Green Accounting and the Economic Value of Nature
I was paddling down the Big Gunpowder Falls near Sparks, Maryland, when I saw a great blue heron standing on a log in the river, tall and elegant. As I drifted closer, it launched into the air and flew over my head, its six-foot wingspan and knife-like beak all the more impressive at close range.
Nearby, atop the riverbank, was a house. I thought: what is the economic value of this heron to that homeowner?
Would he be able to sell his house for $505,000 instead of $500,000 if a buyer saw the heron before agreeing to the price? Or maybe the location and the view of the river are all that matter in the fast-moving world of real estate transactions.
What if there were no more blue herons? It’s not an idle thought. During the quarter century after World War II, the spraying of the pesticide DDT almost eliminated the species – as it almost killed off bald eagles, osprey and other fish-eating birds. EPA’s ban on DDT in 1972 brought all these birds back, in big numbers.
But now the Trump Administration is proposing to dramatically shrink EPA. And this raises in my mind again the question of economic value – the worth to capital markets -- of all the nonhuman life saved by EPA and environmental regulation.
There is a growing movement by economists and investment bankers to calculate the economic value of nature. The argument for so-called “green accounting” is that economics is the currency of public policy, and unless we end the economic invisibility of nature, government can not adequately protect wildlife through laws and regulations.
There is some truth to this argument. After all, wetlands are not only homes for birds and fish, but also can prevent the flooding of cities like New Orleans by acting as sponges to slow down storm surges. That flood prevention has a cash value. Oysters work like tiny wastewater treatment plants in the Chesapeake Bay and elsewhere, cleaning and filtering the water. Bees pollinate billions of dollars worth of crops.
But what is the value of species like great blue herons and monarch butterflies? There are lots of animals that do not pollinate our crops, or protect our cities, or otherwise work in service to our economy. Monarch populations have declined sharply over the last two decades perhaps in part because of the spraying of an herbicide – RoundUp—that helps farmers earn a few percentage points more profit from their corn. An economist might argue there is more money in killing the milkweed plants that monarchs depend on than in protecting the butterflies from extinction.
What is the value of a human life? Such numbers are routinely calculated by adding up the annual salaries a person can be expected to earn over his or her remaining years. But there is something immoral about such calculations. Some people who earn billions are less than worthless to our world, because they degrade everyone around them with their selfishness and business schemes that prey on others.
Other people, like Monarch butterflies, earn nothing – and yet are beautiful and priceless to those who love them.
It is a sign of a sickness in American culture that we see people’s value primarily through an economic lens, and increasingly try to put a dollar figure on life itself. Life has an inherent and infinite value. And protecting the biodiversity of our world should be the moral currency of our public policy; just as nurturing human life should be the coin with which we calculate our worth.