Warner Pacific College
Submitted on November 29, 2010
There are many tools that society uses to determine how to best use our natural resources. One of the most common ways is to do a cost-benefit analysis. Estimated costs for a proposed action are totaled up and compared to the sum of benefits estimated to result from the action. (Withgott and Brennan 2008).
Today’s capitalist market system follows the pattern of neoclassical economics. Four fundamental assumptions of neoclassical economics have implications for the environment:
• Resources are infinite or substitutable.
• Costs and benefits are internal.
• Long-term effects should be discounted.
• Growth is good.
(Withgott & Brennan 2008)
However, when dealing with environmental issues, this would not be the best way to asses our resources as natural resources are not infinite, for the most part. An example of this is unregulated mining. Some companies may over mine the land; draining it of its resources.
Another principle is that cost and benefits are only internal and do not affect others in society. Yet, in environmental related issues, this isn’t usually the case. Many external costs are not calculated into the equation. These costs are such things as the effects on the environment and the people who live in the region. A good example of this would be when a company drains the natural resources and also creates harmful byproducts that affect the environment negatively, which then in turn, affects the economic structure of a society. This commonly leads to higher poverty rates.
Another principle is that long-term effects should be discounted. Societies tend to look at only the short-term effects and do not usually calculate in any potential long-term problems. In the case of mining, long term effects could by many, from the effects on the surrounding environment to the probable and possible effects to the economic welfare of the people.
The last principle is that growth is always good. Often, when dealing with environmental issues, this would not be the case. Sometimes growth may actually harm the very resource that a society is using or the method in which said resources is harvested may harm the land or people who live near the resource.
For decades, economists have assessed the robustness of an economy by calculating the Gross Domestic Product (Withgott & Brennan 2008). One recent alternative to this is to use the Genuine Progress Indicator (GPI). The GPI calculates costs beginning with the conventional system then adds in any positive contributions that are not monetary and subtracts negative impacts. The GPI summarizes more forms of economic activity than the GDP It factors in and differentiates between economic activity that increases societal well-being and activity that decrease it (Withgott & Brennan 2008).
There are many governmental and private agencies that work to accurately calculate the various impacts on society. These agencies help to create and enforce policies and laws intended to advance societal welfare (Withgott & Brennan 2008).
Governmental agencies, such as The World Trade Organization and The United Nations, and nongovernmental organizations, can exert influence. The World Trade Organization represents multinational corporations and promotes free trade by reducing obstacles to international commerce and enforcing fairness among nations in trading practices (Withgott & Brennan 2008). The WTO has the authority to impose financial penalties on nations that do not comply with its directives (Withgott & Brennan 2008).
Many nongovernmental organizations have been successful with using the federal government to enact environmental laws. The process is a long one. First, they must identify the problem. Second, they must discover a specific cause of said problem. They must also envision a solution to the problem; this is the third step in the process. The fourth step is to get organized. Organizations are more successful than individuals as they are not as easily dismissed. The final step is to gain access to politicians who can help to enact the changes. This is done through lobbying, campaign contributions, and the revolving door (where individuals who were employed by government-regulated industries take jobs with the government agency that regulates such industry.
Politicians can help these agencies by voting for laws and policies using the legislative branch of the government. They introduce these as bills, and they are voted on in the House and the Senate and enacted by Congress.
These regulations have an enormous impact on culture and lifestyle. It stands to reason that if a mining company drains the land of its resources and pollutes the air and water, then the people who live in that area would be impacted negatively. They would most likely suffer from food shortages, illness due to pollution and economic poverty.
Governments enact laws and policies to not only protect our resources, but also to protect the economic and social viability of the people. If corporations were allowed to use resources and were not regulated, the effects would be devastating.
Environmental policies are enforced in various ways. Most often, an approach called command and control is used. It sets rules or limits and threatens punishment for violating these policies (Withgott & Brennan 2008).
Other methods used are tax breaks, subsidies, and instituting green taxes. Green taxes are intended to help fund the negative costs on the environment as well as to make corporations more responsible for any pollution they create.
Cultures and lifestyles are impacted by any and all events that surround us. If governments do not regulate use of natural resources and try to lower pollution, then lifestyles are negatively impacted. If the lifestyles of the people of a society are hurt due to the negative effects of business on the environment, the culture of the society would suffer also.
One example of this is the Mirrar Clan and the Jabiluka Uranium mine. The Mirrar depend on the resources to live and view the land as sacred. It is part of their culture. A main reason they fought the mine in Jabiluka was over the sacred spiritual sites of the tribe. Another was the negative environmental impact that the first mine in the area had on the surrounding land (Withgott & Brennan 2008).
In enacting these policies, all nations have the ability to affect their citizens lifestyles; therefore, greatly affecting the culture of the people.
Withgott, J & Brennan, S. (2008) Environment: The Science Behind the Stories (3rd Ed.). New York. Pearson Benjamin Cummings.