Thursday, 19 February 2015

It’s not that easy being “GREEN”
“Efficiency” vs. “Sustainability”

Image Collage by PeapodLife: It takes more than “efficiency” to be “GREEN”

Decades after the birth of the modern environmental movement, the western world has seen the rise of a burgeoning “green economy.”

But the world seems somehow hamstrung to tackle global warming and other major environmental problems, leaving environmentalists frustrated and the general public apathetic. Perhaps the ecological warning of the century came not from Al Gore, but from Kermit the Frog…

Video: sesame street - its not easy being green 

So what makes being green so hard? Like anything in life, how we think about something effects greatly its impact on us. Recycling, conservation, emissions reduction, carbon trading, and many other schemes have emerged into the mainstream under the umbrella of sustainability.

Logo: Sustainability – creating more, wasting less. 

But this isn’t the definition of sustainability…it’s the definition of efficiency. And this gross oversimplification of sustainability in purely material terms has become the proverbial Achilles Heel of the so-called “green” movement.

But sustainability is not a question of material efficiency alone. If it were, the world would be taking it much more seriously. If we say sustainability only matters in the material economic sense, then we are attributing purely tangible value to ecology, ecosystems and humanity’s ongoing harmonious and symbiotic relationship with the natural world.

By thinking about sustainability solely in the “what we take out of / what we put back into the environment” equation, we deny its intrinsic value—the intangible value of nature and a healthy, vibrant, thriving environment.

In my book, The Attlas Project, Volume One: SEE the World in a New Light, I explore this question and offer a context with which to further the discussion:

Accounting for the Tangible and Intangible Costs of Business
One of the interesting concepts in economics is that of opportunity cost, the notion that, in free markets, while direct costs of goods and services are contained in the price, one must also consider the benefits of making alternative choices.  The inherent scarce nature of resources means that choices are usually based on a prioritized cost-benefit analysis including consideration of opportunity costs.

Consumers, like most entities existing in free markets, have incentives to achieve maximum benefits at minimum costs.  While there are exceptions to every rule, on the whole consumers will make purchase decisions based on an evaluation of their choice—the tangible and intangible benefits they will receive versus the tangible costs they will incur, including some opportunity cost factor.  Of note here is the consideration of intangible benefits on the part of the consumer.  A designer label or prestigious trademark will often fetch a higher price than an identical substitute (minus the mark) despite having the same tangible costs.  One might be tempted to argue that supply and demand forces prices higher in this instance, as in others, since designer brands are distributed in limited quantities and the desire to own one of a limited number of units is high.  Or a connoisseur might argue that it is precisely the limited availability of premium goods that warrants paying a higher price.  In either case, the producers of such goods make up for lower quantities with higher margins.  In the case of some producers such as Tommy Hilfiger or the GAP, neither argument applies, since neither of these so-called designer labels are produced in limited quantities.  In fact, the intangible benefit of fashion is the very notion of being “fashionable,” which by definition stands in opposition to the idea of exclusivity.  The paradox of individuality as it is expressed through following the latest fashion trends is a socio-psychological issue beyond the scope of this chapter; nevertheless, the point must be made that markets—especially in the West—have accepted the concept of intangible benefits and use monetary metrics to account for them, despite inherent incompatibilities.

One need only observe the salaries of certain athletes, actors, and CEOs in the West—particularly in the United States—to realize that accounting for intangible benefits with dollars can produce simply outrageous results.  Investors and analysts alike have puzzled over exactly how an acquiring firm arrived at the sum paid out in “goodwill.”  So-called priceless works of art, antiques, and artefacts nonetheless get auctioned off for very real sums of money.  The retail price of a designer t-shirt manufactured offshore can sell for double or triple the price of a higher-grade cotton t-shirt “Made in the USA.”  One cannot deny the inherent incompatibility between intangible value and dollar measurement.  Currency is useful for valuating measurable quantities of resources: pounds of salt, bags of grain, kilowatt hours, acres, hours of labour, etc.  But how does one quantify the value of the Sistine Chapel or the Great Wall of China?  Surely not in terms of square footage!  The old cliché “money can’t buy happiness” rings true in this regard.  Still, markets have deemed it fair and necessary to incorporate intangible value into price.

If there are varying degrees of intangible benefits considered in all economic choices, then it follows that there must also be intangible costs.  Like the balance sheet itself, the cost-benefit analysis should balance, and yet it does not.  Historically, free markets have over-emphasized the “assets” side and turned a blind eye to the “liabilities.”  After all, there is no incentive for markets driven by earnings growth and increased profitability to concern themselves with the intangible costs of doing business.  The capitalist system, moreover, is ill-equipped to account for intangible costs.

To illustrate, consider a $20 GAP t-shirt.  Due to all the advertising and fashion trends depicted in the media, I as a consumer may believe the intangible benefits of wearing a GAP t-shirt (over and above the tangible benefits of any normal $10 t-shirt) are greater than the $10 premium I must pay to wear it.  The market has priced in the intangible benefits of wearing GAP, and I am willing to pay that price, despite the fact that Costco sells an American-made generic-label t-shirt for $10.  The GAP could source t-shirts manufactured under decent conditions, with workers being paid relatively decent wages, and still provide me with a $20 GAP t-shirt at a profit of at least $10.  Instead, it sources t-shirts from Southeast Asia manufactured under sub-par conditions, paying sub-standard wages, to provide me with a $20 t-shirt at a profit significantly greater than $10.  As a consumer, I have no simple basis on which to make an informed choice in this case, since although the price clearly accounts for the intangible benefits—reinforced through marketing and fashion trends—it fails to account for the intangible costs of GAP’s business practices.  In short, I cannot readily or easily evaluate all the costs against the benefits.

If I was an investor and not a consumer, I would have an even greater incentive to buy GAP, since its business practices give it a better operating margin, and that translates into higher earnings.  Thus, the high social costs of GAP’s exploitative business practices abroad and the high environmental costs of its international shipping practices, are reflected in lower economic costs and higher share price for the company and its investors.  In other words, the effects of GAP’s high intangible costs have been accounted for as tangible benefits—assets, if you will—but the intangible costs themselves have not been accounted for anywhere for what they are—liabilities.  Given the natural scarcity of resources and the purported long-term nature of equity investment, such inequitable cost-benefit analysis is unsustainable over time.

Tens of millions of dollars are spent on marketing and advertising the intangible benefits of wearing GAP clothing, but nowhere are the intangible costs mentioned to either the consumer or the shareholder who, by purchasing GAP over another company, are supporting low-paying, high-margin operations in Southeast Asia, increasing contributions to greenhouse gases via shipping, and helping eliminate higher-paying jobs domestically.  The ripple effect of their economic choice, compounded with the choice of millions of others following fashion and investment trends, will eventually come back to haunt them, but the effect is so far removed at the time the purchase decision is made it is intangible and unaccounted for—“out of sight; out of mind.”  Like the billions upon billions in off-balance-sheet debt that caused the collapse of Enron, global markets have set themselves up for a terrible fall.  Eventually, all those unaccounted-for intangible costs will catch up to us—this time in the trillions—or if not us, then our children (and/or our children’s children).
Source: – Attila Lewis Lendvai, Author, "The Attlas Project," Chapter 2: SEEconomics.

Image: The Attlas Project Volume One - SEE the World in a New Light Cover 

But rainforests can and are measured in square kilometers and tons of lumber. What’s worse, after they are cut or burned down, the land they once occupied is repurposed and measured in heads of cattle or tons of coffee beans, cocoa, palm oil, etc. The pricelessness of the rainforest, however, is unaccounted for. At least not yet, according to Lendvai :
Eventually this issue will take care of itself.  Economics does, after all, take into account scarcity of resources and supply and demand.  The intangible costs of generations of indiscriminate logging, fishing, agri-business, manufacturing, and science and technology will eventually be priced into the handful of fresh vegetables, healthy farm animals, and potable water left on our planet.  How ironic if someday mighty CEOs, oil barons, rock stars, and professional athletes must face a future when the wealthiest people on earth are farmers, and a bushel of grain is auctioned off for the price of a Ferrari or a luxury home.  Indeed, economics has built in the mechanism—albeit delayed—to price intangible costs into goods, with compound interest to boot.”
~ Attila Lewis Lendvai, Author, "The Attlas Project," Chapter 2: SEEconomics.

PeapodLife and The Attlas Project alike challenge us to consider, then, a much more comprehensive definition of sustainability:

Image: Sustainability as more than just efficiency 

In this definition of sustainability (SEE: Social, Environmental, Economic), the efficiency part is at best only 1/3rd of the equation (economy). The word economy is practically synonymous with efficiency (economies of scale, more economical products, etc.) Since the satisfaction of the profit motive is based on net results, efficiency is only 50% of the equation of “materialist success.” Thus, it is only 1/6th a factor in the overarching umbrella of sustainability.

Why This Matters to PeapodLife Building Ecosystems and Technology

It should be clear that PeapodLife ecosystems  adheres to the much more comprehensive, holistic and meaningful definition of sustainability…SEE Value(s). These are benefits you do not measure or think so much as you feel…instinctively in your body and intuitively in your heart.

When you experience a high-order rainforest ecosystem in the flesh, you know its value. Not because you’re measuring the amount of fresh oxygen it’s producing; not because you’re counting the atmospheric particulates being filtered out of the air by the living wall; not even because you’re  calculating the number of sick-days you won’t be taking thanks to having an ecosystem in your life. No, you just know its valuable to you and yours…you just feel it.

And no, a video cannot do it justice, but hey—what more can we offer over the Internet?

Now ask yourself (and be honest), can your low-flow toilet or showerhead make you feel that way? How about your recycling bin? Don’t get me wrong, we’re sure you believe you’re doing good, and making some difference, but do you know it…can you feel it, deep down?

Can you develop a meaningful relationship with “energy efficient technology?” More importantly, does “materialist green technology” truly deepen your appreciation for—and love of—nature, your friends and family, your community? Do gadgets and gizmos and processes relax you, invigorate you, strengthen your immune system by immersing you in an experience of mutual harmony and symbiosis?

Your Toyota Prius may make you feel like you’re doing something good for the environment in your head, but it’s still just a machine…it’s not actively surrounding you with a space of love. You may “love it” in a materialistic sense—a kind of ego attachment—but it cannot love you back.

PeapodLife‘s ecosystem can…and does…more than your mind can begin to imagine, but in ways that your body, heart and soul can experience…without mind…and can absolutely know.

Yes, it takes more than efficiency to be green…it takes something much deeper. And it’s that deeper thing inside all of us which is the only level on which we can ever find lasting satisfaction of any kind—true peace, joy and happiness. PeapodLife’s ecosystems create a space of love and connect with you on that level.

SEE a New Vision of Green Bloom, Rooted in a Holistic Definition of Sustainability

Now imagine a world in which everyone had the opportunity to connect with nature on that level, all the time. Imagine what that would mean to the societal, environmental and economic aspects of sustainability…if everyone was surrounded by a space of love…if everyone was immersed in a field of peace, joy and happiness.  What would happen to the nature of relations, decisions and transactions if they could be made surrounded by nature in its highest expression?

This is PeapodLife’s vision of “Green.” And no, it’s not easy to get there, maybe. But it’s not that hard to experience. PeapodLife is an Attlas Project: we have the technology and the financial services to make owning and living/working in a high order rainforest ecosystem a reality.

Come SEE for yourself. Contact Us today.

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