No real commons economics at the Mercator Research Institute for Global Commons

A critique excerpted from David Bollier:

“After listening to the four speakers at the MCC’s inaugural one-day conference on November 15, “The Green Growth Dilemma,” the institute seems poised to explore modest, socially minded twists to the standard economic narrative. In other words, a fairly tame, meliorist agenda within the crumbling edifice of neoclassical economic thought.

There will apparently be no deep critiques of the basic goals, assumptions and methodologies of economics as it is practiced today. Nor does it seem that the potential of the commons as a form of participatory socio-ecological management will be probed. That topic lies too far outside the framework of standard economics. Or at least, no one focused on such commons at the institute’s inaugural conference.

This is too bad. Even today the economics profession is repeating the errors of Garrett Hardin. It blindly regards the commons as synonymous with “public goods,” for example. It treats them as mere physical assets, not as generative, more eco-friendly social systems.

At the MCC event, a series of scholars addressed such questions about how “green policies” might affect investment incentives and how GDP accounting should be redefined to take account of social welfare and ecological services. All of this is good as far as it goes. It’s just that it isn’t really about the commons. It’s about extending standard economic logic to environmental problems. For example, one ecological economist called for stronger environmental regulations because, in our current recession, “a lower opportunity cost for green investment provides a strong reason for more stringent environmental policies both during and after a recession.”

It’s hard to quarrel with such efficiencies and counter-cyclical public investment in environmental protection. But such approaches do not really grapple with the elemental dynamics of nature itself, and they are not likely to take us where we need to go. So long as the rest of the economy is committed to maximum growth and consumption; and so long as actual market externalities are disguised through murky methodological abstractions; and so long as citizens are not asked to play any meaningful role in addressing climate change beyond more efficient consumption; we are doomed. We need a far more bracing vision of change.

To his credit, Ottmar Edenhofer, the deputy director and chief economist of the Potsdam Institute for Climate Impact Research and the director of the MCC, wants to move economics in a more progressive direction. His talk, “Growth, Degrowth or Green Growth? In Search of a Better Paradigm,” argues for better metrics for societal well-being than GDP (i.e., “happiness research”). He argues for good government; greater investment in public goods and infrastructure; and greater investment in social welfare such as education and healthcare.

A rigorous scholar with a frenetic personal schedule, Edenhofer proffered his own complex scenario for change. He would revamp economic accounting so that the depletion of natural resources and “social capital” would be properly measured. Growth would be possible and even necessary (to provide green tech innovation and reduce poverty), but it would have to become more carbon-intensive and address externalities such as pollution. Economic growth must not be seen as a goal in itself, but rather as a way to serve social welfare functions. “The central question for economics,” said Edenhofer, “is not growth, degrowth or green growth, but social welfare.”

Again, a great vision so far as it goes. But can such an agenda adequately reduce carbon emissions? And can the state realistically deliver on this vision? Would the state find this approach politically feasible?

The problem with most economists’ theories of change is that they tend to avoid the process for making them come to pass. And yet everything hinges upon that. Markets usually have little interest in change lest it disturb existing, fixed investments. And the state as constituted is based on centralized, geographically bounded structures that have limited efficacy in our networked age. More critically, they have dwindling moral legitimacy. The state as a governance system has manifestly failed to anticipate, control or mitigate myriad environmental disasters over the past fifty years. Most governments do not have the political interest, clout or administrative resources to alter the fundamental workings of markets (if only because the state reaps so many short-term benefits from conventional economic growth). States acting on their own have few political incentives to step up to advocate a “green economy,” socially minded economic policies, or limits to growth.

Meanwhile, carbon-emitting industries have amassed plenty of political clout to stave off regulatory controls and entrench free-market discourse as the default policy approach. This means that the state must supposedly win concessions from market players who want growth at all costs, a goal that the state itself has historically shared. It should not be surprising, then, that despite trustworthy scientific findings that confirm the profound ecological crisis posed by climate change, the state and the market have failed to take significant action for more than twenty years. Climatologist James Hansen made his famous warning to Congress about climate change in 1988.

So on a purely pragmatic level, I’m wondering what are the political means by which the nation-state would supposedly step up and neutralize the fundamental drivers of climate change. And would new metrics of GDP (Edenhofer proposes a “Net National Product” that takes account of social capital) and growth tethered to social welfare (echoes of the New Deal and Great Society?) accomplish what is needed? Would corporatists even let such an agenda be debated?

The problem is the market/state duopoly doesn’t really want to change, and all politics flows from this core premise. The market/state wants growth – more growth. That’s why I doubt that the meliorist proposals like the ones floated at the MCC conference are likely to lead us to a post-carbon future. The vision is not bracing enough and it does not seek to mobilize the political energies for change that are needed. It does not confront core failures of contemporary economic thought. Perhaps most critically, it does not enlist the committed energies and innovation that commoners themselves could provide, if given the chance.

To take the commons seriously, we are going to have to begin to move beyond economic categories of thought. We are going to have to go beyond nature as a collection of physical assets, and instead understand that they have an intrinsically social dimension (as reflected in how we use them) and their own irreducibly ecological character. There are vital interconnections between the social and the ecological that are either ignored or misrepresented in standard economic logic.

I found the MCC debut disappointing because it purported to speak about commons without once mentioning actual commoners. There were no mentions of small-scale fisheries, rural forestry commons, transnational commons movements, or other social collectives that can function as an alternative economy and should be more aggressively supported by public policy. No role was sketched for these commons.

And yet the benefits of fostering such commons and slipping the shackles of standard economic thought are manifold. The commons-based economy is not based on relentless growth. It strives conscientiously to limit “externalities” and think more holistically. It establishes cultural identities and social practices based upon stewardship and responsibility. People come to internalize values and practices rather than relying so heavily on external, politically corruptible authority — government.

And yet the tacit assumption of most economists is that only the market and state are credible, significant actors in the worsening drama of climate change. Commoners? They don’t exist. Or not enough to be considered politically relevant or economically consequential.

In this respect, history is repeating itself. Ignoring the commons as a generative, ecologically sustainable paradigm is the essence of the “tragedy” parable. Even though subsistence commons meet the everyday needs of an estimated two billion people in the world, two of the most popular economics textbooks in the U.S. – by Samuelson & Nordhaus and by Stiglitz & Walsh – entirely ignore the commons as a viable, attractive provisioning model. How dismaying that one speaker at the MCC’s opening reception, Harvard economist Robert Stavins, barely mentioned the many instructive possibilities of commons. The title of his talk: “The Problem of the Commons: Still Unsettled After 100 Years.”

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