The cost of money
the way humankind has dealt with the environment has undergone numerous changes over the ages. The earliest civilisations revered the personifications of nature. This attitude changed over time and the environment is now used as a resource-base and a dumpyard. This metamorphosis, if one may call it so, has been brought about by the slow but steady influence of economics in human life, which places everything in context of the forces of demand and supply operating in the market.
This book discusses the environmental impact of shortsighted economic policies and faulty resource management. The author charts the course of economics-led resource management and culminates the study with a brief on the current state of the environment in the Philippines.
In the 17th century, when colonial powers set out in search of new lands to exploit, resource extraction was cheap as the price of the resources extracted did not reflect the costs borne by the people and the environment. This kind of incompatibility between the price and the real costs could have been due to two reasons: one, the concept of exploitation; second, the belief that there is no limit to the availability of resources and that nature has a limitless capacity to regenerate itself. The latter is based on the belief that the market system would automatically adjust itself by increasing the prices of those resources that are becoming scarce and, correspondingly, there would be a demand for its lower-priced complement.
The author proves this point by giving the example of the 1992 World Bank ( wb ) report which uses the downward trend in metal prices since the mid '70s to state that there would not be any resource depletion or degradation. The wb model uses scarcity value as a yardstick to measure environmental decline and resource depletion. What the report ignores is the constant improvement in technology, which enables the extraction of resources from areas that were previously difficult to access. Technology, therefore, kept down prices and led to further economic growth and environmental decline. This wb concept does not take into consideration discoveries of new resources and technological innovations, nor does it consider the fallout of extraction, which could include destruction of an endemic species and relocation of human settlements.
Such attitudes continue to be prevalent, as is evident from the burning of rainforests in Brazil, the logging contracts given in Malaysia, Indonesia and Thailand, and the water harvesting scheme in Libya, which could dry up all its aquifers in a few years time. Such cases are not restricted to developing nations alone. Spain, in its attempts to connect all regions by road, has been uprooting trees indiscriminately, which is increasing the incidence of floods and landslides. All these schemes are governed by current economic needs and not by a principle that harmonises the need for economic growth and environmental stability.
The author gives a graphic example of the Philippines. Almost 90 per cent of the country's natural old growth forest has been destroyed or is being used for commercial purposes and its marine and land ecosystems have been destroyed in the interest of economic growth. The author explains this sacrifice in terms of government policy and foreign demand. The author goes on to state that a growing population need not be the foremost reason for environmental destruction. There is weight in this argument as the p hilippines has a land area of 296528.17 sq km and a population of 38,61,300 (1970 estimates). In other words, the population density is 13 per sq km.
The author explains the basis on which the Philippine government has been manag ing its resources. Being the
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