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Green Economy Inquiry: Environmental Audit Committee

Green House's response to the Environmental Audit Committee’s inquiry into the Green Economy.

We recently marked the centenary of the birth of E. F. Schumacher and it is 40 years since he published Small is Beautiful we have seen an acceleration of species loss, rapidly rising carbon emissions, and the depletion of a range of essential resources. Over the past few years the issue of climate change has moved from a peripheral concern of scientists and environmentalists to being a central issue in global policy-making. This is but one of many indications that our economy is in fundamental conflict with our ecological systems; it was these indications that stimulated the development of a green approach to the economy.

Nicholas Stern famously identified climate change as the greatest ever example of market failure. Climate change is only one, although clearly the most serious one, of the many environmental crises we are facing. In the discourse of orthodoxy each of these is an independent example of ‘market failure’, the solution being merely to strengthen property rights and extend the reach of the market, as in proposing carbon trading as a solution to climate change. For a green economist, by contrast, the strict market ideology itself is the failure, and beneath and beneath that failure lies a deeper failing of our society to recognize and celebrate its place within a living, breathing planetary system.

Summary of Green House's evidence:

  • A ‘green economy’ is not a globalised market economy producing a slightly different range of products; a green economy would be an economy whose design was compatible with the primary constraint on human life: that we live within ecological limits.
  • The central change that a green economy requires is from considering the economy, environment and society as intersecting but separate to recognizing that the economy is located within society, which is in turn embedded within the environment.
  • A green approach to the economy would seek to move the target of our economy away from economic growth and towards flourishing, convivial human communities which do not threaten other species or the planet itself. In place of economic growth we should move towards a steady-state economy.
  • As demonstrated by the report Prosperity without Growth by the Sustainable Development Commission, we reject the idea that ‘business as usual’ can lead to a sustainable future. The sorts of increases in energy and materials efficiency required to ensure our current level of consumption at a sustainable rate of resource use are simply not feasible.
  • Permaculture principles are useful in guiding economic developments: for example, we will have more examples of closed-loop economics, where the consequences of our economic decisions impinge on us directly rather than being exported to other distant communities.
  • In a green economy businesses will need to learn from the ways of nature, hence the importance of closed-loop production systems and biomimicry.
  • A green economy is likely to be dominated by co-operative businesses, guided by humane and respectful principles and values, rather than corporations, legally constrained to maximize value for shareholders
  • A green economy would not rely on lengthy supply chains for the provision of basic goods and resources, but rather would be based around a system of self-reliant local economies.
  • A green economy is likely to focus more on livelihoods than simply on the labour-market, and opportunities should be made available for citizens to meet their own needs, especially by opening up access to land.
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