Wednesday, February 25, 2015

The Externality Trap, or, How Progress Commits Suicide

I've commented more than once in these essays about the cooperative dimension of writing:  the way that even the most solitary of writers inevitably takes part in what Mortimer Adler used to call the Great Conversation, the flow of ideas and insights across the centuries that’s responsible for most of what we call culture. Sometimes that conversation takes place second- or third-hand—for example, when ideas from two old books collide in an author’s mind and give rise to a third book, which will eventually carry the fusion to someone else further down the stream of time—but sometimes it’s far more direct.

Last week’s post here brought an example of the latter kind. My attempt to cut through the ambiguities surrounding that slippery word “progress” sparked a lively discussion on the comments page of my blog about just exactly what counted as progress, what factors made one change “progressive” while another was denied that label. In the midst of it all, one of my readers—tip of the archdruidical hat to Jonathan—proposed an unexpected definition:  what makes a change qualify as progress, he suggested, is that it increases the externalization of costs. 

I’ve been thinking about that definition since Jonathan proposed it, and it seems to me that it points up a crucial and mostly unrecognized dimension of the crisis of our time. To make sense of it, though, it’s going to be necessary to delve briefly into economic jargon.

Economists use the term “externalities” to refer to the costs of an economic activity that aren’t paid by either party in an exchange, but are pushed off onto somebody else. You won’t hear a lot of talk about externalities these days; it many circles, it’s considered impolite to mention them, but they’re a pervasive presence in contemporary life, and play a very large role in some of the most intractable problems of our age. Some of those problems were discussed by Garret Hardin in his famous essay on the tragedy of the commons, and more recently by Elinor Ostrom in her studies of how that tragedy can be avoided; still, I’m not sure how often it’s recognized that the phenomena they discussed applies not just to commons systems, but to societies as a whole—especially to societies like ours.

An example may be useful here. Let’s imagine a blivet factory, which turns out three-prong, two-slot blivets in pallet loads for customers. The blivet-making process, like manufacturing of every other kind, produces waste as well as blivets, and we’ll assume for the sake of the example that blivet waste is moderately toxic and causes health problems in people who ingest it. The blivet factory produces one barrel of blivet waste for every pallet load of blivets it ships. The cheapest option for dealing with the waste, and thus the option that economists favor, is to dump it into the river that flows past the factory.

Notice what happens as a result of this choice. The blivet manufacturer has maximized his own benefit from the manufacturing process, by avoiding the expense of finding some other way to deal with all those barrels of blivet waste. His customers also benefit, because blivets cost less than they would if the cost of waste disposal was factored into the price. On the other hand, the costs of dealing with the blivet waste don’t vanish like so much twinkle dust; they are imposed on the people downstream who get their drinking water from the river, or from aquifers that receive water from the river, and who suffer from health problems because there’s blivet waste in their water. The blivet manufacturer is externalizing the cost of waste disposal; his increased profits are being paid for at a remove by the increased health care costs of everyone downstream.

That’s how externalities work. Back in the days when people actually talked about the downsides of economic growth, there was a lot of discussion of how to handle externalities, and not just on the leftward end of the spectrum.  I recall a thoughtful book titled TANSTAAFL—that’s an acronym, for those who don’t know their Heinlein, for “There Ain’t No Such Thing As A Free Lunch”—which argued, on solid libertarian-conservative grounds, that the environment could best be preserved by making sure that everyone paid full sticker price for the externalities they generated. Today’s crop of pseudoconservatives, of course, turned their back on all this a long time ago, and insist at the top of their lungs on their allegedly God-given right to externalize as many costs as they possibly can.  This is all the more ironic in that most pseudoconservatives claim to worship a God who said some very specific things about “what ye do to the least of these,” but that’s a subject for a different post.

Economic life in the industrial world these days can be described, without too much inaccuracy, as an arrangement set up to allow a privileged minority to externalize nearly all their costs onto the rest of society while pocketing as much as possible the benefits themselves. That’s come in for a certain amount of discussion in recent years, but I’m not sure how many of the people who’ve participated in those discussions have given any thought to the role that technological progress plays in facilitating the internalization of benefits and the externalization of costs that drive today’s increasingly inegalitarian societies. Here again, an example will be helpful.

Before the invention of blivet-making machinery, let’s say, blivets were made by old-fashioned blivet makers, who hammered them out on iron blivet anvils in shops that were to be found in every town and village. Like other handicrafts, blivet-making was a living rather than a ticket to wealth; blivet makers invested their own time and muscular effort in their craft, and turned out enough in the way of blivets to meet the demand. Notice also the effect on the production of blivet waste. Since blivets were being made one at a time rather than in pallet loads, the total amount of waste was smaller; the conditions of handicraft production also meant that blivet makers and their families were more likely to be exposed to the blivet waste than anyone else, and so had an incentive to invest the extra effort and expense to dispose of it properly. Since blivet makers were ordinary craftspeople rather than millionaires, furthermore, they weren’t as likely to be able to buy exemption from local health laws.

The invention of the mechanical blivet press changed that picture completely.  Since one blivet press could do as much work as fifty blivet makers, the income that would have gone to those fifty blivet makers and their families went instead to one factory owner and his stockholders, with as small a share as possible set aside for the wage laborers who operate the blivet press. The factory owner and stockholders had no incentive to pay for the proper disposal of the blivet waste, either—quite the contrary, since having to meet the disposal costs cut into their profit, buying off local governments was much cheaper, and if the harmful effects of blivet waste were known, you can bet that the owner and shareholders all lived well upstream from the factory. 

Notice also that a blivet manufacturer who paid a living wage to his workers and covered the costs of proper waste disposal would have to charge a higher price for blivets than one who did neither, and thus would be driven out of business by his more ruthless competitor. Externalities aren’t simply made possible by technological progress, in other words; they’re the inevitable result of technological progress in a market economy, because externalizing the costs of production is in most cases the most effective way to outcompete rival firms, and the firm that succeeds in externalizing the largest share of its costs is the most likely to prosper and survive.

Each further step in the progress of blivet manufacturing, in turn, tightened the same screw another turn. Today, to finish up the metaphor, the entire global supply of blivets is made in a dozen factories in  distant Slobbovia, where sweatshop labor under ghastly working conditions and the utter absence of environmental regulations make the business of blivet fabrication more profitable than anywhere else. The blivets are as shoddily made as possible; the entire blivet supply chain from the open-pit mines worked by slave labor that provide the raw materials to the big box stores with part-time, poorly paid staff selling blivetronic technology to the masses is a human and environmental disaster.  Every possible cost has been externalized, so that the two multinational corporations that dominate the global blivet industry can maintain their profit margins and pay absurdly high salaries to their CEOs.

That in itself is bad enough, but let’s broaden the focus to include the whole systems in which blivet fabrication takes place: the economy as a whole, society as a whole, and the biosphere as a whole. The impact of technology on blivet fabrication in a market economy has predictable and well understood consequences for each of these whole systems, which can be summed up precisely in the language we’ve already used. In order to maximize its own profitability and return on shareholder investment, the blivet industry externalizes costs in every available direction. Since nobody else wants to bear those costs, either, most of them end up being passed onto the whole systems just named, because the economy, society, and the biosphere have no voice in today’s economic decisions.

Like the costs of dealing with blivet waste, though, the other externalized costs of blivet manufacture don’t go away just because they’re externalized. As externalities increase, they tend to degrade the whole systems onto which they’re dumped—the economy, society, and the biosphere. This is where the trap closes tight, because blivet manufacturing exists within those whole systems, and can’t be carried out unless all three systems are sufficiently intact to function in their usual way. As those systems degrade, their ability to function degrades also, and eventually one or more of them breaks down—the economy plunges into a depression, the society disintegrates into anarchy or totalitarianism, the biosphere shifts abruptly into a new mode that lacks adequate rainfall for crops—and the manufacture of blivets stops because the whole system that once supported it has stopped doing so.

Notice how this works out from the perspective of someone who’s benefiting from the externalization of costs by the blivet industry—the executives and stockholders in a blivet corporation, let’s say. As far as they’re concerned, until very late in the process, everything is fine and dandy: each new round of technological improvements in blivet fabrication increases their profits, and if each such step in the onward march of progress also means that working class jobs are eliminated or offshored, democratic institutions implode, toxic waste builds up in the food chain, or what have you, hey, that’s not their problem—and after all, that’s just the normal creative destruction of capitalism, right?

That sort of insouciance is easy for at least three reasons. First, the impacts of externalities on whole systems can pop up a very long way from the blivet factories.  Second, in a market economy, everyone else is externalizing their costs as enthusiastically as the blivet industry, and so it’s easy for blivet manufacturers (and everyone else) to insist that whatever’s going wrong is not their fault.  Third, and most crucially, whole systems as stable and enduring as economies, societies, and biospheres can absorb a lot of damage before they tip over into instability. The process of externalization of costs can thus run for a very long time, and become entrenched as a basic economic habit, long before it becomes clear to anyone that continuing along the same route is a recipe for disaster.

Even when externalized costs have begun to take a visible toll on the economy, society, and the biosphere, furthermore, any attempt to reverse course faces nearly insurmountable obstacles. Those who profit from the existing order of things can be counted on to fight tooth and nail for the right to keep externalizing their costs: after all, they have to pay the full price for any reduction in their ability to externalize costs, while the benefits created by not imposing those costs on whole systems are shared among all participants in the economy, society, and the biosphere respectively. Nor is it necessarily easy to trace back the causes of any given whole-system disruption to specific externalities benefiting specific people or industries. It’s rather like loading hanging weights onto a chain; sooner or later, as the amount of weight hung on the chain goes up, the chain is going to break, but the link that breaks may be far from the last weight that pushed things over the edge, and every other weight on  the chain made its own contribution to the end result

A society that’s approaching collapse because too many externalized costs have been loaded onto on the whole systems that support it thus shows certain highly distinctive symptoms. Things are going wrong with the economy, society, and the biosphere, but nobody seems to be able to figure out why; the measurements economists use to determine prosperity show contradictory results, with those that measure the profitability of individual corporations and industries giving much better readings those that measure the performance of whole systems; the rich are convinced that everything is fine, while outside the narrowing circles of wealth and privilege, people talk in low voices about the rising spiral of problems that beset them from every side. If this doesn’t sound familiar to you, dear reader, you probably need to get out more.

At this point it may be helpful to sum up the argument I’ve developed here:

a) Every increase in technological complexity tends also to increase the opportunities for externalizing the costs of economic activity;

b) Market forces make the externalization of costs mandatory rather than optional, since economic actors that fail to externalize costs will tend to be outcompeted by those that do;

c) In a market economy, as all economic actors attempt to externalize as many costs as possible, externalized costs will tend to be passed on preferentially and progressively to whole systems such as the economy, society, and the biosphere, which provide necessary support for economic activity but have no voice in economic decisions;

d) Given unlimited increases in technological complexity, there is no necessary limit to the loading of externalized costs onto whole systems short of systemic collapse;

e) Unlimited increases in technological complexity in a market economy thus necessarily lead to the progressive degradation of the whole systems that support economic activity;

f) Technological progress in a market economy  is therefore self-terminating, and ends in collapse.

Now of course there are plenty of arguments that could be deployed against this modest proposal. For example, it could be argued that progress doesn’t have to generate a rising tide of externalities. The difficulty with this argument is that externalization of costs isn’t an accidental side effect of technology but an essential aspect—it’s not a bug, it’s a feature. Every technology is a means of externalizing some cost that would otherwise be borne by a human body. Even something as simple as a hammer takes the wear and tear that would otherwise affect the heel of your hand, let’s say, and transfers it to something else: directly, to the hammer; indirectly, to the biosphere, by way of the trees that had to be cut down to make the charcoal to smelt the iron, the plants that were shoveled aside to get the ore, and so on.

For reasons that are ultimately thermodynamic in nature, the more complex a technology becomes, the more costs it generates. In order to outcompete a simpler technology, each more complex technology has to externalize a significant proportion of its additional costs, in order to compete against the simpler technology. In the case of such contemporary hypercomplex technosystems as the internet, the process of externalizing costs has gone so far, through so many tangled interrelationships, that it’s remarkably difficult to figure out exactly who’s paying for how much of the gargantuan inputs needed to keep the thing running. This lack of transparency feeds the illusion that large systems are cheaper than small ones, by making externalities of scale look like economies of scale.

It might be argued instead that a sufficiently stringent regulatory environment, forcing economic actors to absorb all the costs of their activities instead of externalizing them onto others, would be able to stop the degradation of whole systems while still allowing technological progress to continue. The difficulty here is that increased externalization of costs is what makes progress profitable. As just noted, all other things being equal, a complex technology will on average be more expensive in real terms than a simpler technology, for the simple fact that each additional increment of complexity has to be paid for by an investment of energy and other forms of real capital.

Strip complex technologies of the subsidies that transfer some of their costs to the government, the perverse regulations that transfer some of their costs to the rest of the economy, the bad habits of environmental abuse and neglect that transfer some of their costs to the biosphere, and so on, and pretty soon you’re looking at hard economic limits to technological complexity, as people forced to pay the full sticker price for complex technologies maximize their benefits by choosing simpler, more affordable options instead. A regulatory environment sufficiently strict to keep technology from accelerating to collapse would thus bring technological progress to a halt by making it unprofitable.

Notice, however, the flipside of the same argument: a society that chose to stop progressing technologically could maintain itself indefinitely, so long as its technologies weren’t dependent on nonrenewable resources or the like. The costs imposed by a stable technology on the economy, society, and the biosphere would be more or less stable, rather than increasing over time, and it would therefore be much easier to figure out how to balance out the negative effects of those externalities and maintain the whole system in a steady state.  Societies that treated technological progress as an option rather than a requirement, and recognized the downsides to increasing complexity, could also choose to reduce complexity in one area in order to increase it in another, and so on—or they could just raise a monument to the age of progress, and go do something else instead.

The logic suggested here requires a comprehensive rethinking of most of the contemporary world’s notions about technology, progress, and the good society. We’ll begin that discussion in future posts—after, that is, we discuss a second dimension of progress that came out of last week’s discussion.

228 comments:

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John Michael Greer said...

Chester, you're most welcome.

Iuval, no, as I said in the post, the reason our current technology has that problem is because it progresses in the direction of increased complexity, thus imposing increasing costs on whole systems. (I noted in so many words that a society that embraced a stable technology, one that did not progress, would not fall into the same trap.) As for the claim that maximizing entropy is hardwired into living things, it's abject nonsense -- any first year ecology textbook will show you that those ecosystems that endure are those that maximize negentropy, using the flow of energy to squeeze out as much complexity as thermodynamics will permit.

Derv, I'm watching that closely. If in fact they're being driven by methane explosions, I wonder what's going to happen the first time one goes off under the North Slope oilfields, say, or a Siberian town...

Thomas, I doubt any of those will be interested. They're the same publications that turned their backs on these same ideas thirty years ago, remember. I'd encourage you and others instead to repost this as widely as possible on the blogosphere and other less tightly controlled media, and see whether these ideas can spread into wider circles of conversation.

MawKernewek, I probably need to do a post about the Foundation series one of these days!

Thomas, I'm sorry to hear about the cancer -- I hope things are holding up well for you. As far as the CancerWorld definition of progress, I think it applies; the ideology of limitless growth is as central to modern industrial economics as it is to cancer, after all.

Matthew, curiously enough, I'm planning on giving directions to that place in a series of upcoming posts. Stay tuned!

Paul, I will indeed commment on it.

Cherokee Organics said...

Hi JMG,

Many thanks for your response. I felt that it was worth a try too, just to engage with peoples imaginations. Actually, I spent the day at the festival manning a stall and just talking to people about plants and groups just to see what they were looking for. I believe that the results are in and you are right - they want benefits in return for their time.

Also, I forgot to mention, I did enjoy the bit in the book where manufacturing of the F-35 (nice name too!) had finished several years before and there was this awful dawning realisation about the manufacturing capacity surrounding the J-20. Ouch.

You know, I think about that too, with the shut down of the car industry here. The results are in and I rate our governments performance in this matter as: 10 out of 10 for economics, 1 out of 10 for strategic interests. Just sayin... Perhaps I seriously ought to learn Mandarin...

Hi Friction Shift,

;-)! A solid point.

Hi trippticket,

Well done. Don't let the perfect become the enemy of the good. Just sayin... My solar PV panels were made there too, so you are in good company. It doesn't make them any less good for that fact.

Cheers

Chris

Unknown said...

(Deborah Bender)

I've spent a couple of days thinking about something that bears on Matthew Heins' inquiry about whether it is possible for a market economy to intentionally rein in technological progress and externalization of costs, without totally suppressing personal choice and innovation.

JMG has written about the different social impacts of production in the household economy versus production for the market. I think it would be useful to make another distinction, between production (of crops, extractive commodities, manufactures and services) for local and regional markets versus production for export or for sale in distant parts of one's own country.

One of the maxims of prevailing economic theory is that every country should identify products or commodities that it can produce more cheaply than any other country, organize its economy around production of those items for export, and import everything else. The result is supposed to be that the whole world will buy everything from its most efficient producer, and therefore at the cheapest price. Thus the free market produces general wealth. This idea is in contrast to older theoretical schools such as mercantilism, which favored protection of domestic manufacture from foreign competition by high tariffs.

Nations that voluntarily turn their economy over to production of a few things for export, or have that strategy forced on them by the World Bank, sacrifice resilience. They have all their eggs in one basket. If some other exporting nation finds a way to undercut the price, or the crops fail, or worldwide demand falls for some reason, the exporting country has no source of foreign exchange to buy what it cannot produce. When its exports are in demand, the exporting nation does not necessarily benefit very much because the more distant the market, the more power falls into the hands of middlemen who wind up raking off most of the profit.

Furthermore, international markets have no room for sentiment. One competes primarily on price, secondarily on consistent quality and timely delivery. Labor relations and environmental impact are irrelevant. It's the famous race to the bottom.

In contrast, those who make a living selling commodities, goods and services to the societies they live in cannot wholly isolate themselves and act from purely rational, which is to say selfish, economic reasons. They have social interactions with their suppliers and their customers. They have some reason to see that their employees are housed and paid enough to buy what they produce. Their communities expect them to be philanthropic. They are generally more accountable to local social, legal and religious norms.

Historically there were lots of relatively steady state market economies that only got major influxes of wealth if their rulers went in for conquest and looting (I'm looking at you, Hellenistic Period.) We don't have a lot of examples of preindustrial societies that had gradual technological development over a long period without massive ecological damage. The medieval period in Europe comes pretty close, lots of tech the Romans didn't think of or didn't bother to apply, but the rising European population did coincide with deforestation and extinction of most of the native wild megafauna.

Moshe Braner said...

"Of course technologies all involve some degree of externalization; so do your bowels and bladder ... whole systems can generally work around a steady state production of externalities. ... the ongoing and unlimited increase in technological complexity (and thus in demand for resources and production of waste), that generates the rising tide of externalities..."

- so is it the technology, or is it the "growth"? If technology were to remain static, wouldn't the banksters still push for more-of-the-same? My personal conclusion from a decade of study of the peak-oil predicament is that the source of all evil is, as already noted by moral leaders 2 or 3 millenniums ago, is usury. It's the expectation that money should somehow make more money that is behind the push for "growth" by the "haves". Technological change is only one tool in their kit. The way the monetary system is organized is the bigger part.

Ed-M said...

JMG, "and everyone else tried to escape via emergency stairs."

Exactly! ;^)

Steve in Colorado said...

"Steve, you're missing one of the core parts of the argument. Of course technologies all involve some degree of externalization; so do your bowels and bladder, for heaven's sake. The point is that whole systems can generally work around a steady state production of externalities. It's technological progress, the ongoing and unlimited increase in technological complexity (and thus in demand for resources and production of waste), that generates the rising tide of externalities that eventually causes whole systems to degrade to the point of collapse. Once you no longer have progress, you no longer have that accelerating dynamic. "

JMG -

It's not that I miss that aspect of the problem, just that I view it's causes differently.

As you point out, all technology and biology too has externalities. Ecology and the web of life could be viewed as a collection of organisms that survive largely on externalities of the others (with a "little" help from the sun).

The question is (for me at least) how did we end up in this deep hole we have dug for ourselves. No doubt technology provided the "shovel", but we still chose to do the digging.

Even as we face the inevitable end of this particular "path of progress" (the consequences of our own actions), the question most on my mind is what have we learned, if anything. What were the critical mistakes, and given the same choices again would we do it differently?

A broad topic no doubt, but I think it is too simplistic to blame the tool and not the craftperson.

Øyvind Holmstad said...

What Hardin describes is plundering, not commoning, and without commoning there is no commons.

"Each commons has its own distinctive character because each is shaped by its particular location, history, culture and social practices. So it can be hard for the newcomer to see the patterns of “commoning.” The term commoning means to suggest that the commons is really more of a verb than a noun. It is a set of ongoing practices, not an inert physical resource. There is no commons without commoning. This helps explain why the commons is different from a "public good"; the commons is not just an economistic category floating in the air without actual people. There are no commons without commoners." - David Bollier

FRMurph1 said...

I forwarded this to my friend Kamran Nayeri who responded, "Thank you for this VERY insightful article. There are some problems with his account but they are relatively minor compared to his overall view about externalities. I have made a similar argument by suggesting that the transition from ecocentrism of hunter-gahthers to anthropocentrism farming societies alienated people from nature and lays the grounds for social alienation and institutionalization of social stratification, subordination and exploitation, hence the rise of class society. Alienation is the pre-requisite for exploitation."

JML said...

I think that the tendency of modern Westerners to analyze things in isolation and ignore the isolated thing's effect on whole systems is a consequence of the liberal thought that began with Hobbes and Locke. Liberal thought atomizes everything. It also makes certain people believe that they have the "individual right" to externalize their costs. Unfortunately for us, Hobbes and Locke committed a great error in thinking with their "state of nature" theories.

indus56 said...

Anent Latour: For your interest--
Latour, Bruno. Facing Gaia. Six Lectures on the Political Theology of Nature. Being the
Gifford Lectures on Natural Religion. (Http://Www.Bruno-
Latour.Fr/Sites/Default/Files/Downloads/Gifford-Six-Lectures_1.Pdf). 2013.

I haven't read this yet, but I did run across it in another writing of his that may be of interest:
http://www.bruno-latour.fr/sites/default/files/128-FELSKI-HOLBERG-NLH-FINAL.pdf

As I said, I'd be interested to read what you might make of this in some future essay.

Iuval Clejan said...

Dear sgage,

Well the essay/article was based on some harder science, some of which has gotten some feedback from experiments (The Crooks Fluctuation Theorem). Here is the article on formulas that supposdedly have been derived from Crooks but not been tested experimentally yet:
https://www.quantamagazine.org/20140122-anew-physics-theory-of-life/

They are not saying what you think. Certainly life can decrease entropy locally, but overall entropy increases (which has been known at least since Prigogine). Much low entropy energy from the sun is converted to high entropy energy/heat by life. But this physicist thinks that entropy production is maximized in the process. Dumping entropy elsewhere, and reducing it in your own backyard. If he is correct then externalization is built into life, not just into industrial technology. Not a comforting prospect.

Iuval Clejan said...

Sorry.JMG, I just saw your response. Anyway, I think the claim made by this pysicist (England is his last name) might be correct but missing something essential--the ability of life to decrease entropy (increase complexity) locally.

squizzler said...

Cheers for feedback...

Another point: the post and subsequent comments make a lot of the issue of complexity - as a bad thing. Complicated technologies are one part of it, but these complicated machines replace complexity in the industry that employs them.

I forgot to make anything of it at the time, I had also been too lazy to fact check so was perhaps nervous about drawing attention to this use of language, but the difference between complexity and complication was really the key to my argument. See this essay:

http://learningforsustainability.net/sparksforchange/complicated-or-complex-knowing-the-difference-is-important-for-the-management-of-adaptive-systems/

Complex systems are problematic to "The Man" because outcomes are not predictable. A complicated system on the other hand can be managed to the intended conclusion. Better still for the elite is that the considerable resources to build and operate such a system (or develop a complicated product for the market) provides high barriers to entry.

So now I might propose my own tongue-in-cheek definition (or an additional criteria to go with that postulated in the main post) of the sort of progress being pushed by The Man: "progress tends to replace the complex with the complicated".

Cherokee Organics said...

Hi JMG,

It might also be worth mentioning that the lack of an ability to return an economic surplus is highly indicative of the present real world relationship between human activities and the biosphere.

Given that we (i.e. our civilisation) only got here through the usage of fossil fuels - the supply of which has long since peaked - we're seeing the awkward and unpalatable truth that nature tends not to supply a surplus. Economics are simply mirroring the returns from nature.

It was funny how that thought popped into my head, because at the festival I was talking to a young couple who were very interested in picking my brain about gleaning opportunities in the local area. They wanted to exchange my knowledge for their knowledge - although we pretty quickly exhausted discussion about the various opportunities for gleaning at this time of year and they didn’t seem particularly interested in opportunities for future plant production using free plants. I couldn't quite get across the concept to them that the birds, animals and insects all enjoy those gleaning benefits too and that they'd be better networking with the locals and establishing their own productive garden systems. They really genuinely believed that there was a free lunch out there somewhere...

Anyway, I'm sure I disappointed them, but too bad, I occasionally disappoint myself too! Just kidding, but actually they really did look disappointed! It was a bit sad really because there is just so much they could do instead of pinning all their hopes on that single activity. How they got that meme into their heads was interesting too and I’m unsure of the answer.

Cheers

Chris

Matthew Casey Smallwood said...

Trouche, on "evolution". I was simply speaking their lingo. It's funny that people's idea of what is adaptation changes constantly.

We're trying to sell our home right now: keep in mind that I don't have alfalfa sprouts from a thatch roof or anything like that, just things like a blueberry bed, a rock-herb garden, and piles of leaf compost on the borders of two acre property. The consistent feed back from people who come visit (I think these are downsizers from the "nice" part of town) is that the place lacks "polish", doesn't have any landscaping, and in general, doesn't live up to their expectations. I guess they want to see a lunar installation with no hint of life around other than plastic looking shrubbery?

1ab9a86a-8991-11e3-899b-000bcdcb8a73 said...

luval,

you say "Anyway, I think the claim made by this pysicist (England is his last name) might be correct but missing something essential--the ability of life to decrease entropy (increase complexity) locally."

But from the article you cite:

"Although entropy must increase over time in an isolated or “closed” system, an “open” system can keep its entropy low — that is, divide energy unevenly among its atoms — by greatly increasing the entropy of its surroundings. In his influential 1944 monograph “What Is Life?” the eminent quantum physicist Erwin Schrödinger argued that this is what living things must do."

This idea, that life prospers by exporting entropy to its surroundings, has been around for a very long time (since 1944 according to the above) and is not controversial at all.

Thermodynamically, it's similar to a hurricane creating local ordered structures at the expense of dissipating a jumbo load of entropy in it's wake, or your fridge creating a colder (more ordered) interior environment at the expense of heating your house by more than an equivalent amount.

Taking this further, positing the idea that the systems that are actually observed in far-from-equilibrium-systems are those that maximize the rate of entropy production (globally, not locally), is a newer idea but has also been around for at least a decade.

Previous attempts to mathematically prove this, last time I looked, had obvious flaws, which did not go unnoticed in the field.

However this (related) result:

http://en.wikipedia.org/wiki/Crooks_fluctuation_theorem

...dates back to 1998.

1ab9a86a-8991-11e3-899b-000bcdcb8a73 said...

luval - the fact that life prospers by externalization is no excuse to get depressed. Is it a disaster that the background radiation in space is a teeny-tiny bit more featureless due to our jewel-planet being teeming with life? I find it hard to get upset about that!

donalfagan said...

Greg Laden has another blog post about another paper in Science, “Systems integration for global sustainability,” written by a busload of scientists. Though his post, The Hydraulic Hypothesis and the End of Civilization is mostly about water - and virtual water - instead of energy, Laden does address external costs:

[[This makes sense because of one of the things people almost always forget when it comes to market forces. The free market model assumes that the system is made up of “ideal free actors.” Ideal free does not mean free of ideals! (Maybe there should be a comma there.) The actors in the market are “ideal” in that they are identical in their access to information and ability to act on it, and they are free in the sense that there are no external constraints on those actions. So, ideal actors regulated (not free) do not make up a free market (that is the point usually made by Libertarians) but more often than not, the actors are not “ideal.” It is a major failure of integration of economics theory and social theory to place the non-ideal parts in the category of “external costs” and ignore them. One actor’s external costs is another actor’s non-idealness.]]

http://scienceblogs.com/gregladen/2015/03/02/the-hydraulic-hypothesis-and-the-end/

Mark Rice said...

I have long thought the only way to bring about a seious reduction in externalities is to have a radical change in the tax structure. End income tax, along with various other taxes and have externality taxes instead. This includes a carbon tax. We could have other polution taxes too.

This is called internalising the externalities. With externalities showing up in the prices, everything would be more expensive, but with less taxes elsewhere overall it should be a wash.

If another country does not tax externalities, we can impose import externality duties. The result could be a race to the top instead of a race to the bottom.

This could slow down envirenmental degredation such as climate change but it would not stop it. I suspect we are just too dependent on fossil fuesl to give it up.

I realise this will not happen in the next couple of decades. We are at a time and place where entrenched interest groups can block almost any change. So called "liberals" will not like externality taxes because they could be regressive. I can not imagine any business liking this. Their costs will shoot up and they will be afraid they will not be able to price in a way that will reflect their costs. In the long run it should be OK but that is a leap of faith.

But this is just an intellectual exercise and not presently a viable option.

Neo Tuxedo said...

This is not my entry in the Great Squirrel Case Endeavor; this, in the immortal words of Jack Black and Kyle Gass, is just a tribute. Or another demonstration that actual cornucopians are far beyond anything the ecotechnic camp could invent as a satire of them:

http://waitbutwhy.com/2015/01/artificial-intelligence-revolution-1.html

http://waitbutwhy.com/2015/01/artificial-intelligence-revolution-2.html

See how many of the logical holes you can spot (beyond the obvious one of "whence is the energy to come that will make this happen?").

Unknown said...

(Deborah Bender)

@Mark Rice--I expect carbon taxes to spread faster than you think. They have some corporate support. They are simpler to administer than cap-and-trade schemes. Many large corporations are concerned about the economic effects of climate change and would like something done to slow it down, as long as that something doesn't put them at a competitive disadvantage.

Contrary to what you say, the tax on carbon has some support among liberals and a few conservatives. I expect the idea to gather political momentum because it's a direct action that is fairly simple to explain. People who are worried about climate change can get behind it and feel like they are doing something. Getting back a tax refund from the government is also popular. California's got a cap and trade law, but if we had it to do over, I think we'd go for a carbon tax.

Taxing other externalities will be a harder fight. I've read that Germany has a law that all manufacturers must accept their products back for recycling, which is an alternative to a recycling tax that gives manufacturers an incentive to design for long life and reuse of components. It would be great if that spread. Regulatory capture is always a problem in the U.S., but I don't know that enacting social goals through taxation has been any more effective.

Imposing tariffs on countries that don't tax externalities is also going to be difficult, because China puts economic development first and the free trade crowd has the upper hand in both major American political parties.

On the whole, I agree that restructuring the economy through internalizing externalities will not happen quickly enough to do much good.

Michelle said...

I'm not sure this relates directly to this post, except insofar as it reflects the magical "it will all just work out somehow" attitudes of most of the sheeple of the world today:

http://upriser.com/posts/alarm-bells-toll-for-human-civilization-as-world-s-12th-largest-mega-city-is-running-out-of-water

Sao Paulo is running out of water, fast, and nobody has a clue what to do. Denizens of California and Las Vegas might want to pay close attention.

Pinku-Sensei said...

This entry is an excellent description of externalities and how they work. It's as good as anything I've come up with. In fact, I'm tempted to use it as a script for a stand alone lecture on the topic, which I would give with attribution by your permission. I suppose this could have been the TED Talk you were invited to present but never gave, as I recall you wrote that you turned down the invitation.

Just the same, there are two aspects to fully pricing externalities that you addressed in a different way than how most students, including mine, encounter the subject. I suspect that's because the authors of environmental science textbooks and the professors who use those books, tend to subscribe implicity or explicitly to the school of environmental economics instead of ecological economics. They realize that problems of pollution and resource depletion are important, but hope that solutions can be achieved by reforming the existing system instead of outside the system. These are the "bright green" types within the environmental movement that you invited to make a bargain with you a year ago by advocating conservation, decentralization, and rehumanization.

The first is a minor difference. You mentioned a regulatory environment that returned the externalities right into the sticker price of the technology. That would definitely work, but I found the mechanics of it rather vague. I do know one way to do it--taxes, which Mark Rice brought up. That's how European countries manage to raise the price of gasoline/petrol close to full price. The taxes are included in the sticker price that way. Advocating that seems to rely on a confidence in government that I see in the environmental economists but I generally find lacking in the ecological economists. The latter see government to be a major problem, almost as important as big business.

The second is a major difference. The environmental economists seem to see full-cost pricing as a means of spurring technological innovation in sustainable direction, one consistent with higher levels of technology as progress. I doubt most of them foresee that including externalities in the prices of technologies would actually cut off what they see as advances in technology. Won't they be surprised if that happens!

Finally, thanks for accepting Paean to the power of poop, a Squirrel Case entry.

Scotlyn said...

@ Deborah Bender and Mark Rice

re carbon taxes:

"Many a slip twixt the cup and the lip"

The behaviours such taxes (and associated permissible tax deductions) will incentivise may be utterly different in fact than intended.

To wit, the sorry story of "biofuels".

The link below warns of another potential road to perdition paved with equally good carbon tax intentions.

http://permaculturenews.org/2010/11/18/beware-the-biochar-initiative/

Thomas Prentice said...

A link on the never ending 2015 winter and the links to Global HEATING and Climate DISRUPTION that the TV weatherwizards NEVER talk about. Or online either.

Sometimes you can’t win: More cold and snow thanks to global warming - Systemic Disorder

https://systemicdisorder.wordpress.com/2015/03/04/cold-snow-global-warming/

Unknown said...

(Deborah Bender)

Scotlyn wrote, "The behaviours such taxes (and associated permissible tax deductions) will incentivise may be utterly different in fact than intended."

I agree. It's impossible to anticipate all the outcomes of a tax or any regulation. It's prudent to experiment on a small scale. Great Leaps Forward have terrible human costs. Am I sounding like a Burkean conservative yet?

Under the federal system, large states like California and New York can experiment with reforms. Sometimes California's experiments wind up being adopted nationally (automobile emissions control to reduce smog). Sometimes they turn out to be bad ideas (mandating the addition of ethanol to gasoline).

Janet D said...

Shane, the "West" is comprised of 13 states with approximately 72 million people, with several different regions, differing greatly in culture/values/politics and outlook. Several states are closely aligned in political views with the NE, others, such as Idaho, are their own animal. It's a very mixed, independent bag out here.

In the 30 years I've lived (in several states) in the West, I've never heard anyone talk about "the South" or "the NE" - most people here are from all over the U.S. and they don't think in blocks. Along the same lines, I can't imagine - and certainly have never heard of - anyone writing off tens of millions of people in a region as all sharing a single set of personality characteristics (all of which happen to be negative).

Please claim your own opinions as just that - yours.

Thomas Prentice said...

Some more sobering news:

"Landowners engaging in orgy of soil destruction" / George Monbiot

Landowners around the world are now engaged in an orgy of soil destruction – so intense that, according to the UN’s Food and Agriculture Organisation, the world, on average, has just 60 more years of growing crops.

…a Sanscrit text written in around 1500 BC noted, “Upon this handful of soil our survival depends. Husband it and it will grow our food, our fuel, and our shelter and surround us with beauty. Abuse it and the soil will collapse and die, taking humanity with it”.

There’s no longer even an appetite for studying the problem. Just one university – Aberdeen – now offers a degree in soil science. All the rest have been closed down.

This is what topples civilisations. War and pestilence might kill large numbers of people, but in most cases the population recovers. But lose the soil and everything else goes with it.

- from "Ploughing On Regardless" 25 March 2015ce UK Guardian
http://www.monbiot.com/2015/03/25/3703/

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