Title: Does capitalism have to be bad for the environment? | World Economic Forum
Headings: Does capitalism have to be bad for the environment?
Does capitalism have to be bad for the environment?
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Content: If the carrying capacity of the world cannot sustain endless consumption and production, there is clearly a contradiction at stake here. This contradiction naturally raises the more important question: how to reconcile the quandary of maintaining a capitalist system that meets necessary growth rates to remain stable on the one hand, and simultaneously contain the environmental hazards that threaten our planet on the other? To answer these questions, there are three propositions about the very nature and dynamics of capitalism that have to be examined. First, firms in a capitalist setting are under enormous pressure to cut costs, because if they don’t, their competitors will. Since their competitors cut costs to be able to reinvest in the firm’s growth and thereby, become more competitive, if one firm refrains from doing so, it will be soon pushed out of the market by others. As the economic sociologist Erik Wright of the University of Wisconsin-Madison said, one way of cutting cost is to project some of that cost onto the environment. Imagine, for instance, throwing a can of soft drink from a car window because this is a low-cost way of disposing of a can, and being totally indifferent to its negative impact on others. The same behaviour is often adopted by large businesses. The market dynamics in capitalism do not provide any mechanisms in themselves to prevent this behaviour;