From Poverty to Power Green, Oxfam 2008 - weman

3 POVERTY AND WEALTH A TWENTY-FIRST CENTURY ECONOMICSTHE ENVIRONMENTAL CRITIQUEUnlike feminism, environmental thinking, the second major lacuna inconventional economics, has moved rapidly from the margins to themainstream over recent decades, and is reflected in national legislation,the appointment of environment ministers, new academic disciplines,international agreements such as the Kyoto protocol, and massivepublic awareness. The driving forces behind such change have beenthe growing and incontrovertible evidence of serious environmentaldamage and the efforts of active citizens around the world to push theenvironment higher up the agenda of policy makers.As long ago as 1987, the concept of ‘sustainable development’came to prominence through the Brundtland Report, which defined itas ‘development that meets the needs of the present without compromisingthe ability of future generations to meet their own needs’. 11While vague, the definition cleverly brought together two fundamentalissues: the environmental degradation that so commonly accompaniesgrowth in the market economy, and the need for such growth toalleviate poverty. 12 To solve this apparent contradiction, policy makersneed to stop assuming that the natural environment is infinite andbegin taking the cost of damaging it into account.One way to do this is called ‘full cost accounting’ (FCA). UnderFCA, goods and services are priced to reflect their true costs (includingenvironmental and other social costs). Thus the true cost of a vehiclewould include its environmental impact and the cost of final disposal,in addition to the cost of manufacture. With full cost accounting,natural resources would be factored into calculations of a country’s GDP,natural resources would be redefined as assets on company ledgers,and damage to the environment would be built into a product’s cost.World Bank economists used just such an approach when theyestimated the depletion of natural resources and pollution damage inBolivia in 2003. They found that what conventional economic analysiswould have said was a national savings level of 12 per cent of totaleconomic output was actually a net loss of nearly 4 per cent. 13 InChina, losses from pollution and ecological damage have ranged from7–20 per cent of GDP in every year over the past two decades – noteven counting the 300,000 deaths per year that are attributed to airpollution. 14113