisfactorily. The prime players are consumers, entrepreneurs and
the people's representatives in government. All of these players are
faced with dilemmas because all players are also consumers. All
players must make or derive a living through an enterprise or
government. All have a direct (if they are voters) or indirect
accountability for good government. The interrelationships and
interdependencies of the players influence individual attitudes and
behavior and government organization and policy outcomes. Members of
the system strive to postpone selective extinction and are outraged
with massive extinction; nevertheless, the system's rules permit
enterprises to fail. Governmental "rules of the game," however, are
protective of the consumers, the employees and the general public
shareholders of enterprises.
The "rules of the game" have produced a system that is highly self-
organizing and self-regulating, much like Earth's life system, and
that governs community and individual outcomes by strict enforcement
of the rules. The system's rules have made it possible for
individuals to want and to use resources at a rate that is orders of
magnitude greater than required to meet the individual's survival
needs. The system has not always provided the organization or "rules
of the game" necessary to counterbalance such a high rate of use.
For instance, the system has only limited capacity to keep
nonrenewable resources accessible to its economy. The system's rules
permit the wastage of resources sufficient to permanently decrease
the accessibility of resources to its economy, and to create
environmental hazards and pollution. Government has set no clear
objectives for the system except the creation of jobs and continual
growth. The system, however, is highly democratic and, in fact, is
more democratic than our system of governance. We all vote with our
pocketbooks daily. Community dynamics responding to the "rules of
the game" counterbalance the lack of clear objectives.
System Inefficiencies
Further assessment reveals what economic theorists have recognized
for some time -- that the free market economic system has inherent
inefficiencies. They explain that there are inefficiencies in the way
free markets handle accounts and accounting and pricing systems. The
prime reasons1 for these inefficiencies are:
* Theory and practice exclude some of the elements that influence
outcome.
* Theory presumes the coverage of some factors that in practice must
be treated as externalities.
* Theory is based on hypotheses that are inconsistent with the real
world.
* Real world practices are inconsistent with achieving pricing
objectives.
The free market pricing system excludes many of the products and all
of the services provided by the non-human part of the life system.
For example, the recycling of carbon dioxide to provide life-
essential oxygen is excluded. "Free goods" are excluded. When "free
goods" transactions become economic, they are considered to be
externalities. Unfortunately, more and more, goods that were at one
time "free" (e.g., clean air and clean water) are now scarce goods of
economic significance. The free market pricing system has no
inherent means for handling public property and the global commons.
The system has no means for allocating the costs associated with
atmospheric disturbance disasters caused by anthropogenic activities.
The system presumes that the producer is well-informed about costs
and the consumer is well-informed about what the requirements should
be to assure satisfaction. These are false presumptions because
today neither the producer nor the consumer has the knowledge
required to make prudent micro-decisions that can have global impact.
Real world practices, particularly those involving government
policies on taxation and subsidy programs, significantly influence
economic effectiveness and efficiency. Because such programs are
generally politically rather than economically motivated, they tend
to lower economic effectiveness and efficiency. More detailed
discussions about system inefficiencies are presented under the
sections "Accounts and Accounting" and "Pricing System."
Targets for Alteration
Because of their impact, accounts and accounting and pricing are the
primary instruments influencing economic outcomes.
Accounts and Accounting
The basic purpose of accounts and accounting is to provide
information for decisionmaking, evaluating performance and
establishing financial status. Accounts and accounting record
transactions, allocate revenues and costs, establish the financial
status of economic entities and determine the profitability of
private enterprises. Free market economic system accounts consist of
economic resources such as monetary and tangible assets and rights.
They need to be identifiable, quantifiable in terms of money, and
ownable or allocatable.
Accounts and accounting are used to establish the financial status of
nations as well as all other economic entities, including individual
persons. Decisions are made at all levels based on accounts and
accounting information. If this information does not reflect
reality, wrong decisions will be made, wrong actions will be taken,
and wrong outcomes will result. For instance, if natural capital is
not included in national accounts, the exploitation of natural
resources may increase national Gross Domestic Product, temporarily
giving the impression of increased well-being when, in fact, the
exploitation is consuming capital that has continual value in meeting
well-being needs. Thus, inadequate accounts, lack of full-cost
accounting and the human priority propensity all lead to poor long-
term decisions. In the case of a renewable natural resource, such as
fisheries in the global commons, natural economics can determine the
means for maximizing sustainable return on the natural resources
investment. If nonrenewable resources are exhausted, those resources
may be permanently lost to the human economy. For instance, if those
nonrenewable resources have been wasted to the environment, they may
be accessible to the life system on the basis of its long-term
natural economics timeframe, but not be accessible to humans within
their economic timeframe; therefore, there is lost opportunity for
both present and future generations. In addition, the resource
losses will likely impose costs on others because of pollution and
reduction in life system productive capacity.
Industrial experience has clearly demonstrated that appropriate
accounts and full-cost accounting that ensure the correct allocation
of costs to accountable parties will change behavior and reduce
costs. There are many examples of wrong decisionmaking because of
unrealistic accounting information. Some enterprises have profited
at community expense because full-cost accounting was not used in
allocating costs. In this country an entire segment of the economy,
food production, is based on unrealistic costs and prices because of
government subsidies. A global economy, which includes hundreds of
millions of individual decisions that impact that economy, is driven
by self-deceiving decisions because of unreal cost information, for
example, the unreal price of fossil fuels.
Present accounts and accounting rules constrain integration because
natural economics includes all of the Earth's resources as economic
resources. All natural economics transactions are made in terms of
the actual resource, not in terms of money. Also, many resources
significant to the human economy are not owned by or allocatable to a
specific individual (i.e., entity). These constraints can be overcome
with change over time toward full-cost accounting.
I believe that natural economics' accounts and accounting procedures
will be used initially in an assessment process as an instrument for
identifying, avoiding or solving sustainability problems. In time,
appropriate accounts and accounting procedures will become a routine
management tool. Eventually, there will be standardization for their
use in compliance with legal requirements relative to advertising,
performance compliance and taxation.
In the assessment process, effectiveness and efficiency relationships
will be determined on the basis of an accounting of the relevant
resource. Resource relationships will be converted into monetary
relationships as necessary.
Pricing System
The free market pricing system has provided the following goals for
efficiently establishing prices:
* Voluntary exchanges in a competitive market must establish a price
such that all participants consider it to their advantage to engage
in transactions.
* Producer participants maximize their profit and the consumer
participants maximize their satisfaction.
* Nonparticipants in the transactions neither gain nor lose as a
result of the transactions.
If the price is correct, price and value will be essentially equal.
Price generally assesses the short-term benefits and value generally
assesses the long-term benefits. Price should always reflect value.
One does not have to be an economist to understand the logic and the
soundness of these and the pricing system goals. These are human
goals to enhance the system's efficiency and fairness.
The "no gain, no loss" pricing system goal establishes a high moral
plane for performance. It establishes a virtue-based goal. The fact
that the efficiency of the free market economic system is highly
dependent on moral performance is probably one of the most carefully
guarded secrets of the free market economic system. It means that a
goal essential to the efficiency of the system has been
systematically and consistently ignored. The "no gain, no loss" goal
is the rug under which economists sweep their difficult-to-solve
externality problems. It is, therefore, a powerful driver for
change. For instance, a producer who wastes resources to the
environment increases costs to nonparticipants by creating
environmental pollution. Free market pricing system goals would
allocate such an increase in costs to the consumer participants.
Accountability for ensuring that nonparticipants are not allocated
costs belongs to the producer. In other words, the system pricing
goals allocate the burden of proof and associated costs to the
producer; otherwise, producers would have unduly lower costs and
thereby undue profits and the consumers of their products would gain
at the expense of the nonparticipants. In practice, many individuals
consider costs incurred to avoid the unfair allocation of costs to
nonparticipants as unnecessary costs to the system. Command/control
regulation of pollution provides relief from the system's
inefficiencies and inequities, but there is ample room for
improvement.
The lack of an effective self-regulating means for enforcing the "no
gain, no loss" goal has created the biggest con game in town. It has
created the need for advocate and self-interest groups and lobbyists
to strive to influence the governmental "rules of the game" to their
advantage. They use the art of politics to gain undue advantage. The
free market pricing system goals are sound. The challenge is to
attain those goals through self-regulation. The requirement of full-
cost accounting is a large step in that direction.
As indicated, price is established by free markets in most cases.
There are some cases, however, in which the conventional pricing
process is neither effective nor efficient. I have arbitrarily
classified the different instruments that have been, or should be,
used as surrogates for the pricing system as follows:
* Full-cost accounting.
* Case-specific means.
* Price management (strategic nonrenewable resources/special
circumstances).
* Prudent Practices Guidelines (technology/ethics basis).
The free market pricing system and each of the surrogate instruments
are discussed below.
Free Markets
Free markets rely on the priority propensity of the individual to
actuate the system and on the legal system to achieve justice. In
both theory and practice, the free market pricing system relies on
the same human propensity to actuate its system that Mother Nature
uses to cull her species. Today, in many parts of the world, local
massive extinction is occurring because of human reproductive,
priority and completive propensities. The sequence in outcomes is an
increase in the need for survival to a level approaching the local
resource carrying capacity, followed by mismanagement of resources,
warfare or violence, famine, disease and massive extinction. Such
real world outcomes motivated the call for sustainable development.
Such outcomes can be anticipated and avoided.
Advances in technology have made it possible to lower costs and to
increase return on investment and thereby lower prices in the face of
impending scarcity. Although cost trends have reversed, past and
present inefficiencies in the pricing system have permitted a gross
wastage of a limited and finite resource -- petroleum and associated
natural gas. Members of the Earth's economic system have built a
massive world economy that is highly dependent on that resource. I
believe that such dependency will not pass a "Prudent Person" test
relative to decisions about uncertainty and risk. There is no
scientific evidence to assure us that petroleum or other fossil fuels
can satisfy the energy wants of present populations or meet the
energy needs of future populations. There is no scientific evidence
to assure us that proven renewable energy conversion technologies can
meet energy needs at the time of fossil fuel exhaustion. At the
present rate of use, fossil fuel exhaustion is certain. With that
certainty, the risks to human health and safety for present
populations and massive extinction for segments of future populations
loom catastrophic.
The pricing system assumes that decisions will be rational and
prudent. This may have been a logical assumption in an era of a
limited universe about which the decisionmaker had an acceptable
level of knowledge, or in an era of a large resource base in which
scarcity was relative and marginal propensities could be applied
prudently. This is no longer the case. Today, local decisions have
global significance. Micro-decisionmakers do not have adequate
information to ensure prudent decisions. To add to the seriousness
of the situation, there is clear evidence that reproductive, priority
and completive propensities will override the prudence propensity.
In addition, there is evidence that tech- nological development can
reduce price in the face of increasing scarcity. Thus, there is a
need for organizational and policy change to protect ourselves from
our propensities. A proposed approach will be discussed under "Price
Management."
Most people believe that general business practices leave much to be
desired. Unfortunately, some business people strive to "beat the
game." Others fall back on the cliche "business is business." Both
approaches mean that business practices can be within the law
although "not exactly" moral. If the economic system is to be
effective, efficient and fair to maximize effectiveness and
efficiency, personal accountability for moral (or right) behavior is
necessary. Legal justice is after the fact; morality is before the
fact. Morality can be considered prevention, while justice may be
considered the cure. Our adages tell us that "a stitch in time saves
nine"; "an ounce of prevention is worth a pound of cure." I believe
that personal accountability for moral behavior must become a
recognized instrument of efficient free market economics. Moral
behavior must become our culture. Rules of ethics, or right
practices, should be a part of Prudent Practices Guidelines, which
are discussed later.
Full-Cost Accounting
Full-cost accounting can change cost by changing cost allocation. A
change in cost allocation can change the basis for establishing
price. In addition, full-cost accounting provides needed information
about the source and magnitude of costs. Much progress is being made
in the acceptance of the full-cost accounting concept at the
international, national and local industrial plant levels. The
concept is now being made available for monetizing natural capital by
the United Nations, the U.S. Department of Commerce, industry and
several foreign nations. Full implementation of this concept is
essential to maximizing the effectiveness and efficiency of the free
market system.
Unfortunately, although full-cost accounting may be possible, proper
allocation of costs may not be feasible in all cases. For instance,
encroachment on nature's space needs for geologic aging and
atmospheric disturbances and floods entails uncertainties and risks.
These uncertainties and risks can be estimated. On the basis of
knowledge, humans can adapt to that which they cannot control. They
can provide insurance programs and other free market means to adapt
to their circumstances. However, in the case of atmospheric
disturbances, including rainfall resulting from anthropogenic
activities, the fair allocation of costs may be daunting. For
example, micro-actions by individuals and communities create
situations in which self-enforcing law converts solar light energy
into heat. This occurs in the atmosphere because of gaseous
emissions and at the Earth's surface because of changes in the
conversion and reflection of light energy. Climate change will first
become evident by an increase in the variability and violence of, and
precipitation from, atmospheric disturbances. I believe such trends
are now occurring. If they are, the insurance industry will have
difficulty in accommodating the rate of change. The economically
efficient answer will be found in prudent and moral practices for
prevention rather than cure. Proof of no harm should be an
accountability of the producer. Obviously, full-cost accounting is
of inestimable value in attaining the pricing system goal of "no
gain, no loss" for nonparticipants in economic transactions.
In endeavoring to maximize economic effectiveness and efficiency, the
taxes required to cover the costs of governance and government
services have become a significant item. Taxes are a financial
concern to private enterprise because they impact international
competitiveness and are a concern to individuals because they impact
job opportunities and their standard of living. I believe that to
maximize efficiency, the cost of governance should be separated from
the cost of services. The costs of governance should be minimized and
provided within a fixed budget. Costs can be minimized by
eliminating counterproductive micro-management. The costs of
services should be accounted for as operations and capital
investments. The budget of each category should be justified and
adhered to in accordance with the same sound economic rules that
government applies to "for profit" private enterprises. Government
must be held accountable to the same standards of performance
required of the private sector. It is the only sound way to minimize
the costs of government to ensure international competitiveness.
Any government taxation program should address the issues of income,
capital gains and estate taxes. All reflect regressive natural
economics. Natural Economics Impact Assessments can provide the
information necessary to maximize economic effectiveness and
efficiency to meet human needs. I am sure that Natural Economics
Impact Assessments will reveal that there are relatively few
individuals with the entrepreneurial capacity to create jobs and
wealth. This scarce resource should be leveraged, not stymied.
Income and estate taxes reduce the capacity of such individuals or
organizations to contribute to the common good. Income taxes should
be eliminated. In their place, there should be consumption taxes
supplemented by surtaxes on luxury consumption and wastage. I
believe that as a general policy, taxation "rules of the game" should
incentivize good behavior and disincentivize bad behavior. Welfare,
health care and crime should be addressed as economic, rather than
political, issues.
Accounting standards require that all transactions of the free market
economic system be based on the exchange of currency, i.e., money.
The exchange of money for value, however, may give the unrealistic
impression of infinite substitutability. It disconnects the real,
tangible resource from the value that money is supposed to represent.
It creates the perception that money is "just money." Actually, in
our free market economic system, money is an inadequate surrogate for
wealth. It is inadequate because wealth is an imperfect measure of
the value of human time. Generally, wealth is the result of creative,
prudent, economical, thrifty and persistent effort over time by
individuals. Thus, money is not "just money," it is a surrogate for
valuable human time and bother. Natural Economics Impact Assessments
and evaluations demonstrate this fact.
Consideration of money and value raises an interesting question:
Will consumers spend their money differently if they know more about
the industrial metabolism of the products they are purchasing? Some
producers think so. They advertise the "greenness" of their products
and endeavor to use the "greenness" of their products as a
competitive advantage. This is movement in the right direction;
however, this movement requires the means for ensuring truth in such
advertising. Such assurances are being provided through private
sector activities as well as through government.
Case-Specific Means
Case-specific means include those cases excluded from the system and
those cases violating the pricing system goal that non- participants
in transactions shall neither gain nor lose. Case-specific means
include treaties, command/control regulation and means for specific
situations, such as Global Commons fishing rights, mineral rights,
pollution control (e.g., Montreal Protocol on CFCs), new products,
major projects, specific taxes and rule-making legislation. Specific
cases require cost/benefit analyses and one or more types of impact
assessments under current legislation and should require Natural
Economics Impact Assessments in all cases. I believe that decisions
will be different if these analyses and assessments are made using
basic resources and natural economics' criteria as the prime basis
for decisionmaking. Conventional monetary-based analyses and
assessments can be used as the secondary basis for decisionmaking. A
standardized, natural economics approach can be used for all cases.
A change in environmental protection command/control regulatory
compliance policy from a means to a voluntary performance objective
base will stimulate the implementation of sustainable development. A
corporate voluntary commitment to go beyond compliance and to submit
to a third-party audit or citizen suit, to permit exposure through
the publication of audit results, and to agree to severe penalties
for deliberate or inept violations of voluntary commitments would
provide the following positive changes:
* Minimize government involvement by reducing monitoring and
enforcement costs.
* Stimulate use of sustainable product designs, material
substitutions and new sustainable manufacturing, waste minimization
and monitoring technologies.
* Maximize industrial economic efficiency and international
competitiveness by permitting timely change in accordance with
changing circumstances.
* Provide the general public and skeptical advocate groups a
guarantee of good faith performance.
* Open the door for broadening the base for a more ethical and
thereby more effective and efficient community performance.
Such regulatory changes can make it economically feasible for
producers to use sustainable performance as a competitive advantage.
Price Management
Price management is necessary for global, regional and local
situations where local owners of tangible assets or rights are
willing to sell their resources at a price below current regional,
national or global social value and significantly below future social
value. A glaring example of this kind of situation is the current
price of fossil fuels. These fuels are being used from hundreds of
thousands to possibly a million times the rate at which nature formed
them. The price is sufficiently low that wastefulness is common
(e.g., petroleum well-flaring of gas, ineffective uses for fuel).
Overall, the United States is the most wasteful user of energy in the
world. Current per capita energy consumption is 80 times the U.S.
average of 3,700 kilocalories per day of food energy we consume
individually to sustain our lifestyle. Morever, our current per
capita energy consumption is 82 times the world average per capita
food consumption of about 2,700 kilocalories per day. The overall
energy efficiency, including photosynthetic energy, for our food
growing and marketing system is about .03%. The food production
efficiency in the use of fossil fuel energy is about 10%. The food
growing and marketing system uses about 17% of the energy consumption
in this country. With 5% of the world's population, the United
States uses 25% of the world's fossil fuel energy. Currently, we
import more than 50% of our petroleum usage. About 90% of our energy
consumption is provided by fossil fuels.
Fossil fuel availability is limited spatially and finite
quantitatively. The resource is exhaustible. Excessive use of
fossil fuel resources raises serious international ethical issues
about loss of opportunity for current and future generations.
Because the resource is limited spatially, international trade is
necessary; thus, there is strong evidence of the need for an
international governmental organization to act as a Prudent Person
Surrogate. The concept of a Prudent Person Surrogate is not new.
Our Supreme Court and our Federal Reserve Board act as a Prudent
Person Surrogate. The Prudent Person Surrogate should have the
civility to wisely regulate fossil fuel price, based on reliable
information. The price should be established at the resource well-
head or mine mouth and should act as a disincentive to use fossil
fuels for fuel. The managed price should consider future scarcity.
It should include a "sustainability fee" and provide for the
accumulation of funds that can be used to develop energy conversion
alternatives, fulfill equity needs and institute revenue-neutral tax
reduction programs. Target price change should take place over 10 to
15 years. If enacted, I believe that such a program will have a
positive effect on the economy.
International cooperation is highly desirable, but not absolutely
necessary. Until international cooperation occurs, individual
nations can establish their own programs. Obviously, action is
critically needed in the United States. We should act because some
nations are managing the price of gasoline at this time to stimulate
efficiency in their economies. Their adjustments now can give them a
competitive edge in the future.
Other examples of where price management is needed include arable
land, which is rapidly becoming a globally scarce resource; coastal
lands, which are of significance to global commons fisheries; and
interregional wildlife migration pathways. The new science of
ecological economics is establishing methodologies for determining
realistic natural economics impacts and values. Although price
management should be the last resort, I see no way, at this time, to
avoid price management of critical resources such as fossil fuels.
It is the most effective way to equitably impact all levels of the
economy while transitioning to sustainable development and a
practical way for incentivizing the development of fossil fuel energy
alternatives. To be effective, price management should comply with
an economic constitution designed to ensure sustainable development.
The constitution should satisfy the need to institutionalize measures
for self-regulation of consumption through full-cost accounting and
pricing system instruments, such as a Prudent Person Surrogate, to
protect ourselves from our priority propensity to consume and our
completive propensity to exhaust accessible resources.
Prudent Practices Guidelines
Prudent Practices Guidelines would be virtue-based guidelines to
assist in meeting the "no gain, no loss" goal of the pricing system.
They would be developed by organizations and individuals to ensure
that both macro- and micro-decisions and actions enhance
opportunities for maximizing natural economics' effectiveness and
efficiency. Prudent Practices should include the following
instruments:
* Purpose and philosophy statements from all influenial
organizations.
* Codes of ethics from the professions.
* Performance commitments for environmental and resource conservation
from industry groups.
* Product quality and truth in advertising certifications.
The practices should be used as an adjunct to command/control
regulation. They can be used as a substitute if they are supported
by Natural Economics Impact Assessments, commitment on the part of
the subject organization to go beyond compliance, and appropriate
audit or citizen suits to confirm or to ensure adherence to the
performance commitment made by the regulated organization.
It must be remembered that the means for ensuring fairness (i.e., no
loss of opportunity) for future generations may be significantly more
complex than the means for ensuring fairness to members of the
current generation. Decisions must answer the question of moral
rightness and timeliness. If the proposed action is morally right
and must be done eventually, why not do it now? In some cases,
Prudent Practices may be technology-based and may require physical
changes to correct micro-level variances from the nonparticipants'
"no gain, no loss" goal. In other cases, Prudent Practices may
require only simple moral behavioral changes and could be called
"Right Practices." Right Practices can fill the void created by the
inability to monetize a micro-transaction. Few organizations are so
efficient that Prudent or Right Practices Guidelines cannot be
creatively introduced into their culture. My experience shows that
Prudent and Right Practices engender efficiency and thereby cause
unexpected favorable outcomes.
The Prudent Practices Guidelines idea is promising because, in
enlightened self-interest, segments of the private sector have in the
past and are now establishing and conforming to standards for their
own and the public's common good. Voluntary compliance with Total
Quality Management concepts, various industry environmental
protection standards and ISO 9000 standards are some examples.
Willingness to voluntarily comply with the proposed ISO 14000
standards for environmental protection is another example.
THE NEED FOR CHANGE NOW
The role of the economic system is to provide the organization and
"rules of the game" so that participants in the system will
contribute toward the effective and efficient allocation of
accessible systems resources in the course of satisfying their own
needs and wants. From a sustainable development perspective, this
role will enable participants in economic transactions to contribute
toward maximizing their community's capacity to sustain itself.
Sustainable development is a requirement to avoid nature's inhumane
process of massive extinction for culling the species. To avoid that
process, maximization of local sustainability capacity will require
the trade of energy and matter for human energy, time and bother to
effectively and efficiently utilize accessible human resources. It
may require the enhancement of human capacity to better utilize local
energy, material and space resources. In other cases, it may require
population control because local population needs exceed the local
sustainment capacity. Thus, there are serious issues of resource
allocation and personal accountability.
It must be recognized that there is no large city that is sustainable
from resources solely from within its geographical limits. It must
also be recognized that on that basis there are only a few
sustainable countries; thus, there is need for free trade. The rules
of free trade, however, must be concerned about the equity of the
wasteful use of resources and the impact of such practices on the
loss of opportunity for both present and future generations. Free
trade rules must also look at the global impact of continued resource
wastefulness on the loss of productivity from the Earth's life system
and the costs of more variable weather and more violent atmospheric
disturbances. The wants of the global community will place
significant pressure on resource accessibility and will rightfully
challenge wasteful practices that reduce the quantity of resources
accessible to the human economy while at the same time creating
serious risks to human health and safety. I believe that the world
community will challenge the prudence of risking the potential for
large present and future generation costs for the sole purpose of
permitting current practices to continue that are convenient to
present populations but violate the rules of sound economics.
The goals of the "rules of the game" governing the participants in
the free market economic system are theoretically and morally sound.
The pricing system goals are applicable to sustainable development.
In many cases, surrogates have been provided to correct the system's
deficiencies, and many things have been done well. The only flaw in
the theory that seriously constrains sustainable development
implementation is the lack of recognition that the human propensity
used to drive the economic system is the same propensity used by
Mother Nature to cull her species. Thus, humans will naturally tend
to creatively exhaust resources in the short-term unless they are
sufficiently wise to counterbalance their priority propensity.
Counterbalancing their technological creativity and priority
propensity through use of a Prudent Person Surrogate for nonrenewable
resources offers a simple and practical means for resolving the most
significant issues of the industrialized and industrializing nations
and solving the world's problem of attaining a sustainable capacity
for meeting its needs and exacting its aspirations.
I feel confident that Natural Economics Impact Assessments will
provide the change in perspective necessary to understand the merits
of the theory supporting the free market system and to objectively
evaluate the means of improving the effectiveness and efficiency of
that system. If an honest effort is made to attain the pricing system
goals of the free market system, if a national sustainable
development objective is adopted, if full-cost accounts and
accounting concepts are accepted, and if Natural Economics Impact
Assessments are the primary basis for decisionmaking, the United
States will be able to become significantly more efficient and will
be able to achieve a sustainable capacity.
I believe that no nation can afford to support wasteful resource use
practices from either a moral or an international competitiveness
perspective. I believe that there is a dire need for the United
States to change course and to become a leader in attaining global
sustainable development. Therefore, I present a strawman (see Table
1 at the end of this paper) for alteration of the free market
economic system that will assist in attaining the nation's
sustainable capacity to meet its needs and exact its aspirations.
Integration
Integration of the limited scope free market economic system into the
complete scope natural economics system will take time and sound
planning. Alteration of the free market system to accommodate
integration must take place to ensure our well-being. The issue is
not whether, the issue is how and how fast.
The highest priority for humankind and for our country is to provide
the organization and policy to counterbalance humankind's
propensities toward the exhaustion of nonrenewable resources,
particularly fossil fuel resources. We should take advantage of the
current window of political opportunity. The private sector should
accelerate their Prudent Practices programs and continue the
voluntary "beyond compliance" performance objective initiative to
change the environmental command/control regulatory process. The
private sector must be willing to be honest and to expose itself to
tests of honesty. Such a willingness could change the "virtue-base"
and the economic efficiency of the entire nation. The Republican
Congress and Democratic President should continue to reinvent and
downsize government. They should establish a national Sustainable
Development Objective and provide role model leadership for the
development of sound natural economics goals.
The integration of a full-cost accounting and free market pricing
system into the natural economics system provides a scientifically
and morally sound economic system. It has the potential for changing
perspective and incentivizing moral behavior for the benefit of both
present and future generations.
Once initiated, I am confident that the concepts of natural economics
and sustainable development will create the environment for change
needed to maximize our national well-being. I believe that an
economy based on the principles of natural economics will attain
sustainable development and will be more effective, more efficient,
more productive, more stable and more gratifying to all of us. Time
is short; procrastination aggravates pernicious problems. Our future
is in our hands.
1Economics Principles, Problems, Decisions, 5th Edition, Edwin
Mansfield, W.W. Norton and Company, New York, London.
TABLE 1
Free Market Economic System Alteration Needs
1.Adopt a National Sustainable Development Policy, such as: The
present generation is to attain the capacity required to meet its
"needs" and exact its "aspirations," through maximizing natural
economics' effectiveness and efficiency in using accessible basic
resources, without foreclosing the opportunity for future generations
to attain an equivalent capacity to meet their own "needs" and exact
their own "aspirations."
2.Leverage the strengths and bolster the deficiencies of
the free market system so that efforts, in self-interest, contribute
toward implementation of sustainable development through:
* Adopting the United Nations' proposed Natural Capital accounts and
accounting standards for determining Gross Domestic Product (GDP) and
Sustainable Income (SI, i.e., Sustainable Net Domestic Product), and
for using natural economics' criteria and standards (true full-cost
accounting) as a supplement to monetary criteria and standards in
economic impact assessments.
* Establishing a nonpartisan Sustainable Development Board to set a
present price for nonrenewable resources so that future generation
nonparticipants in economic transactions shall neither gain nor lose
by:
* Acting as a Prudent Person Surrogate with supreme power to develop
and enforce an economic constitution and to plan for ensuring a
sustainable economy.
* Providing a process for determining present fair market value of
nonrenewable resources and for justifying value change.
* Assessing and collecting a "sustainability fee" at the extracted
resource's source.
* Managing such funds for research and development and for taxation-
neutral and other justified purposes.
* Enforcing the free market pricing system goals that present
generation nonparticipants in economic transactions neither gain nor
lose by:
* Accelerating the private sector initiative toward the use of
morality -- through purpose and philosophy statements, codes of
ethics, performance commitments, certifications and Prudent Practices
Guidelines -- in the conduct of normal business as a means to assure
the public that practices are honest, as a differeniator among
competitors, and as a prevention measure to minimize the unethical
practices and legal costs associated with doing business.
* Changing environmental protection command/control regulatory policy
from an imposed means to a voluntary performance commitment basis.
* Using other established pricing system surrogates, as appropriate.
3.Enhance the government's contribution toward system effectiveness
and efficiency through:
* Separating the accounts and accounting for and reporting the costs
of governance and government services.
* Downsizing governance by less micro-management by law and more
macro-management by policy.
* Requiring government services to abide by the same rules for
operations and investments as government applies to the for-profit
private sector.
* Treating health care, welfare and crime prevention as economic
investments rather than political issues.
* Eliminating regressive income, capital gains and estate taxes and
replacing them with progressive consumption taxes and luxury
consumption and wastage surtaxes.
* Terminating all existing subsidy programs and reinstating only
those programs that can pass new natural economics' criteria and new
"sunset provisions."
(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston,
Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone
610-701-3511, Internet Address: henrym@rfweston.com)
About Roy F. Weston, Inc.
Pioneering the industry since 1957, WESTON has become a leading
international environmental management, design and consulting firm
working in the public and private sectors to preserve, protect and
restore vital air, land and water resources. Nearly 2,800 WESTON
people specialize in analytical laboratory services, engineering,
facility construction and operations, remediation and large-scale
turnkey programs. Based in West Chester, Pa., WESTON has 60 offices
and laboratories across the U.S. with international operations in
Europe and the Asian Pacific.
"Sustainable Development" WESTON WAY April/May 1995
Part 5 of 8
SUSTAINABLE DEVELOPMENT
MAKES GOOD BUSINESS SENSE
by
Andrew L. Ullman, Senior Project Leader
and
James A. Fava, Ph.D., Project Director
Roy F. Weston, Inc.
INTRODUCTION
As an environmental business manager in today's global economy, you
face some tough challenges. You must:
* Understand complex regulations and their implications for your
enterprise, including the emerging Securities and Exchange Commission
environmental liability disclosure requirements and the U.S.
Department of Justice prosecution and sentencing guidelines for
environmental crimes.
* Protect your business interests from liabilities that could mar
your image in the marketplace or your investment value to
stakeholders. In fact, some U.S. companies have had to reserve more
than $300 million in one year to address environmental liabilities.
* Voluntarily adhere to a variety of established environmental
performance standards, for example, Europe's Eco-Management and Audit
Scheme, which promotes continuous improvement in industry
performance.
These challenges underscore the importance of integrating
environmental improvement systems, objectives, targets and practices
into your day-to-day operations to help ensure good decisionmaking.
The overarching goal is to ensure that your enterprise grows and
prospers over the long term and, at the same time, to ensure that
your enterprise does not adversely impact natural and human
resources. This goal is consistent with the broader concepts
associated with sustainable development.
Recently, the International Institute for Sustainable Development
developed a definition for sustainable development as it relates to
business: "For the business enterprise, sustainable development means
adopting business strategies and activities that meet the needs of
the enterprise and its stakeholders today, while protecting,
sustaining and enhancing the human and natural resources that will be
needed in the future."
The fundamental premise is that an enterprise that can successfully
accomplish the development of an environmental management system
(EMS) that is consistent with the principles of sustainable
development will gain a long-term global competitive advantage. This
paper describes what an EMS is, how to implement an effective EMS and
what benefits can be expected.
WHAT IS AN ENVIRONMENTAL MANAGEMENT SYSTEM (EMS)?
An EMS is a group of policies, standards, systems, practices and
tools to increase an organization's effectiveness in dealing with
environmental matters. An effective EMS is integrated across all
relevant functions within a company and ideally is consistent with
sustainable development principles. These functions include the
following:
* Siting, construction and operation of manufacturing facilities.
* Site remediation management.
* Employee performance evaluation.
* Product, process design and/or modification.
* Procurement of materials and supplies.
* Information management.
* Business management.
* Internal and external communications.
For each of these functions within an enterprise, decisions are made
regularly that have some level of impact on minimizing pollution,
managing waste, energy efficiency, product safety (from a human and
environmental perspective), employee welfare, risk management and
community relations. These decisions are made either by a separate
unit solely responsible for environmental improvement or by
individuals whose jobs involve making environmental improvements, or
a combination of these two.
Having an independent unit responsible for environmental management
could result in inefficient operations by creating duplicate systems,
establishing unclear responsibilities and delaying or protracting
decision-making. Effective integration of environmental performance
improvement into an enterprise involves including it as an element in
the activities or actions of individual in the enterprise, operating
within well-defined environmental management policy, management
systems, objectives, targets and practices.
HOW YOU IMPLEMENT AN EFFECTIVE EMS
The three main phases in the implementation of an effective EMS are
Assessment, Improvement and Measurement (the AIM process, Figure 1 at
the end of this paper).
Assessment
In the assessment phase of the process, an enterprise compares its
performance against predefined criteria. Areas to be considered
during this phase include compliance management, remediation
management and product stewardship. These criteria can be based
either internally on specific goals or externally on such standards
as the sustainable development principles developed by the
International Chamber of Commerce. An enterprise may also choose to
benchmark its performance against that of other enterprises. When the
assessment phase is completed, the organization can determine which
areas require improvements and set goals for making these
improvements.
Improvement
Once areas for improvement are identified and prioritized, these
improvements can be planned and implemented. Typical areas for
improvement include:
* Corporate goals, objectives and performance standards.
* Facility operating manuals.
* Training programs.
* Design for environment programs.
* Project management systems.
* Information systems.
An implementation plan, which includes schedule, resource
requirements, expected return and performance measurement criteria,
is usually developed for each improvement area. The changes are then
executed within the company.
Measurement
To ensure continuous improvement, an enterprise should implement a
performance measurement system along with the identified
improvements. The performance measures should be based on clear,
quantifiable goals covering both technical performance and business
impact improvements (e.g., cost reduction and liability reduction).
Success Factors
The proper development and implementation of an effective EMS can
yield significant benefits. Several critical success factors
associated with developing these types of management systems are as
follows:
Senior Management Commitment
As with any performance improvement/re-engineering process, it is
critical that the senior executives within the organization be 100
percent committed to the improvement process from the beginning. If
senior executives are involved, they will motivate both the
environmental managers, who are making the bulk of the changes, and
the other stakeholders (employees, customers, investors), who will be
potentially affected by the changes.
Clear Goals and Objectives
To help ensure continuous improvement, all personnel involved must
understand what the environmental goals are and how their performance
will be measured against those goals.
Resources Commitment
The proper implementation of an effective EMS requires a significant
upfront commitment of financial and personnel resources. Enterprises
must realize that although the financial benefits of an EMS program
may significantly exceed the costs, these benefits may not be
realized for 1 or 2 years after the system improvements have been
made.
Effective Information Flow
This critical area is often ignored during the improvement process.
Many companies have developed elaborate operating procedures/ manuals
but do not have the systems to track regulatory changes or update all
personnel affected by changes in procedures required in a rapidly
evolving regulatory environment.
HOW YOU WILL BENEFIT FROM AN EFFECTIVE EMS
Of course, compliance is significantly improved by an effective EMS.
As a result of improved compliance, an enterprise can realize
substantial savings. For example, a U.S. manufacturing company did an
internal study on incidents of noncompliance and determined that the
actual cost of such incidents was more than 5 times the cost of the
fine. This company was averaging more than $1 million in fines per
year during the course of the study, so their total cost of
noncompliance was significant. In addition to reduced compliance
costs, an enterprise can benefit from an improved image, and
consequently, improved flexibility in siting facilities.
The benefits of an effective EMS go far beyond regulatory compliance
(which seems to be the main focus of many organizations). An
enterprise that has an effective EMS can conserve resources (e.g.,
energy, water, raw materials) and significantly reduce remediation
and capital project costs. In addition, some enterprises have used
environmental issues to create marketing advantages over their
competitors as well as to enhance the confidence of their investors
and other stakeholders. See Table 1 (at the end of this paper) for a
listing of additional potential benefits of an integrated EMS.
In most cases, the benefits outlined above far outweigh the costs of
upgrading a company's EMS. Although many enterprises may initially
believe that moving toward sustainable development through the
development of an integrated EMS will be just another
administrative burden, it is important to analyze all the costs and
benefits of such a program before making a decision. An integrated
EMS can often increase efficiency and make your enterprise more
competitive.
(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston Inc.,
1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone 610-
701-3511, Internet Address: henrym@rfweston.com)
About Roy F. Weston, Inc.
Pioneering the industry since 1957, WESTON has become a leading
international environmental management, design and consulting firm
working in the public and private sectors to preserve, protect and
restore vital air, land and water resources. Nearly 2,800 people
specialize in analytical laboratory services, engineering, facility
construction and operations, remediation and large-scale turnkey
programs. Based in West Chester, PA., WESTON has 60 offices and
laboratories nationwide with international operations in Europe and
the Asian Pacific.
"Sustainable Development" WESTON WAY April/May 1995
Part 6 of 8
ISO 14000:
A Building Block for Redefining Environmental Protection and Moving
Toward Sustainable Development
by
Robert B. Biggs, Ph.D., P.G.
Vice President
and
Glenn K. Nestel, Vice President
Roy F. Weston, Inc.
INTRODUCTION
The momentum toward global markets and international trade agreements
has prompted a broad cross-section of companies to adopt
international consensus standards, such as ISO 9000 Standards on
Quality Management. These same free trade drivers, coupled with the
"greening" of global markets and issues like cross-border pollution
impacts, have created the impetus for the Switzerland-based
International Organization for Standardization (ISO) to formulate
environmental management standards. The emerging ISO 14000
environmental standards represent an impending "sea change" that
promises to reshape the way both the private and public sectors think
about environmental protection.
The ISO 14000 framework represents a move toward integrating
sustainable development principles into our free market economic
system. It is an important first step toward adopting a system of
natural economics as referred to in this issue's accompanying papers.
ISO 14000 will incentivize self-organizing and self-regulating
approaches to environmental protection that will lay the groundwork
for continuous performance improvements.
We expect the strong linkage of ISO 14000 with ISO 9000 to further
drive this trend. Benefits derived from the total quality management
movement in the 1980s provided strong incentives for businesses to
seek ISO 9000 registration. Like quality management, environmental
management follows a continuous improvement model. ISO 14000 will
stimulate new approaches to materials selection, product and process
design, and transportation logistics at each step of the product life
cycle. These approaches will lead to overall reductions in
environmental burdens, as well as the development of economics-driven
reverse distribution systems that reclaim recyclable components at
the end of a product's service life. ISO 14000 will encourage
significant changes in the way we have traditionally valued both
renewable and nonrenewable natural resources. ISO 14000 will also
create a market-driven framework for balancing environmental
protection with socioeconomic needs and will foster the concepts
embodied in sustainable development and natural economics.
OVERVIEW OF ISO 14000
ISO 14000 Drivers
Faced with global markets and competition for selling their goods and
services, many companies have moved toward new manufacturing and
quality control methods. New sourcing models have evolved, and
quality management requirements have been extended to suppliers,
resulting in significant benefits in productivity and cost
competitiveness. The rapid move to adopt ISO 9000 over the past 3 to
4 years has been driven by many factors, a significant one being the
benefit of having a single, global set of quality management
standards. ISO 9001 or 9002 certification now defines a standard of
excellence that replaces periodic customer quality audits of
suppliers.
Similarly, in the United States, escalating environmental compliance
and remediation costs, coupled with evolving requirements for
companies to fully disclose their environmental discharges and
environment-related costs, have created a growing awareness of
environmental requirements. Sensitivity to environmental requirements
has also increased internationally. This increasing environmental
awareness culminated at the June 1992 United Nations Conference on
Environment and Development (UNCED) in Rio de Janeiro, Brazil, where
the concept of sustainable development was rolled out globally and
more than 100 countries agreed on the need for further international
environmental management standards. This meeting and subsequent
UNCED/international focus represent much of the impetus behind the
ISO 14000 development process over the last 2 years. There is, in
fact, a new group of stakeholders driving enterprises to adopt
sustainable business practices. In addition to the traditional
stakeholders (shareholders, lenders, regulators and policy makers),
the new emerging stakeholders include employees, suppliers,
customers, trade associations, professional societies, and community
and environmental groups.
ISO 14000 Elements
Figure 1 (as shown at the end of this paper) illustrates the overall
ISO 14000 continuous improvement model. It begins with executive
management's commitment to corporate governance by a set of
overarching principles, including:
* Environmental protection as one of the highest corporate priorities
with clear assignment of responsibilities and accountabilities to all
employees.
* Compliance with all environmental laws and regulations applicable
to the company's activities, products and services.
* Ongoing communications on environmental commitment and performance
with all stakeholders.
* Strategic planning that sets forth environmental performance
objectives and targets, implemented through a disciplined management
process.
* Periodic performance measurement, as well as systems audits and
management reviews, to achieve continual improvement wherever
possible.
* Full integration with health and safety, quality, finance, business
planning and other essential management processes.
ISO 14000 is a series of standards and guidance documents that falls
into two broad categories. The first category is Environmental
Management Systems (EMS), comprising the following three standards
plus an overall guidance document:
* ISO 14000 - Guidance on How To Set Up and Improve EMS
* ISO 14001 - EMS Specification Standard for Registration Purposes
* ISO 14010-12 - Auditing Principles and Procedures for
Internal/External Auditors
* ISO 14031 - Guidance on Measuring Environmental Performance
British Standard (BS) 7750 and the evolving European Communities' Eco-
Management and Audit Scheme (EMAS) have significantly influenced
these ISO 14000 EMS standards. These EMS standards are being
developed rapidly, with issuance of the final versions expected later
this year or early in 1996.
The second category of standards is more operationally focused in
areas of product stewardship. Two standards are under development,
one set governing methodology for life-cycle assessment (ISO 14041-
44) and a second governing labeling principles (ISO 14020-24). These
standards are not as advanced in the process, with issuance not
expected before mid-1997.
Another document, ISO 14012 - Initial Review, is currently being
considered. This document would provide guidance for an initial
assessment of a company's current situation (baseline determination)
in preparing to seek EMS registration under ISO 14001.
Links with Quality Standard ISO 9000
As part of the ongoing EMS development process, Technical Committee
(TC) 207 for ISO 14000 is closely coordinating its activities with TC
176, which governs the ISO 9000 quality standards. At a minimum,
this coordination will ensure similarity in the ISO 14000 EMS
standards structure and format and should result in significantly
reduced EMS implementation and registration costs for companies that
are already ISO 9000-certified. Figure 2 (at the end of this paper)
is a matrix comparing the elements of ISO 9000 with the draft ISO
14000 EMS.
Beyond the formal ISO certification process, the natural linkages
between quality and environmental management processes will lead to
combined integration into a company's overall business management
systems. Practicality will extend this integration to other
emerging environmental management codes, such as U.S.
Chemical Industry Responsible Care, BS 7750, International Chamber
of Commerce (ICC), Global Environmental Management Institute (GEMI),
Coalition for Environmentally Responsible Economies (CERES) and the
EMAS regulations, resulting in a single fully integrated
Environmental Management System. See Figure 3 (at the end of this
paper).
WHY ISO 14000 IS EXPECTED TO BECOME THE GLOBAL EMS STANDARD
ISO 9000 Momentum/Market Forces
As indicated above, ISO 14000 has been significantly influenced by
the ISO 9000, BS 7750 and EMAS regulations. ISO 9000 certification
has emerged as the global quality management standard. Thousands of
companies have already embarked on ISO 9000; rapid implementation has
occurred in sectors like chemicals and electronics. ISO 9000
registration has been strongly leveraged by customer/supplier
relationships. ISO 9000 is being market-driven as ISO 9000 companies
require their suppliers to become certified. This chain of commerce
linkage is a compelling reason for companies to proceed, and we
believe there is sufficient ISO 9000 momentum for a natural carry-
through into ISO 14000. The timeline and dynamics of the
certification process also provide incentives for getting a head
start on the ISO EMS process.
Avoidance of Trade Barriers
As previously stated, the official adoption of the ISO 14000
standards is expected to begin by early 1996. The continued rapid
growth of ISO 9000 registration and the resulting business successes
will provide prima facie evidence driving companies to proceed with
ISO 14000 once it becomes ratified. International trade will also
play an important role. ISO 14000 is being seriously considered for
adoption under NAFTA and various GATT trade agreements to prevent the
development of artificial trade barriers from country-specific
environmental requirements. Vice President Gore's sustainable
technologies task force is, in fact, looking for ways to stimulate
the export of U.S. environmental technology to Third World countries.
All these developments represent moves toward integrating
environmental protection/sustainable development into our free market
economics systems, while embracing natural economics principles.
Why Get Started with ISO 14000 Now?
For those companies already involved in ISO 9000, the answer is
obvious. Achieving certification is an arduous process requiring
numerous internal resources and significant support and assistance
from consultants. Experience indicates that ISO 9000 certification
takes a minimum of 18 to 24 months, even in companies with well-
established quality programs. Many companies who started ISO 9000
early have achieved preferred supplier status and gained a
significant competitive advantage. For those who delay, ISO
certification has often become a reactive exercise requiring
inordinate amounts of resources to catch up with competitors who are
already registered.
More importantly, significant performance improvement benefits can be
gained by having an effective environmental management system in
place. ISO 14000 is one such tool for companies to:
* Better address growing environmental protection pressures.
* Help minimize legal/financial liabilities.
* Reduce compliance costs.
* Enhance stakeholder image.
* Gain competitive advantage.
ISO 14000 also provides the framework for designing more
environmentally benign processes and products.
Numerous proactive companies have realized the competitive benefits
of superior environmental performance. In the waste
minimization/pollution prevention arena, reduced operating costs and
cost avoidance opportunities have resulted in lower cost structures
relative to competitors and corresponding market share gains and
bottom line improvement. Design-for-environment strategies applying
life-cycle concepts are emerging, and new products are selectively
achieving market successes so long as the market pricing structure is
carefully considered. Overall, ISO 14000 implementation will provide
a framework for improving regulatory compliance and for supporting
environmental protection decisions in balance with other
socioeconomic needs. ISO 14000 will provide the building blocks for
improving the environmental performance of an enterprise's activities
and products consistent with sustainable development and natural
economics principles.
(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston,
Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone
610-701-3511, Internet Address: henrym@rfweston.com)
About Roy F. Weston, Inc.
Pioneering the industry since 1957, WESTON has become a leading
international environmental management, design and consulting firm
working in the public and private sectors to preserve, protect and
restore vital air, land and water resources. Nearly 2,800 WESTON
people specialize in analytical laboratory services, engineering,
facility construction and operations, remediation and large-scale
turnkey programs. Based in West Chester, Pa., WESTON has 60 offices
and laboratories across the U.S. with international operations in
Europe and the Asian Pacific.
"Sustainable Development" WESTON WAY April/May 1995
Part 7 of 8
SUSTAINABLE DEVELOPMENT
The Economic Model of the Future
by
Roy F. Weston, P.E., D.E.E., Chairman Emeritus
Revised September 1993
DEFINITION
Sustainable development(1) is a concept for a process of change in
which human attitudes and behaviors are modified so that, in
endeavors to meet needs, achieve aspirations and preserve options for
future generations, individuals and communities(2) will enhance and
maintain their well-being by:
* Maximizing natural economics'(3) effectiveness and efficiency
through:
* Conceiving development as an integral and compatible part of the
Earth's systems.
* Emulating the economics of nature in the production and use of
resources.
* Removing barriers to human goodwill, cooperation and capacity
enhancement.
* Attaining necessary balance among:
*Resources(4) accessibility.
*Requirements of communities.
*Capacity of communities to meet their requirements.
* Implementing Guidance Principles in establishing goals, strategies,
tactics, and the plans needed to meet the effectiveness, efficiency
and balance requirements of subject communities.
GUIDANCE PRINCIPLES
* Be accountable, personally; practice enlightened self-interest; and
acknowledge that every individual's decisions and actions make a
difference. Contribute toward the sound governance and maximization
of the common good(5) of relevant communities. Be circumspective and
caring. Behave ethically and prudently. Anticipate, set goals,
strategize, plan, implement, monitor, reassess and react.
* Accept custodianship of the Earth's life system and the systems on
which it depends.
* Acquire and diffuse the knowledge needed to understand
fundamentals, to achieve goals and to ensure informed risk taking.
* Emulate the economics of nature:
* Maximize system productivity and efficiency in the conversion and
use of energy.
* Minimize losses and wastage(6) in the use of essential nonrenewable
resources.
* Optimize overall effectiveness and efficiency in the production and
use of renewable resources.
* Alter humankind's cultural and institutional "rules of the game" to
ensure attainment of the above.
(1)Development: Any change in conditions, materials, products, uses,
services, structures, facilities, systems or activities associated
with human endeavors.
(2)Community: A group of people with common interests living under
the same laws [e.g., Earth, nation(s), municipality(ies),
business(es), vocation(s), society(ies) and neighborhood(s)] or a
group of animals and/or plants living together in the same
environment.
(3)Natural economics: Involves the total system, including both
natural and human subsystems. The concept uses all Laws of Mother
Nature to provide the most effective and efficient way to achieve a
desired outcome. It assesses full costs and benefits including
factors excluded from or considered as externalities to the
conventual financial-incentive free market economic system. Theory
recognizes the impact of factors such as the limits and finiteness of
natural resources, natural limits and balances, micro-decisions and
actions, interrelationships, interdependencies, self-regulation,
human factors, instincts, heredity, variability, foreign to nature,
resource irreplaceability, rate of change, prevention vs. cure, risk
and the need for multigenerational planning horizon, a community-unit
approach, the concept of "common good" and integration with
religious, cultural, governance and human economic systems. It is
based on reserves, input, output and losses/wastage. It requires
that proposed goals be performance-based and permit options for
implementation and that accounting principles and standards provide
consistency between the public and private sectors. It measures
performance by using parameters such as: achieved standard of living
and/or quality of life, human capacity to produce and trade,
accessibility of resources for future use, non-human life system well-
being and productivity, maximum sustainable yield, natural and made
wealth, and "net" domestic income. Also, natural economics is based
on the use of natural units of measurement for the quantification of
energy, materials, space, life and time.
(4)Resources: The Earth's resources are limited spatially and are
finite quantitatively. They include energy, materials, space, life
and time.
(5)Common good: Minimal disparity in well-being between individual
members of the community consistent with maximization of the media of
the well-being of all members.
(6)Wastage: The controllable loss or transfer of energy and/or
matter to the environment, such that natural or human economic
constraints make such resources inaccessible to the community's
economy for future use.
(Reprinted from "The Weston Way," April/May 1995, Roy F. Weston,
Inc., 1 Weston Way, West Chester, PA 19380 USA, Roy F. Weston, Phone
610-701-3511, Internet Address: henrym@rfweston.com)
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