The Albanese government will release its federal budget this week.
That means you’ll be hearing a lot of conversations about “inflation,” the “economy,” and “economic growth.”
But let’s remind ourselves of the thing that makes those phenomena possible.
The way the budget is normally framed, with an intense focus on the politics and “winners and losers” of the budget, means we can easily forget some deeper truths about economics and the natural world.
Without the environment, there’s no economy
Last week, an interesting paper was published that discussed the issue I’m referring to.
It was titled: Rethinking ecosystem services from the Anthropocene to the Ecozoic: Nature’s benefits to the biotic community.
It was written by economists and researchers from North America. They argued we had to stop treating “the economy” as though it was separate from nature.
“Modern science accepts that all complex species, including humans, are an inseparable part of nature, incapable of surviving without the ecosystem services nature generates,” they argued.
“Nature is the whole, the economy is the part. We must internalise the economy into nature, not vice versa.”
The paper contributed to a larger discussion about something called “ecosystem services”, which is becoming increasingly important.
The concept of “ecosystem services” refers to the benefits that nature provides to humans through the transformation of environmental “assets”, such as land, water, vegetation and the atmosphere, into a flow of essential goods and services.
In 2010, when the concept was younger, the Australian government published this document to explain what it was.
It now plays an important role in environmental accounting, which is quietly revolutionising the way we account for economic growth within a framework that pays more attention to the environment.
But the researchers in last week’s paper argue that “ecosystem services”, as it’s currently conceptualised, still doesn’t go far enough.
They say it still puts humans at the centre of things by focusing on nature’s benefits to people, rather than accepting that humans are an integral part a much larger system that sustains all life, and which must be handled with care.
“It is based on the outmoded belief at the root of mainstream economics that everyone acting in their own self-interest creates an invisible hand that maximises the welfare of all,” they argued.
“Climate change, biodiversity loss, and the transgression of several other planetary boundaries are proof that this is not so.
“Solving our current ecological and social crises — which have only grown worse over the past ten years — requires a radical transformation of humanity’s relationship to the global ecosystems that sustain all life.”
Their paper followed a different paper published in Nature last month that estimated the financial and economic damage coming our way from the rise in global temperatures in coming decades.
“We find that the world economy is committed to an income reduction of 19 per cent within the next 26 years independent of future emission choices,” the paper said.
“These damages already outweigh the mitigation costs required to limit global warming to 2°C by sixfold over this near-term time frame, and thereafter diverge strongly dependent on emission choices.”
The paper came from the Potsdam Institute for Climate Impact Research, which is a German government-funded research institute.
It’ll be hard not to think about those papers this week, when Treasurer Jim Chalmers delivers his budget speech.
The mood of climate scientists is not good
In a similar vein, the latest edition of the Quarterly Essay, which is about to hit shelves, has been written by renowned climate scientist Joëlle Gergis.
Dr Gergis is an internationally recognised expert in Australian and southern hemisphere climate variability and change, and a lead author on the United Nations’ Intergovernmental Panel on the Climate Change’s Sixth Assessment Report.
Her Quarterly Essay has been billed this way:
“Working from the science, she discusses the world’s and Australia’s efforts to combat climate change. She outlines how far Australia is from keeping its promises to cut emissions.
“She takes aim at false solutions and the folly of ‘adaptation’ rather than curbing fossil fuel use. This is an essay about government paralysis and what is at stake for all of us. It’s about getting real, in the face of an unprecedented threat.”
On social media last week, Dr Gergis said her essay was a “scientific reality check of Australia’s climate policy (gas, carbon capture and storage, carbon offsets, adaptation etc) and what it means for our country”.
And she was unable to hide her frustration about the state of politics and climate policy, lamenting how we keep voting in people who are OK with prolonging the use of fossil fuels, “the very thing that is cooking our planet”.
A few days earlier, the Guardian published a story about the current “mood” of climate scientists.
With the headline, “We asked 380 top climate scientists what they felt about the future … They are terrified, but determined to keep fighting“, it had some sobering statistics:
- 77 per cent of respondents believe global temperatures will reach at least 2.5C above pre-industrial levels, a devastating degree of heating
- Almost half – 42 per cent – think it will be more than 3C
- Only 6 per cent think the 1.5C limit will be achieved
That’s how the Guardian’s environment editor, Damian Carrington, presented the information.
It’s the type of story that’s difficult to read, if you’re not feeling up to it. So spare a thought for the scientists who are living those statistics every day.
When it comes to this week’s federal budget, the most pressing thing for households will be to get some help for their household budgets, and to ensure they have shelter, and employment, and their health accounted for, and their loved ones looked after.
That will always be a priority.
But the “economy” that provides those things is sitting inside a larger planetary system, and we can’t keep ignoring that fact forever.
