Value of Ecosystems Should Figure in Economic Decisions
Ecological scientists take stock
As the United States and much of the world try to recover from the current economic crisis, the nation’s largest organization of ecological scientists sees an opportunity to rebuild the economy for long-term sustainability. The key, these scientists say, is to take natural capital—ecosystem services such as clean water provisioning—into account. Because they lack a formal market, many of these natural assets are missing from society’s balance sheet and their contributions are often overlooked in public and private decision-making.
In a statement released today, the Ecological Society of America said that healthy ecosystems are the foundation for sound economies, sustaining human life with services such as food, fuel, and clean air and water.
“We are sensitive to the economic hardships so many people are currently facing,” says ESA President Alison Power. “But as the United States takes a fresh look at how our economy functions, we see a tremendous opportunity to adopt an approach that incorporates the value of natural ecosystems.”
ESA lays out four strategies for moving towards sustainable economic activity:
- Create mechanisms to maintain ecosystem services—Creating markets for services such as carbon sequestration would provide incentives for environmentally sound investments. However, markets must often be coupled with other strategies or they can lead to negative outcomes. For instance, the emissions trading legislation currently in Congress could provide financial incentive for carbon sequestration, motivating stakeholders to invest in low-carbon technologies. But some sequestration practices stand to reduce the quantity or quality of freshwater resources, resources that are available freely and therefore not priced. Additional mechanisms such as quality standards or land-use regulations would help ensure that the public continues to have adequate access to clean water.
- Require full accounting for environmental damage—Change our existing economic framework so that entities that degrade the environment are held accountable. For example, the adverse environmental impacts of fertilizer use are not reflected in fertilizer prices and users do not bear the costs associated with the resulting degraded rivers and lakes.
- Manage for resilient ecosystems—We should move away from management strategies that favor one ecosystem service at the expense of many others and transition to strategies that sustain a suite of services. This transition will improve the health and resilience of ecosystems, helping them sustain future generations, in spite of natural and human-driven disturbances.
- Enhance our capacity to predict the environmental costs of investments—While the economic repercussions of environmental change are increasingly clear, the linkage often becomes apparent only after the damage has been done. Models to predict the consequences of anthropogenic change, and monitoring systems to detect problematic trends could help address problems before they become irreversible.
ESA points out that some initiatives already exist that take natural capital into account. The World Bank’s concept of adjusted net savings calculates an economy’s rate of savings after factoring in natural resource consumption, pollution-related damages, and other environmental impacts. The U.S. Forest Service is exploring ways to advance markets for ecosystem services recognizing that forest ecosystems are natural assets with economic and societal value. And the U.S. Environmental Protection Agency’s Ecosystem Services Research Program is working to provide methods and models needed by states to understand the “cost and benefits of using ecosystem services.”
“Sustainable development requires that individual wealth—including natural capital assets—does not decline,” says the ESA in its statement. “This requires technological and behavioral changes to reduce both the demand for material resources and the volume and toxicity of waste products, while simultaneously improving human wellbeing.”
According to the Society, sustaining living standards and spreading the benefits of economic development while preserving the ecological life-support system on which future welfare depends may be humanity’s central challenge in the 21st Century.
The Ecological Society of America’s statement is available at: www.esa.org/pao/economic_activities.php