/ 14 November 2011

Put a cap on capitalism

Climate change compels us to recognise the complex of links between this catastrophe and our heavily commercialised and commodified economies. This imperative is fundamentally different from what business around the world is already doing. Corporations accept the need to reduce carbon emissions and be less wasteful; they even give themselves “green” awards and seek to make the Newsweek list of what is presented as being the world’s 100 greenest companies.

Protecting Mother Earth and its life forms from further damage requires something altogether different. One possible beginning is to question the social need of each particular product and its priority among competing products. This requires a critical assessment of each product and its promotion and distribution throughout its entire life cycle — its employment, resource depletion, social, greenhouse-gas and other environmental impacts.

These fundamental issues lie outside traditional concepts of demo­cracy and are left instead to each business and investor to decide by themselves. They make these life-shaping and ecology-determining decisions, even though they are driven primarily by the imperatives of their own short-term if not immediate profit maximisation.

This market freedom is no longer compatible with the challenges of climate change. It demands the deepening of democracy by allowing a much louder social voice. The prioritisation of this voice leads to two immediate conclusions.

First, some products are inherently incompatible with a world endangered by climate change and natural-resource depletion, which means the cessation of such production, no matter how relatively energy-efficient it might become.

Bottled water is an example — and no more than an example — of a product that is irrational in the context of climate change, environmental degradation and sustainable-resource use, which in South Africa includes already existing water scarcity. The enormously lucrative profit of the bottled-water industry is offset by its even more expensive public cost.

To make the meaning of such a product clear, and to make the climate audit of each product as comprehensible as possible, it is worth detailing some of the many costs of bottled water. They are:

  • It uses up three to eight times as much water to make the bottle as it does to fill it — with an even higher price in water-scarce South Africa, where precious ground water is being tapped into;
  • Some 1.5-million tonnes of plastic are used worldwide to make the bottles;
  • It takes 17-billion barrels of oil to produce the plastic bottles — the same amount of petrol needed to cover 2 533 855 313 kilometres at eight litres per 100 kilometres;
  • A litre of bottled water generates 600 times more carbon dioxide than a litre of tap water;
  • Bottling water in the United States created 2.5-million tons of carbon dioxide in 2006;
  • Millions of litres of fast-disappearing oil are used transporting bottled water around the world and within South Africa, often from place to place where (virtually) identical water exists. South Africa annually imports three million litres of bottled water;
  • South Africa has an overall rate of plastics recycling of only 13%. Even in the US, where most major cities have recycling facilities, the figure for plastic bottles is only 20%. The remaining 60-million bottles a day either add to US landfills, with 1.4-billion kilograms of plastic, or, at still greater energy cost, get shipped to India for dumping; and
  • With very limited recycling, most of South Africa’s solid waste ends up in increasingly expensive public landfill sites.

The full life cycle of financial, social and environmental costs of bottled water (the energy requirements, solid-waste generation and greenhouse-gas emissions for the production, packaging, transport and end-of-life management) are clearly enormous.

The point to emphasise is the inherent irrationality of bottled water for ordinary mass consumption. In this sense, the attempt to “green” bottled water is like the apologists of nuclear weapons who sought to sell the idea of a “clean” atom bomb.

This brings us to the second of the two immediate conclusions. Unlike bottled water, many other products are indeed inherently useful. The anarchy of the market, however, transforms these inherently useful products into a serious climate-change problem. Cellphones and the car industry are examples (as with bottled water, they are no more than examples) of how the imperatives of profit maximisation that drive all business result in hugely wasteful competition that, in turn, accelerates climate change.

Elaborating this basic proposition and using cars as the illustration, the first point is that a need for some cars is not questioned. Climate-change insanity, however, prevails in the way this need is met. Take South Africa. Notwithstanding South Africa’s small total population of less than 50-million, and its far smaller car-owning population because of our world-beating inequality, no fewer than 44 car manufacturers are active in South Africa. Between them, they provide a staggering 1,180 or so different — and constantly changing — models.

The differences between competing makes and models are, at best, marginal. Consider, however, the amount of energy that goes into all stages of the design, production, distribution, marketing and maintenance of each of the current 1 180 different models, some of which are even shipped here from the far reaches of the world. Consider, more especially, the energy that goes into making the road-legal tanks that masquerade as cars. Their sheer size alone proclaims their absurdity. Think of the extra metal, minerals and other materials that go into making and maintaining these monsters, whose most arduous off-road activity is likely to be curb-climbing when looking for city-centre parking.

Water is another urgent reason for curbing the freedom of the car industry to prioritise its own profit maximisation. Water is one of the heavily used, though not widely recognised, resources required by the car industry. For instance, it takes an estimated 147 972 litres of water to make a car; each tyre alone uses 1 961 litres. The larger the car and tyre the more water is used.

From these examples it should be easy for most people to accept the need for a comprehensive climate-change impact assessment on everything we market, notwithstanding the novelty of idea. Far less easy — though essential — is agreeing first on the criteria to be used in the impact assessment and second on how to implement the assessment. Bottled water and cars again serve as useful illustrations of the problems involved.

An outright and immediate ban on bottled water would probably not be practicable. But the following should be considered:

  • An immediate prohibition on bottled water by all public bodies or those financed by national, provincial or municipal governments;
  • Bottled water to be heavily taxed in the same way that cigarettes and alcohol is (with the money raised thereby being ring-fenced and used to help pay for climate jobs);
  • Bottled water to have a warning label explaining the climate-change and related costs of bottled water. This would be similar to warnings that must appear on all cigarette packets.

Bringing climate-change rationality to cars is far more challenging than the bottled water example. An efficient, frequent, safe and affordable public-transport system would reduce the market for private cars and thereby the number of competing manufacturers and the models on offer.

The current carbon tax serves as a useful precedent, even though the measure itself is woefully inadequate. More daring and in keeping with the demands of climate change would be measures such as:

  • A serious limit on maximum engine size, and such size to be related to the purpose of the vehicle;
  • Measures to greatly control four-wheel-drive/off-road vehicles for urban use;
  • A progressively punitive speed tax based on the extent to which each model is designed to exceed the legal speed limit;
  • Banning or greatly reducing car imports;
  • Greatly reducing car exports (and converting the manufacturing capacity and skills to mass public-transport modes);

A comprehensive life-cycle climate-change audit is clearly far from easy, even allowing for the guaranteed outcry from business and the need to tackle the transitional direct and indirect impact on jobs. This makes it all the more necessary to begin as soon as possible.

Consensus on the questions to be asked is the first and least difficult step. The answers are much more challenging, not least because they touch on powerful vested interests (apart from being a new way of viewing the manner of decision-making on some of the most fundamental issues affecting everyone).

Impact assessments of various kinds are not new. Even without the hazard of regulation capture, however, they have proved to be more gloss than substance. Cause for hope of this one being different is that the catastrophic consequences of climate change are increasingly being recognised by ever-increasing numbers of people around the world.

Capping capitalism does not mean reverting to a pre-industrial society. What it does mean is an entirely more rational use of finite resources to meet basic human needs, rather than the artificial manufacture of constantly changing wants designed to feed a mindless consumerism as the source of profit maximisation for the very few.

Jeff Rudin is a board member of the Alternative Information and Development Centre

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