Will Hatchett wonders how long it will be before value is directly linked to carbon impact. He argues that this concept could be the basis of a global currency – the tree
It used to be tie-dyed and counter cultural. But, in the past fifty years, a slightly heavy-seeming guest has joined the environmental movement. Blame Star Trek and Dr Spock. A pointy-headed person with a puzzled expression is now lounging on the beanbags at the save-the-world party – an economist.
It is becoming increasingly clear that to stave off destruction of planetary ecosystems, we will need to quantify the elements of nature. Carbon was the first candidate. Carbon is being chased down and measured everywhere, as companies pursue the desirable and investment-friendly goal of net zero – not just as direct emissions from burning fossil fuels, but the carbon ‘embodied’ in the making and moving of things.
Sophisticated data capture, using AI, and venture capital investment are driving this process. Financial technology (or fintech), which led to a welcome DIY culture in the investment world, has spawned cleantech and proptech and other yet-to-be named disciplines. Some of this, of course, is PR hype. But some of it isn’t. Surprise, surprise, some investors don’t just want to be rich – but to be ‘nice rich’. This can be interpreted as self-interest – if the planet dies, we all die. Even if Elon Musk and Jeff Bezos get to Mars, in their home-made rocket ships, most people expect that it won’t go well for them.
The Gaia hypothesis, popularised by the English scientist and futurist James Lovelock in the 1970s, was backed by some serious-looking maths, but it was basically a simple concept – the planet and everything upon it as an interconnected network of linked and self-regulating systems, forming a single entity. This touchy-feely notion was perfect for its time.
Society is less polychrome now. The atmosphere at the save-the-world party is serious. The walls are grey. We’re protecting the biosphere here guys! Everybody has a laptop. Compared to the 1970s, humans have access to vast computational power. But all save-the-world scenarios need a wild-haired genius, scribbling forests of runic equations on the wall. Today, they would probably be an economist.
The reason? Financial markets and capital flows, albeit guided by political jurisdictions, have sculpted and formed the damaged world that we are living in, since the first industrial revolution – the agri-deserts that stretch to the horizon, the plastic-souped oceans with their eutrophic dead zones. Ergo it is markets than can save us.
Investments and capital flows are shaped by measurement. Measurement facilitates comparison. But we’ve been doing it wrong, bro. Money, as a medium of exchange forms one ecosystem interacting with that of commodities being moved around and made into other things. Other than by the simple law of supply and demand the relationship between the two ecosystems is non-contingent. What if they were more directly connected?
Rise of natural capital
It’s hard to reliably measure the benefits of more sustainable activities, in a way that allows meaningful comparison. That’s why nature is now being evaluated for its ‘ecosystem services’ and as ‘natural capital’ and converted into currency value. In 2020, the asset value of UK natural capital was estimated by Defra at £1.8trn 1. This can be a useful exercise, for example, in calculating the environmental impact of a new project, and it is being used for this purpose – but it can be accused of subjectivity.
Perhaps this methodology is a transitional one. Damage to the biosphere, associated with climate change and mass global extinctions, has been caused by anthropogenic greenhouse gas emissions. We need to reduce carbon from energy generation, travel, manufacturing and farming and we know that low carbon activities are socially beneficial and that they heal earth and water and their resources.
Technology is close to being able to generate a carbon impact number (CIN) for all products and services. This could serve as parallel unit of value for consumers and would greatly influence markets – the demand for fast fashion, for example, which is responsible for a tenth of the world’s ghg emissions 2, would significantly fall. But we could move beyond this. Here’s my idea. The average amount of carbon sequestered by an average mature tree in one year, could form one unit of carbon currency – the tree.
Some people see crypto currency as a universal, neo-utopian means of exchange, arguing that it can serve as a global reserve currency and is accessible to those with no access to conventional financial services, such as bank accounts. There is another candidate for a non-fungible exchange token – the tree.
Trees wrap up a load of environmental benefits. They absorb carbon. They look good. They produce food and many other valuable products. They can be integrated with sustainable arable farming systems and animal husbandry. Humans have always lived amidst trees. But we started to clear them on a landscape-changing scale in the Neolithic era, long before the first industrial revolution.
A tree is a quantum – the smallest and most holistic practicable unit of natural goodness that we have – perfect as a unit of exchange and as a symbol of good intent. And trees are already being traded to provide carbon credits in carbon offsetting markets.
We may have missed out on delivering of the UN’s Sustainable Development Goals by 2030. We had actually made significant progress on many of them before the Covid pandemic and the Ukraine War. I would argue that the adoption of carbonaceous economics could be a key development on the path to a better world. It’s like taking the building blocks of capitalism, scattering them across the ground and setting them up again. What would Marx have thought?
Will Hatchett has been a journalist since 1986. He has written for the Guardian and the New Statesman and was editor of a weekly, then monthly magazine, Environmental Health News from 1998 until 2018. The views expressed here are purely his own
1 UK naturalcapital accounts: 2022
https://www.ons.gov.uk/economy/environmentalaccounts/bulletins/uknaturalcapitalaccounts/2022
2 Can fashionever be sustainable?
https://www.bbc.com/future/article/20200310-sustainable-fashion-how-to-buy-clothes-good-for-the-climate
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