Modern economics says that global trading can often create additional value for all involved. A country’s economy will function more efficiently if it produces an excess of goods that are easier for it to make and trades these for other goods; that’s a basic extension of the concept of division of labor. The obvious negative impacts of global trading are transportation costs, both financial and ecological; but if we can develop cleaner modes of transportation, surely the positive economic effects outweigh the ecological costs?
I had thought as much, until Professor Ben Linder of Olin College of Engineering made me rethink my assumptions. In a sustainability workshop that I’ll be chewing on for a while, Ben said that global trade’s real threat to sustainability has to do not with transportation costs, but with carrying capacities.
First, a brief ecology lesson. Picture a world of three tribes: the Sumerians, Babylonians and Phoenicians. For simplicity, these ancient people need only three things to survive: stones (for building houses), barley, and fruit, say one unit per person. Each tribe practices an internal division of labor and produces some of each resource.
Each tribe’s skills and geography are differently suited for producing each resource, but all three resources are equally necessary for survival, so for each tribe only one resource is the limiting factor to growth. Let’s say in our case, Sumer is always scrounging for stones; the Babylonians are often bereft of barley; and fruits are few and far between in Phoenicia. If each tribe can make 1000 units of its scarce resource, but can make 2500 of the other two, each can still only support 1000 people; so the world population is 3000.
Now the tribes discover trade. Each tribe barters some of its two excess resources to the one deficient in each, so now the resources are distributed evenly at 2000 each of stones, barley, and fruit. Now, each tribe can support 2000 people. Without producing any new resources, the population of the world has doubled! And with further specialization, production will likely increase as well. Clearly, the more tribes you can trade with, the fewer your resource limitations to growth.
So why is in-tribe division of labor a good thing, but cross-country trading detrimental to the planet? Because ecosystems can’t trade natural resources. A tribe’s ecosystem is resilient as long as its resources don’t flow out, but the earth can’t ship fertile soil to Phoenicia in exchange for some cleaner water elsewhere if Phoenicia depletes all of its crop nutrients. Yet that’s surely what will happen if the whole world demands Phoenician fruits from land that wasn’t evolved to support the needs of the trade-burgeoned domestic population, let alone the entire world.
This was happening long before the world “flattened”. Ben is fond of telling the story of the collapse of the Atlantic cod population, a resource that put Boston on the world map. Over the last few centuries, “tribes” from around the world traded their resources for Atlantic cod and literally fished it out of George’s Bank. There are cod species elsewhere, but since George’s Bank can’t exactly trade for this top-tier predator, its entire food web is now going through an unstable flux known as a trophic cascade in the cod’s absence. (Read the fascinating history of George’s Bank.)
There are other ways that global operations can stymie sustainability, such as introducing lags into the feedback loops for optimal production, but this argument of carrying capacities seems to be the main challenge. I’d love to hear your thoughts on it, though.
February 20, 2009 at 4:50 am
Thank you for these very interesting reads! George’s Bank story was very good to read too.
My company’s main line of service is not about sustainability, but more and more, I find myself urging companies to start taking meaningful sustainability initiatives. For the past year, we have made a little progress, and we started working with a small number of clients in Japan on sustainability related projects. On one occasion, we had Interface representative come and give my client and their guests a seminar about Interface’s efforts, but right now, we are still at the stage of “let’s measure our CO2 output, then we’ll be able to speed up the process in improving the sustainability efforts”. Would you have any idea on how to improve this situation in Japan?
February 22, 2009 at 11:47 am
Konnichiha Suda,
Your description is something I see very often here in the US as well. Since carbon has gotten so much press — kicked off by Al Gore’s _Inconvenient Truth_ — companies either conflate carbon mitigation with environmental management, or at least believe that carbon is a reasonable proxy for environmental impact.
Performing a carbon footprint, more formally called a Greenhouse Gas (GHG) Inventory, is actually a good way to get a company to *start* thinking about its overall environmental footprint. Once a CO2(equiv) baseline is established, it’s a good idea to introduce lifecycle assessment (LCA) thinking into the firm.
A full-blown LCA of even a single product line can be overwhelming for a company that’s just beginning to explore the LCA mindset. Simple, lightweight LCA measurement tools are not readily abundant, but check out IDSA’s Okala ecological design coursework, which you can pick up for a mere $16 at http://www.idsa.org/whatsnew/sections/ecosection/okala.html.
You can put together some useful Okala exercises with this to initiate LCA thinking, as long as your client doesn’t consider it the final authority on all environmental decisions. GHG Inventorying may be as a much science as accounting, but true lifecycle assessment is as much an art as finance.
Hope this helps! Feel free to contact me (see contact page) with additional questions.
Asheen
February 22, 2009 at 7:30 pm
Konnichiha Asheen-san,
Thank you for your detailed reply! It’s very helpful, especially the IDSA’s Okala ecological design coursework bit. They didn’t have one for me to order, but the materials are all downloadable. Don’t know which way uses more CO2, downloading and printing or ordering books. (I just can’t face reading all that stuff on PC screen.)
Since I am really new at sustainability measurement thing, it’s staggering to think all the measurements we have to do to understand the environmental impact. As with to print or not to print question I went through with the reading material, in our private and company lives, it’s not simple yet.
You said true lifecycle assessment is as much an art as finance, and that is so true. This fact has long been abused by us “consultants”. Often, the truth is told in the way to accommodate convenient profit making for consulting company. I guess I can say this because I (my parents) didn’t invest neither time nor money for “formal education”, and basic life values will not be shattered to discover that the time and cost of formal education did not have the value that was in balance with the sacrifice that was made. I’ve worked over 20 years in various companies and during that time experienced all sorts of efforts by “consultants” that did not give promised result but often made things worse. After working as a consultant for nearly 10 years now, I seek ways to help people and companies in truly meaningful way. So I’ll continue to check back with your site for ways to do that.
Meanwhile, if you could think of one most effective thing I could be doing now to practice what I preach about sustainability, please share your thoughts.
Suda
April 22, 2009 at 7:44 am
This is pretty interesting, and I’ve wondered alot about this. Greens often point to the energy costs of global trade, but I always thought: couldn’t that be skirted with renewables? But I think you revealed another dimension of the issue here, which is that trade is great, but it has to be in the context of the scale of natural systems, ie: relatively local. Global trade would be fine, then, for non-limiting factor stuff (like music, or novels, or cooking recipes). But sustainability seems pretty contingent on living within your means, not off the means of another corner of the world.
Thanks for posting this.
Scott
July 21, 2009 at 1:40 pm
Ahh, but with each new human born, a new brain begins to work on the problem of creating more fruit from depleted soils, producing alternative materials from waste generated in the mining of stones, etc…
I won’t argue that wringing every last drop of resources from the earth is a good thing, nor that resources are unlimited. But human innovation does push the carrying capacity of the earth upward even as we grow in population.
Moreover, it’s not unreasonable to imagine a world where population growth slows as the carrying capacity of a region is approached. In fact, whether by dint of policy (china) or choice (Japan, EU, USA), many societies do slow their rate of growth as they approach their economy’s (or environment’s) carrying capacity.
So globalization of trade isn’t good or bad for sustainability, in my estimation. It’s simply is a stage of development on the way to global population growth’s natural slowing and eventual sustainability.
Still, I love the story – it’s one of those classic ecology equations that are great, solid bases for discussion. Thanks.
July 21, 2009 at 2:40 pm
Isaac: this is a good point, and I didn’t mean to ignore or underappreciate human ingenuity. My view is not nearly so cynical as to think that we can’t use our cleverness to get out of our mess (though a different kind of cleverness than got us into it). But I think a slight modification of your statement is needed: “human invention does push the carrying capacity of the earth upward for humans“. We’re not nearly as good at carrying any of the other billions of species forward with us.
Globalization can be a very positive force for social change without being necessarily “bad” for environmental sustainability, if we adhere to the hard lessons of ecology. It’s one of the reasons I chose the word “dangerous” for the title of this post, rather than inherently “malignant” or so. Here’s to hoping that human creativity can avert the danger in time!