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PAUL HAWKEN AND THE ECOLOGY OF COMMERCE
by Norbert Senf
This article originally appeared in Volume 7 No. 1 of MHA News and is the second of two articles reporting on the The First International Conference on Sustainable Construction (1994)
Day two of the conference concluded with a dinner that featured speaker Paul Hawken. It was easily the highlight of the conference, and recharged everyone's batteries after two days of wall-to-wall technical papers. A successful entrepreneur in his own right, he founded Erewhon Trading Company, the natural foods wholesaler, and Smith and Hawken, a very successful retailer of high quality tools.
Paul Hawken is also emerging as one of the leading philosophers of the sustainability movement. His third book, "The Ecology of Commerce" has been in print for about a year. It is a must-read. His previous books include "The Next Economy" and "Growing a Business." Our own business philosophy started to be influenced about ten years ago by articles of his that first appeared in CoEvolution Quarterly, and his insight has served us well.
Before undertaking the writing of his most recent book, Hawken's research included reading 200 books and 1000 papers, more than 20,000,000 words in all. He said that the more he read, the more depressed he became about the actual state of the world today. It is in a lot worse state than he had imagined.
Every natural system in the world today is in decline. The loss of habitat and of biodiversity is not only continuining, but is in fact accelerating. Multinational corporations have become so large and so successful at exploiting the earth's natural resources that we are witnessing the physical limits being reached.
A large array of toxic waste products are being released into the environment where they will never be broken down - chemical compounds such as chlorinated hydrocarbons have no counterparts in nature, and therefore there are no natural processes to assimilate them. They include the CFC's that are depleting the ozone layer, as well as the millions of gallons of herbicides that are applied annually to North American lawns. The current method of increasing profits for corporations and their shareholders is to eliminate employees. In California, PacBell has told its telephone operators that they can no longer use the word "please". This will save enough time to allow them to lay off enough operators to save 5 million dollars per year. California is also currently building the world's largest penal colony and calling it "economic development". Since the publication of his book a year ago, Hawken has given more than 120 talks worldwide. From what he has seen in the last year, he is convinced that the sustainability movement has reached critical mass. It will probably take another 50 or 60 years of hard work to get there however, so we need to be of good cheer and prepared to roll up our sleeves.
At the turn of the century, the total number of human beings that inhabited the planet was 1.5 billion. Today, when Hawken speaks to a university audience, he points out that 1.5 billion is the population increase since today's freshman was born. In the preface to his book, he states: "The problems to be faced are vast and complex, but come down to this: 5.5 billion people are breeding exponentially. The process of fulfilling their wants and needs is stripping the earth of its biotic capacity to produce life; a climactic bust of consumption by a single species is overwhelming the skies, earth, waters and fauna...Making matter worse, we are in the middle of a once-in-a-billion-year blowout sale of hydrocarbons. They are being combusted at a rate that will effectively double-glaze the planet within the next fifty years..."
Several years ago he calculated that in order to reverse the current trend and live on current solar income instead of spending our capital, we need to reduce the throughput of energy and resources per person by 80 percent. This was considered a radical idea at the time, but recently a Swiss research group has come up with a figure that is closer to 90 per cent. We are all stressed out, in debt, and working long hours. This is it. This is as fast as it gets. We've reached the limit.
Despite the recent right wing shift in politics, Hawken believes that the growing movement towards sustainability is beyong right-left politics. The political right has appropriated the moral high ground when in fact they have no solutions to offer. The only solution offered by the right is to bring everyone in the world up to North American consumption levels through trickle down economics. Rather than reducing throughput by 80%, this would require a global increase of 20,000%, a clear physical impossibility. We have to stop being such political wimps. It is for the sustainability movement to reclaim the moral high ground.
This rings true for many heater masons that I've talked with over the years. As Paul Hawken told Leila: "Your products are beautiful. They are the right thing." He also told the audience: "You are real the low cost leaders". Many of us have believed for years that we are not a high-end product, but in fact the very opposite. Gas fireplaces and plastic patio furniture are the high cost products - it is time to stop pretending otherwise. On the way home, at a gas bar in Florida, we got a good illustration of the difference between cost and price: we paid 90 cents a gallon for diesel fuel, and 2.59 for a quart bottle of water. What's wrong with this picture?
Hawken feels that we essentially have a design problem. Businesses can buy all the recycled paper and recycle all the toner cartridges they want, but that won't make a sufficient difference. If every business in the world emulated environmental leaders such as 3M and Ben & Jerry's, it still will not be enough to reverse the environmental decline. In order to solve the problem, we must first define it in real terms. The first half of Hawken's book does this with an in-depth look at today's envronmental problems - they must be understood before solutions can be designed. He states: "Although I think the problems are actually more severe than we realize, embedded in each one of them is a realizable and crucial design solution."
He then proposes a set of eight design objectives. In his opinion, business is the only entity with the resources and skills to implement such a large undertaking. Briefly, the design solutions will:
Some examples of action towards these goals are already evident in several European countries, including Germany and Sweden. In Germany, there is now cradle-to-grave accountability in several industries, including the auto industry. When BMW sells you a car, their responsibility for its environmental impact doesn't stop when you drive it off the lot. When you are done with it, they have to take it back. Federal law puts all manufacturers on a level playing field, and strong economic signals encourage them to design for recyclability. The Japanese challenged this as an unfair trade practice. They lost. When you wrap your Toyota around a tree in Germany, Toyota either has to recycle it in Germany or ship it back to Japan.
An even more radical change is currently being discussed in Sweden, and is in fact agreed on by all political parties. It is known as the "tax shift". Hawken believes that this will eventually become the economic model here in North America. It involves a complete restructuring of the tax system. Taxes will be taken off of income and profits, and placed instead on emissions, energy, resources and pollution.
An example of how this would work in the United States is as follows: to minimize economic dislocation, the tax change is phased in over 20 years. This allows companies to write off existing investments in plant and equipment. The tax is made revenue neutral for low and middle income earners. So, for example, a 3 dollar per gallon carbon tax is added to gasoline to more accurately reflect the true costs associated with consuming it. This would mean an increase of 2,400 dollars per year in the gasoline bill for the average American. To make it revenue neutral, the average income tax is reduced by a corresponding 2,400 dollars. Therefore, it doesn't cost you one penny extra to run your car. However, you are now living in an economy that is giving you more accurate information about the impact of your actions on the environment. You have a lot more incentive to buy an energy efficient car, and the auto industry has more incentive to design and build one. Right now, the tax on gasoline is about 2.50 per gallon in Germany. In the United States it is 38 cents, the lowest in the industrialized world. Which signal do you think places you in a better position to thrive in a future economy?
With a cost structure that is more in line with environmental costs, businesses will be able to lower their costs by lowering their environmental impacts, instead of achieving low prices by externalizing costs such as toxic waste production onto the public at large. Why should a coal fired power plant in the Ohio Valley be able to discharge sulphur into atmosphere that reduces the growth rate in my 60 acres of Québec hardwood forest? Am I not entitled to damages, and should these damages not be assessed against the electricity consumers of Ohio? If they are not getting this signal, then it needs to be designed into the economic system. 200,000 people in Bhopal, India, had their health seriously and permanently damaged by the Union Carbide Company. They haven't been paid. Why are corporate lawyers the only winners in this scenario?
A design-based economic restructuring as envisioned by Hawken and others could be a boon for the masonry heater industry. A truly level playing field would make biomass extremely competitive with non-renewable energy. Dirtier methods of woodburning could be directly penalized with taxes on their emissions, again a potential boost to our industry. And among masonry heaters, the cleanest systems would achieve a price advantage. This would stimulate clean-burn research. The marketplace would be restructured and would now deliver accurate information that includes the enviroment in the bottom line.
Reducing resource and energy consumption may sound to many people like a pipedream, but isn't really that difficult to achieve, according to Hawken: " In material terms, it amounts to making things last twice as long with about half the resources. We already have the technology to do this in most areas, including energy usage."
Here's a sampling of other quotes from "The Ecology of Commerce":
"Because the restorative economy inverts ingrained beliefs about how business functions, it may precipitate unusual changes in the economy...the restorative economy will be one in which some businesses get smaller but hire more people, where money can be made by selling the absence of a product or sevice, as is the case where public utilities sell efficiency rather than additional power, and where profits increase when productivity is lowered. Corporations can compete to conserve and increase resources rather than deplete them. Complex and onerous regulations will be replaced by motivating standards." (This is exactly the situation where we are now at with R2000 and masonry heaters. We have the option of adopting an enlightened approach to change, favouring collaborative efforts to redesign codes and standards for everyone's benefit).
"One statistic makes clear the demand placed on the earth by our economic system: every day the worldwide economy burns an amount of energy the planet required 10,000 days (27 years) to create."
"Biologic diversity, in the end, is the source of all wealth, and with a developed and practiced knowledge of nature, it could be even more so."
"...Germany, formerly the most wasteful nation in Europe, now (is) the leader in recycling. (But they still have a ways to go, still averaging yearly 824 pounds of waste per household. At 1900 pounds per household, we Americans have even farther to go; we're the world's worst wasters. With just 5 percent of the world's population, we produce 50 percent of its solid waste.)"
..."Markets are superb at setting prices, but incapable of recognizing costs... The answer cuts right through abstract political philosophy: We cannot return to the era of local markets, but we can regain control of the larger markets by enforcing the payment of costs--total costs...The incentive to lower costs is the same as the one that presently operates in all businesses, but in this case the producer's most efficient means to lower them is not externalizing these costs onto society, but implementing better design.
...none of the producers (of coal) are held accountable for the effect coal is having on the atmosphere--the prospect of global warming. The result? Planet Earth is having a once-in-a-billion-year carbon blow-out sale, all fossil fuels priced to move, no reasonable offer refused. And when this eon's hydrocarbons are sold, they're gone, never to be seen again.
Another way of imagining the scale of the carbon dioxide problem is by removing its two oxygen molecules. Looked at that way, every time you fill up... you are depositing into the atmosphere the equivalent of a 100-pound sack of pure carbon. It stands to reason that coal should be the most expensive form of energy, not the least expensive. The only reason that it is now the cheapest is that the newer technologies (solar, biomass, etc), ...more accurately internalize their costs to the environment and future generations."
TOWARDS A SUSTAINABLE MASONRY HEATER
We can ask some interesting questions if we decide to take a look at masonry heaters from the standpoint of sustainabililty. There are many things that we are obviously already doing right - let's list some:
Sustainability Features of Masonry Heaters
(Brick could be the ultimate reusable building material if appropriate mortars are used. Instead of carting them off to the landfill site after demolition as is done now, they could be reused basically forever. How Buildings Learn, Stewart Brand's recent book, has an eloquent section on the inherent "rightness" of brick as a building material)
That's a pretty good start. A good excercise would be to expand the list, and to start analyzing some of the points. The goal is to get ourselves up on the learning curve. A slightly more radical approach would be to ask the question "How can I increase the sustainability of the heaters that I build?" This list will be more personal, and more tailored to your own situation and locale. Here's a more or less random list of items, by no means exhaustive and hopefully getting longer as time goes by:
Making Masonry Heaters More Sustainable
A slightly more radical approach would be to ask the question "How can I increase the sustainability of the heaters that I build?"
The next step might be to start an environmental impact study/analysis of your business and the products and services that you sell and that you use. You are building the heater anyway, using a certain amount of natural resources and energy. When you implement better design, you are adding information with no increase in resource or energy use. This is the definition of value added. Eventually, if you can't provide an environmental impact assessment for your product or service, your competitor will. The demographic slice of aware consumers is growing daily.
North American drivers have, probably, the single largest environmental impact on the planet. Masons drive pickup trucks. Your pickup truck puts its own weight of carbon dioxide into the atmosphere every year. Drive less. Get better organized and make checklists for repetitive jobs (like heater core installations) so you don't forget something and have to make an extra trip - you'll boost profits at the same time. When the time comes to buy a new truck, consider a diesel. Many MHA masons are driving one already - the favorite seems to be the turbocharged Cummins from Dodge. It uses about 25% less fuel and has plenty of power. Invest in rustproofing and be scrupulous about maintenance so that you don't have to buy one as often - again, you'll reap more profits by being more organized. And it'll look good on your environmental impact statement.
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This page last updated on February 1, 2007