America the Possible
Author, law professor and economic expert James Gustave (Gus) Speth argues that a green economy can happen here, but only if the U.S. system has a major overhaul.
By Green Builder Staff
GB: Your books talk about sustainability and how it relates to economics and the future of our system.
GS: Yes. The more I looked at these issues, the more concerned I became. It wasn’t like we were building a fool’s paradise and ignoring the rest of the world, but we were definitely falling way behind on a whole host of indicators that you think of as triple bottom-line indicators for the country—in environment, in society, in our economic performance and our politics. I began to worry that we were defining environmentalism in much too narrow a way. If you ask the basic question, “What’s an environmental issue?” you get some pretty obvious answers: air quality, and indoor and outdoor water quality. These are fairly straightforward, but if you define an environmental issue as what affects environmental outcomes, you get a much broader answer than the traditional environmental agenda.
GB:Broad in what way?
GS:Issues such as social equity in our society is a big determinant of whether we make progress with environmental issues. Issues such as the health of our democracy—who really is in control of a presumably democratic system? That’s a huge determinant of environmental outcomes. What we have, I think, is a bad case of system failure. We need to start thinking not about mere incremental reform in our governance, but changing some of the fundamental dynamics of the systems that impact the root causes more directly.
GB: Can you elaborate on how the system is failing?
GS: Well I think that Americans have been too gullible and too quick to get on the bandwagon with things that are pretty misguided. For example, we have this anti-tax movement in the country that seems quite potent. We are the least taxed country in the group of 20 leading advanced democracies. We are at the bottom. We’re also spending about half the world’s military expenditure in one country. It’s pretty obvious to me where the money is that we need to deal with our many problems.
GB: Taxes are never popular, of course.
GS: We have a lot of potential for raising money from new taxes and higher tax brackets and also from reallocating the funds away from our loaded defense expenditures—two real possibilities. If you look at all the taxes—state and federal, payroll taxes and other things—and add them all up, the effective tax rate in Denmark is twice ours. I don’t think we need to double our taxes, but there’s plenty of scope out there for dealing with our fiscal problems.
GB: Let me throw out a question from left field. I heard the CEO of a European company says the root of the sustainability problem in the U.S. is that we undervalue our land resource.
GS: We tend to see investment in our society through a very odd prism, if you think about it. We invest in things with decent or high financial return, and the higher the return, the more attractive the investment. Meanwhile, there are areas of huge environmental return where we are not making investments and not doing well. Our parks are suffering, and we could be protecting a lot more land through land trusts and conservation and other means of that type. There’s still a tragedy of the land out there.
GB:But we’re not alone. Other countries face the same pressures on their natural resources.
GS:Yes. Unfortunately, almost none of these big treaty regimes we’ve entered into to deal with the global scale problem are working. We have a treaty now for almost every global-scale problem you can identify—except loss of tropical forest—and the only one that’s succeeding pretty well is the Montreal Protocol and the protection of the ozone layer, but even that still has problems. And the other treaties are hardly doing anything, and the U.S. is not even a party to most of the agreements! So it’s an international failure of tremendous proportions. I think it reflects very poorly on the U.S. as a society.
GB: Can you help to attribute that then? Is it a general complacency? Is it a lack of leadership?
GS: Some of this is the result of the “American exceptionalism” syndrome that we suffer from—of seeing ourselves as so big and mighty and different that we don’t have to collaborate and cooperate with other countries on things we don’t see as priorities. We’ve allocated much of our international attention and resources so severely to the military and economic [dealings] that we neglect environmental and social issues.
GB: Such as?
GS: Global climate is serious. We have a continuing loss of biodiversity on a large scale, and a confluence in much of the developing world of what I call the climate-food-water-energy complex. The trends in these four areas are moving in a direction that’s going to cause tremendous hardship and destabilization, and exacerbate the whole problem of failing and fragile states. We tend not to think of preventive strategies, which would make much more sense than defensive ones.
GB: Defensive strategies?
GS: We spend more on the military than the next 17 countries combined, about 43 percent of the world total. When we do collaborate with other countries, it’s overwhelmingly in the economic areas, trying to get the trade regimes running, and dealing with international imbalances of various types. We have an army full of weapons when that’s the case, every problem looks like it needs a military solution.
GB: I’m wondering if we can pull it back for a moment and look at some of the key domestic problems getting in the way of a sustainable economy.
GS: Sure. In my latest book, I look at a 20-country sample of well-to-do countries and advanced democracies and 30 different issues. What you find is that the U.S. has the largest inequality, the greatest poverty, the least social mobility, the worst care of our children in terms of the UNICEF material well-being index, and on and on! We’re literally at the bottom of these social indicators, in health, in education—severe deficits across a wide front. How does that affect environmental sustainability?
GB: Negatively, I assume.
GS: Yes, but with all these social problems it’s even harder to address. Say we put a price on emissions and require that big companies internalize externalities. There was a study done of 3,000 corporations internationally that estimated the external environmental costs they create is equal to about a third of their profits. But when you internalize those externalities [pollution, etc.], prices will go up. We’re now a country where half the families are living paycheck-to-paycheck, so people are likely to be unwilling to go along with many environmental proposals.
GB: It sounds like we’re sort of stuck.
GS:Americans have this growth fetish, but growth isn’t delivering very much for us anymore, even if we had it. During the last several decades, the economy has grown much larger, but we lost 42,000 manufacturing facilities, life satisfaction flatlined, environmental quality declined, poverty mounted, inequality mounted. My good friend, Herman Daly, says we’re in an era of “uneconomic growth,” where the cost of trying to boost the GDP is outweighing the benefits. This idea that growth is going to provide solutions to all our problems, which it hasn’t in the past, is one of the major myths.
GB:Are there other myths you’d like to explore?
GS: I think another myth is that America is a land of equal opportunity, and everyone can get ahead if he or she just tries hard enough. Statistically, we have the least social mobility in an international sample of countries. People who are poor tend to stay that way in the next generation, and vice versa. Probably one of the most troubling myths is that we’re not responsible for climate change, or it’s not even occurring.
GB: It’s always been interesting—the fact that we value our buildings on this bizarre metric we call dollars per square foot—rewarding quantity, rather than quality.
GS:Growth, like everything else in the economy, has rising costs right at the margin and declining benefits at the margin.
GB: Gus, we’ve surveyed the gathering dark clouds, but where do you see rays of sunshine breaking through that cloud cover?
GS: Well I think there are a lot of exciting things going on. A lot of things are happening at the local level in our country. There are new types of corporations—a new world of business enterprise out there: public/private hybrids, profit/not-for-profit hybrids, community development corporations, local banking coming back, state banking movements trying to get the focus out of Wall Street, different types of ownership. The co-op movement is flourishing in the country.
GB: That seems to be a real trend.
GS: There are more members of co-ops in the U.S. than there are people who have money in the stock market. There are transition towns, all kinds of community revitalizations—people just doing it, not waiting on Washington. I think that’s a very encouraging area for change. There’s a need for new indicators beyond GDP. There’s a tremendous sort of intellectual ferment in that area. In Europe, OECD is leading in this effort with some very important contributions. And you have some academic leaders in the U.S. who are proposing dethroning GDP. Some states are doing genuine progress indicators. I think this is a very important area for change.
GB: Consumerism is a tough mindset to unseat, isn’t it?
GS: We’re seeing people, in a quiet moment, in a poll or a focus group, if you ask them, “Do you think the country’s too materialistic?” huge majorities say they want a different lifestyle. So I think there are some very positive signs of change.
GB: Then there are the politicians. Any hope there?
GS: Political reform is an area where we need to make huge change. For example, we need to come up with alternative systems for public financing and small donor financing, amend the Constitution and get rid of the Electoral College, have independently determined congressional districts, get rid of the filibuster, close the revolving door. These are things we desperately need to do whether you’re right, left or center to make democracy work in this country.
GB: We have such political gridlock. How do we rise above the animosity, certainly at the federal level?
GS: Well it is a serious problem. Political scientists tell us that polarization is more severe than any other time since Reconstruction. It is bitter. I’m very attracted to a template that would make third parties more viable, more hopeful—not spoilers. You could do that a couple ways that might work together well. One is fusion voting where the third party can list as its candidate one of the candidates of the major parties. Another other way to do this is instant runoff voting, where you can vote for your candidate—let’s say a third-party candidate—you have a second vote or even a third vote where you can vote for other candidates if your first-choice candidate doesn’t qualify.
GB: Those don’t sound impossible. I wonder if you can tell us, in a word, what is America the Possible—what do you think is the most important thing we have to do to get there?
GS: America the Possible involves a deep change in values so that we’re a lot more committed to community and less to individualism, committed to things other than materialism. It involves taking the environmental sustainability challenge very seriously, setting limits to and of growth. America the Possible involves accepting and learning from what this field of positive psychology is telling us. What are the wellsprings of real human happiness? What really improves peoples’ quality of life? I think we can do it, I think we still have it in us, but we better get started soon.
This book will change the way we understand the future of our planet. It is both alarming and hopeful. - Yale University Press