I’ve posted this image before but find myself repeatedly returning to the tension it expresses. It is sort of a Rorschach test for climate intuition.
It depicts a clash of mindsets about the relationship between economy and environment that I believe lies at the heart of the climate change debate, though is too often left implicit.
The left chart is economics’ view that ‘growth is the solution’ for environmental problems. Yes, economists say, economic growth may initially cause environmental damage – the curve rises up to start – but more growth will bend the curve down again, creating a ‘win-win’ of growth and environmental protection.
The intuition is ‘growth generates the wealth to pay for environmental protection’, or:
Growth → wealth → environmental protection
Technically, this is the ‘Environmental Kuznets Curve’, or EKC. It is a proposition about the ‘win-win’ potential not of an individual technology or investment but of a whole system defined by a certain type of damage, e.g. the planet for climate change.
Critically, the EKC is an *hypothesis*. Growing evidence finds it is only sometimes true, not a law of the universe.
Which is exactly what concerns ecologists, who see the world on the right. What they are most worried about is that climate and ecological problems are characterized by the prospect of irreversible tipping points that, if crossed, may trigger ongoing damage that no amount of growth could repair.
The contrasting intuition: the growth that generates the wealth to pay for environmental protection may cause irreversible damage before the solutions arrive, or:
Growth → (damage > wealth) → environmental destruction
It all hangs on the red dashed line. Are there thresholds and tipping points in the biophysical world, or not?
Economics has repeatedly rejected ideas of limits – Malthus, Club of Rome, etc. – but critically today’s limits are a different type to those of past debate.
Instead of the age-old concern about running out of inputs – food, energy, etc. – the new concern is that our many outputs and impacts – emissions, waste streams, etc. – may exceed natural absorptive and regenerative capacities and destabilize the planetary systems upon which we depend.
Bluntly, the limits problem today is less about ‘running out’, and much more about ‘screwing it all up’. This is what ‘Anthropocene’ is trying to get at.
In other words, ecologists are increasingly troubled by possibilities that economics – and hence business and finance – rule out by assumption.
Why it matters is that the left chart fosters a view that system-wide sustainability is a grand ‘win-win’, while the right chart suggests sustainability is a ‘race against time’, whether it be profitable or costly.
People might reflect not just which chart feels more intuitive for them, but why? Based on what formal education, professional experience or cultural upbringing? And does the original learning context still apply?