Environmental Science Risk and Cost of Decision Making

John Kenneth Galbraith

"Public squalor amid private affluence," economist

debt-for-nature exchange

developing countries use this to forgive debt in exchange for investment in conservation and sustainable development projects; banks don't receive complete return, but some return is better than total loss

common public ownership

results in over-exploitation

adaptability

willingness to change for the better, open-mindedness

probability

*mathematical* statement about how likely it is that something will happen

pollution costs

1. Private or public expenditure to avoid pollution damage once pollution has already occurred 2. Increased health costs and loss of the use of public resources because of pollution

four economic/environmental schools of thought

1. slow-down economic growth--and do it right 2. keep economic growth, so make lots of money to fix environment 3. pro-growth, because science and technology will save the world 4. econ/environment mutually reinforcing goals (sustainable development)

The Tragedy of the Commons

1968 essay by biologist Garrett Hardin; in a common pasture, "if my animals do not eat the grass, someone else's will;" thus each herd grows until the commons becomes overgrazed and all animals die of starvation; the tragedy is that even though the eventual result should be perfectly clear, no one acts to avert disaster from individual to global level

Warning to Humanity

1992 warning signed by 1600 scientists (102 Nobel Laureates) calling for a new ethic for reluctant leaders, governments, and people to address three major driving forces of environmental decline: the wage gap (inequitable distribution of income-must be driven by self-interest, must reduce third world debt and improve their standard of living), economic growth through consuming resources (resource consumption economic growth) and rapid population growth; it would redirect technology and trade to buy time for this change to occur

extended product responsibility

EPR; making sure every aspect of a product, including its life cycle, is more environmentally sustainable; gives the opportunity for shared responsibility, from packaging to manufacturing, to retailers, to consumers, etc. Manufacturers hold the greatest responsibility of reducing environmental impact, but also have the opportunity to reap the greatest benefit, and foster product and market innovation

subsidies

MBI, a gift (loans, favorable tax situations or grants) from government to a private enterprise that is considered important to the public interest; to know the true cost of a product, you must add on the "hidden" (through govt taxes) cost of the subsidy. Encourage activities that may be beneficial or detrimental to environment in long term (e.g. rebate on energy-efficient appliances or farmers being paid to either plant or not plant certain crops, usually intended to keep economy going smoothly. Or, in transportation, by sending money to the states for highway repairs, it encourages us to continue using high-polluting vehicles instead of more energy-efficient public transportation--one solution would be to charge higher taxes on vehicles to discourage people from buying them)

trade-able emissions permits

MBI, give companies the right to emit specified quantities of pollutants; companies that emit less can sell their permits to other firms or "bank" them for future use (like a savings account, e.g. chicken processing plant drawing or releasing water into Etowah, saving up gallons of water for future use in case they expand)

performance bond/deposit-refund programs

MBI, place a surcharge on the price of a product, which is refunded when the used product is returned for reuse or recycling--used a lot for land and forests (e.g. rock quarry sold bonds to fund reclaiming the quarry and surrounding land for human use after they are done, and turning it into a lake and residential area; or, Japan's bottle return refunds)

emission fees, taxes, and charges

MBI, provide incentives for environmental improvement by making environmentally damaging activity or products more expensive

information programs

MBI, rely on informed consumers' market choices to reduce environmental problems

market-based instruments

MBIs; provide alternative to common command-and-control legislation (making a law and forcing people to follow it) because they use economic forces and the ingenuity of entrepreneurs to achieve a high degree of environmental protection at a low cost; provide incentives by imposing costs on pollution-causing activities

negligible risk

at what point is there really no significant health or environmental risk? at what point is there an adequate safety margin to protect public health and the environment

factors that determine supply

availability of raw materials, cost of obtaining processing, degree of completion, recycling, societal costs

institutional commitment

community that practices sustainability on all levels, from education to laws

risk management

decision-making process of weighing policy alternatives and selecting the most appropriate regulatory action, integrating the results of risk assessment with engineering data and with social, economic, and political concerns to reach a decision; includes: 1. Deciding which risks should be given the highest priority 2. Deciding how much money will be needed to reduce each risk to an acceptable level 3. Deciding where the greatest benefit would be realized by spending limited funds 4. Deciding how much risk is acceptable 5. Deciding how the plan will be enforced and monitored

sustainable development

development that meets the needs of the present without compromising the ability of future generations to meet their own needs

scarcity

exists whenever the demand for anything exceeds its supply

external costs

expenses or diminished environmental quality borne by someone other than the individuals who use a resource; e.g. fishermen who suffer lost recreational opportunities from a polluted lake

Tan Sri Razali

former chairman of UN commission on sustainable development, said the transfer of modern environmentally sound technology to developing nations is the "key global action to sustainable development;"

Gaylord Nelson

founder of first earth day, listed five characteristics that define sustainability: renewability, substitution, interdependence, adaptability, and institutional commitment

China coal subsidy

government stopped subsidizing coal over a 15 year period, which led to privatization of mining, more efficiently run coal mines, and increase in coal costs for consumers and companies, making coal more competitive on international market; one environmental benefit was that increased cost of coal decreased usage and environmental harm

probability of risk, consequences of risk, economics of risk

in decision-making processes and prioritization, analyze and balance

internalize environmental costs

incorporating external costs into economic accounting of resources in order to provoke us to construct more ecologically sustainable foundations

Plimsoll line

marking on ships that water cannot rise above, or ship will have reached its full weight capacity and sink

renewability

rate of consumption of renewable resources cannot exceed rate of regeneration

pollution-prevention costs

rather than simply treating a specific pollutant, the cost should be factored into a life-cycle analysis that incorporates every stage of a product's use, from material flow, to resource use, to product substitution (manufacture use and disposal)

pollution-prevention hierarchy

regulatory controls that emphasize reducing the amount of hazardous waste produced

National Environmental Policy Act of 1969

requires environmental impact statements for major government-supported projects; serves as a model for the World Bank

interdependence

see the bigger picture and know how all communities affect each other and act accordingly

policy objectives

steady progress in reducing risks, cost-effectiveness, encouragement of technological innovation, fairness, and administrative simplicity

risk assessment

the use of facts and assumptions to *estimate* the probability of harm to human health or the environment that may result from exposures to pollutants, toxic agents, or management decisions

sustainability

the viability of natural resources and ecosystems over time; maintenance of human living standards and economic growth

developing nations quandary

they exploit their natural capital (or resources) because they cannot afford to survive otherwise

substitution

transition from nonrenewable to renewable whenever possible, especially before nonrenewable becomes scarce

stagnant command technology

when govt establishes a law, they need to keep the requirements vague enough to encourage competition in marketplace and human creativity (e.g. fancy, very safe seat-belt as opposed to a strap across the lap)