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James K. Boyce of the Political Economy Research Institute says we must develop new economics to serve human and environmental needs. We need to think deeply about these ethical foundations, says Boyce, as he discusses his latest book, Economics for People and the Planet: Inequality in the Era of Climate Change

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SHARMINI PERIES It’s The Real News Network. I’m Sharmini Peries coming to you from Baltimore. Joining me today to talk about his new book Economics for People and the Planet: Inequality in the Era of Climate Change is James K. Boyce. He’s the Director of the Program on Development and Peacebuilding and the Environment at the Political Economy Research Institute at UMass-Amherst. James, good to have you back.

JAMES K. BOYCE Great to be here, Sharmini. Thank you for having me.

SHARMINI PERIES Alright. Jim, let’s start with your book. A very interesting title, an important title. I’ll hold it up. Economics for People and the Planet— why did you feel it necessary to write this very important and critical book at this time?

JAMES K. BOYCE Well longstanding concerns of mine have been how we can harness economics and economic analysis, to try to advance the goals of improving human well-being and also improving environmental well-being. And often, these two goals of improving how people live and improving the quality of our environment, are viewed as being subject to a kind of inexorable tradeoff. It’s as if you can have more of one, but you end up with less of the other. And that notion that there is a tradeoff is something that is peddled routinely by corporations who want to resist environmental regulation and claim that trying to clean up the environment or clean up their own acts, would have terrible economic costs and impose hardships on people. And unfortunately, it’s a tradeoff view that’s also sometimes echoed by environmentalists, especially when they get into guilt tripping people about how they consume too much, it’s their fault that the environment’s in such bad shape, and we need to tighten our belts in order to improve things. So my own view that I’ve developed over a number of years of thinking about this is that in fact, there’s no necessary tradeoff. That two goals of improving human well-being and improving the quality of our environment can and indeed must go hand-in-hand. So in this book I tried to bring together a number of the things I’ve written over the years aimed at broader audiences. Not just at my fellow economists, but at people out there who really want to grapple with these, to my mind, terribly important questions.

SHARMINI PERIES And I love the fact that you have combined issues of economic injustice and issues of the environment, what’s concerning the planet. And of course, it’s economics for the people. So what is it that made you bring these two topics together, and how is it going to assist us in thinking about the world differently?

JAMES K. BOYCE Well if you think about the difference between what an economics for people and the planet would look like, and the kind of economics that is conventionally taught today in schools and colleges, and informs a lot of public policy-making, there is a profound difference. The conventional economics upholds one, and really only one, core ethical value. And that value is to try to create the biggest possible economic pie where the pie is measured in dollars, regardless of to whom those dollars accrue. Things that aren’t readily converted into dollar terms are ignored and impacts on future generations are discounted— kind of like looking through binoculars from the wrong end. They look small because they’re far away. That ethical approach has contributed to the shortfalls we’ve seen in both human well-being and environmental quality today, and in particular has contributed to the obscene growth of inequality as well as the obscene destabilization of our planet’s environment. So the kind of economics that I’ve been trying to advance and that I talk about in the book, is an economics that has a very different ethical foundation. It’s not about or just about trying to create the biggest pie measured in dollars. It’s really about a broader and deeper set of values, of ethical values, that include equity or fairness, human rights, sustainability and the well-being of future generations of our children and our grandchildren and those beyond them, and justice. All of those are really part of what people care about. Certainly, what I care about and what I think most people care about, and they too ought to inform our analysis of how the economy works and how it should work.

SHARMINI PERIES A recent study that has come out, Jim, says that we are living at 1.7 percent of the capacity of the planet in terms of its climate change and environmental crisis we are faced with. How do we get this under control, according to some of your thinking in this book?

JAMES K. BOYCE Well I think what’s important to recognize is that there are certainly some limits on how we can safely use the resources that are available to us on the planet. And included in those resources is the limited ability of the biosphere to absorb emissions of carbon from the burning of fossil fuels. So it’s clear that we need to organize our economy in order to respect those limits. And in that sense, there are limits to growth, limits to growth on our use and abuse of the planet and its resources. Unfortunately, the phrase “limits to growth” has often taken on meanings that diverge a bit from what I’ve just described. It’s sometimes presented as if what there are limits on, is the growth of human well-being, of economic well-being, and of the economy, and I don’t think that’s necessarily the case. I think it’s quite possible and indeed desirable. It’s something we really ought to think about how to do, to continue improving human well-being, to continue to grow the things that are good, that make our lives better, and that will improve the well-being of our children and our grandchildren to grow things like health care, education, arts, music—  all these kinds of things that are really important and are not constrained, or at least not necessarily constrained, by the limited capacity of the environment to absorb emissions of carbon or other toxic wastes. And so, when we talk about limits to growth, we have to always ask the question, limits to growth of what? I think the real limits are on the growth of our use of the environment as a source of raw materials and as a sink for our disposal of wastes. But that doesn’t imply, or doesn’t need to imply, that we can’t continue to improve human well-being. The other thing where I think, the other aspect of growth that I think we need to think deeply about, is the continued growth of inequality in the distribution of power and wealth. I think there are real limits. We’ve hit the limits in terms of our ability to allow that inequality to continue to widen. And so, that’s something as well that we need to think about limiting, limiting the growth of inequality.

SHARMINI PERIES An important point. Jim, people who are in the environmental movement can imagine what our different way of life, with limits to growth, with different ways of eating, different ways of living can help the environment. However, people that are in the day-to-day grind of going to work, and coming back, and just trying to survive, and sometimes working two jobs, three jobs— they cannot actually imagine a different way of living that is more helpful for sustainability. What would a pro-people, pro-climate policy look like? And how would it change our lives?

JAMES K. BOYCE Yeah. Great question. I think, you’re right as you’re implying that the way we address the problem of climate destabilization is not merely a matter of individual lifestyle choices. It’s partly the case that many people can’t afford to even think about making lifestyle choices. And it’s partly the case that no matter what individual lifestyle choices any given person or family makes, it’s not going to be enough to really reorient the trajectory of our economy away from the crises of climate destabilization and growing inequality that we see today. So in order to address those problems, we need more than well-meaning individuals changing their lifestyles. We do need action at the level of public policy, which means action at the level of politics because public policy doesn’t just come out of nowhere. It’s not that politicians wake up some fine morning and decide: oh, this sounds like a good policy. It comes in response to organized, mobilized demand from the public for change. And so, we do need to think seriously about what sorts of policies we need to address the problem. And an answer to your question about what those policies would look like— I think we need to recognize that we’re not talking here about a single magic bullet. We’re not talking here about one policy that if we implement it, everything’s going to be hunky dory. We’re really talking about a mix of policies that will address the problem of climate change, and the intimately linked problem associated with that of growing inequality. So with respect to climate change specifically, it seems to me that there are at least five policies or five categories of policies that are really important to include as part of the mix. One element is public investment. We need investments in things like, for example, mass transportation systems and a smart grid. Because if people don’t have the option of doing things differently, for example, taking a train to work instead of driving in a single occupancy vehicle, they’re not going to be able to make those changes. Public investment is required for those things and I’m happy to see that with the discussion of the Green New Deal in the past few months, the importance of public investment is getting more and more attention. That’s one element. A second element is smart regulations. We need regulations that will guide private decisions, decisions of firms and individuals, in directions that we want and need to see. Regulations, smart regulation— I’m not saying all regulation is necessarily smart— but smart regulations, help to accelerate a technological change; for example, in the development of renewable energy, battery storage technologies, et cetera. And also, are important to deal with inequalities in the distribution of environmental harm; for example, when we burn fossil fuels, we’re not only emitting carbon dioxide, the main greenhouse gas, we’re also emitting a slew of other noxious pollutants— sulfur oxides, nitrogen oxides, particulate matter, etc. And those we know fall disproportionately on vulnerable communities especially in this country, the United States, on communities of color and low-income populations. And so, to address those disparities, we need regulations to ensure that we get emissions reductions in the places that are currently being hit hardest. A third element of the policy and something that I’ve worked on quite a bit over the years and this features in the book as well, is a policy for carbon dividends. And the basis for that is restricting our use of fossil fuels, restricting the amount of fossil fuels we allow into the economy, and allowed to be burned. And when we do that, the price of those fossil fuels is going to go up. People will be paying more for fossil fuels because their supply is cut just like when OPEC wants to raise oil prices, it cuts supply. And the question is, where the money that people pay will go. And what I’ve argued for and others have argued for as well, is that much of that money, if not all of it, should be returned straight back to the people in the form of equal per capita dividends, which would not only protect the policy from political backlash. If people see prices going up and the money’s not coming up to back to them, they’re not going to be happy. But also would help in a modest way to address the problem of rising inequality because everybody’s dividends would be equal, regardless of their own individual carbon footprint. So those who have bigger carbon footprints, wouldn’t get back as much compared to their dividends, whereas those with small carbon footprints, would come out ahead. A fourth element of the policy in addition to the ones I’ve just mentioned, in addition to public investment and smart regulations and carbon dividends, a fourth element of policy— and this is something that folks in the labor movement and my colleague here at Perry, Bob Poland, have really emphasized— is a set of policies for what’s called just transition. That is to say, policies that will address the specific needs of workers and communities that have been involved in the fossil fuel economy and will need assistance in making the transition to the clean energy economy of the future. It’s not going to automatically happen just because the clean energy economy may require more jobs, more labor, may increase net employment, doesn’t necessarily mean that the people who are displaced or the communities who see their incomes decline, will be the ones who get those new jobs and get those two incomes. So we need just transition policies to ensure that these folks who have often made great sacrifices to provide the energy of the past, aren’t left out when we transition to the energy the future. And finally, we need adaptation policies, which I would describe as adaptation for all. There’s a certain amount of climate destabilization that we’re not going to be able to prevent. We’re not preventing it now. You can see it in the cyclones that have hit Mozambique in the past few weeks, including just in the past week. You could see it in the flooding hitting the Midwest. We saw it in Hurricane Katrina in New Orleans back in 2005. Again and again we see climate destabilization impacts that are particularly harmful for vulnerable populations, for low-income people— be they people of color in New Orleans, or family farmers in the Midwest, or villagers in Mozambique. One of the key issues that I think we need to start thinking about is how we’re going to allocate the resources that are available for purposes of adaptation to climate change across people, across communities. And if that’s left to the market alone, if that’s left to business as usual, conventional economic thinking, the allocation will be— well, you allocate the limited resources to the most valuable communities, the most valuable people, the most expensive real estate, the people with the highest incomes, et cetera. They will get the claim on the resources. So we’ll end up protecting high-value property and high-income people, while letting lower-value property and “lower-value people” go by the wayside, allowing them to be sacrificed so to speak. And I think we need to juxtapose to that conventional approach, a different approach to adaptation which is founded on the principle that access to a clean and safe environment, including access to adaptation, means to deal with climate destabilization as a basic human right. It’s something that we all share. It’s not a commodity that should be allocated on the basis of purchasing power and it’s not a privilege to be allocated on the basis of political power. We need adaptation for all. So I think, all of those policies that I’ve referred to here— public investment, smart regulations, carbon dividends, just transition, and adaptation for all— ought to be part of the policy mix that we roll out in order to address what at this point seems to be the most pressing environmental challenge of our time, of the problem of climate destabilization.

SHARMINI PERIES Very important policies and thank you for spelling them out in the way you have, very easy to understand, which brings me to another point, which is that this book, Economics for the People and the Planet, really speaks to the fact that people can actually get their head around this issue. They can actually read this book and understand what we need to tackle in terms of sustainability and safeguarding the environment, the planet in an equitable way. Now as it is important for people to understand this, I am also left with how this kind of thinking about economics differ from the conventional economics that is taught in classrooms today and relied on by policy makers.

JAMES K. BOYCE Right. Well as I mentioned earlier in the interview, Sharmini, I think there’s a big difference and that the core of that difference lies in ethics. It’s about what we define as the goals of economic policy and indeed the goals of economic life. The conventional view that we just need to maximize the size of the pie— the biggest possible GDP, the biggest return denominated in discounted dollars. That thinking in the name of efficiency is part of the problem, not part of the solution. And if we’re going to develop a new economics, an economics that better serves human and environmental needs, we need to think deeply about ethical foundations. We need to think about what we view as a good life, what we view as things that are valuable for people, and other living things. And so, those other values I mentioned— equity, human rights, sustainability, justice— all of those are really important ethical foundations for developing an alternative economics. That doesn’t mean we throw efficiency out the window. Efficiency is an important concern as well, but it implies a more modest role for efficiency in the overall decisions we make about what to do. The more modest role would be one of what’s really about cost-effectiveness, the notion of trying to achieve our goals in the most cost-effective and efficient, in that sense, fashion. But it’s not about the choice of the goals. It’s not about defining or deciding upon our ends. It’s about choosing the means to our ends. And unfortunately, the efficiency criterion as applied in conventional economics, has basically said we ought to use efficiency to decide not only how to do things most cost effectively, but what it is we really want to do. For example, we need to decide whether it’s really efficient to protect people’s lives or not. Are their lives worth protecting? Whereas, the kind of economics I’m talking about says, hey, protection of lives, the right to a clean and safe environment, that’s a human right. That’s not something that we need to ask, can we afford it? It’s something that we are committed to as a matter of principle. And the rule of economics then becomes the more modest one of deciding not whether we should try to protect lives or not, but how we can and should do so in the most cost-effective fashion.

SHARMINI PERIES Fantastic. James, the book is obviously out in hardcover and e-book form. You mentioned that the paperback version is coming out in the fall at which time we’re going to unpack this chapter-by-chapter. So I welcome you to come to our studio, so we can do that. And I thank you for it today, just for highlighting the most important features of the book. We’ll take it up in detail very soon. Thanks, James.

JAMES K. BOYCE Well thank you very much, Sharmini. I look forward to talking with you more about these issues.

SHARMINI PERIES Alright, Jim. Thank you for joining us here on The Real News Network.

JAMES K. BOYCE Thank you, Sharmini. Take care.

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James K. Boyce is a Professor at University of Massachusetts, Amherst. He is the Director of the Program on Development, Peacebuilding, and the Environment at PERI - The Political Economy Research Institute.