[Coral-List] Reefs in Trouble - The Real Root Cause - an update

James Spurgeon James.Spurgeon at erm.com
Tue Oct 21 02:52:10 EDT 2008

Dear Coral-listers

Apologies for raising this one again, but some additional thoughts from an economics perspective post Barcelona Congress and mid financial crisis:

In a nutshell: the overall solution requires accounting for the true value of 'ecosystem services' (ie the benefits humans gain from the environment) and aligning human incentive structures accordingly; coupled with appropriate regulation.

This is a core message permeating from: i) the World Congress on Conservation in Barcelona, ii) numerous great minds as highlighted below, and iii) the recently published 'The Economics of Ecosystems and Biodiversity', a 'Stern Report' equivalent for biodiversity and ecosystems (see http://ec.europa..eu/environment/nature/biodiversity/economics/pdf/teeb_report.pdf)

Here's a great article highlighting that the current economic crisis is petty by comparison to the nature crunch, with a natural capital loss of $2-5 trillion per year from deforestation alone.


Stephen Jameson originally concluded in his article, that: "We must design and maintain a system of human governance that balances human population growth and consumption with carrying capacity and that accurately values ecosystem services in the economic equation  and do it fast (Jameson 2006)!"  This is absolutely right, and speed is of the essence given potential climate change ramifications.

The 'ultimate' root cause of environmental degradation is, as Stephen points out, no doubt the 'innate human species behaviour' that tends towards selfishness (see Richard Dawkin's (1976) 'The Selfish Gene'): hence the need for aligning incentive structures - at all levels.  However, to make a meaningful difference quickly enough, we must address the full range of 'root causes' in parallel (see Figure 1 and accompanying text on tackling the root causes of environmental and coral degradation in http://www.icriforum.org/docs/Valuation_CR.pdf.)

Peter Sale's excellent 2008 MPB article stresses the need to recognize the economic value of coral reefs, particularly focussing on fisheries, tourism and coastal defence, and to encourage local ownership.  This is indeed of vital importance.  However, as argued in Spurgeon 2006 (see chapter 12 in http://www.cambridge.org/catalogue/catalogue.asp?isbn=9780521671453&ss=toc or let me know if you'd like a copy of the chapter) the need extends beyond just 'knowing the numbers'.

Firstly, we need to account for a broader set of benefits, to include 'passive'/'non-use'/'cultural service' values that can represent a significant proportion of value.  Secondly, we need to better understand the 'make up' of the values so we can increase our ability to 'enhance' and 'appropriate' (ie gain revenues from) them.  Thirdly, the ensuing values must appropriately inform policy and project decisions. Finally, we must use this information to design modified 'incentive' structures that aligns human behaviour to foster continued conservation and sustainable use of the environment and coral resources (in part through encouraging local ownership!).

Although dinner with Voltaire, Galileo and Darwin would be insightful and entertaining, there are plenty of brilliant minds around today (and in recent years) who have a pretty good idea as to the necessary solutions to solve the global environmental crisis.  In addition to Herman Daly's (1991) 'Steady-State Economics' recommended by the above Guardian article, the following books are all an excellent read: Joseph Stiglitz (2006) 'Making Globalisation Work'; Jonathan Porritt (2005) 'Capitalism as if the World Matters'; Paul Ekins (1992) Wealth Beyond Measure: an Atlas of New Economics; David Pearce (2000) 'Blueprint for a Sustainable Economy'; and Tim Flannery (2005) 'The Weather Makers; The History and Future Impact of Climate Change.'  Interestingly, they all stress the need to: account for environmental values; create appropriate market mechanisms to influence behaviour and use of resources; and reject use of GDP in favour of a more sustainable economic global indicator.

Because corals are so interlinked with the wider environment, the solutions have to be considered and implemented at a global, eco-region, river catchment and local level.  In particular, this will need to include changing the incentive structures relating to carbon emissions (some form of improved global carbon trading or tax system) and river basin management systems - plenty of work yet to be done!  I really wonder whether enough is being spent on researching such approaches.

Finally, in response to Stephen's original two key questions:

(1) Does the human species, when operating in very large groups such as a nations, have the genetic capability to live sustainably with its environment?

(2) Does the human species have the genetic ability to create and maintain systems of national governance that makes sustainable environmental stewardship possible?

I think we do have the genetic capability and ability to live sustainably and create the right governance systems. However, we are probably too selfish (individually and as nations) for this to come about quickly enough without a series of further climate related calamities that give us no choice but to do so.  When there's enough certainty that the potential consequence of inaction will be far worse, nations will work together to solve global problems more rapidly (as has been the case with the current financial turmoil, and the Montreal Protocol to deal with CFCs).  If that is the case, one can only pray, especially given the nature of climate change (eg time-lag impacts and critical thresholds/tipping points etc), that by then, what is done is not too little, too late!

Best wishes


James Spurgeon

Technical Director: Head of Environmental Economics for UK and International Projects

Strategic Services Team

Environmental Resources Management Ltd

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