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Political Perceptions of Sustainability: A Sustainable Economy for NZ Address, Dr Kennedy Graham

Kennedy Graham MP
kennedy [dot] graham [at] parliament [dot] govt [dot] nz (Email)

We have heard today from the sustainability experts - particularly this morning's addresses by David Suzuki, John Peet and Maryan van den Belt. I thank them, and all others, for their insights.

The distinction was drawn between orthodox economics, that is, neo-classical economics, and ecological economics within the context of sustainability. Now, we are to focus on the political perceptions of sustainability. And we are doing this in the context of a global resource crunch - peak oil, peak water, some have said peak everything.

And we're doing all of this within the context of three related crises. In the short-term, we have been facing the financial crisis. In the medium term, we are, as a result, facing a broader economic crisis. And we're confronting both crises within the long-term ecological crisis. Not long-term in the future - we've already entered it. But long-term in the sense of being drawn out, long after we pretend we've solved the other crises.

What we've heard so far has been mainly at the theoretical level. This panel is to focus on the political dimension. So let me address that directly by outlining what I take to be the Green Party's perception of sustainability.

There are, I believe, seven fundamental tenets of sustainable economics - let's call them the 'seven lively virtues'. They are context, process, measurement, time-frame, objective, scale and synergy.

Regarding context, the green Party regards the economy as a subset of the environment, not the reverse.

Regarding process, we see economic activity not as a purely productive process of transforming raw materials into finished goods without proper regard to the natural resource base or waste disposal. Rather we see economic activity as a throughput of matter and energy within which the productive process operates.

The measurement of economic activity can no longer be confined to gross domestic product. I think everyone here today is aware of the shortcomings of GDP as the principal economic instrument for measuring the health of an economy. There are a number of alternative concepts that can be used, as are outlined in the Stiglitz-Sen-Fitoussi report. The Genuine Progress Indicator is one useful alternative. It has regard to environmental protection and social justice that safeguard against the obscene levels of inequality obtaining today in the name of individual freedoms.

The time-frame for macro-economic policy-making is now critical. We need to move from the short-term, of 1 to 5 years, to the medium-term of 5 to 20 years, and even in some cases the long-term of 20 to 50 years.

The overall policy goal is critical as well. We must move away from the concept of growth of the economy and towards the concept, through measurable techniques, of the quality of life of the people. And that requires a move in our underlying national ethic from 'acquisitiveness' to 'sufficiency'.

The Greens see the economic imperative now as one of optimal scale, rather than optimal efficiency. We need to have regard for the national economy, but not as a separate entity that competes for maximum advantage in a brutal arena. We have to see the NZ economy as an integral part of the global economy, in which sustainability will only be attained through a more insightful mix of cooperation and competition.

Finally, synergy. Green economics successfully attains the orthodox goals - price and monetary stability, fiscal responsibility, adequate housing, health and education, with secure employment and decent income - with the new Green goals of material sufficiency and ecological integrity.

I believe that the theories of ecological economics serve these seven goals. A related point. Two phantom elephants appeared in the chamber today - climate change and biodiversity loss. They have to be accepted as economic issues. If we do not, we shall never solve these problems. They are symptoms of economics gone wrong.

So, that is the Green political perception of sustainability. How might it compare with those of National and Labour? I believe that there are three central and fundamental values in politics today. One is freedom. One is equality. And now, one is sustainability. The first dominated 19th century politics. The second dominated 20th century politics. The third, sustainability, will come to dominate the 21st century.

For me, personally, sustainability is the paramount political value of our times. Sustainability trumps freedom and equality, simply because you cannot achieve them without sustainability. That is why I joined the Green Party.

Yet, sustainability requires, in turn, freedom and equality if it is to be achieved. So there is an intimate, and causal, relationship between these three political values, and I believe that explains why it is so important for National, Labour and the Green Party to dialogue in a constructive way.

As I see it, we now have a vertical axis in political thought, one that complements the traditional left-right axis. That traditional axis is now two centuries old, a legacy of revolutionary France which became the conceptual framework of modern Western political thought.

In the 21st century, we now have a vertical axis that is sustainability. Where people choose to sit on the left-right axis, and how sustainable they might claim to be from where they are, is contestable. That is a natural part of the democratic debate. But the existence of the sustainability axis itself is not negotiable. It exists.

There are challenges each party has to confront in economic policy. The Greens, for example, challenge National and Labour in their commitment to economic growth. We question whether they are indistinguishable in that respect. How will you preserve the planet if you insist on continuous growth? As far as I can discern, they do not produce a convincing, perhaps even a coherent, response.

For their part, National and Labour challenge the Green Party to be economically realistic. How are we, they say, to ensure jobs are retained and tax revenue is maintained without growth? How are we to avoid capital flight and carbon leakage if we insist on strict financial regulation and emission trading schemes?

These are the challenges for each party. It seems to me that each party is obliged to advance credible answers to these questions. For us Greens, we must find ways of stressing a holistic approach to ecological economics while proving that we are conversant with fiscal and monetary policy and engaged in the economic here-and-now. We must meet the normal expectations of voters while preserving the planet and the country's ecological health for the sake of their children.

In my Discussion Paper, I laid out a series of what I called critical questions for each party to answer, with a view to seeing how much common ground there might be among us. Where, if at all, do the three parties diverge as we proceed through those questions.

First, is there agreement that the global economy has reached certain critical ecological limits? My answer is 'yes'. Is there agreement over an absolute limit to the carrying capacity of the planet and/or a prescriptive limit to the size of the global population? My answer is 'yes'. Are our concepts and techniques for measurement adequate to these tasks? My answer is 'We've developed some, but they're not adequate quite yet'.

Second, is it possible to attain sufficient international cooperation for the goal of global sustainability in a global economy whose structures and precepts are based on international competition? 'Yes, but not easily. We need a change in mind-set'.

Third, is the neo-classical commitment to continuous economic growth a valid policy for the global economy? 'No'. Is it possible to combine elements of both economic models - the ecological model at the macro-level and the neo-classical model at the micro-level - within clear parameters, with accurate pricing of externalities and proper accounting for natural capital? My answer is 'Possibly - let us try'.

Fourth, can we get by, then, without using the word 'growth'? 'Growth' matters less than the quality of life. If the 'Green GDP' rises or falls, that is of no consequence. What matters is the quality of life, shared decently among all. Is a global 'steady-state economy' a necessary policy for global sustainability? Yes. Is it possible? Yes, but with great effort. Is there a distinction, in this respect, between the developed and the developing world? Yes, the rich countries must attain a steady state economy with qualitative growth in sustainable development, while the poor countries must be free to continue with material growth.

Fifth, is there agreement that each country should aspire to a state of 'strong sustainability' in which all its capital stock of each natural resource should be maintained at current levels? If not, will a state of 'weak sustainability' for each country guarantee a sustainable global economy? I must say I am not sure about the answer to this. I look forward to a dialogue on this.

Sixth, should New Zealand reduce its Ecological Footprint to within the range of the biological land availability per capita for global sustainability? Yes. Can this be reconciled with the conventional view of a need to recover from the recession and also reduce debt levels? Yes, I believe so.

Finally, a question of political psychology. What will be required for orthodoxy and change to combine to good effect? This is a challenge of behavioural psychology - to explore possible common ground, between a rather rapid and expedited evolution in thought - blending stability with change in times that cry out for both.

If we can dialogue across parties, across political persuasions, about these issues, we might just begin to generate progress to solving the daunting problems of our time. That is what I am hoping we can generate here in this beautiful Legislative Council Chamber, just 20 metres from the House where we engage in adversarial political combat. This venue is a perfect antidote to the cheerfully vigorous democratic arena just down the corridor.

Let us se what there is in common between our parties, where the differences may lie, and where we are coming from with respect to those differences. We need, as a country and indeed as a species, to find common ground enough to tackle these daunting problems together.

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