The Math of Ethical Growth

I listened to this conversation between Nathan Schneider and Marjorie Kelly this week, about her new book Wealth Supremacy and why simply trying to build more ethical economic entities is insufficient. It’s a retrospective look at the evolution of her own thinking, which has been very solutions oriented, and focused on bringing additional values into business, either through entities like B-corps or the recently much maligned ESG initiatives. One thing she seemed particularly regretful about was falling into the trap of using the framing of business to advocate for these kinds of changes: accepting that the profit maximization is the most appropriate metric, and then making the case that more sustainable, equitable, diverse, egalitarian etc. businesses are more profitable, and therefore those attributes should be more widespread, even within the very narrow logic of Actually Existing Capitalism.

On one level, it would be awfully convenient if that were true, and in the context of the Long Algorithm I think it should probably be our goal to create an economy where it is true by construction: through the laws, taxes, markets, policies and social norms we adopt. But in general it doesn’t seem like that’s the world we live in right now. Extractive, monopolistic, wealth-concentrating businesses still seem to have some pretty high margins, and many folks arguing for more ethical, sustainable, equitable business have said that a lower rate of return might be acceptable or even necessary.

Mathematically, I don’t think that works out.

We have to let go of the idea of maximizing returns to capital. If a corporation will do something that’s beneficial to sustainability and it breaks even… why isn’t that good enough?

Marjorie Kelly
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The Unending Frontier by John F. Richards

The Unending Frontier: An Environmental History of the Early Modern World is a series of case studies looking at what happened when organized pre-industrial administrative states or globalized markets came in contact with other human societies with less organizational capacity and power. It was a little dry, but I really liked the diversity of examples and the way they fed into each other, knitting together almost 300 years of history, from about 1500 to 1800. I’d highly recommend it to anyone who wonders what the global economy looked like in its awkward teenage years.

This is the first time that all the disparate parts of the human world became connected persistently, with flows of information, material resources, pathogens, culture and people growing almost continuously throughout. Communication and travel weren’t fast, but they were reliable enough that people kept doing them, and built huge economic and cultural and political structures around globe-spanning trade. Capital markets that vaguely resemble what we have today were starting to form. The state and market apparatus were sophisticated enough in some places to wield huge collective resources in very focused ways, impacting huge populations and natural resource stocks, even for what seem like kind of trivial ends. European fashion trends and status hierarchies nearly drove the North American beaver to extinction, dramatically reshaping the watersheds of half a continent.

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Overpopulation isn’t the Problem

Some folks in Boulder like to make analogies to exponential global population growth in discussions about our local land use decisions (see for example Frosty WoolridgeFrosty Woolridge again, Robert Baker, David Brandt, or the venerable Al Bartlett himself). These analogies are inappropriate in multiple ways.

First, steep declines in fertility worldwide have largely defused the population bomb. Second, even if the bomb were still ticking, the population changes we see in Boulder, and more generally the Front Range of Colorado, the US and the booming megacities of Asia aren’t about population growth per se, they’re about migration.  In the developing world, it’s migration from rural areas to cities. In the already rich countries, it’s mostly migration between cities, often from low-wage regions to areas with better jobs and higher quality of life. Or it would be anyway, if we actually let people build housing in those places.

How we choose to build and rebuild cities to accommodate these migrations and humanity’s peak population later this century will largely determine our ultimate impact on the Earth’s climate and biosphere, and the quality of life that humanity has access to.  Contrary to many “population bomb” narratives, the main problem here as it relates to climate isn’t the impact of large numbers of poor people, because small numbers of rich people are responsible for the overwhelming majority of current greenhouse gas emissions.  How we accommodate those wealthy, high emissions populations makes a big difference, both directly, and through the example it sets for the rapidly expanding global middle class.

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Less Than Revolutionary Finance

I’ve gotten some good natured pushback on the idea of buying oneself out of corporate servitude.  The objection seems to come in two general forms.

  1. Contingency of Financial Autonomy: Deriving financial autonomy from investments in corporations whose operations are fundamentally destructive creates a morally corrosive dependency — your interests end up being aligned with theirs, because your autonomy depends on them remaining profitable.
  2. Opportunity Costs: Even if investing in corporations doesn’t actually give them financial support, there’s an opportunity cost: the same money could be used to invest in small local businesses or social enterprises.  Wouldn’t that be more powerful and potentially transformational?

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Sustainable Energy Without the Hot Air

Sustainable Energy, without the Hot Air by David MacKay, is a book (available in its entirety online) looking at the sources of energy available, and the ways in which we use it today.  There are lots of options, but any real discussion has to, at the very least, use numbers that add up.

Industrial Scale Urban Farming in NYC

TED fellow Viraj Puri talks about his Brooklyn rooftop farming startup.  Gotham Greens has ~1500 square meters of hydroponic greenhouses producing herbs and salad greens in a very controlled environment… somewhere between a farm and a manufacturing facility.  The system is solar powered, and can operate all year long.  They currently produce ~100 tons of food a year, and they believe the business is viable at least in the urban foodie context.  I was happy to see Puri readily (repeatedly) admitting (or even pointing out) that the system cannot scale up sufficiently to provide a large proportion of the city’s overall food requirements.  This is in stark contrast to the idea of Vertical Farming, which is clearly bunkum — once you’ve covered the roofs with greens, there’s no more farming to be done unless you pipe in light somehow, which is much less efficient than simply farming where the light is naturally.

Just out of curiosity… I wonder how much food could be produced in Brooklyn at full capacity?  And roughly how much does the city eat?  The land area of the borough is 183 km^2 and it has 2,500,000 residents, or roughly 75 m^2 per person.  Their production of 100 tons/1500 m^2 is roughly 66 kg/m^2 per year.  So if the entire area of Brooklyn were producing like this greenhouse, you’d get nearly 5000 kg of food per person per year.  The average American consumes about 1000 kg of food per year, so if you were able to use 20% of the borough’s area, you’d be close to meeting demand… at least by mass.  Gotham’s 59kW solar array probably takes up ~590 m^2 (100 W/m^2 is typical of solar cell power production) and only provides part of the operation’s power.  Probably there’s other infrastructure too that’s not actively producing food, so say they’ve got about half their total area dedicated to actual plants… then you’d need to get up to 40% of the land area being utilized to get 1000 kg of greens per resident per year.  However, most of the 1000 kg that we actually eat is a lot more energy dense than lettuce.  I wonder how many calories per m^2 one can get out of these setups, and what the most productive crops would be?  Honestly I’m surprised at how large the potential production is.  I wonder what the actually available rooftop area is?

Why I Won’t Be Turning Off Any Lights for Earth Hour

A GOOD (Magazine) summary of why Earth Hour is lame.  First, it’s symbolic — turning lights off for an hour has a negligible effect on your (and the globe’s) energy consumption.  Second, the symbolism (which is all it’s got) totally sucks!  Want to be environmentally sound?  Then sit shivering in the dark.  Great.  Widely publicizing an action which is both unnecessary and turns people off (ha!), isn’t gonna win any hearts or minds.  It just reinforces the needlessly “hair shirt” vision of “green” that most people have.

This is what a closed-loop economy looks like today

A great series on the recycling industry in China from the writer of Shanghai Scrap.  We need to build a closed-loop material economy, and there are pieces of it around today.  This is one of them.  Mountains of fist-sized shards of shredded cars, sorted manually by women who are earning more than your average Chinese college grad.  Amazing photos.