Nature can teach us sustainable economicsComment on this story
Last Thursday I had the pleasure of occupying a front row seat at the annual South American Business Forum hosted in Buenos Aires. While boasting an impressive line-up of international speakers, it is the words of Eban Goodstein, the director at Bard College for Environmental Policy in New York, that stuck with me a week later: “To truly reach a sustainable economy, the world is going to need to model commercial systems on natural systems.”
Goodstein explained how nature produces no pollution, it never has an energy crisis and it operates no systems that are too big to fail or require debt in order to spur growth. With 3.8 billion years of experience, nature has perfected a system whereby all of its citizens are fed, housed and provided with adequate energy and clean water, while remaining in equilibrium with its surroundings.
The key to ensuring sustainable human life on earth will come from adopting insights from these proven systems.
Extracting technologies from nature, otherwise known as biomimicry, is a well-established practice in architecture and engineering circles. Paint for exterior walls is being modelled on the surface of butterfly wings to give it the ability to self-clean using only rainwater. Vibrant colour is created through a design of transparent fibres that reflect light at the exact angles that create the colour desired. Termite mounds are used by architects to understand how buildings can be designed to have adequate ventilation and heating without the need for energy intensive air conditioning units.
Replicating physical designs provides a significant set of challenges but innovators are making good progress. Lessons from nature’s systems of economics and resource management are far more difficult to apply.
Monopolies, for example, do not exist in nature. Or as Goodstein pointed out in a private meeting later in the week, the closest example of monopolies in nature were invasive species introduced by human migration. In nature as in economics, monopolies and centralised power choke out competition, increase consumption inequality and lead to predatory behaviour and the existence of unnecessary surplus. It is inefficient and unnatural.
The greatest difference between human and natural systems is that nature does not operate with fiat money (where money supply is greater than the value of deposits it represents). While trade exists in nature, the currency used is strictly an exchange of goods and services. Plants, for example, use their roots to supply subterranean fungi with sugar in exchange for phosphorous which they cannot produce themselves.
It would be impractical for humans to return to this bartering form of economics, but our diversion from a monetary system based on real value is what has led to the collapse of the world economy. The roaring 1990s were driven by the expansion of invented money; a debt then taken out against the future which our present is now paying back.
Nature operates without debt – growth is the reward for efficient use of resources, not the ability to shift consumption from one time period or region to another. Nature saves before it spends, and this simple restriction requires it to develop complex ways of achieving incredible output complexity with relatively low levels of inputs.
It is not necessary nor appropriate for humans to copy nature, but to secure a sustainable future of wealth and economic stability, it is important for us to not just learn about nature but to learn from it.
Pierre Heistein is the convener of UCT’s Applied Economics for Smart Decision Making course. Follow him on Twitter @PierreHeistein