March 12, 2024

This essay is in response to the October 2023 interview and discussion between Prosocial World and Evolution Institute founder, and renowned evolutionary biologist, David Sloan Wilson, and Resident Senior Fellow at the Columbia Center on Sustainable Investment, and author (The Myth of Capitalism: Monopolies and the Death of Competition), Denise Hearn,

See: https://youtu.be/iJZVOsEr6aU?si=I6n-JxR5Mt04_vt-

Of the many ProSocial interviews and discussions I have either attended and participated in, or watched on-demand afterwards, this is one I would certainly consider among the most important. The purpose of the following comments is twofold: to provide some context and reason for that assessment, and to define how a historic opportunity for the Human Energy, ProSocial and Evolution Institute organizations

- https://www.humanenergy.io/about

- https://evolution-institute.org/

to pursue ‘next steps’ after the recent Science of the Noosphere master class might be framed. And in the spirit of recognizing the importance of this webinar, beginning with a grateful salute of appreciation to both professor Wilson and Ms. Hearn is more than justified.

Given the richness and breadth of implications arising from Ms. Hearn’s presentation and the subsequent discussion with professor Wilson, my comments below will barely scratch the surface. But fair warning: the intent here is to be somewhat intentionally provocative.

Because of the definitional and intersecting thematic heterogeneities which Ms. Hearn dissects – and quite appropriately repeatedly refers to as “profound” - in presenting and illuminating the many facets involved in considering the intersection of anti-trust and other forms of regulatory commercial policy administration with sustainability, an increasingly dour, if not grim, sense of soberness about the severity of the challenge of seeking to realize the objective of substantive, constructive and decisive cooperation based on the principles of multi-level selection out of this seemingly hopeless legal and institutional Gordian Knot seemed to palpably grow as the discussion unfolded. This is perhaps most explicitly acknowledged by professor Wilson himself at about the sixty-four minute mark in the talk. Perhaps counter-intuitively, this may actually be a very good thing. Why? A deep sense of sobriety may be entirely appropriate given the highly non-trivial challenges – socially, politically, scientifically, and ecologically - associated with realizing the multi-level mandate of making the whole system the target of selection.

Reflecting on this presentation and discussion after a first, and then a second viewing, revived to mind a longer-term historical perspective which may be worth reiterating; one based on a correlated point I had raised in a blog written in review and support of a paper professor Wilson had co-authored with economist, Denis Snower some months ago. In it, I offered select grounds for why certain of the current characteristics of corporate charters should not be considered sacrosanct nor immune from review, nor from possibly deeply fundamental and far reaching modification of their terms and incentive profiles, if the objective of living within planetary boundaries – and doing so by the deep and pervasive degrees of multi-tiered and sectoral cooperation which doing so will necessarily require - is to ever be realized and sustained.

(See: Rethinking The Theoretical Foundations of Economics ).

The cited context for this suggestion was the then recent admonition by the IPCC that, “it is clear now that minor, marginal, reactive or incremental changes won’t be sufficient.”

As the following very informative article lays out, efforts to address the profound sustainability challenges we face with new commercial/business legal-entity forms, structures and business models have emerged, but the article itself then articulates cautionary observations which complement the bias of the arguments to follow in these comments that these do not obviate the need for more deeper and more fundamental institutional innovation. Two of these cautionary passages especially stand out. “Incorporation laws that enable the formation of these businesses are ad hoc and vary wildly.” This is followed, importantly, by the two closing sentences. “We need to reform businesses so they adopt environmental protection goals on their own (emphasis in the original.). This means encouraging new legal forms of business: ones that allow the purpose, governance, and role of profit to align with the steady-state goal.”

https://steadystate.org/redesigning-business-for-sustainability/?blm_aid=109510

In this context it is also worth emphasizing something noteworthy: it seems to have recently finally become acceptable to demythologize the once virtually sacrosanct status accorded to the ‘(Milton) Friedman Doctrine’ pronouncements and characterization of the extremely constrained societal role and obligations of the commercial enterprise. Recent examples include:

https://hedgehogreview.com/issues/markets-and-the-good/articles/the-myth-of-the-friedman-doctrine

https://hedgehogreview.com/issues/markets-and-the-good/articles/profit-power-and-purpose

Considering that the first, formal corporate charter was granted by the British Crown to the East India Company in 1600 – i.e., now well over four hundred years ago - and that scholars have traced other antecedent structures sharing some similar characteristics to medieval Italy, and even as far back as ancient Rome, there should be little surprise that these foundational factors of the invisible legal infrastructure have come to seem not merely sacrosanct, but have come to be mistakenly taken by many as virtually the underlying economic equivalent of fixed physical laws and constants of nature; perhaps especially so in the world of finance. In reality, of course, they are nothing of the kind; they are human constructs and, as such, potentially perfectly malleable, pending contingencies of context, need, objectives and priorities.

(And a glimpse at the scholarship in economic history which has emerged in recent years exploring why much greater appreciation for the path-dependent nature of the institutional forms which now prevail, and for the penumbra of interpretive nuance associated with their original rationales and current justifications would corroborate such a tempered perspective; e.g., see recent books by USC professor Jacob Soll and colleagues, Glory M. Liu of Harvard, and Brad DeLong of UC Berkeley, and their recent discussion at:

https://youtu.be/peHlMwkGnGo?si=PnuIz2xVYTYevW3X )

The reason for citing the deep symbiosis between the emergence of the corporate charter and the State is that it has effectively played the role ever since of grounding what has become a path-dependent operational condition of virtually incontestable policy deference due to the State priority assigned to economic conquest, expansion and aspirations for competitive dominance. And though the process of corporate formation evolved over time to become much more routine, this very ease enabled their vast proliferation, while the naturally inevitable coupling with accelerating technological advancements morphed together until they became operationally inseparable as the foundational ‘metabolism’ of the entire social/economic system. But to the extent that historians concur in dating the genesis of the modern Nation State itself to be defined by the 1648 signing of the Treaties of Westphalia, assigning relative priority and importance between these entities, growing ever more reinforced in their symbiotic mutual dependence, may be considered a very interesting and open question; as considerable contemporary scholarship indeed seems to consider it. But given such a lengthy history of mutual self-preservation – often rationalized in terms of ‘national security’ - nor should it surprise that, generation after generation, and even century after century, a self-reinforcing legion of lawyers, lobbyists, short-sighted (even if not ethically compromised) legislators, and apologist academic theoreticians have become exceptionally adept at concocting rationales and mechanisms to reinforce justifying the misplaced sense of the sacrosanct, and assuring that any prospect of serious reevaluation, let alone actual modification, that might jeopardize State-mediated incumbent power and advantage would be, if not completely eliminated, minimized to precisely change which is generally only “minor, marginal, reactive or incremental”.

In this sense, the Gordian Knot exposed by Ms. Hearn’s presentation, and inclusive of arguably often spurious protestations against any perceived challenge to their prerogatives by commercial incumbents and their defenders, can be seen historically as the path dependent accretion of such mechanisms of obfuscation and obstruction. And as long as a self-serving culture of Social Darwinist rationalizations could be invoked in justification, and as long as social and political manipulations were available to contain any backlash challenges – prospective or actual - arising from ‘mere’ human suffering resulting from the specific formulation of this paradigm, maintaining this conditionally baked-in status quo inertia could be and has been reliable and incredibly durable over time; even if at the expense of such an ever expanding legal definitional Gordian Knot fur ball as illuminated here. Until now.

As increasingly evidenced by climate-reality acknowledgment from the insurance, re-insurance and a growing number of other industries - with the backlash against narrow incumbent privilege effectively coming not (yet) from a revolutionary human rabble brandishing pitchforks and guillotines, but from the planet itself - the historical perspective invoked above suggests that what we are seeing emerge is a classic collision between an ostensibly immovable object with an irresistible force playing out as a kind of existential game of chicken.

But the historically tried-and-true immovability posturing of incumbent legal gamesmanship is now up against this stark reality for the first time: the actually irresistible force of the planet, and its’ very real biophysical and geophysical limits, could not be more indifferent to legal gamesmanship because the laws of physics and chemistry by which it operates simply aren’t playing; the dynamics of those entropic and other physical laws are perfectly willing to steamroll right over the legal, financial, legislative, academic or other ‘masters of the universe’ who continue to presume, in spite of all evidence to the contrary, that their narrow parochial exercise of legal, legislative and institutional tactics designed to eliminate or constrain change to the “minor, marginal, reactive or incremental’ can again prevail as they largely always have; a very bad bet indeed since ‘prevailing’, in this case, courts the equally very real entailment of civilizational consequences of potential suicidal moment, notwithstanding derisive accusatory invocations of ‘climate catasrophizing’ by the dwindling cadre of those determined to remain devotees of climate-change denialism, in disregard of all mounting experiential evidence and increasing rigor in scientific modeling and inference to the contrary.

One intention here is to suggest that considering the severity of the Gordian Knot noted above as a kind of symptomatic metric of the historic significance of the impending transition would be a more than merely justified framing, and that the virtually reflexive incumbent attempts to limit change to the “minor, marginal, reactive or incremental’ now so broadly evident are simultaneously misguided, tinged with a scent of the desperate, illustrative of a severe underestimation of this historic significance, and reflective of an almost dizzyingly disorienting deficit of institutional and administrative imagination. In one sense, this final deficit is understandable since the default political and legal tendency is to address problems by not looking beyond the many implicated ‘silos’ but to merely tweak at this familiar proximate level as timidly as it is possible to get away with. Recognizing this, a further intended suggestion of these comments is that it may be equally misguided and futile to envision resolving this Gordian Knot by such piecemeal means. But suggesting this naturally begs the questions, ‘why’, and ‘what is the alternative’?

To approach an answer for the first question, it may be useful to mentally rewind the clock to the year 1600 and ask the following: what was the imperative at that time which made necessary the structuring of that initial corporate charter by the British Crown? Answer: the need to distribute the risk of the otherwise overwhelming cost and other expeditionary demands of realizing the Crown’s exploration and expansionist economic objectives. With that in mind, but returning to the present, the problem now is precisely that the political/governmental, institutional, legal and financial antecedents then instantiated to satisfy those objectives have ravenously expanded and taken on a life of their own to the point where their reflexive tendencies of self-perpetuation now obstruct broader systemic resilience; obstruct allowing appropriate systemic adaptations even though the current driving imperative is dramatically altered from what it was judged to be in 1600; largely precisely because of the amplifying feedback dynamics and associated exponential successes of what was unleashed in 1600. And lest anyone imagine that State/econo-financial symbiosis as the key driver of nearly unconditional policy deference can be left as a relic of history associated exclusively with the colonial era, a recent book may help to disabuse any such notion: The Underground Empire, by Henry Farrell and Abraham Newman (see: https://us.macmillan.com/books/9781250840554/undergroundempire ).

And in a very important sense, even though it may seem obvious that interrogating the nature of our current driving imperative would lead to an answer focused on addressing the highly multi-dimensional ‘wicked problem’ of the climate challenge, a strong case could be made that this, though clearly necessary, may itself be regarded as relatively proximate and symptomatic; that what is more deeply primary is actually a governance meta-challenge: i.e., how to make endogenous to the very process of governance the imperative to enable resilient adaptation of its’ own processes so that necessary and constructive modifications to its’ own modes of operation, policies and objectives are facilitated rather than being allowed to become ossified sources of self-perpetuating obstruction to such adaptations; significantly via various forms of ‘capture’ by both commercial and political incumbents seeking to diffuse disadvantage anticipated from the needed modifications.

One prominent, and often even reflexive, response to this is easy to anticipate. Many would vociferously argue that these are precisely the adaptive capabilities already available to us through democracy. But the reality is far more problematic and nuanced. Not unlike the fact that there are many forms or realizations of ‘capitalism’, to realize (or not) such an adaptive ideal via democracy, the form of the democratic system matters, and it matters a lot. For ‘exhibit A’, we need look no further than the shocking level of virtually adolescent dysfunction currently on display in the legislative branch of the U.S. Federal government. But more generally, current forms of democracy (U.S. included) are not even close to satisfying the ideal with respect one of the most important organizing and driving forces in social life: economics.

Amazingly, with the exception of taxation and trade issues, and in spite of how categorically fundamental to life this factor is, it is almost completely absent from the founding documents defining the U.S. republic; many, if not most, of whose founders were, as is generally well recognized, (white) men of either relative affluence or of actual economically independent means. From the perspective of today - especially after the revelations provided by the scholarship of Thomas Piketty regarding how inextricable ownership of capital assets, and the income streams they can provide, are to securing wealth - one can only stand somewhat agog that, after stipulating as universal and inalienable the rights to life, liberty and the pursuit of happiness, the founding documents remain so conspicuously mute about making explicit, universal participatory economic rights for citizens so as to assure enabling the living realization of those higher, more normative and abstract rights for which the American Declaration of Independence is so rightly renowned.

(For a deeply researched narrative of how contentious the process of U.S. Constitutional passage was, how very narrowly it passed, which class and economic interests were subordinated, how and why, and which managed to ascend and prevail as superordinate because of whose voices were granted most prominence, a very strong recommendation is given to: The Framer’s Coup: The Making of the United States Constitution, by Michael J. Klarman. See: https://hls.harvard.edu/bibliography/the-framers-coup-the-making-of-the-united-states-constitution/ .)

In spite of the growing prevalence of politically-correct, socially placating lip service given at now untold numbers of World Economic Forum or other think tank or academic presentations, and/or panel discussions in recent years – often enunciated in a ‘green washing’ or other political PR context - to how dire the need is to address economic inequality, why are the economic and financial ‘rules of the game’ still written not merely to enable, but to insure that ownership of productive capital assets – as Piketty illuminated, the real wellspring of wealth - remain concentrated in the hands of a vanishingly small subset of the population instead of writing them to insure the opposite; i.e., that such ownership be made universal as a natural right of every (global) citizen, necessary to attain life, liberty and the pursuit of happiness? Why are we still clinging to the social and economic opportunity-cost tragedy, yet almost comically anachronistic idea, that the only viable mechanism for the mass distribution of income is through the sale of labor? The institutional forms and associated legally defined constraints which have locked us into this misguided path generation after generation are one perfect example of precisely the suggested de facto State grant of, and sustaining deference to what has become a severely anachronistic economic/financial/legal/academic status quo, and one contrary to the kind of systemically integrated change the IPCC is calling for. (And more than merely incidentally, a deference which was on full display during the aftermath of the 2007/8 economic crisis when recommendations for defining the terms in which post-crisis evaluation should be conducted and, then, what actual policy decisions should be taken in the wake of the crisis, came almost exclusively from this ‘priesthood’ of the status quo; having everything to do with propping up extant institutions and highly selective individual privilege rather than re-envisioning or seriously considering deeply fundamental theoretical and structural change; an enormous missed opportunity.)

The Founders at least had as tacit excuse for their sins-of-omission the fact that, in their pre-Industrial-Revolution era, still dominated by a nearly exclusively labor-based, agrarian economy, they could not be expected to anticipate how absolutely indispensable to the generation and maintenance of personal wealth and individual economic viability, competence and political autonomy the advances of technology would become. Anyone pleading ignorance of this dependence today would be suspect of either acute deficiencies of observation and inferential capacity, and/or a surfeit of guile so disingenuous that only among an audience populated by the similarly afflicted would there be any hope of not being laughed out of the room; or perhaps pelted out with rotten eggs and moldy tomatoes. Indeed, one measure of just how pervasive the brain washing is, might be crystallized with a corollary question: why in the world has the labor-union movement not long ago abandoned maintaining highly counter-productive labor/capital antagonism in favor of recognition that the far more potent – to say nothing of mutually beneficial - objective would be to collectively bargain for expanding, and ultimately universalizing, participation in ownership of the capital itself? Yet this extraordinary and unconscionable regime of exclusionary and highly concentrated ownership rights remains unscathed not merely decade after decade, but century after century; notwithstanding the current displays of crocodile tears of concern and hand wringing over the need for more equitable distributions of wealth. And this reality bears on a significant instance of, and exercise in the abuse of language intimately related to these considerations, and one which is frequently invoked, not infrequently, in paeans of nationalistic self-congratulation.

The American economic system is often said to be the embodiment of ‘democratic capitalism’. Oh really? While, yes, a republic having electoral political representation is certainly consistent with democratic principles, the absence of any formal Constitutional or other fundamental and universal, rights-based legislated linkages between political suffrage, and provisions explicitly stipulating and ensuring a citizen’s universal right for what might be called ‘economic suffrage’, the nearly exclusive reliance for earning a livelihood of the vast majority of citizens on the fickle vicissitudes often associated with the sale of their labor (i.e., ‘wage slavery’), and their nearly total exclusion from meaningful participation in the markets for ownership of productive capital assets and their associated income streams, embodies nothing remotely close to a system of decisional citizen agency inclusive of such rights, and thus deserving to be characterized as ‘democratic capitalism’. (Of considerable historic note, and to their great credit, both Thomas Jefferson and Abraham Lincoln intuitively grasped an important related truth: the independence-of-mind and relative immunity from economic or other influences of coercion with which political suffrage can be exercised will also be a diminished, if not nominal, thing in the absence of such broader and more inclusive ‘economic suffrage’ and independence.) The more cynical or conspiratorially minded might be forgiven for inferring that perhaps this is precisely the point, and that this conceptually utterly unnecessary political/economic schism is both how and why such a socially perversely exclusionary regime could be sustained and allowed to persist for so long. (As a brief aside, in another of professor Wilson’s recent ProSocial webinars - with Jerome Warren on the subject of Cooperatives - Mr. Warren makes reference to the fact that the Italian Constitution explicitly does make provision for what has apparently become an extremely diverse, creatively vibrant, highly productive, growing and substantive ecosystem of cooperatives within Italy; a not insignificant fact which might hold interesting promise as a possible model to internationally encourage dissolution of this political/economic schism, in spite of the case to be made that the cooperative, as an institutional form, might be reasonably characterized, for all its’ benefits, as a kind of desperate social ‘backdoor’ compromise effectively compelled by exactly the absence of the broader, and more institutionally formal ‘economic suffrage’ only intimated above, but fully possible.)

Returning now to address the second part of the question posed above – i.e., what is the alternative to piecemeal efforts to disentangle the Gordian Knot illuminated by Ms. Hearn’s presentation – may be best approached by momentarily stepping back for a bit of reorientation.

The Systems Change Lab is an organization doing very important work. A passage from comments opening a training webinar recently conducted to guide users on how to navigate and leverage the many resources which their powerful website offers, provides exactly the reorientation needed here. (See: https://youtu.be/y0vBfOtMCJQ?si=Bexq9CUb-wb4Vn28 ). And the attentive reader will also notice that this passage is also highly complementary with the IPCC excerpt cited above.

“Nearly every major system will need to transform. This includes things like how we power our economies, how we grow food, build cities, conserve nature and beyond. And additionally, cross cutting transitions also need to occur in our political, social and economic systems. By using system syncing we know that these changes are complex and interconnected, and we can’t change one system without changing others.” (Bold/italic emphasis added.)

The relevance of this passage for purposes of imagining alternatives to disentangling by piecemeal means the Gordian Knot noted above is insidiously easy to overlook. Such means tacitly assume that the identity of the ‘pieces’ would remain essentially unaltered by any successful disentangling. As such, the effort effectively devolves to an exercise of tweaking within the parameters of that assumption. But under conditions of highly multi-dimensional integration suggested in both the passage just quoted, as with the previous IPCC excerpt, it is often the very identity of the ‘pieces’, how they are organized, and literally the semantics of the very criteria in terms of which any needed disentangling would take place which cannot be assumed to have remained stable and fixed. In fact, in this sense, a more appropriate characterization of the scenario may actually be far less a case of disentangling at all, and far more a case of creative and systemically re-conceptualizing according to a new systemic gestalt whose defining causal and semantic profile might be quite distinct from that which led to the original ‘knotting’.

In this case, just one example of what would likely be a quite severe incongruity with the historically path-dependent existing gestalt out of which that dread Gordian Knot emerged, would be any new system design which ceases to continue granting the virtually incontestable operational and policy deference to the State/economy alignment which prevails in the current paradigm; a deference which, both historically and to this very day, effectively entails that every other aspect of the system must effectively play ‘second fiddle’ because they remain bound and inhibited within the legal/financial prerogatives and associated institutional constraints of that alignment; health and viability of the planet, or any other priority be damned. Hence, consider the famous quip by political advisor to former President Clinton, James Carville: "I used to think that if there was reincarnation, I wanted to come back as the president or the pope or as a .400 baseball hitter. But now I would like to come back as the bond market. You can intimidate everybody." Hence, consider the growing ranks of global corporations reneging on prior net-zero or other climate ‘commitments’, even while their ‘green washing’ PR campaigns may continue unabated in striving to associate themselves with, and portray themselves as responsible participants in the very transition they are betraying; something which further betrays a kind of theoretical, institutional and, indeed, even systemic schizophrenia which dare not be acknowledged even though failure to acknowledge it simply compounds both the betrayal and the schizophrenia, assuring that the civilizational existential game of chicken persists.

Understood in this light, the protestations proclaiming ‘democratic capitalism’ suddenly deflate almost to the point of farce, being more worthy of ridicule rather than justification with quasi-theological allegiance; and though misguided, an allegiance so potent, that its’ grant of deference and license has been many times invoked – not infrequently by rousing nationalistic tribalism - to rationalize and justify policies and exercises of power that it is unlikely any authentically democratic process would ever sanction.

And if the revelations of Ms. Hearn were not enough, further basis for the increasing sense of soberness observed over the course of discussion during this webinar is provided by the following excerpt from professor Katharina Pistor’s very important 2019 book, The Code of Capital: How the Law Creates Wealth and Inequality:

“Like most empires of the past, the empire of law is a patchwork; it consists not of a single global law, but of select domestic laws that are knit together by rules, including conflict-of-law rules that ensure the recognition and enforcement of these domestic laws elsewhere, as well as select international treaty law. The decentered nature of the law that is used to code global capital has many advantages. It means that global commerce and finance can thrive without a global state or a global law; and it allows those in the know to pick and choose the rules that best suit their or their clients’ interests. In this way, the empire of law severs the umbilical cord between the individual’s self-interest and social concerns. The legal decoding of capital reveals Smith’s invisible hand as a substitute for a reliable legal code – visible even if often hidden from sight, and with a legal infrastructure firmly in place that is global in scope – that is no longer serving its purpose. Effective legal protection almost anywhere allows private self-interest to flourish without the need to return home to benefit from local institutions. Capital coded in portable law is footloose; gains can be made and pocketed anywhere and the losses can be left wherever they fall.”

How non-trivial this passage is in the context of this webinar, the context of professor Wilson and Snower’s recognition and explanation of the evolutionary reasons that the validity of Smith’s ‘Invisible Hand’ metaphor must be seen as contextually conditional rather than the categorical universal it is traditionally asserted to be, or of Ms. Hearn’s important acknowledgment that the now anachronistic nature of key tenets of neoclassical economics renders it hopelessly insufficient as a basis for providing guidance to anti-trust administrators who might recognize the imperative of applying multi-level selection criteria in executing their professional oversight duties relating to mergers, and/or allowable levels of cooperation among firms in service of attaining ecological sustainability, and its’ importance in the context of the suggestion raised in these comments that the exact nature of these very duties might be markedly different from how they are manifest at present if the terms defining rights and obligations in corporate charters were altered to be consistent with those criteria rather than antagonistic to them, all would be difficult to overstate. And how non-trivial it is for the prospect of authentic democratic governance is compounded by the following somewhat more extended passage appearing a bit further in professor Pistor’s book under the sub-heading, An Exorbitant Privilege:

“The story about capital and its legal code is complicated as the legal modules that are used are complex and hidden in arcane statutory or case law and the plot frequently develops behind the closed doors of large law firms, with only a rare airing in a court of law or parliament. The legal code confers attributes that greatly enhance the prospects of some assets and their respective owners to amass wealth relative to others – an exorbitant privilege. Choosing the assets and grafting onto them the legal attributes of priority, durability, universality, and convertibility is tantamount to controlling the levers for the distribution of wealth in society.

“This account contradicts the standard argument that capitalist economies are defined by free markets that allocate scarce resources efficiently and that prices reflect the fundamental value of assets. Many legal scholars have already drawn attention to the fact that the operation of the market hinges on legal institutions that facilitate price discovery. I go a step further and argue that the legal coding accounts for the value of assets, and thus for the creation of wealth and its distribution. This should be only too apparent with respect to financial assets and intellectual property rights that do not exist outside the law. However, it is also true for simpler assets that were used as the prototypes for legal coding, such as land or pools of assets held together in firms.

“States and state law are central to the coding of capital. States have not only dismantled existing rights and privilege to make room for the power of market forces, as Polanyi has pointed out. Capital and capitalism would not exist without the coercive power of states. States often do not, in fact they need not, control the legal coding process itself. Indeed, at the frontiers where new capital rights are minted day by day in the offices of law firms, states take a back seat. But states provide the legal tools that lawyers use; and they offer their law enforcement apparatus to enforce the capital that lawyers have crafted. Not all coding strategies will go unchallenged, and some of them will be struck down at a future date. Many, however, will never be scrutinized, and others will survive the challenge; and the few that are eventually struck down often have already produced fortunes for their holders.

“The ability to graft the code’s modules onto an ever changing roster of assets makes lawyers the true masters of the code of capital. In principle, anyone has access to lawyers and their coding skills, but the market for legal services ensures that only the best-paying clients can hire the most skillful among them. The specifics about how assets are selected for legal coding are rarely scrutinized. The common depictions of law as stable, almost sacrosanct, immunize from the public eye the work that is done more and more in private law firms, and less and less in parliaments or even court rooms.

“The state’s willingness to recognize and enforce privately coded capital, indeed to foster it by recognizing innovative coding strategies and the expansion of asset classes that can be legally coded as capital, may seem puzzling. Many a state has fallen for the promise that expanding the legal options for some, including offering them exemptions from general laws and other legal privileges, will enlarge the pie and offer greater prosperity for all. They frequently realize only later, that the trickle is often rather small. More important, most of the benefits from capital do not trickle down; they trickle up to capital holders who repatriate their gains or place them behind the legal shields other jurisdictions afford them to protect their wealth from tax and other creditors.

“Another explanation is that states themselves have more to gain than to lose from privileging capital by backing the private coding efforts that create it. States benefit from economic growth, because it boosts their tax revenue and allows them to raise debt finance. The fate of governments in democracies in particular has been tied ever more closely to their governments’ ability to produce growth. Growth rates, and the rise of stock markets, not the distribution of wealth or indices of human development, have become the standard measures for adjudicating success or failure of elected governments – in itself an indicator of the enormous cognitive sway capital has over politics. Yet, as many states have realized, the power of the tax sword has been blunted by sophisticated legal coding strategies that can hide assets from their reach. Even more generally, promoting the interests of capital first and foremost boosts private, not necessarily national, wealth and thereby fosters inequality. To see why this is so, we need to decode the legal structures of capital.”

There are at least two reasons for providing such an extended excerpt. First, the expert perspectives offered in it strongly reinforce recognition of several important factors: the depth and scope of State/economy symbiosis, the insidious nature of some of its implications in the global context, how these interface with the Gordian Knot illuminated in this webinar, and what this entails for the challenge of system change. But a second reason is to suggest that the very plasticity of the legal coding process presents a potentially positive flip side. In fact, professor Pistor herself intimates such possibilities when she references a very interesting and suggestive case brought before the Supreme Court in Belize by the Mayan tribe. In summary, she notes:

“But the story of the Maya and their quest to legally code their claims to the land also holds the promise that legal coding might be used for purposes other than private wealth maximization; as the reasoning of the highest court in Belize suggests, property rights can take many shapes, and forms and they might just as well be used to protect collective use rights and sustainable practices (emphasis added).”

Part of the reason for highlighting this passage is the obvious salience it holds in the context of professor Wilson and Snower’s concerns to inform economic theory, practice and institutional design with insights from multi-level selection theory, including “collective use” scenarios. And if the plasticity of legal coding can serve in support of the “many shapes, and forms” in which property rights might be embodied for something as basic and fundamental as land, it is not a wild stretch to suggest that the possibilities for the other more intangible or sometimes even rarefied legal modules which professor Pistor addresses might hold even more creative potential. And this very possibility interfaces with another related context and perspective having great salience and enormous importance to the subject of this webinar. It comes from the very important recent book by professors David G. Victor and Charles F. Sabel, Fixing the Climate: Strategies for an Uncertain World. While this excerpt from the subsection, Governance, appearing in chapter 3, Theory of Experimentalist Governance, will also be of some extent, the reason for the indulgence should be almost immediately apparent.

“ . . . It is governance that determines whether regulation is adversarial or cooperative, and what those terms actually mean.

“Because governance links formal law to informal practice and public to private decision-making, it is sensitive to changes in economic and political conditions often well before such changes prompt reconsideration of legislation or regulatory rules – if they ever do. In short, law tends to lag where governance leads. For this reason, governance is frequently the language in which think tankers, academics, and business leaders broach proposals for reform too urgent to be postponed, yet too speculative to be codified into law. From this point of view, governance is a kind of test bed for urgent and often highly consequential adjustments to new circumstances.

“The rise of uncertainty is recasting the nature of the governance problem. For most of the last century, governance debates have been concerned with determining the identities and aligning the interests of principals and their agents. On this model, principals – whether the sovereign people, a legislative body, government administrator, controlling owner of a corporation, or corporate manager – have plans and projects. But to realize these plans, principals must rely on agents with interests of their own. If the background conditions are fixed, the principal’s problem is to devise an incentive system that induces agents to spend their efforts in achieving their goal rather than using the discretion their position affords to disguise self-interested behavior as dedication to the project. For instance, tying manager compensation to stock price increases links the interests of principals and agents when the principals are shareholders.

“When the background conditions are changing, however – as is typical of the episodes that provoke a concern with governance – the problem of aligning interests becomes entwined with the larger problem of determining which actors should be principals in the first place. . . .

“Even as these debates continue, the principal-agent relationship has been breaking down under uncertainty – first in pockets of the economy (like automobiles and semi-conductors) and areas of regulation (like pharmaceuticals or air pollution) especially exposed to rapid change, and then in fits and starts more generally. In a risky world, actors can assign probabilities to outcomes and incentivize behavior that leads to the desired ones. Under uncertainty, it’s impossible to anticipate what outcomes will be and hence impossible to assign them probabilities. In these circumstances, the challenge for governance changes radically. Under uncertainty, no actor alone can formulate plans with the precision and confidence necessary to engage agents for precise tasks, let alone devise methods to incentivize and hold them accountable. Conception cannot usefully be separated from execution. Actors instead have to collaborate, defining projects in the very process of trying to carry them forward, and using such progress as they make to reassess the feasibility of the undertaking along with the capabilities and reliability of their partners. In a stable world, in other words, agents execute steps in the plans of their principals, and the fact of their interdependence is covered over by the serviceable fiction that the principal is in control. Under uncertainty, however, planning and execution are inextricably connected; pooling their knowledge and experience, actors use the execution of provisional plans to revise their joint goals. Their mutual dependence is as open as the fallibility of their projects.

“Over the last few decades, in advanced sectors of the economy and public administration, this kind of collaboration has been institutionalized and given legal form, keeping cooperating actors accountable to each other despite the fluidity of their relations and transience of their plans, and thus protecting them against the vulnerabilities that their interdependence creates. Organizations are designed so that anomalies and surprises touch off an investigation of possible improvements rather than efforts to enforce the existing structure against newly identified risks. Regulations and contracts, long intended to be proof against every imaginable contingency, are likewise being reconceived as open to learning through use. The form of administrative decision-making is shifting as well, from the promulgation of rules to the issuance of guidance, in recognition of the impossibility of certitude and therefore the acceptance that directives will routinely need to be revised.”

The attentive reader will notice several sections in these passages of obviously high relevance either to the specific subject of this webinar and/or these comments more broadly.

Further, an important, though generally unacknowledged, part of exploring what alternative there might be to the otherwise excruciating prospect of attempting a piecemeal disentangling of the current regulatory, legal and econo-financial Gordian Knot is first to recognize this: that the knot is, to begin with, a reflection of, emerged because, and is one glaring embodiment of the fundamental inconsistency and conflict between human economic/financial, legal, institutional and social constructs which treat as ‘externalities’ natural processes and limits which are, in reality, foundational and endogenous and the factual, geophysical and biophysical scientific realities of the biosphere; a reality not yet recognized when the path-dependent historical process of institutional design and theoretical framing we have inherited, and are now constrained by, began four hundred years ago. But now, appropriate recognition of the endogeneity just noted demands the further recognition that the two stand not statically in an equilibrium relation to each other, merely as predefined subset to super-set, but in relational modes which are of a highly interactive, dynamic, interpenetrating, mutually generative nature and, therefore, complex, as opposed to merely ‘complicated’. By comparison, the merely complicated is easy; it can be algorithmically simulated while real complexity cannot. And it is real complexity, and the unanticipated and not predefined emergence of often surprising and disruptive novelty associated with it, that is at the root of the ‘wicked problem’ scenarios with which our social, economic, legal and governance institutions are continually confronted, and which provides another way to frame why the vision for their design on the basis of “experimental governance” principles enhances the chance to contend with them effectively; with climate change, per se, being almost certainly the most encompassing, though not exclusive, of such scenarios. Failure of such design leads to the Gordian Knot problem on display in this webinar by frequently, but perhaps often unnecessarily, imposing an impossible square peg-round hole problem associated with the exogeneity/endogeneity conflict just noted.

With this in mind, with the reality of planetary limits in mind, and recognizing how complementary principles of experimental governance are with the principles of multi-level selection, with the core design principles elaborated by Nobel laureate, Elinor Ostrom, and professor Wilson’s call for ‘the supremacy of the global’, coupled with ‘the subsidiarity of the local’ begs this very interesting question: how might the laws for corporate charters be reformulated to complement this, and how far might this go to not so much cut or disentangle the existing Gordian Knot illuminated in this webinar but, in effect, to dissolve it?

And given such a reformulation, another deeply important, interesting and challenging question follows.

A concept central to free-market, capitalist economics, as both an ideology and a putative science, is that of self-equilibration; generally construed in a price-auction, supply/demand framing; effectively, the tacit embodiment of the misguided equilibrium presumption foundational to neoclassical economics. But if a reformulation of corporate and economic law is to be a key part of modifying capitalist market economies so as to remove the numero uno deference they have effectively been accorded for over four hundred years to operate as if biophysical constraints and limits do not exist on the resource extraction, product production, waste, and the perpetual growth taken for granted by this presumption, when it becomes necessary to systemically include into a new global economic and financial metabolism operational recognition that they, in reality, do exist – as is beginning to occur now - what would the institutional and market redesigns need to look like to instantiate a legitimate concept of endogenous economic self-equilibration when that endogeneity must comprehend being truly systemic of global ecology, writ large, rather than merely the human production/consumption economics where the prevailing, much more narrow, incomplete and flawed equilibrium framing and institutional infrastructure associated with these, obtains? Merely posing this question explicitly unleashes a cascade of others; in addition to those pertaining to the administration of corporate law directly addressed in this webinar, others might include, whether prevailing private-banking, debt-based monetary theory and operations are complementary or antagonistic of this more expansive scenario; of the existing universe of financial instruments, which might remain complementary and which would need to be judged antagonistic; related to both of these, are extant configurations and ‘metabolic’ implications of both primary and secondary market structures and operations complementary or antagonistic? The preceding unleash yet another question which is especially important to consider.

By implication, these questions are intimately related to a cluster of important concepts at the intersection of conservation and ecological economics: e.g., the valuation of ecosystem services, when ‘markets’ for natural resources/capital are either highly inefficient or actually non-existent, and others. But systemically speaking, there is a potentially highly non-trivial ‘rub’ involved in the first of these. When we identify and mentally segregate for valuation purposes a given property of an ecosystem – e.g., watershed dynamics, or the relative vitality of the soil microbiome - and assign to it the designation of ‘service’, we impose, knowingly or not, a potential functional/causal and relational duality: the ‘service’ that it seems to provide us, and the natural functions (note the plural) that it may fulfill in the ecosystem, per se, when not subject to human intrusion. In other words, by our choosing to prioritize for valuation purposes such a mentally segregated ‘service’, how the dynamics and coupling of that ‘service’ is effected by market operations as a consequence of the particular ‘value’ we assign to that selection for whatever specific utility it is observed to provide to us, will not necessarily comport with how the ecosystem itself relationally embeds or ‘values’ the functional and causal tentacles of that property in time, space or feedback dynamics within the total embedding ecosystem. And if maintaining the latter, based on principles of multi-level selection, is taken to be the ideal target of selection, the divergence between the two, and its’ relative stability given selection, becomes an important governance and data/tracking consideration. One reason for this importance relates to potential sources of divergence over time; examples include possible systemic ‘service’ co-benefits having potentially non-trivial feedback/rebound effects, difficulty or even impossibility of formally assigning monetary value to intangible, and often highly value-laden normative properties which the ‘service’ or the larger ecology within which it is embedded may hold for various constituencies, and last-but-not-least, trade-offs. A recent IIASA webinar is of considerable merit on these points.

See: https://www.youtube.com/live/xCgtvRCKKYw?si=JTL6ibicgPUDCAdS

These understated observations also bring to mind a couple of cautionary passages by editors, Charles G. Curtain and Timothy F.H. Allen, from their book offering a collection of scholarly papers, Complex Ecology: Foundational Perspectives on Dynamic Approaches to Ecology and Conservation:

“This means designing systems that can learn and adapt, so the process itself is essentially an experiment in which those involved learn from the experience. However, over 40 years of adaptive management have shown the concept is relatively easy in theory, and extremely hard in practice.”

And then, near the end of the book, the following excerpt expanding on why it is so “hard in practice” is telling in several respects.

“While a command-control strategy is efficient and necessary in situations where rapid and directed action is needed (as in war), with long term and large scale challenges it is frequently counter productive for it assumes a level of continuity and predictability that was probably never realistic, but is especially unrealistic in an era of increasing rates of social and environmental change. This rigidity of design means that in the face of adversity they are intrinsically maladapted for they are always a step behind the latest perturbation (Holling 1986, Holling and Meffe 1996).

“Essentially the intent of governments is to maintain existing power structures, not to sustain social and ecological integrity (Schumpter 1942, Homer-Dixon 2006). For power relationships are frequently at odds with long term sustainability (e.g. Tainter 1990). In essence, governance arrangements too often work to sustain existing institutions, rather than promote the institutional flexibility necessary to maintain the overall continuity of socio-ecological systems over the long haul. . . . Short-term competitiveness and long-term resilience are too often at odds for the very processes that make systems competitive in the short term, predispose them to failure over time (e.g. Tainter 1990).” (Bold emphasis added.)

“Ostrom’s approach is predicated not on maximizing short term productivity, but on sustaining both social and ecological systems. This is accomplished through positive feedback loops that are not about control and resource concentration. Rather they are about promoting innovation to facilitate the processes whereby systems are sustained through learning, adaptation, and response to change (e.g. Meadows 1999, Article 30).”

Given the extent to which this invaluable collection of papers illuminates that, after many decades of quiet development, conservation science and scholarship itself has become broad, deep, and conceptually and analytically sophisticated, the fact that its’ insights and lessons have continued to formally remain largely excluded from institutions of governance at most, if not all, scales, and certainly have not theoretically informed or been integrated into operational economic and financial practice or institutional structures, should make the second of those excerpt passages every bit as sobering as this webinar ultimately became. Further, it should amplify awareness that the Gordian Knot the webinar unpacks effectively embodies the depth of the mutually reinforcing symbiosis between the State, and how the economy is currently theoretically framed and institutionally structured. And with that amplification constituting a reasonable measure of how historically significant the transition before us is, it should also instill a sense for how much an impediment the reflexive tendencies of status quo self-preservation this symbiote will present to making that transition. It should also provide at least an inkling of how deeply complementary this body of work is with the implications of professor Wilson’s theory of multi-level selection; something which should probably not come as a surprise since the natural systems with which conservation science largely deals are the living embodiment of such multi-level processes. But this is a decidedly mixed blessing; on the one hand, that very embodiment provides a kind of de facto conceptual corroboration from a scientific close cousin while, on the other hand, offering little hope that mere conceptual and scientific substance and significance will suffice to assure that the scales will fall from the eyes of recalcitrant entrenched academic, commercial or policy sources of denial and resistance.

While it is increasingly widely recognized by the growing cadre of important scholars involved in reevaluating economics – examples of such ‘renegade’ voices might include Jeremy Rifkin, Mariana Mazzucato, Steve Keen, Kate Raworth, Doyne Farmer and others – that the conceptual and mathematical armory applied to the study of biological systems constitutes a far more appropriate means of modeling and understanding economic processes, recognition of this may have stimulated far less consideration than is warranted of what this may entail in terms of how the institutional infrastructure of the economy may need to be modified to satisfy the kind of globally systemic objective suggested.

Convention insists that truly fundamental economic and financial conceptual, legal and institutional modification is not required; that merely tweaking factors-of-adjustment such as imposition of carbon pricing, bolstering the regulatory regime and, of course, buying in to the techno-optimist assumption that technological fixes are sufficient to realize the objective of a condition of socio-economic and ecological self-equilibration. But, in the first instance, from the perspective of ecological or regenerative economics, the very need to graft onto the system such a post-hoc, often far from perfectly objective cost/valuation assignments – even if only on an accounting, as opposed to a market basis - already represents a glaring theoretical and conceptual void representative of failing to see and design institutional structures in systemic terms; in the second instance, trying to accommodate the stated systemic-equilibration objective within the complex and highly non-linear dynamics of the living biosphere, while otherwise maintaining unscathed the extractive, perpetual-growth dynamic baked in to the unquestioned structural deference and priority accorded to the extant economic price-auction-efficiency, and private-banking, debt-based monetary regime in the face of the causally and functionally teaming and interpenetrating heterogeneity of the biosphere would impose perhaps impossible regulatory and administrative burdens. For the third instance (i.e., technological fixes), a level of nuance is required that it is generally not accorded. But, due to its’ importance, there may be no more appropriate basis for beginning to steer these comments toward closure in service of the objective stated at the outset, viz. a science of the Noosphere, than striving to provide at least a measure of this nuance.

Tempting as it is to pursue this by directly providing examples of, and exploring how far various emerging, and truly revolutionary technological innovations may be for pushing the production/consumption frontier toward viability with planetary boundaries, the purpose may be better served by stepping back to instead frame these considerations in terms of principles. Doing this is very well served by invoking several passages from the truly excellent book, An Introduction to Ecological Economics, (Robert Costanza, John H. Cumberland, Herman Daly, Robert Goodland, Richard B. Norgaard, Ida Kubiszewski, and Carol Franco). To start, the Chapter 3 sub-heading entitled, “Complementarity, Substitutability, and Fundamental Limits” is almost perfectly on point with the key principle:

Pg. 95

“A standard assumption of Neoclassical economics has been that factors of production are highly substitutable. Although other models of production have considered factors as not at all substitutable (e.g., the total complementarity of the Leontief model), the substitutability assumption has dominated. Consequently, the very idea of a limiting factor was pushed into the background. If factors are substitutes rather than complements, then there can be no limiting factor and hence no new era based on a change of the limiting role from one factor to another. It is therefore important to be very clear on the issue of complementarity versus substitutability.

“The productivity of human-made capital is more and more limited by the decreasing supply of complementary natural capital. Of course, in the past, when the scale of the human presence in the biosphere was low, human-made capital played the limiting role. The switch from human-made to natural capital as the limiting factor is thus a function of the increasing scale and impact of the human presence. Natural capital is the stock that yields the flow of natural resources – the forest that yields the flow of cut timber; the petroleum deposits that yield the flow of pumped crude oil; the fish populations in the sea that yield the flow of caught fish. The complementary nature of natural and human-made capital is made obvious by asking: what good is a sawmill without a forest?”

Then in the subsequent sub-heading, Policy Implications of the Turning Point, these crucial points follow:

Pgs. 96/97

“Natural capital productivity is increased by: (1) increasing the flow (net growth) of natural resources per unit of natural stock (limited by biological growth rates); (2) increasing product output per unit of resource input (limited by mass balance); and especially by (3) increasing the end-use efficiency with which the resulting product yields services to the final user (limited by technology). We have already argued that complementarity severely limits what we should expect from (2), and complex ecological interrelations and the law of conservation of matter-energy limits the increase from (1). Therefore, the ecological economics focus should be mainly on (3).”

And important qualification of these points appears a bit further into this same sub-heading:

Pgs. 99/100

“Once investments in natural capital have resulted in equilibrium stocks that are maintained but not expanded (yielding a constant total resource flow), then all further increases in economic welfare would have to come from increases in pure efficiency resulting from improvements in technology and clarification of priorities. Certainly investments are being made in increasing biological growth rates, and the advent of genetic engineering may add greatly to this thrust. However, experience to date (e.g., the green revolution) indicates that higher biological yield rates usually require the sacrifice of some other useful quality (disease resistance, flavor, strength of stalk). In any case, the law of conservation of matter-energy cannot be evaded by genetics: more food from a plant or animal implies either more inputs or less matter-energy going to the non-food structures and functions of the organism (Cleveland 1994). To carry the arguments for infrastructure investments into the area of biophysical/environmental infrastructure or natural capital replenishment will require new thinking by development economists.”

While the allusion to genetic engineering in this last passage, and the cautionary explanatory provisos associated with them, begin to approach the greater nuance needed for properly understanding the demanding and highly non-trivial set of implications gravitating around the very important subject of tech-fixes, and whether the techno-optimist hope that these will be sufficient in themselves to ‘save us’ ecologically is justified or not, the broader technology horizon goes so far beyond the genetic examples given, and so greatly further displaces the directness of the complementarity between human-made capital and the natural capital resources which may be its inputs, the need for clarification is not quite satisfied. Much to the credit of this exceptionally good book, however, several additional passages a bit further on take us in the right direction.

Sub-heading 3.3.2, tellingly entitled in the interrogative, Can Built Capital Substitute for Natural Capital?, starts:

“The main issue is the relation between natural capital, which yields a flow of natural resources and services that enter the process of production, and the human-made capital that serves as an agent in the process for transforming the resource inflow into a product outflow. Is the flow of natural resources (and the stock of natural capital that yields that flow) substitutable by human-made capital? Clearly, one resource can substitute for another – we can transform aluminum instead of copper into electric wire. . . . However, when we come to substitution across the roles of transforming agent and material undergoing transformation (efficient cause and material cause), the possibilities of substitution become very limited and the characteristic of complementarity is dominant.”

Deeply incisive, important, and succinct as this passage otherwise is, the final sentence falls victim to a major oversight relating to “the possibilities of substitution”. At the scientific frontiers, research and development is rife with the most profound implications for “the main issue” which this passage correctly identifies. But at that frontier, defining the category of “natural capital” may require crucial modification at a much more fundamental level, and going beyond reliance on the familiar, manifest flora and fauna examples such as stocks of fish or timber referenced in this book. The actual physical matter at this frontier – the material cause, and in these cases generally comprised of elements from the periodic table that are among the most basic and abundant on the planet – presents not so much a case or instance of being transformed from the manifestly macroscopic living state in which it may have been embodied and preexisting as ‘natural capital’ in the raw state of nature. At this frontier, it is matter at the atomic, molecular and mesoscopic scales that is being composed by bottom-up accretion – a blend of material, efficient and formal cause –rather than transformed by means of bulk top-down subtractive milling, lathing, grinding, stamping, etc. typical of conventionally understood industrial capital instruments, to satisfy desired physical properties; in many cases, properties which may not even exist in any familiar macroscopic sources of ‘natural capital’, per se, at all and are, therefore, beyond any prospectively viable top-down material transformation at all; clearly a distinction much more than merely a semantic quibble. And this is before even invoking the potential compositional variations of biomimetic, synthetic biological and related methods. Further, any thought that such capabilities are limited to genetics, per se, would be, at this juncture in the expanse of the R&D universe, virtually quaint; we are talking material science, writ large; chemistry, biochemistry, lattice, mesoscopic (and other) physics, photonics, metamaterials, de novo protein, catalytic and enzymatic design, spintronic. plasmonic and topological states of matter, certainly genetics, of course, and others.

Perhaps the ultimate hypothetical example of the intended distinction between natural capital resource input transformation via conventionally envisioned human-built industrial capital in the intuitive, traditional sense which the characterizations in this book invoke, as distinct from resource input composition, was articulated by K. Eric Drexler in his now famous 1986 book, Engines of Creation, and his vision for molecular assemblers; i.e., distinguishing between conventionally understood top-down machine/capital modification of bulk matter into end products, versus the design of bottom-up atomic, molecular and mesoscopic processes of composition into end processes and/or products. And while the full realization of the kind of actual molecular assemblers initially proposed, and repeatedly clarified and justified by Dr. Drexler to be, in principle, perfectly scientifically viable since 1986, remain on the R&D horizon, the chorus of those inclined to dismiss their ultimate realization as science fiction continues to dwindle in light of the kind of adjacent advances represented by the work of the following very limited sampling of researchers; some of which may complement and contribute to what may well be multiple paths toward realizing Drexler’s vision, and which has now become more generally known as atomically precise manufacturing, or APM.

See:

- Professor Omar Yaghi and Reticular Chemistry: https://pubs.acs.org/doi/10.1021/acscentsci.9b00750#

- Professor Christian Schafmeister and Spiroligomers: https://www.schafmeistergroup.com/

- Professor Frances Arnold and Evolutionary Protein Design: http://fhalab.caltech.edu/

- Professor David Baker and Protein Design: https://www.bakerlab.org/

- Professor Chad Mirkin and Nanomaterial Design: https://mirkin-group.northwestern.edu/people/chad-mirkin/

- Professor Donald Ingber and Biologically Inspired Engineering: https://wyss.harvard.edu/

- Professor Hao Yan and Molecular Design and Biomimetics: https://biodesign.asu.edu/molecular-design-and-biomimetics/

While these transitional technologies, or even the eventual optimal realization of the Drexler vision of APM, do not, of course, dissolve mass balance or the conservation of matter-energy rightly emphasized by ecological economists, what they are very likely to do is to profoundly alter production process profiles with respect to a whole raft of important considerations including: properly understanding natural capital input substitutability, complementarity, degree of complementarity, and specificity, with respect to an accurate calculation of the Inada condition and Hicksian income, with respect to diminished energy use, diminished waste stream generation, increased circularity potential, with respect to gaining greater clarity about when and where it is appropriate to extend the depreciation concept to natural capital, and with respect to the profuse efflorescent potential of end product variability and differentiation. All of these and, of course, the crucial issue of rebound effects, portend that the policy implications for ecological economics may be extremely significant. How significant?

A few pages after the last excerpt quoted above, the authors pose this central and summary question: “To what extent can we substitute manufactured for natural capital, and how much of our natural capital is irreplaceable?” Well, in 2020, McKinsey & Company published a report which sought to actually answer exactly the first of those two questions.

(See: https://www.mckinsey.com/industries/life-sciences/our-insights/the-bio-revolution-innovations-transforming-economies-societies-and-our-lives?utm_source=pocket_saves .)

Answer? Even though the report is focused on only the biological and, importantly, is not inclusive of the range of other scientific domains just noted above where comparable developments are occurring, their conclusion was, “As much as 60 percent of the physical inputs to the global economy”, with “A pipeline of about 400 use cases, almost all scientifically feasible today,” which they designated as “already visible”. Clearly, the long term opportunity for dramatically reducing the impacts associated with considering answers for the second part of that dual question may be stunning. And apparent corroboration of this analytic assessment comes from what has begun to occur not merely in the investor community - perhaps most aggressively exemplified by Schmidt Ventures: https://www.schmidtfutures.com/our-work/task-force-on-synthetic-biology-and-the-bioeconomy/ - but also at the level of federal government policy evaluation.

These considerations also suggest an additional, and very important clarifying take-away demanding emphasis related to a passage appearing a few pages further into this book.

(Page 131):

“But natural capital is also very different from built capital. First of all, built capital is made from natural capital. In other words, nature can exist without built capital, but built capital cannot exist without nature. There is an essential hierarchy limiting the extent to which built capital can substitute for natural capital, and they are better thought of as complements than substitutes.”

Since those words were published not quite ten years ago, however, what has become increasingly evident is that the degree of difference asserted in this passage between the two forms of capital are being profoundly blurred at the scientific and technological frontier, rendering the salience of a continued insistence on a hard line of demarcation increasingly problematic for informing policy. In other words, as long as the mental model which ecological economics relies on conceives of production processes strictly in terms whereby natural capital inputs to human-built capital are defined only as top-down, subtractive transformations from bulk objects of the natural world – living or otherwise - into some finished form of output product, then accurately defining the essential hierarchy just posited will be misconstrued by missing the true, broader scientific and practical significance of the revolutionary bottom-up compositional production capabilities now becoming manifest. Getting this wrong puts at risk the absolutely vital mission of getting ecological economics right, so that its very important insights and broad prescriptions may properly inform policies about what and where the real limits do exist for input-output scenarios, for evaluation of, and distinguishing between growth versus development scenarios and, ultimately, for informing the conception of robust, adaptive institutional forms needed to sustain true sustainability.

A further step toward realizing that mission is also very well served by an important recent paper by German economist, Stefan Mockel, of the UFZ Helmholtz Centre for Environmental Research, and published through PLOS Sustainability and Transformation; see:

https://journals.plos.org/sustainabilitytransformation/article?id=10.1371/journal.pstr.0000095

In the context of this webinar, the comments it has elicited here, and as suggested in my previous blog written in support of the Snower/Wilson paper seeking to redefine the foundations of economics cited above, the importance of truly recognizing and confronting the money-nature nexus addressed in this paper by Dr. Mockel could hardly be overstated since there is likely no way of doing so that would not entail deep institutional modification reflecting the kind of broad integration which would transcend just economics, per se, precisely because of the imperative that it be integrative systemically, in the broader sense; in other words, in the parlance of the IPCC, “it is clear now that minor, marginal, reactive or incremental changes won’t be sufficient.” Another perspective on the importance of this money-nature nexus theme was offered by noted, indeed, perhaps the ‘father’ of modern ecological economics, Herman Daly, in the following 2013 essay in which he asked and answered the question, ‘is there a better way’.

(See: https://steadystate.org/nationalize-money-not-banks/?utm_source=pocket_saves )

Perhaps analogous to the politically fatal ‘third rail’ danger often ascribed to any proposal perceived to subject the Social Security program in the U.S. to existential jeopardy, the conspicuous and nearly total policy silence which wreaths this subject in spite of how deeply fulcral it is to truly systemic change, may well be a tacit, subliminal admission of political and administrative terror at the prospect of taking on something so fundamental; in effect, of daring to venture into theoretical and institutional territory presumed reminiscent of medieval oceanic maps demarcating horizon boundaries beyond which all that could be said is that here ‘there be dragons’. And what be the ‘dragons’ beyond this conceptual and institutional horizon? Any such truly systemically integrated money-nature-nexus institutional modifications that are inclusive of the defining criteria and metrics of ecological economics will, if history and hierarchy theory is any guide, almost certainly compel corollary revisions to legal criteria defining corporate charters and incentives, with obvious implications for the nature of anti-trust and other related administrative regulatory issues explored by Ms. Hearn and professor Wilson in this webinar; in effect, a stirring of the hornets nest of imminent political and incumbent commercial power plays over whose ‘ox’ is likely to be gored by taking seriously the need to institutionally embody truly systemic operational economic/ financial/monetary criteria consistent with the multi-level selection theory imperative to make the conscious unit of selection at the global level. If so, again, Ms. Hearn’s invocation of the term ‘profound’ during her talk seems highly appropriate; not least because – whether correct or not – what seems implied may be perceived as tantamount to the proverbial case of building a new supersonic airliner while in mid-flight.

And holding that analogy in mind may provide the ideal segue for circling back to the aspiration expressed at the outset of these comments to conclude by venturing some suggestions for what might be ‘next steps’ worthy of serious consideration by Human Energy and the Evolution Institute as a sustained follow-on initiative to the recent inaugural Noosphere Masterclass.

Whatever else realizing an inspired and dynamically positive Noosphere may entail in ascending toward the upper tiers of the Maslow hierarchy, certainly one very fundamental sine qua non requirement will be the kind of systemic integration of ecological economics into our global institutional forms and governance processes just suggested. Where and how doing this overlaps with precisely the broader palette of higher social factors implicated in the emerging Noosphere suggests a most compelling ‘next steps’ opportunity for Human Energy and the Evolution Institute. Specifically, ecological economics is also deeply implicated in the growing consideration being given globally to alternatives to GDP as an indicator of a.) economic welfare, and more broadly, b.) human well being and total human welfare; a theme which even the introductory text on the subject cited at some length several times above goes on to devote considerable space to developing and illuminating. And as a complement, this recent YouTube presentation both corroborates its significance, provides a sense of some of the UN and other participants, and offers a glimmer of how much room remains for solution proposals which expand the scope of transdisciplinarity on the basis of which to provide them.

(See: https://www.youtube.com/live/0ZP6Dr4POEo?si=HzJDQ0TUg26fWjuZ )

In short, there is a very strong case to be made that there may be few, if any, better ways to serve facilitating the instantiation of the foundational conditions required for a Noosphere of mutually reinforcing virtuous cycles than this.

As such, Human Energy and the Evolution Institute would be providing an invaluable public service to consider jointly sponsoring, organizing and mediating recurring conferences – perhaps annually or bi-annually – with invited guests representing a highly transdisciplinary array of expertise to generally explore a.) most effective paths for such systemic integration and, more specifically, b.) needed institutional innovations to embody these. The ‘deliverable’ objective of the conferences would be summary guides meant to inform both policy makers and the wider public. And perhaps most importantly, this would offer an ideal venue to incorporate something which receives far too little consideration, but which was a key point of emphasis in this very important recent paper by Anders Sandberg (Oxford Univ.) and co-author, Len Fisher: A Safe Governance Space for Humanity: Necessary Conditions for the Governance of Global Catastrophic Risks.

(See: chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://ora.ox.ac.uk/objects/uuid:ada8806a-c6de-4807-9683-06f3d4d06f5d/files/r2227mq26s )

While there is a great deal in this paper to recommend attention and justify elaborating or qualifying comment – perhaps especially the cautionary references to the influence of reflexivity – emphasizing the process nature of the three enabling conditions to “facilitate transition to the new form of governance” cited in the paper’s Conclusions would be highly justified for inclusion in the exploration agenda of the kind of conferences being suggested. And of these three, the first - “‘bridging organisations’ to connect governance levels and spatial and temporal scales” – might be the most crucial. Why?

Throughout these comments, repeated reference has been made to what is, effectively (if tacitly), an institutionally embodied categorical political priority and operational deference accorded by State power to an economic/financial/monetary system which ‘bakes in’ a socioeconomic dependence on perpetual growth. The fact that this deference has persisted for over four hundred years, the fact that it continues to persist in contravention of the sobering reality, voiced with increasingly confident scientific warnings, that we are now confronted with existential threats directly related to the compounding feedback impacts arising from the diffuse and myriad systemic tentacles which embody this deference, is reflective of the absence of precisely something like ‘bridging organizations’; in this context, particularly the absence of a meta-organization which would serve the function of on-going oversight of the prevailing institutional infrastructure to assess whether it remains consistent with the broad public interest in planetary sustainability. Indeed, merely pointing out such an absence with the suggestion that this constitutes a serious flaw in the system of governance might seem, at least, surprising and, perhaps, heretical. Given this, it is worth briefly pausing here to interject two passages from the book, Digital Disconnect, by professor Robert. W. McChesney, that could scarcely be more on point.

In the first he notes: “C.B. Macpherson was among the first to grasp how a duopolistic party system in a modern capitalist society like the United States will tend to provide a “competition between elites”, which “formulate the issues”. The basics of the political economy are agreed upon by the two parties and are off the table for public debate or discussion.” (Emphasis added.) In the second, emphasizing a key responsibility of the journalistic Fourth Estate deeply relevant to our next point, he observes: “Such journalism addresses not only the transitory concerns of the moment, but also challenges that loom on the horizon. It must translate important scientific issues accurately into lay language. These issues cannot be determined primarily by what people in power are talking about. (Emphasis added.) Journalism must provide the nation’s early warning system, so problems can be anticipated, studied, debated, and addressed before they grow to crisis proportions.”

Not only do these passages – and especially those in bold/italic emphasis – highlight why our current governance structures are so problematic precisely for their absence of such a meta-organizational oversight function, and for the blind, relentless momentum of the economic status quo that it locks us into, but they also beg this question. Does history provide any guidance or examples where such oversight was not absent? Fortunately, though few may be aware of it - and with thanks, yet again, to ancient Greece - there is a relevant precedent.

In striving to decisively debunk the fallacious but common misconception that ancient Athenian democracy was a form of direct citizen – as opposed to representative – democracy, Yale University political science professor, Helene Landemore, offers this clarification in her very valuable book, Open Democracy: Reinventing Popular Rule for the Twenty-First Century:

“The main legislative institutions of Classical Athens were the Boule, or Council of 500; the Ekklesia, the People’s Assembly; the Nomothetai; and (in the fourth century BC) even the courts. The Council was a body of 500 citizens randomly selected among the willing and able. It was “a linchpin institution that was given control of the vital agenda setting function for the meetings of the People’s Assembly” (Ober 2008, 142; emphasis added) . . . The People’s Assembly, by contrast, was an open Assembly where up to 8000 citizens were able to gather in order to deliberate and vote about the Council’s proposals.

“Assuming for now that the People’s Assembly can legitimately count as an institution of direct democracy, this assembly was thus largely dependent on agenda-setting by the Council of 500. According to Josiah Ober, the institution of the randomly selected council was in fact the key institution in Greek democracy and may even have been more central to the Greek’s concept of democracy than the Assembly (Ober 1997 and 2008; emphasis added).”

In light of such a compelling precedent, of governance structures designed to invest the fundamental agenda-setting (oversight) function in the hands of the people, and so carefully conceived to do so in a truly democratic manner, perhaps what should now seem surprising, or even heretical, are current structures where such a function is either absent or where the system is left undemocratically in a position of decision dependence only on “what people in power are talking about”; dependence on a “ “competition between elites”, which “formulate the issues”, and where “The basics of the political economy are agreed upon by the two parties and are off the table for public debate or discussion.” In contrast, with the Athenian Boule, in principle, there is conceptually clearly no reason that “the basics of the political economy” would be precluded from being very much on the table “for public debate or discussion” if conditions emerged which might make this appropriate for evaluation. This is obviously what it means to be authentically in the service of the broader public interest, as opposed to merely serving the interests reflected in “what people in power are talking about”.

Returning to the present, exploring whether there are, indeed, emergent conditions which might justify placing exactly such meta-institutional evaluation center stage for purposes of “public debate or discussion”, presents an embarrassment of riches. Just two examples closely related to the dynamics of the money-nature nexus problem, and having quite profound policy and institutional implications, are presented in the following recent and very important papers:

https://www.sciencedirect.com/science/article/pii/S0921800923003130

https://www.nature.com/articles/ncomms14389

In light of a multitude of revelations about major commercial/oil interests having concealed and purposefully lied for decades about their knowledge of the virtually inevitable ecological consequences from continued use of fossil fuels, of revelations about how these same interests opened the funding spigots for Congressional lobbying to purchase inertia and inaction, often predicated on the phony-science propaganda output of bogus think tank front groups, it seems far from wild speculation to imagine that impartial citizens comprising a modern instantiation of the agenda-setting function provided by the Athenian Boule would assess the broader public interest implications of papers such as these, and what policy and/or institutional restructuring response those interests might warrant serious evaluation of, very differently than our existing ‘democratic’ institutions are willing or equipped to provide; especially since the chances are unfortunately far beyond remote that papers of such substance and moment as these would ever receive “public debate or discussion” by our current severely compromised institutions to begin with. Hence, the great potential value of the conferences being suggested here. These would have the effect of serving notice to politicians of dubious devotion to the real public interest, that the public is increasingly ‘wise’ to what is being kept “off the table for public debate or discussion”; including the “basics of the political economy”, as well as the very structural design of our governance institutions; neither of which warrants any default deference to be held as sacrosanct and beyond possible modification if the true governance objective is service to what is the ultimate broader public interest of living sustainably within scientifically defined planetary boundaries. But they might also have the more affirmative salutary effective of inspiring more people of higher calling and sense of public service to seek representative office, and amplify a broader public zeitgeist where more of the citizenry would enthusiastically embrace opportunities to participate in deliberative democratic fora as these continue to become more and more pervasive. But the latter hopeful prospect also raises an important point. First, the spirit of precisely such a zeitgeist is already evident in the proliferation of countless grassroots efforts to exercise constructive agency by citizens all over the world. It would, however, be an error to infer that the groundswell of these important and necessary public actions constitute a sufficient substitute for structurally and conceptually deep institutional innovations which would further facilitate their ultimate success.

To readers for whom such considerations renew frustrations and disappointments with the United Nations for failing to provide precisely the kind of visionary meta-organizational evaluation being suggested here for Human Energy and the Evolution Institute, there is actually hopeful news. The following links introduce the scheduled U.N. Summit of the Future, scheduled for September, 2024. And similar to the suggestion here that the proposed Human Energy/Evolution Institute conferences be recurring, as the following Carnegie Endowment discussion specifies, this U.N. initiative is not intended to be a single, one-off event; something which, it could be strongly argued, could present recurring Human Energy/Evolution Institute conferences of the type proposed here with a serious opportunity to be a complementary, or perhaps even a guiding resource for and partner with the Summit(s) of the Future.

https://www.youtube.com/live/T1s2qgM_kx0?si=kgRW6uaTYcg852sH

https://www.un.org/en/common-agenda/summit-of-the-future

That said, this may be the most propitious point to conclude these comments.

Before doing so by invoking several concluding passages from the excellent book, An Introduction to Ecological Economics, cited several times above, offering a few suggestions for conference attendees whose expertise might otherwise be overlooked may be constructive. Though perhaps understood, all of the authors, scientists and scholars already cited in these comments would be high priority choices. Further, clearly the extensive personal and professional networks of most of the key founders and advisors with Human Energy and the Evolution Institute, will be a rich source of attendee expert candidates.

- Economist Steve Keen. Professor Keen has long been an incisive, vociferous and even ruthless critic of the deeply flawed logic and dangers of Neoclassical economics. A major reason for his sense of urgency and mission may be best intimated with this passage from his recent book, The New Economics: A Manifesto: “I can say only one thing in favor of the work by Neoclassical economists on climate change: it is so bad that, once it becomes obvious how serious a threat climate change is, revulsion at how Neoclassical economists have trivialized the dangers may finally lead to the overthrow of Neoclassical economics itself.” Then, as synopsis of his more general critique of the Neoclassical paradigm, he observes: “That, in essence, is the Neoclassical disease: treating something that any outside observer would regard as a fantasy as a ‘simplifying assumption’, and asserting that the fantasy cannot be questioned when one challenges the resulting model. Economics abounds in such fantastical assumptions because of the problem outlined in the first chapter: economics has, time and time again, been subject to paradigm-challenging anomalies, but rather than accepting the challenge, economists have responded by making ridiculous assumptions to shield the paradigm from criticism.”

- Robert Ashford, Syracuse University professor of Corporate Law. Professor Ashford’s mastery of the theoretically distinctive conceptual foundations of binary economics, and their profound implications for rationalizing the design of institutions with the real promise, over time, of universalizing citizen ownership of productive capital assets without recourse to either transfer-state redistribution schemes or confiscatory tax or other claims on existing asset owners, is unparalleled. His insights and understanding also have profound implications for resolving the challenge of how to finance the transition to a ‘green’ capital base; something presenting almost insuperable difficulties under the ownership-concentrating ‘rules of the game’ of conventional finance.

- Poe Yu-Ze Wan, Sociology professor at the National Sun Yat-sen University, Taiwan. Why his participation would be recommended will likely be self-evident with even a cursory review of his important paper, Systems Theory: Irredeemably Holistic and Antithetical to Planning?, and related book, Reframing the Social: Emergentist Systemism and Social Theory.

- Andrew W. Lo, MIT professor of Finance. Beyond mere expertise in finance, the creative and innovative accomplishments of professor Lo in developing the Adaptive Markets Hypothesis, and its potential relevance if/when applied in a context of institutional innovation to enable ecological economics, should perhaps most recommend his invitation to participate. https://mitsloan.mit.edu/faculty/directory/andrew-w-lo

- J. Doyne Farmer. Leading complexity theorist and researcher, formerly with the Santa Fe Institute, founding entrepreneur with the Prediction Company, and currently at Oxford University, the April 2024 release of his new book, Making Sense of Chaos: A Better Economics for a Better World, promises to be a very substantive addition to the literature. https://www.doynefarmer.com/book

- Alex Pentland, MIT Computer/Data Scientist with a long resume of innovation and extensive affiliations; perhaps most importantly in this context, as a Board member with the U.N. Foundations’ Global Partnership for Sustainable Development.

- Thomas Homer-Dixon, founding Director of The Cascade Institute and author with extensive expertise in system-dynamics modes of analysis. As stated here - https://cascadeinstitute.org/ - the mission of Mr. Homer-Dixon and this Institute could scarcely be more ideally suited to the objective of the conferences proposed here.

- Mariana Mazzucato, economist and founding Director of the UCL Institute for Innovation and Public Purpose. https://marianamazzucato.com/ Professor Mazzucato’s important work debunking the misapprehension that entrepreneurial value creation and the State are inherently mutually exclusive, that social and economic policy are dramatically improved when the economic system is understood to have both an extent and a direction, and her extensive experience in advising policy makers on both – often in a context coupled with institutional innovation - would be invaluable in the kind of conferences being proposed here.

IN CONCLUSION:

Given the purpose of these comments stated at the outset, the choice to conclude with the additional passages below from the book cited several times earlier, An Introduction to Ecological Economics, will likely be quickly evident. The choice is then reinforced with the prospect of possible collaboration between the proposed Human Energy/ Evolution Institute conferences with the U.N. Summit of the Future. And this very recent paper published in PLOS Sustainability and Transformation may be considered a useful complement:

https://journals.plos.org/sustainabilitytransformation/article?id=10.1371/journal.pstr.0000098

- pg. 76: “The co-evolutionary perspective helps us see that the problem of humans interacting with their environment is not simply a matter of establishing market incentives or appropriate rules about the use of property. Our values, knowledge, and social organization have co-evolved around fossil hydrocarbons. Our fossil fuel-driven economy has not simply transformed the environment, it has selected for individualist, materialist values, favored the development of reductionist understanding at the expense of systemic understanding, and preferred a bureaucratic, centralized form of control that works better for steady-state industrial management than for the varied, surprising dynamics of ecosystem management. And the co-evolutionary framing highlights how our abilities to perceive and resolve environmental problems within the dominant modes of valuing, thinking, and organizing are severely constrained.”

- pg. 88

“The transdisciplinary view provides an overarching coherence that can tie disciplinary knowledge together and that can address the increasingly important problems that cannot be addressed within the disciplinary structure. In this sense, ecological economics is not an alternative to any of the existing disciplines. Rather it is a new way of looking at the problem that can add value to the existing approaches and that can address some of the deficiencies of the disciplinary approach. It is not a question of “conventional economics” versus “ecological economics” but rather conventional economics as one input (among many) to a broader transdisciplinary synthesis.

“We believe that this transdisciplinary way of looking at the world is essential if we are to achieve the three interdependent goals of ecological economics discussed here: sustainable scale, fair distribution, and efficient allocation. This requires the integration of three elements: (1) a practical, shared vision of the way the world works and of the sustainable society we wish to achieve; (2) methods of analysis and modeling that are relevant to the new questions and problems this vision embodies, and (3) new institutions and instruments that can effectively use the analyses to adequately implement the vision.

“The importance of the integration of these three components cannot be overstated. Too often when discussing practical applications, we focus only on the implementation element, forgetting that an adequate vision of the world and our goals is often the most practical device for achieving the vision, and that without appropriate methods of analysis even the best vision can be blinded. The importance of communication and education concerning all three elements also cannot be overstated.

“The basic points of consensus in the ecological economics vision are as follows:

1.) The vision of the Earth as a thermodynamically closed and non-materially growing system, with the human economy as a subsystem of the global ecosystem. This implies that there are limits to biophysical throughput of resources from the ecosystem, through economic subsystem, and back to the ecosystem as wastes.

2.) The future vision of a sustainable planet with a high quality of life for all its citizens (humans and other species) within the material constraints imposed by 1.

3.) The recognition that in the analysis of complex systems such as the Earth at all space and time scales, fundamental uncertainty is large and irreducible and certain processes are irreversible, requiring a fundamentally precautionary stance.

4.) That institutions and management should be proactive rather than reactive and should result in simple, adaptive, and implementable policies based on a sophisticated understanding of the underlying systems that fully acknowledge the underlying uncertainties. This forms the basis for policy implementation, which is itself sustainable.

5.) The last point is conceptually pluralistic. This means that even while people writing in ecological economics were trained in a particular discipline (and may prefer that mode of thinking over others), they are open to an appreciation of other modes of thinking and actively seek a constructive dialogue among disciplines (Norgaard 1989). There is not one right approach or model because, like the blind men and the elephant, the subject is just too big and complex to touch all of it with one limited set of perceptual or computational tools.”

Page 91:

“Priority of Problems. The problems of efficient allocation, fair distribution, and sustainable scale are highly interrelated but distinct; they are most effectively solved in a particular priority order, and they are best solved with independent policy instruments (Daly 1992). There are an infinite number of efficient allocations but only one for each distribution and scale. Allocative efficiency does not guarantee sustainability (Bishop 1993). It is clear that scale should not be determined by prices but by a social decision reflecting ecological limits. Distribution should not be determined by prices but by a social decision reflecting a just distribution of assets. Subject to these social decisions, individualistic trading in the market is then able to allocate the scarce rights efficiently. . . .

“The prices that measure the opportunity costs of reallocation are unrelated to measures of the opportunity costs of redistribution or of a change in scale. Any trade-off among the three goals (e.g., an improvement in distribution in exchange for a worsening in scale or allocation, or more unequal distribution in exchange for sharper incentives seen as instrumental to more efficient allocation) involves an ethical judgment about the quality of our social relations rather than a willingness-to-pay calculation. The contrary view, that this choice among basic social goals and the quality of social relations that help to define us as persons should be made on the basis of individual willingness-to-pay, just as the trade-off between chewing gum and shoelaces is made, seems to be dominant in economics today, and it is part of the retrograde modern reduction of all ethical choices to the level of personal tastes weighted by income.

“It is instructive to consider the historical attempt of the scholastic economists to subsume distribution under allocation (or more likely they were subsuming allocation under distribution – at any rate they did not make the distinction). This was the famous “just price” doctrine of the Middle Ages that has been totally rejected in economic theory, although it stubbornly survives in the politics of minimum wages, farm price supports, water and electric power subsidies, and so forth. However, we do not, as a general rule, try to internalize the external cost of distributive injustice into market prices. We reject the attempt to correct market prices for their unwanted effects on income distribution. Economists nowadays keep allocation and distribution quite separate, and they argue for letting prices serve only efficiency, while serving justice with the separate policy of transfers. This follows Tinbergen’s dictum of equality of policy goals and instruments: one instrument for each policy. The point is that just as we cannot subsume distribution under allocation, neither can we subsume scale under allocation.
“It seems clear, then, that we need to address the problems in the following order: first, establish the ecological limits of sustainable scale and establish policies that assure that the throughput of the economy stays within these limits. Second, establish a fair and just distribution of resources using systems of property right and transfers. The property right systems can cover the full spectrum from individual to government ownership, but intermediate systems of common ownership and systems for dividing the ownership of resources into ownership of particular services need much more attention (Young 1992). Third, once the scale and distribution problems are solved, market-based mechanisms can be used to allocate resources efficiently. This involves extending the existing market to internalize the many environmental goods and services that are currently outside the market.”

- pg. 7: “Since the Club of Rome’s 1972 “Limits to Growth,” the emphasis has shifted from source limits to sink limits. Source limits are more open to substitution, are more amenable to private ownership, and are more localized. Consequently, they are more amenable to control by markets and prices. Sink limits involve common property where markets fail. Since 1972, the case has substantially strengthened so that there are limits to throughput growth on the sink side (Meadows et al. 1992; Randers 2012). Some of these limits are tractable and are being tackled, such as the CFC (chlorofluorocarbon) phaseout under the Montreal Convention. Other limits are less tractable, such as increasing CO2 emissions and the massive human appropriation of biomass. Another example is landfill sites, which are becoming extremely difficult to find. Garbage is now shipped thousands of miles from industrial to developing countries in search of unfilled sinks. It has so far proved impossible for the U.S. Nuclear Regulatory Commission to rent a nuclear waste site.”

- pgs. 50: “To bring a system into equilibrium, negative feedbacks are needed. Economics helps us see how biodiversity is decreasing because so few genetic traits, species, or ecosystems have market prices, the negative feedback signals that equilibrate market economies. In market systems, prices increase to reduce the quantity demanded when supplies are low and prices drop to increase the quantity demanded when supplies are high, keeping demand and supply in equilibrium. The problem, economists argue, is that most genetic traits, species, and ecosystems are being lost because they do not have prices acting as a negative feedback system to keep use in equilibrium with availability. When individuals of the species become fewer, increasing price to decrease quantity is not an option. By putting economic values on species and including them in market signals through various ways would reduce biodiversity loss. Furthermore, the economic explanation and solution is systemic. . . .

“Biologists also find the idea that we need to know the economic values of species compatible with their own understanding that if the true value of species to society were understood, more species would be conserved. Clearly, if we knew the value of biological resources, we would be in a better position to manage them more effectively. And, to the extent these values could be included in the market system, markets themselves could assist in the conservation of biodiversity. The situation can frequently be improved through amending market signals. At the same time, it is important to remember that market values only exist within a larger system of values, which for many people include the preservation of nature for ethical or religious reasons (Sagoff 1988).”

- pg. 51: “Although several techniques for estimating the value of the environment are proving interesting, valuation is by no means an easy task and estimates should be used cautiously. A major difficulty is related to the systemic nature of economics, ecosystems, and the process of environmental degradation. Market systems relate everything to everything else. For example, when the price of oil changes, it causes the price of gasoline to change, which causes the demand and hence the price of products that use gasoline, such as automobiles, to change, which causes the demand for and hence the price of coal to change, and so on. Prices bring markets to equilibrium and their flexibility is essential to this task. Similarly, the “right” price for a given species or ecosystem will depend on the availability of a host of other species or ecosystems with which they are interdependent as well as with other species and ecosystems that may be substitutes or complements in use. To think that a species or ecosystem has a single value is to deny ecosystem and economic system interconnections. Nevertheless, environmental valuation can assist us in understanding at least the minimal importance of ecological services and in conveying this understanding to the public to improve the political process of finding common ground.”