Imagine this scenario: A friend, one who has never asked anything of you, spends weeks knitting a beautiful sweater. When the sweater is finished, you hire someone to go into your friend’s house and take the sweater and you cover his or her cost in transporting the sweater to you. When you receive the sweater, you decide to embellish it weaving a thin ribbon into the neckline. You then package the sweater in a box and take it to a local market where you intend to sell it in a rented stall. In determining how much to charge for the sweater, you’ve factored in the expenses of obtaining, transporting, embellishing, and packaging it. You’ve considered demand for handmade sweaters. You’ve included the cost of the market stall rental and even the inches of ribbon. And you’ve marked up your total to compensate for your time and effort. You sell the sweater, pocket the money, and use some of the profit to do the same thing all over again. Sure, you’ve put some work into this enterprise, but you’ve essentially ripped off your knitting friend while making yourself wealthy. Not once did you consider the time, energy, materials, and skill involved in your friend’s crafting of the sweater.
The world’s economy, at its foundation, is based on resource extraction (Common and Stagl 2005). When we extract raw materials and “resources”—even those that are renewable—from Earth, and we commodify them without factoring in nature’s time, energy, and general brilliance in producing them, we are essentially ripping off our planet. We are also missing the complete economic picture. Even when we add what we perceive as value to nature’s products, as we do when we create wine from grapes, we are capitalizing on natural system processes. Think of our utilities, like water and energy. We are only paying for the delivery and refinement. The cash value of extracting, trading, adding benefits/services to these is only part of our true economy. Just imagine if our utility bills included charges for making air or water.
Our human economy is a subset of, and is totally dependent on, Earth’s natural economy, which is not without limits. This is becoming clearer to many and drives social change towards renewable resource use over non-renewable resource consumption and trends in increasing ‘sustainability’. Similarly, our increased efforts directed at conserving, protecting, and restoring our natural resources derives from this greater understanding of how dependent humankind is on our resources and their condition (Nielsen-Pincus et al. 2012). Nature provides benefits that have significant economic value at all scales, from the mental health benefits of time spent in nature to the physical health benefits of attenuation of climate change through ocean and plant uptake of excess CO2 .
The idea of nature delivering services and adding value (both real and economic) to our lives is not new, but it has taken a back seat to society’s emphasis on managing the human economy for short-term gain. A longer-term focus on our human economy would recognize that without the natural world economy, our human economy fails. Without sunshine and rain, our food chain doesn’t exist, and we disappear.
Another shortcoming of the human economy is that it does a poor job of distributing its goods and services equitably across the world. In fact, too many communities bear the burden of extraction without enjoying the benefit of goods or services they yield.
In Storm Cunningham’s book Restoration Economy (2002), multiple efforts were made at estimating the human economic value of restoration. The most impressive was not the annual investment in restoration of about $1.75 trillion a year, but the recognized backlog of more than $2.7 trillion. Unfortunately, both of these figures pale in comparison to the estimated value of the world’s human economy, which was estimated at $94 trillion in 2021, up 10% from 2020 (World GDP 2021 – StatisticsTimes.com).
Economists have done a poor job of estimating the value of ‘externalities’ like the ‘cost’ of producing the air, water, and energy resources on which our lives depend. If a business were producing, storing, and distributing widgets, every exchange would be monetized and clearly understood. When nature provides these services, the economic value of the services is rarely included in the calculation.
An economic study of restoration (BenDor et al 2015) found that counter to decades of business complaints about the costs of environmental regulation, economic output of environmental regulation is a significant contribution to the economy. This sector delivered 33 created jobs per million dollars spent with an employment multiplier (jobs supported for every restoration job) of 1.5 to 3.8, and an economic multiplier of 1.6 to 2.6 (dollars generated for every dollar spent). These metrics are comparable to those of the oil, gas, and livestock industries. In addition to these easily estimated economic outputs, the authors also identified other tangible benefits and services that are not easily quantified, such as increased property values, tourism, recreation (e.g., swimming, boating, park visitation, fish and game-based recreation, etc.), and ecosystem services (e.g., erosion control, stormwater management, flood reduction, groundwater recharge and purification, surface water quality and quality, carbon sequestration, etc.).
Think about the positive benefits that haven’t been accounted for as freebies-environmental regulation is a business delivering cleaner air and water, more natural green space, etc. Unlike the unaccounted for costs of the comparable ‘freebies’ from the energy and agriculture sectors, including polluted air and water (surface and groundwater), reduced biodiversity, increased carbon emissions and global warming, etc. If the externalized costs of the energy and agricultural sectors were incorporated in the balance sheet, these sectors would have much lower economic output.
Economists are developing better tools for evaluating some of the tangible but difficult to estimate benefits of restoration. A study conducted in Baltimore, Maryland (Towe et al. 2021) showed that stream restoration increased property values to a much greater extent than had been previously assumed. Previous estimates predicted that property values would increase 1 to 2 % in proximity to a stream restoration project. When measured, the authors found a 15% increase in homes within 1,000-ft of a stream restoration project (11% increase of home values within 2,000-ft). This appeared to be related to the replacement of an eroded stormwater channel littered with floatable trash from street runoff with an inviting park-like setting associated with the restoration project. Other stream restoration benefits were not monetized in this study.
While some politicians mismanage society with promises of bringing back coal mining and other dirty industries best left in the past, other, more thoughtful voices call for a green economy that delivers well-paying jobs that improve the quality of society and reverse damages from prior industries. There certainly appears to be an interest in such jobs. In an evaluation of academic programs in the US and Canada focused on training restoration professionals, Nelson et al. (2008) found that academic curricula focused on restoration had doubled from 2003 to 2008 but these increases were still insufficient to meet the demand for academically trained professionals.
Imagine a world economy that benefitted a worldwide effort to protect, conserve, and restore natural systems and resources. This work would not all occur in a concentrated location, as that is not how the world’s resources are distributed. Instead, efforts at mitigating for historic and current carbon emissions could be distributed around the globe, advancing environmental as well as social and economic improvements globally. In fact, this is happening through the United Nations Decade on Ecosystem Restoration. Capitalizing on international commitments to restoring hundreds of millions of acres of forests on all continents save Antarctica, the United Nations is formalizing lessons learned to initiate more restoration partnerships, secure more financial and political support for restoration, and building greater capacity for restoration at the local level (FAO 2020).
As the conservation and restoration of resources progresses, the global economic impacts delivered in the forms of goods and services have attracted attention. Governments see the benefits these goods and services bring to their economy and society, and they are increasing funding and support. As residents benefit from the goods, services, and jobs, they also support the restoration efforts. With more support for projects, the number of restoration projects and the demand for workers grows. Local governments, institutions, and NGOs continue to work to train more local people to build capacity to do the work. As more people become engaged, more ideas and opportunities in the restoration economy are identified (Mills et al. 2020).
This world-wide restoration economy will make significant positive contributions to the World’s Gross Domestic Product (sum of the gross domestic product of 194 national economies). It will also raise the quality of life in many nations for hundreds of millions of people. While we aren’t there yet, we are in the first year of the United Nations decade-long commitment to this vision. While it may be difficult to believe this vision will come to fruition, there is no doubt that if the UN and its partners work towards this goal, the world will be a better place, our world economy will be more just and robust, and maybe, just maybe, we can begin repaying the planet for all we have extracted.