On the Dangers of Monetizing Nature

I remember in the late 1970s how the corporate world essentially invented the use of cost-benefit analysis in health, safety and environmental regulation. It was a brazen attempt to redefine the terms for understanding social ethics and policy in terms favorable to capital and markets.  Instead of seeing the prevention of death, disease and ecological harm as a matter of social justice, period, American industry succeeded in recasting these issues as economic matters.  And of course, such arcane issues must be overseen by a credentialed priesthod of economists, not ordinary mortals whose concerns were snubbed as selfish NIMBYism (Not in My Backyard).

And so it came to be that, with the full sanction of law, a dollar sum could be assigned to our health, or to the cost of getting cancer, or to a statistical baby born with birth defects. Regulation was transformed into a pseudo-market transaction.  That mindset has become so pervasive three decades later that people can barely remember when ethical priorities actually trumped big money. 

It is therefore a joy to see Barbara Unmüssig’s essay, “Monetizing Nature:  Taking Precaution on a Slippery Slope,” which recently appeared on the Great Transition Initiative website.  Unmüssig is President of the Heinrich Boell Foundation in Germany and a stalwart supporter of the commons, especially in her backing of the 2010 and 2013 conferences in Berlin.

Striking a note that is note heard much these days, Unmüssig points out the serious dangers of seeing the natural world through the scrim of money.  Here is the abstract for her piece:

In the wake of declining political will for environmental protection, many in the environmental community are advocating for the monetization of nature. Some argue that monetization, by revealing the economic contribution of nature and its services, can heighten public awareness and bolster conservation efforts. Others go beyond such broad conceptual calculations and seek to establish tradable prices for ecosystem services, claiming that markets can achieve what politics has not.

However, such an approach collapses nature’s complex functions into a set of commodities stripped from their social, cultural, and ecological context and can pose a threat to the poor and indigenous communities who depend on the land for their livelihood. Although the path from valuation to commodification is not inevitable, it is indeed a slippery slope. Avoiding this pitfall requires a reaffirmation of the precautionary principle and a commitment to democratic decision-making and social justice as the foundations of a sound environmental policy for the twenty-first century.

Unmüssig’s essay is followed by comments by some fantastic commentary by nine ecological economists and environmental policy experts, among others, who take issue with parts of the essay and elaborate on points of agreement.  Among the commentators are the noted ecological economists Herman Daly and Bob Costanza, but there are also some insightful comments by Neera Singh, Jutta Kill and Neil Glazer. 

I especially liked biologist Jutta Kill’s comments:

We can see the application of economic valuation in the real world and the damage that application has in far too many cases already done to communities who depend on and defend their territories against outside decisions that will destroy the land that provides them with a livelihood.

And finally, adopting someone else’s frame—the frame that sees “nature” in a way that capital does—by default requires devaluing and undermining the values we (used to) consider worth fighting for. That would likely entail losing moral authority and legitimacy, at least over time. Adopting the concept of economic valuation means adopting the values of actors whose business model is built on limitless growth and the associated wrecking of “nature”—and many people's livelihoods.

Forestry scholar Neera Singh also has a nice response to the perversity that sees ecological conservation as a sacrifice for which market payment should be paid:

“How can we honor the gift of conservation care labor that goes into the production of ecosystem services in ways that it is seen as a gift rather than as production of a service whose exchange can be sealed with a payment? And can we see these gifts—gifts by nature, by people who live in ecologically sensitive landscapes, gifts emerging from human-nature relations—as invitation for long-term exchanges in sharing the burden and joy of environmental care?”

Read the essay and then the comments.  Some terrific insights into the pathological monetization of nature.

Comments

The market price is always the right price...

I agree with Barbara, In addition to all the principle arguments I would also add that the cost of producing a certain eco system service has no relationship to its value for human beings. And in the end the market value will be determined by the "cost of production" in this rigged market. And in our economy the market price is the "right price"

the value of the whole ecosystem to society is more than the sum of its monetized parts: reducing its value to mere monetary terms, even if it were technically practical, strips away its cultural and spiritual value. - See more at: http://greattransition.org/publication/monetizing-nature-taking-precaution-on-a-slippery-slope#sthash.DW8PTvR6.dpuf