[Coral-List] $33B Hawaii Reef Economics Value

Bill Allison allison.billiam at gmail.com
Thu Nov 17 15:41:22 EST 2011

Nicholas Georgescu-Roegen and later Herman Daly and others have critiqued
the use of money as currency for the valuation of nature and natural
resources. Georgescu-Roegen proposed grounding economics in material
reality using energy as the currency. His 1975 essay is a useful
introduction to his thesis and a critique of neoclassical economic theory.

Georgescu-Roegen, N. (1975). "Energy and Economic Myths." Southern Economic
Journal 41(3): 347-381.
There is an appreciable grain of truth in one of Percy Bridgman's[*]
remarks that the economic profession is the most opportunistic of all.
Indeed, economists' attention has continually shifted from one problem to
another, the problems often being not even closely related. Search all
economic periodicals of the English-speaking world before 1950, for
example, and you will hardly find any mention of "economic development." It
is curious, therefore, that economists have over the last hundred years
remained stubbornly attached to one particular idea, the mechanistic
epistemology which dominated the orientation of the founders of the
Neoclassical School. By their own proud admission, the greatest ambition of
these pioneers was to build an economic science after the model of
mechanics-in the words of W. Stanley Jevons - as "the mechanics of utility
and self-interest" [48, 23]. Like almost every scholar and philosopher of
the first half of the nineteenth century, they were fascinated by the
spectacular successes of the science of mechanics in astronomy and accepted
Laplace's famous apotheosis of mechanics [53, 4] as the evangel of ultimate
scientific knowledge. They thus had some attenuating circumstances, which
cannot, however, be invoked by those who came long after the mechanistic
dogma had been banished even from physics [23, 69-122; 5].
For more:
or, most of it:

[*] WRA annotation: Bridgman is noteworthy, not only because of his
observations about economists feature in the first line of this paper, but
because he was, a Nobel prize winner, a proponent of operationalism in the
scientific method (something coral reef survey could profit from more of),
and early on kicked Nazi scientists out of his atomic physics research lab.
(Bridgman, P. W., "Statistical Mechanics and the Second Law of
Thermodynamics," in Reflections of a Physicist, 2d ed. New York:
Philosophical Library, 1955, pp. 236-268.)

On Wed, Nov 16, 2011 at 2:29 PM, kathy kirbo <kkirbo at hotmail.com> wrote:

> All these posts regarding placing value on natural resources made me think
> of a great essay that Paul Hawken wrote in 1997 called "Natural
> Capitalism".. lIt is splendid article that is thought provoking and is an
> excellent syllabus of his book of the same title ""Natural Capitalism". The
> essay is a bit lengthy, but well worth it if you have an interest in the
> subject:
> http://www.paulhawken.com/multimedia/motherjones_naturalcapitalism.pdf
> Paul Hawken is also the author of some other great books on the subject
> including,  "The Ecology of Commerce" and "The Blessed Unrest". The Ecology
> of Commerce has even inspired some industrialists to rethink their business
> model. One of the most impressive stories was Ray Anderson CEO of Interface
> who unfortunately died recently. I wrote a little tribute to his
> initiative-- and to him-- since it was not well known in many circles. It
> sums up the whole story in one short page:
> http://flagpole.com/Weekly/Letters/AGeorgiaHero-31Aug11
> Thanks,
> Katherine Kirbo
> Executive Director,
> The Reef Ball Foundation
> www.reefball.org
> > Date: Tue, 15 Nov 2011 10:56:53 -0800
> > From: frahome at yahoo.com
> > To: coral-list at coral.aoml.noaa.gov
> > Subject: Re: [Coral-List] $33B Hawaii Reef Economics Value
> >
> > Robert's post inspired me to check and compare real figures. $33.5
> billions  match about the 2010 earnings of corporations such as Exxon
> Mobile or Nestlè.
> > Wallmart 2010 revenue was $421 trillions...as far as contributions to
> the GDP god, it sounds like we are better off sticking with corporations
> protected areas...
> >
> > Greetings
> > Francesca
> >
> >
> >
> >
> >
> > ________________________________
> > From: Robert Bourke <rbourke at OCEANIT.COM>
> > To: Linwood Pendleton <linwood.pendleton at duke.edu>; "<
> coral-list at coral.aoml.noaa.gov>" <coral-list at coral.aoml.noaa.gov>
> > Sent: Saturday, November 12, 2011 3:26 AM
> > Subject: Re: [Coral-List] $33B Hawaii Reef Economics Value
> >
> > Coral Listers:
> >     I'm going to take some heat for this, so as a pre-amble I'm a
> private sector environmental consultant, who has worked in Hawaii for 35
> years, was one of the first proponents of widespread MPAs in Hawaii, and
> consider myself a staunch protector of the environment.
> >     The NOAA funded study "Total Economic Value for Protecting and
> Restoring Hawaiian Coral Reef Ecosystems" which places a total value of the
> reefs in the Main Hawaiian Islands at $33.5B is seriously flawed due to
> some basic assumptions it has made.  As scientists with expertise in coral
> reefs and likely a great love of these ecosystems it is very important that
> we critically examine all studies - even those that appear to place a high
> value towards an argument we'd personally like to believe.  Poor science
> will do little to forward this important environmental cause.
> >     First, I'd like to put the study into perspective.  $33.5B per year
> is a lot of money.  A prior study (Cesar, 2002) examined the value of the
> fishing, recreation, research, boating, and intrinsic value of these same
> reefs came up with a value roughly 1% of the NOAA study.   The Hawaii State
> budget for 2009 was about $22B, and the Gross State Economic Product for
> 2009 was $66B.  Does it make sense that the value of protecting and
> restoring "only" the reefs is more than the entire state budget and about
> half the total economic output of the entire State?  $33.5B over 300,000
> acres of reef works out to about $2.50 per square foot/year.  For those
> interested in mitigation for reef damage this figure will lead to some
> interesting calculations.
> >     The study conducted 3277 surveys, primarily by computer, to
> individuals in the contiguous 48 States.  Hawaii residents and Alaska
> residents were excluded from the study.  40% of those surveyed had no more
> than a high school education.  Half had never been to a coral reef.  Think
> about that.. The first part of the survey educates the survey taker about
> the degraded condition of reefs in Hawaii, including a statement that
> 5-acres of reef are damaged every year by boat groundings (false) and that
> closing 25% of the reef to fishing would result in an increase from the
> present day 10% to 50% of historical fish stocks within 10 years
> (unsubstantiated).  The survey asks a bunch of questions to help
> characterize the survey taker and then asks two key questions (paraphrased):
> >     1) Would you pay an additional $X in Federal taxes to increase the
> MPAs in Hawaii to 25% coverage?
> >     2) Would you pay an additional $Y in Federal taxes to repair the
> annual 5-acres of reef damage?
> > The study allows a choice between $0 (no fix) to values from $45 to $170
> per year per household to develop MPAs (X value), and a similar choice for
> reef repair varying from $35 to $135 (Y-value).  The average X and Y are
> then added together for a total willingness to pay of $287 per household.
>  This value times the number of households in the US (~117M) =$33.5B per
> year.    There are two problems with the numbers used to estimate X and Y..
>  A) these represent Monopoly Money figures for respondents.  They know this
> isn't really going to result in an increase to their taxes & these nice
> people have just shown lots of pretty pictures showing that things really
> need to get fixed, so "Why not select some value to fix their problem?".
> To anyone who believes these values mirror real choices, I suggest you look
> at what has been happening to taxes across the country for causes (such as
> education) that are much more important and closer to home.  B) the
> >  choices given, even at the lowe
> > st levels, are much higher than reasonable.  Assuming that 5-acres of
> coral really did get damaged each year (an unsubstantiated claim), the
> lowest selective choice of a $35 per year tax increase to fix the problem
> would result in annual tax revenues of ($35 x 117M families) $6.4B, or
> roughly $18,000 per square foot of reef repaired!
> >     The study appears to have been designed in such a way that it is
> almost guaranteed to yield an unrealistically high value for the coral reef
> resources.
> > Aloha
> >
> > Bob Bourke
> > -----Original Message-----
> > From: coral-list-bounces at coral.aoml.noaa.gov [mailto:
> coral-list-bounces at coral.aoml.noaa.gov] On Behalf Of Linwood Pendleton
> > Sent: Wednesday, November 09, 2011 8:32 AM
> > To: <coral-list at coral.aoml.noaa.gov>
> > Subject: [Coral-List] Marine Ecosystem Services Partnership
> >
> > Folks.  Now that the Hawaii study has your attention, you may wish to
> start to plumb the wealth of studies on marine ecosystem services that
> exists.  Please visit our beta site
> http://www.marineecosystemservices.org/ to view (using a mapper like that
> developed for OBIS SEAMAP) basic information about marine ecosystem service
> valuations conducted across the globe.  These studies are compiled from a
> variety of extant and extinct databases from around the world..
> >
> > Also, consider joining the Marine Ecosystem Services Partnership
> community of practice at www.ecosystemcommons.org<
> http://www.ecosystemcommons.org> - a great place to open this important
> discussion to those interested in marine ecosystem services writ large.
> >
> > Best wishes,
> >
> > Linwood
> > p..s.  I also was not part of the team working on the Hawaii study.  So,
> my ability to answer questions about this study is limited.
> >
> > Linwood Pendleton
> > Director of Ocean and Coastal Policy, Duke's Nicholas Institute Senior
> Economic Advisor, NOAA
> > 805-794-8206
> > blog: www.nioceans.org<http://www.nioceans.org>
> > Connect with the Nicholas Institute through our social media
> >
> > ******************************************
> >
> >
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Is this how science illuminates "reality"? - "the meaning of an episode was
not inside like a kernel but outside, enveloping the talk which brought it
out only as a glow brings out a haze."
- narrator's comment about Marlow's tale-telling, in Heart of Darkness

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