The Truth About Improving Our Economic Security
Published on May 19th, 2022
Dr Janez Potočnik
Co-Chair of UN Environment International Resource Panel, Former European Commissioner for Research and Environment.
Over the past few decades, resource use has contributed to significant improvements in the living standards and wellbeing of people in many parts of the world, but this now comes at an unprecedented cost to the climate, the environment, and human health. While the economic growth of a country was once an indicator of the quality of life of its inhabitants, it is now difficult to make that claim for high- and upper-middle-income countries - the very countries that consume the most resources per capita. This clearly indicates that we need to rethink the north star currently guiding our behaviour and policies.
Commentary
Dr Janez Potočnik
Food and energy prices are rising, economies in Europe are stretched due to the lack, or potential future lack, of fuels (particularly gas), food (particularly wheat and animal feed), and fertilisers, along with other materials, such as the metals needed for energy transition or other transition-related needs.
Substantial disruptions to trade due to the Covid-19 pandemic and the terrible war in Ukraine are inevitably creating supply issues and price shocks throughout global commodity chains. European governments are addressing the energy, food, and materials crises in part by focusing on security—through improving the strategic autonomy of individual European countries and of Europe as a whole. It is paramount that we address the potentially serious knock-on effects of caused by these developments, but, more importantly, we should not use these crises as an excuse for discontinuing our sustainability efforts. The current situation provides an opportunity to (finally) learn how fragile our economies and societies are, and how important it is to increase their resiliency. Prescribing pain killers without treating the underlying causes of disease will just lead to future health-related challenges or, in this case, to new crises, in which we will again be surprised, searching in panic for quick fixes and ad-hoc solutions.
To be clear, food and energy security are critically important - even more so now than when everything seems to be running well.
But food security is not only about “sustainable” intensification of food production or the use of fertilisers and pesticides, and it is certainly not about refocusing our attention away from sustainability efforts. Food security is about changing of the balance of crops produced for food versus for animal feed, tipping it in favour of food for direct human consumption. It is about upscaling systems like agroforestry, which simultaneously provide food and other ecosystem services, like carbon sequestration. It is about a fresh look at marine production systems that can deliver multiple benefits, such as seaweed aquaculture and bivalve farming. Food security is about amazing agricultural technologies, including precision agriculture, vertical farming, and production of meat analogues. It is about the introduction of dematerialised product-as-service business models. It is about caring for pollinators and the health of the soil. It is about food waste, and the equally unethical waste of land, energy, and pesticides used to produce uneaten food. Food security is also about broader policies. For example, it is about the proportion of food crops used to produce biofuels to feed to cars, not to feed people. It is about how much fertile land is swallowed by the expansion of cities, resource-consuming transportation systems, and other infrastructure…and I could continue.
Likewise, energy security does not only involve replacing one type of fossil-based energy with another from a different location and source; and it is not even only about providing abundant, affordable, renewable energy. Energy security is not only about cleaner, less energy consuming steel production. It is also about using steel effectively to meet human needs. It is about how much steel we use in our privately owned, but terribly underutilised, cars. It is about making our cars lighter. Energy security is also about how to use less energy in the first place. It is about alternatives to private cars, public transport options, biking lanes, and options for shared mobility … but also about better land planning and better city design, to minimise the need for mobility in the first place. It is about travelling less and working from home. It is about the energy efficiency and material efficiency of our houses, and the amount of space we use for our living needs. It is about the lifetime of computers, mobile phones, and other products - their upgradability, reparability, recyclability, and value retention. It is about all the energy used to produce the clothing we are wearing or, even worse, not wearing … and I could again continue.
In short, food security, energy security, or any other human security needs are first and foremost about reassessing our values, rethinking our economies, and reducing overconsumption - especially in high-income countries, including Europe.
We know from the work of the U.N. Environmental Programme’s International Resource Panel (IRP) [1] that extraction and processing of natural resources drives all aspects of the triple planetary crisis: climate change, biodiversity loss, and pollution/its health implications. The conclusion that we must use fewer natural resources to meet our needs is not so difficult, but it is essential. We also know that the use of materials extracted from the Earth has tripled since 1970; and IRP data tell us that, without transformative change, it will double again by 2060. The consequences for the triple planetary crisis will be severe. Therefore, it is absolutely necessary to decouple growth in wellbeing and prosperity from natural-resource use and its impacts.
Natural resources are at the very heart of all the climate, environmental, and human health challenges we face today. The more we use and mismanage natural resources, the more we heat the climate, destroy biodiversity, and cause pollution. So, logically, if we want to create real, systemic change to meet today’s challenges head on, we need to focus on how we use natural resources. If we can look at our production and consumption through the lens of natural resource use, we can start to think about transforming the whole system, not just a specific sector, and focus on maximising human wellbeing instead of maximising production-sector outputs.
This is a real message of hope, because by deeply understanding the drivers of the challenges we face, we can address those challenges simultaneously, create co-benefits and synergies, and avoid trade-offs or future lock-ins.
Our current efforts, including international efforts like the United Nations Framework Convention on Climate Change (UNFCCC) are predominantly supply-side focused and driven. But many of the problems we face cannot be solved only by greening, cleaning, and optimizing our current economic model. We need a deeper transformation of the entire system. Unfortunately, this plea is usually only heard and considered when it is already too late, as evidenced by the crisis situations we are currently facing.
The more we ignore and avoid these strategic and sometimes difficult issues, including the required trade-offs and delicate decisions, the higher the probability that we will face them again, in an even more dramatic way. By waiting, we are increasing the chances of creating future lock-ins, rather than generating the necessary synergies and potential benefits.
The fundamental problem lies in our current economic model. Economic theory is based upon the rational behaviour of consumers and producers, at least in the short term. The more we produce at the lowest possible price, the higher the profit, capital returns, and GDP growth. Over the past few decades, resource use has contributed to significant improvements in the living standards and wellbeing of people in many parts of the world, but this now comes at an unprecedented cost to the climate, the environment, and human health. While the economic growth of a country was once an indicator of the quality of life of its inhabitants, it is now difficult to make that claim for high- and upper-middle-income countries - the very countries that consume the most resources per capita. This clearly indicates that we need to rethink the north star currently guiding our behaviour and policies.
Sustainable development goals were an important step in the right direction, but ambitious policies that look to the long term, such as the E.U.’s Green Deal and the UNFCCC’s targets, are facing an uphill battle as they endeavour to set out frameworks, incentives, and regulations to change how we produce and consume—sending policy signals one way and market signals the other, creating confusion and intense lobbying by companies fearing the loss of profitable markets. We must stop giving producers the signals that destroying natural capital is free of charge. We must stop confusing consumers by asking them to behave responsibly by, for example, paying more for food with a low environmental impact and less for food with a higher ecological footprint.
Finally, we should not forget that standards and behaviour patterns linked to the current economic model were set by high-income countries, including Europe. Thus, we are ethically bound to show the world both our willingness and capability to change the reality we have created, and to lead the essential transition efforts.
[1] International Resource Panel (IRP): Global Resource Outlook 2019, UNEP, 2019.
