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Book review

REINVENTING THE WHEELS

NATURAL CAPITALISM: CREATING THE NEXT INDUSTRIAL REVOLUTION by Paul Hawken and Amory Lovins and L. Hunter Lovins

by Elizabeth Grossman
/Cascadia Times

"Everything that makes life worth living has a poor return on investment," said Paul Hawken to the 300 or so people at Portland State University, who'd come to hear him talk about Natural Capitalism, the new book he has written with Amory and Hunter Lovins, co-founders of the Rocky Mountain Institute. This might sound glib, but it is fundamental to the new approach to economy and ecology the authors call natural capitalism.

"Natural capitalism," says Hawken -- author of The Ecology of Commerce, an innovative take on business -- is "not about capitalism," but "about natural capital."

What is natural capital? The environmental and natural systems that are "life itself," says Hawken. They are natural systems that provide services for which there are no substitutes, and cannot be made by humans.

"Natural capital," write Hawken and the Lovins, "includes all the familiar resources used by humankind: water, minerals, oil, trees, fish, soil, air, etcetera. But it also encompasses living systems, which include grasslands, savannas, wetlands, estuaries, oceans, coral reefs, riparian corridors, tundras, and rainforests. These are deteriorating worldwide at an unprecedented rate. Within these ecological communities are the fungi, ponds, mammals, humus, amphibians, bacteria, trees, flagellates, insects, songbirds, ferns, starfish, and flowers that make life possible and worth living on this planet."

According to the authors, ecologically compatible living does not have to mean "the beer will be warm, the showers will be cold but we'll somehow feel better about it." Instead, they've redefined profit and progress in terms of natural capital.

They call this "the next industrial revolution:" a world where "society will be able to create a vital economy that uses radically less material and energy." If done properly, they maintain, "these necessary changes...can promote economic efficiency, ecological conservation and social equity."

This may seem idealistic, but Hawken and the Lovins are practical people. They work, not in the realm of Utopia or Erewhon, but with corporations, utility companies, carpet manufacturers and architects of commercial buildings. The principles outlined in Natural Capitalism show that if we recognize the value of natural capital -- including "human capital, in the form of labor and intelligence, culture and organization" -- we can redesign business, industry, housing, transport and commerce, to conserve, if not add to, our stock of natural capital.

In various sectors of business and industry around the world, Natural Capitalism describes ecological efficiencies now in practice. To show what can be gained, the authors also illustrate conventional practices that waste natural capital. Cars, construction, manufacturing, services, finance, trade, communities, wood and paper products, agriculture and water, climate -- are analyzed in terms of turning a profit in natural capital. This will require, the authors write, engaging in "capitalism as if living systems mattered," a notion often dismissed by traditional economics.

"This is not a fencing match with Adam Smith," Hawken said in his Portland State talk. However, it is a radical rearrangement of current business priorities. To achieve this revolution, Hawken and the Lovins advocate: "1. Radical Resource Productivity... which slows resource depletion... lowers pollution... and provides a basis to increase worldwide employment with meaningful jobs." To this they add, "2. Biomimicry. Reducing the wasteful throughput of materials... by redesigning industrial systems on biological lines... 3. Service and Flow Economy... a shift from an economy of goods and purchases to one of service and flow... by restructuring the economy to focus on relationships that... reward automatically both resource productivity and closed-loop cycles of materials use." And, "4. Investing in Natural Capital... reinvestments in sustaining, restoring, and expanding stocks of natural capital, so that the biosphere can produce more abundant ecosystem services and natural resources."

Natural Capitalism does not skirt around the economic or political fringe. To redefine profit, it engages directly with big money. "The role of business in all this is critical. Business has to stand up and be a leader and stop the race to the bottom," says Hawken. As it becomes increasingly clear that using less energy and fewer raw materials both saves money and improves working conditions, businesses of all kinds are beginning to incorporate basic principles of natural capitalism into their operations. In communities across the United States, "sustainability" and "growth management" have become buzzwords. Businesses and local governments are starting to adopt practices that encourage and require recycling, energy efficiency, and the use of public transportation.

Yet this is just the tip of the iceberg. Realizing it's relatively easy to install compact fluorescent light bulbs, tell your employees to carpool and write on both sides of the post-it notes, I asked Hawken how he sees accomplishing real changes in thinking and practice.

"In short," he said, the way is "to exert pressure from the outside in all forms possible and relevant while simultaneously engaging in widespread forms of education, innovation, design and systems thinking. In other words, sticks and carrots. The sticks come from boycotts, litigation, stigmatization, journalism, legislation, etc. The carrots are improved morale, lower costs, better performance, social approval... etc."

When I asked about the talk of sustainability we are hearing, Hawken replied, "The lip-service is ubiquitous. Without social feedback it will prevail... One of the things that troubles me is that there is a tendency for companies and organizations concerned with sustainability to get into a room, recite the global problems, and then engage in several days worth of self-congratulatory rhetoric. At the same time, companies [making an effort] need to be acknowledged. Tricky stuff."

"I don't think we're hearing all the voices," said Hawken, stressing the importance of social equity. While the economy booms, he said, "every living system on earth is in decline and the rate of decline is accelerating in proportion to the rate of economic growth." Asked how this would begin to change, he replied, "I think you need some outside precipitating events for the U.S. to wake up. It is presently feasting on the Gilded Age and like an overstuffed gourmand, is snoring in the corner."

The details of accomplishing this industrial revolution may not be what anyone but serious policy-wonks want to curl up with, but the concepts of natural capitalism are beginning to permeate many aspects of daily life.

"Natural capitalism," the book concludes, "is not about fomenting social upheaval. On the contrary, that is the consequence that will surely arise if fundamental social and environmental problems."

"We can't win if we think we're going to lose," Hawken said concluding his talk, and, "We are going to win."

The evening's final question came from a young woman from Thailand, who said, "What is your message for my country and other rapidly industrializing nations?"

Hawken described an eight-lane road, well lit, well marked, and clogged with traffic. "That road," he said, "goes straight to industrial hell. Don't go there." This is indeed tricky stuff