the reduction of people’s values to exchange value ensures that what people most care about is disregarded. Many of the things people most care about (e.g., significant social relations and evaluative commitments including those constitutive of identity and social loyalties) have the property of what Joseph Raz ? calls ‘constitutive incommensurability’. To assume that these values are in principle directly comparable under a common measure such as price – and that the operational problem is merely ‘getting the price right’ – is to misunderstand what it is that such values constitute

Excerpted from Paul Anderson, in Open Democracy:

(the original article is longer and well worth reading in full):

“There is mounting realisation that it is incorrect to think that genuine environmental protection can be achieved within the context of the global market economy – or to put it another way, that contracting resource use can be reconciled with expanding resource use. Although a full explanation lies beyond the scope of this commentary, suffice to mention three brief points.

First, economic instruments depend on the existence of competitive markets. This makes them inapplicable to oligopolistic markets. The problem is significant. Many resources subject to ‘global change’ – from freshwater and food sources to minerals and fossil energy – are subject to oligopolistic markets ? .

Second, where competitive markets do exist, economic agents tend to be incentivised to overuse resources rather than to conserve them. Such markets encourage agents

* to use resources at a rate proportionate to the rate of economic return rather than the rate of resource replenishment

* to correspondingly de-value resources that are unproductive from the standpoint of that return; and

* to shift costs onto others, in particular, those who cannot affect the price system – including future generations.

Agents are incentivised to act in this way because failing to do so would place them at a comparative disadvantage to those who use resources to maximise returns. One example of this can be found in emissions trading schemes ? . The problem is an incentive to exploit the entire available ‘emissions space’ rather than to leave some spare for precautionary reasons. As Gerd Winter ? explains, by redefining emissions space as exploitable rights, emissions trading turns

– emissions allowances into an economic value, which is not meant to lie fallow: it is legitimately used to the very last piece, at the level of states and individual actors alike. An entrepreneur who does not use his allowances or does not sell them to others if he has no use for them would appear as economically irrational. A state which accumulates a reserve and preserves it for later extinction would appear as politically incompetent

Third, this incentive to overuse resources is reinforced when competition is supplemented with privately-created credit. In most cases, the use of productive resources is determined by access to credit. Because access to credit is a function of expectations of future revenue, individuals are incentivised to use resources at a rate in excess of interest rates, and in excess of rivals doing the same. As John Dryzek ? notes,

– market participants must discount future costs and benefits at prevailing interest rates. The higher that rate, the more short-sighted the system becomes.

The thrust of the criticism is thus that creating and ‘correcting’ markets may lead, not to the resolution, but to the intensification of environmental degradation – and may do so the more environmental goods are priced and thus privatised.”

In conclusion:

Market instruments and norms need to be removed from areas for which they are simply not appropriate. In essence, the social project for sustainability is part of that, as Karl Polanyi ? recognised, to arrest all manner of social ills produced by unfettered markets. It is part of the social project of (re)subjecting markets, in particular, key resource use, to social and democratic control. Subjecting markets and key resource use to genuine democratic control means that markets may be made to serve people and planet rather than the other way around. Numerous perspectives now exist on the design of institutions governing the use of key resources use to guide the transition to their sustainable use.