Comments (10)

• Francisco Torres

• I wonder just how the Chinese government expects to calculate the so-called environmental costs in order to deduct them from the GDP. They seem to miss the irony in trying to figure out a downright bogus figure in order to calculate a "more accurate" but nevertheless equally bogus figure i.e. a "GDP"

• Published: November 19, 2004 8:59 AM

• Lisa Casanova

• Adbusters whole idea of "true cost economics" is completely bogus. As far as I can figure, they believe that no one is actually paying the "true cost" of what they consume, because environmental degradation, pollution, etc are not taken into account. While they might be right that these days it is possible to socialize some of the costs of pollution and resource consumption onto others, they believe that the government can fix this through taxes. Government is, of course, wise enought to figure out what the true cost of everything is and tax it accordingly. They strike me as your garden variety anti-capitalist, still-waiting-for-the-socialist-paradise loons.

• Published: November 19, 2004 10:54 AM

• D. Saul Weiner

• I disagree with D'Amico's premise. Yes, the notion may be unworkable in practice, but it makes perfect sense to do what they have set out to do. Companies need to account for items such as resource depletion and asset depreciation in determining their income statements and balance sheets. Why shouldn't countries account for such "expenses" in determining their national income? And if they were able to implement this system, they might find out if their economic program was sustainable or if it were heading into the ditch. Wouldn't that be useful information to have? Not that I have much confidence that they'll pull it off or use such information wisely, but it strikes me a sensible development, not a scary one.

• Published: November 19, 2004 12:17 PM

• Pete Canning

• Companies need to account for items such as resource depletion and asset depreciation in determining their income statements and balance sheets.

  The price of a resource reflects its cost just fine. Owners of resources also seem to understand that when they sell a portion of what they own, they own fewer things. This "green" GDP places value somewhere where the market (individuals) does not. If something is valued, people will pay for it and the market will reflect these preferences. When greens rant about these "costs" they are talking about the loss of products they want, but are unwilling to pay for. This is aside from the point that GDP is a relatively meaningless aggregate (like most aggregates), and the fact that "countries" should not be doing any accounting at all.

• Published: November 19, 2004 1:09 PM

• D. Saul Weiner

• "The price of a resource reflects its cost just fine."

  That's a very global statement. If I burn coal (or whatever) and it pollutes lakes and rivers that I do not own, exactly how is that pollution reflected in the price of coal or energy or whatever I am producing?

  "If something is valued, people will pay for it and the market will reflect these preferences"

  This is true in theory, but what if the government has decided to take ownership of, say, a great deal of forest land. To argue that people value this land and would be willing to pay for it is irrelevant as long as it is not and will not be put up for sale. And if the land is abused, then it does detract from the nation's wealth.

  "This is aside from the point that GDP is a relatively meaningless aggregate (like most aggregates), and the fact that "countries" should not be doing any accounting at all."

  I agree with the 1st point but not the 2nd. As long as governments are in the business of owning things and regulating economic life, we do need to account for the mess that they are creating. Unfortunately, most of the measures are so ill-conceived and/or manipulated that the statistics are often useless or even counterproductive. So, from a practical standpoint, we'd be better off with a reputable, private organization(s) doing the accounting.
  

• Published: November 19, 2004 1:42 PM

• Pete Canning

• That's a very global statement. If I burn coal (or whatever) and it pollutes lakes and rivers that I do not own, exactly how is that pollution reflected in the price of coal or energy or whatever I am producing?

  The negative externalities issue is a very real one, but a "green GDP" hardly deals with it.

  This is true in theory, but what if the government has decided to take ownership of, say, a great deal of forest land. To argue that people value this land and would be willing to pay for it is irrelevant as long as it is not and will not be put up for sale. And if the land is abused, then it does detract from the nation's wealth.

  What is with this concern for "a nation's" wealth? It is collectivist nonsense. Further, the government owning the land ensures it will not be used properly. This is the socialist calculation problem. It cannot be solved in any way other than by selling the land to the highest bidder.

  As long as governments are in the business of owning things and regulating economic life, we do need to account for the mess that they are creating.

  This really can't be done in any meaningful way.

• Published: November 19, 2004 2:37 PM

• D. Saul Weiner

• "What is with this concern for "a nation's" wealth? It is collectivist nonsense."

  Pete, when the government comes to your door to take up a collection for the massive debt it has run up allegedly on your behalf, this concept might not seem like such collectivist nonsense. The national debt will impoverish YOU.

  "As long as governments are in the business of owning things and regulating economic life, we do need to account for the mess that they are creating (initial comment).... This really can't be done in any meaningful way. (response)"

  What basis do you have for making this statement? Have you made an exhaustive study of all of the proposals or attempts at doing such? Are you saying it can't be done or it isn't worthwhile? And if it isn't worthwhile, are you suggesting that we should strive for blissful ignorance while our rulers bankrupt the country?

• Published: November 19, 2004 3:05 PM

• Pete Canning

• Pete, when the government comes to your door to take up a collection for the massive debt it has run up allegedly on your behalf, this concept might not seem like such collectivist nonsense. The national debt will impoverish YOU.

  The national debt won't impoverish me, others stealing from me will do that. Who, how, and why is not of much concern when one is being stolen from. It is the theft that is at issue.

  What basis do you have for making this statement?

  Subjective valuation. Only individuals can judge the effect of government policy on their lives. Interpersonal utility comparisons cannot be made. Does a higher GDP make you better off? Not always. No matter the aggregate, it remains fairly meaningless because of these facts. Aggregates only serve to replace of the reality of the individual, with the myth of the collective. As to "blissful ignorance" I am completely aware that I am being screwed over by the government, that is plenty of information for me. And amazingly I can analyze the effects of economic policy without the aid of some bullshit number.

• Published: November 19, 2004 4:24 PM

• Paul D

• While putting made-up numbers on a balance sheet to account for environmental costs is bogus, it's hard to deny that there is value to the environment that goes beyond economic analysis.

  Do not the earth, its resource, and its species belong not only to the people alive today, but also to everyone who will be born in the future? Even if the short-term profit earned by destroying the planet were greater than its discounted long-term potential *to us*, doing such a thing would be foolhardy and wrong, would it not?

• Published: November 19, 2004 6:15 PM

• Marcel Popescu

• Obviously not. Take an "Independence Day" scenario - blowing up the Earth would have given us a higher profit (subjective, but that's equally valid for all profits) than leaving it in the same state for the aliens to enjoy. On what basis could possibly say that such a thing would be foolhardy and wrong?

• Published: November 22, 2004 12:01 PM