Sunday, October 21, 2007

Sustainable development or extreme poverty: do we have to choose?

A friend of mine tells me that sustainable development should not be our priority, since it would impede economic growth, therefore perpetuating extreme poverty.
On the contrary, Jeffrey Sachs argues that both fights should be taken together and will benefit from being solved together:

"While targeted investments in health, education, and infrastructure can unlock the trap of extreme poverty, the continuing environmental degradation at local, regional, and planetary scales threatens the long-term sustainability of all our social gains. Ending extreme poverty can relieve many of the pressures on the environment. When impoverished households are more productive on their farms, they face less pressure to cut down neighboring forests in search of new farmland. When their children survive with high probability, they have less incentive to maintain very high fertility rates with the attendant downside of rapid population growth. Still, even as extreme poverty ends, the environmental degradation related to industrial pollution and the long-term climate change associated with massive use of fossil fuels will have to be addressed. There are ways to confront these environmental challenges without destroying prosperity (for example, by building smarter power plants that capture and dispose of their carbon emissions and by increasing use of renewable energy sources). As we invest in ending extreme poverty, we must face the ongoing challenge of investing in the global sustainability of the world's ecosystems."

(Jeffrey Sachs, "The end of poverty, economic possibilities for our time", chapter "Our generation's challenge").


Daniel said...

This approach seems me very theoretical

If i compare the way of life in L.A and in China campaign and don't see easy real life possible scale up:

- Sustainable dev in L.A means huge economic loss for automotive industry for example -> poverty in US

- Fighting poverty in China means building more builing for poors, increasing chinese individual income for health and food... -> decreasing China workforce attractivity & reevaluating yuan vs dollar -> increase of china exportation cost -> poverty in US

- In both cases people with high revenues in US have no difficulties to export their money and place it in more attractive/competitive places. So they will not be affected by US poverty increase even if they are in US
-> wider gap between rich & poor in US

The same mechanism is valid in Europe. Only difference is that Europe commercial deficit wtih China is not so huge...

Cedric said...

The goal is not that everybody on Earth lives with rich countries living standards, this would simply not be possible: taking into account the surface required for food production and the natural ressources of the world, we would need 7 planets like Earth for everybody to have the same standards of living as Americans, and 2 or 3 planets like Earth for European standards of living !

What Jeffrey Sachs is talking about is not relative poverty, like poor people living in rich countries, but extreme poverty, like the one billion people living under 1 dollar per day on the Earth. So yes, rich countries will have to share the Earth ressources with poor countries to fight extreme poverty and enable everybody decent living conditions with the available ressources on this planet, instead of exploiting the poor countries workforces and natural ressources.

Daniel said...

I agree

but be realistic
while we will fight for sustainable development, we will produce probably more poverty than we will share wealth

fighting extrem poverty is another thing than fighting for energy waste. Both are important but I do not agree that they mandatory goes the same way

Cedric said...

I do not agree !
Fighting for sustainable development will not produce more poverty.
The logic of markets can be adapted to solve this problem, without
impeding economic development.
Right now, natural resources are not taken into account in the evaluation
of the price of a good or service we produce. Only human labor and capital
investment are. Therefore, there is for example an incentive to throw away
something when it does not work any more (or even worse, when it becomes out
of fashion), and buy a new one, instead of repairing it. If we start to
include the fact that natural resources are limited, therefore have a price
in themselves (as limited stocks of the enterprise Earth), repairing will
soon appear to be more cost effective than producing new goods.
Will it make jobs disappear and create more poverty ?
Not at all ! On the contrary, it requires more human labor to repair things
than to produce them in huge automatic industrial chains in huge quantities.
This is the thesis of E. F. Schumacher in "Small is beautiful", we have to
scale down production means to human size, and that will both resolve the
problem of unemployment and poverty, and the ecological crisis, because on
small scales we can care for the environment much more easily than on
large industrial scales.

Finally, I think it will be mandatory to fight both extreme poverty and
the ecological crisis together. Fighting extreme poverty without regard
to our environment is to go right into a wall, because as the
environment degrades, drinking water becomes more scarce, fishes
disappear, biological diversity shrinks, and so on, it will be more and
more difficult to provide food and health to everybody !
And I believe if we change our methods of production and our goals in life,
the poors will be an extremely valuable workforce to help themselves out
of poverty while helping in preserving our environment.

dan said...

"Only human labor and capital
investment are"
That is the problem

Low workforce cost in China make it competitive today and increase country funds
High oil value increase revenue of poor countries like Gabon in Africa

In many cases today the probleme is that at country scale the entering wealth is flow is biased. Instead of being used to increase people way of life (individual income, infrastructures...), it is either taken by leaders (and go in swiss...) or not used (as in China which artifically maintain money gap instead of using ts dollar to buy for its population)

Paying for envionmental impact is the right thing to do. But in my opinion this will create employment not for poor people. Worst: this would probably decrease competitivness of poorest person workforce

That is why I believe that both fights (environmental & poverty) are not really going the same way

Cedric said...

Can you develop more why you think that paying for environmental impact will create employment not for poor people and would probably decrease competitivness of poorest person workforce ?

At least recognize that if both fights don't go the same way, each one will become harder and harder to win !

Anonymous said...

1- because there is huge amout of money to win so large company will try to trust this new value ressource (ex: Veolia, Suze, Vivendi, etc...)

2- Environmental and rational approach mean local production
Poorest population are not very close from richest places, so they will not be the most appropriate to produce close from big markets

However these impacts are so complex that I may be completely wrong...