An Answer To The Meaning of Life
Love, economists have discovered, is depreciating rapidly. On current trends, it is expected to fall by £1.78 per passion-hour between now and 2030...
George Monbiot
Love, economists have discovered, is depreciating rapidly. On current trends, it is expected to fall by £1.78 per passion-hour between now and 2030. The opportunity cost of a kiss foregone has declined by £0.36 since 1988. By 2050 the net present value of a night under the stars could be as little as £56.13. This reduction in the true value of love, they warn, could inflict serious economic damage.
None of that is true, but it’s not far off. Love is one of the few natural blessings which has yet to be fully costed and commodified. They’re probably working on it now.
Under the last government, the Department for Transport announced that it had discovered “the real value of time”. Here’s the surreal sentence in which this bombshell was dropped:
“Forecast growth in the real value of time is shown in Table 3.”(1)
Last week the Department for Environment announced the results of its National Ecosystem Assessment, a massive exercise involving 500 experts. The assessment, it tells us, establishes “the true value of nature … for the very first time.”(2) If you thought the true value of nature was the wonder and delight it invoked, you’re wrong. It turns out that it’s a figure with a pound sign on the front. All that remains is for the Cabinet Office to tell us the true value of love and the price of society, and we’ll have a single figure for the meaning of life.
The government has not yet produced one number for “the true value of nature”, but its scientists have costed some of the assets that will one day enable this magical synthesis to be achieved. The assessment has produced figures, for example, for the value of green spaces to human well-being. If we look after them well, our parks and greens will enhance our well-being to the tune of £290 per household per year in 2060(3).
How do they calculate these values? The report tells us that the “ecosystem services” it assesses include “recreation, health and solace”, and natural spaces “in which our culture finds its roots and sense of place” (4). These must be taken into account when costing “shared social value”. Shared social value arises from developing “a sense of purpose”, and being “able to achieve important personal goals and participate in society.” It is enhanced by “supportive personal relationships” and “strong and inclusive communities.”(5) These are among the benefits which the experts claim to be costing.
The exercise is well-intentioned. The environment department rightly points out that businesses and politicians ignore the uncosted damage their decisions might inflict on the natural world and human welfare. It seeks to address this oversight by showing that “there are real economic reasons for looking after nature.”(6) But there are two big problems.
The first is that this assessment is total nonsense, pure reductionist gobbledegook, dressed up in the language of objectivity and reason, but ascribing prices to emotional responses: prices, which, for all the high-falutin’ language it uses, can only be arbitrary. It has been constructed by people who feel safe only with numbers, who must drag the whole world into their comfort zone in order to feel that they have it under control. The graphics used by the assessment are telling: they portray the connections between people and nature as interlocking cogs(7). It’s as clear a warning as we could take that this is an almost-comical attempt to force both nature and human emotion into a linear, mechanistic vision.
The second problem is that it delivers the natural world into the hands of those who would destroy it. Picture, for example, a planning enquiry for an opencast coal mine. The public benefits arising from the forests and meadows it will destroy have been costed at £1m per year. The income from opening the mine will be £10m per year. No further argument needs to be made. The coal mine’s barrister, presenting these figures to the enquiry, has an indefeasible case: public objections have already been addressed by the pricing exercise; there is nothing more to be discussed. When you turn nature into an accounting exercise, its destruction can be justified as soon as the business case comes out right. It almost always comes out right.
Cost-benefit analysis is systematically rigged in favour of business. Take, for example, the decision-making process for transport infrastructure. The last government developed an appraisal method which almost guaranteed that new roads, railways and runways would be built, regardless of the damage they might do or the paltry benefits they might deliver(8). The method costs people’s time according to how much they earn, and uses this cost to create a value for the development. So, for example, it says the market price of an hour spent travelling in a taxi is £45, but the price of an hour spent travelling by bicycle is just £17, because cyclists tend to be poorer than taxi passengers(9).
Its assumptions are utterly illogical. For example, commuters are deemed to use all the time saved by a new high speed rail link to get to work earlier, rather than to live further away. Rich rail passengers are expected to do no useful work on trains, but to twiddle their thumbs and stare vacantly out of the window throughout the journey. This costing system explains why successive governments want to invest in high-speed rail rather than cycle lanes, and why multi-billon pound road schemes which cut two minutes off your journey are deemed to offer value for money(10). None of this is accidental: the cost-benefit models governments use excite intense interest from business lobbyists. Civil servants with an eye on lucrative directorships in their retirement ensure that the decision-making process is rigged in favour of over-development.
This is the machine into which nature must now be fed. The National Ecosystem Assessment hands the biosphere on a plate to the construction industry.
It’s the definitive neoliberal triumph: the monetisation and marketisation of nature, its reduction to a tradeable asset. Once you have surrendered it to the realm of Pareto optimisation and Kaldor-Hicks compensation, everything is up for grabs. These well-intentioned dolts, the fellows of the Grand Academy of Lagado who produced the government’s assessment, have crushed the natural world into a column of figures. Now it can be swapped for money.
Andreas Whittam Smith in The Independent
How did the media on the one hand and the financial markets on the other build themselves up as such great forces in society?
Thursday, 26 May 2011
We have seen two big powers in action this week. They are not countries. But they can take on governments and win. They are the media and the financial markets. While British newspapers were forcing the UK Government to rethink the use of injunctions issued by courts to protect privacy, the financial markets were maintaining almost unbearable pressure on the currencies of the weaker members of the eurozone.
It was surely resentment at the power of the media that led a gang of masked men to vandalise reporters' cars outside the home of Ryan Giggs on Tuesday. An injunction taken out by Mr Giggs to prevent press coverage of an alleged extramarital affair had been dramatically revealed in the House of Commons on Monday after details had been made freely available on Twitter.
As to the power of the financial markets, my colleague Hamish McRae noted yesterday that the Greek government "may have the electorate's mandate but it does not set policy. That is being determined... in Brussels, Berlin, Frankfurt and Washington. Power has gone". In turn the politicians and civil servants in such cities look to the financial markets to discover what actions are required. Take another case, Spain. As the Financial Times commented: "Watching Spain's agony as it tries to escape the clutches of the eurozone's expanding sovereign debt crisis is like being a spectator at a particularly cruel gladiatorial fight. Whenever the weaker contestant skilfully sidesteps an assault by his opponent, he is promptly confronted with a still more ferocious attack."
How did the media and the financial markets build themselves up as great powers? The most significant date in plotting the growing influence of national newspapers in Britain was 17 November 1969 when Rupert Murdoch launched the Sun as a tabloid. Thirteen years later Associated Newspapers created the Mail On Sunday. In little over a decade, therefore, the market for scandalous news had been substantially expanded. Until then the Daily Mirror and the News Of The World had dominated this area.
This was an era when everything began to change, as much in the financial markets as in the behaviour of the media. Governments strictly controlled exchange rates, for instance, until the early 1970s. When US President Richard Nixon closed the so-called "gold window" on 15 August 1971, ending free exchange between US dollars and gold, he brought to a close a 25-year period during which the world's leading currencies, including sterling, had been fixed in terms of the dollar. Speculation against them had been almost impossible.
From then onwards they could "float", and when a particular currency declined in value against its neighbours', the government concerned began to feel the pressure. In 1979, one of the first decisions of Mrs Thatcher's newly formed government was to abolish UK exchange control. It was a welcome act of self-confident liberation, but it also, in accordance with the law of unintended consequences, handed a weapon to currency speculators, who would use it ruthlessly in 1992 to drive Britain out of the European Exchange Rate Mechanism on a day known forever afterwards as "Black Wednesday".
Repeated oil shocks since the 1970s have also contributed to the power of financial markets. Essentially a higher oil price takes spending power out of the pockets of consumers and places it into the treasuries of countries, mainly in the Middle East, who have no means of spending their new wealth – other than by investing it back into the financial markets of the West. By this mechanism the financial markets have become larger and larger in relation to national economies. Since the first oil shock in 1973 when the price of oil shot up to $10 a barrel – it's now $100 – there have been at least a dozen oil spikes, each time magnifying the size of the financial markets as the unspent surplus was invested in securities.
During the same period, the power of the media has also continued to increase. In the UK, the politicians partly brought this on themselves. From the early 1990s they began a process of non-stop electioneering. So great are the penalties for losing power – the splitting of the party into warring groups, the lengthy period in exile – that party leaders feel they must do what it takes to regain or retain office.
In relationship to the press, Tony Blair described what was needed: "Our news today is instant, hostile to subtlety or qualification... To avoid misinterpretation, strip down a policy or opinion to one key clear line before the media does it for you. Think in headlines." Then when Labour came to power in 1997, the Government Information Service was taught the same rule. Alastair Campbell told Whitehall press officers a few months after the election: "Decide your headlines. Sell your story and if you disagree with what is being written, argue your case." But the more the political parties sought control, the more aggressively the press struck back.
Add to this the dramatic expansion of unregulated digital media. The first email was sent in 1971 (the two computers were sitting next to each other!). The first web browsers became available in 1978. The first social networking site saw the light of day in in 1994. MySpace was created in 2003, Facebook in 2004 and Twitter in 2006.
I don't describe the rise of the media and the financial markets to positions of great power to argue that something should be done about them, though they are both, in their different ways, crude and rough. I particularly dislike the untrammeled greed of bankers though doubtless they equally hate the untrammeled inquisitiveness of journalists. Where the power of media and finance is at its most objectionable, however, is in their ability to deter governments from protecting us from their worst excesses.
In the United States the banks, for instance, use their formidable lobbying skills and resources in Congress to deter lawmakers from curbing their abuses and this phenomenon in turn has the effect of holding back regulation in other markets around the world. In Britain, so far as the media is concerned, there is a strong case for a law on privacy, but I doubt whether any Cabinet would have the courage to propose such a measure. Of course even democratically elected governments can be frightening bodies, but so are their most formidable opponents, finance and media.
It was surely resentment at the power of the media that led a gang of masked men to vandalise reporters' cars outside the home of Ryan Giggs on Tuesday. An injunction taken out by Mr Giggs to prevent press coverage of an alleged extramarital affair had been dramatically revealed in the House of Commons on Monday after details had been made freely available on Twitter.
As to the power of the financial markets, my colleague Hamish McRae noted yesterday that the Greek government "may have the electorate's mandate but it does not set policy. That is being determined... in Brussels, Berlin, Frankfurt and Washington. Power has gone". In turn the politicians and civil servants in such cities look to the financial markets to discover what actions are required. Take another case, Spain. As the Financial Times commented: "Watching Spain's agony as it tries to escape the clutches of the eurozone's expanding sovereign debt crisis is like being a spectator at a particularly cruel gladiatorial fight. Whenever the weaker contestant skilfully sidesteps an assault by his opponent, he is promptly confronted with a still more ferocious attack."
How did the media and the financial markets build themselves up as great powers? The most significant date in plotting the growing influence of national newspapers in Britain was 17 November 1969 when Rupert Murdoch launched the Sun as a tabloid. Thirteen years later Associated Newspapers created the Mail On Sunday. In little over a decade, therefore, the market for scandalous news had been substantially expanded. Until then the Daily Mirror and the News Of The World had dominated this area.
This was an era when everything began to change, as much in the financial markets as in the behaviour of the media. Governments strictly controlled exchange rates, for instance, until the early 1970s. When US President Richard Nixon closed the so-called "gold window" on 15 August 1971, ending free exchange between US dollars and gold, he brought to a close a 25-year period during which the world's leading currencies, including sterling, had been fixed in terms of the dollar. Speculation against them had been almost impossible.
From then onwards they could "float", and when a particular currency declined in value against its neighbours', the government concerned began to feel the pressure. In 1979, one of the first decisions of Mrs Thatcher's newly formed government was to abolish UK exchange control. It was a welcome act of self-confident liberation, but it also, in accordance with the law of unintended consequences, handed a weapon to currency speculators, who would use it ruthlessly in 1992 to drive Britain out of the European Exchange Rate Mechanism on a day known forever afterwards as "Black Wednesday".
Repeated oil shocks since the 1970s have also contributed to the power of financial markets. Essentially a higher oil price takes spending power out of the pockets of consumers and places it into the treasuries of countries, mainly in the Middle East, who have no means of spending their new wealth – other than by investing it back into the financial markets of the West. By this mechanism the financial markets have become larger and larger in relation to national economies. Since the first oil shock in 1973 when the price of oil shot up to $10 a barrel – it's now $100 – there have been at least a dozen oil spikes, each time magnifying the size of the financial markets as the unspent surplus was invested in securities.
During the same period, the power of the media has also continued to increase. In the UK, the politicians partly brought this on themselves. From the early 1990s they began a process of non-stop electioneering. So great are the penalties for losing power – the splitting of the party into warring groups, the lengthy period in exile – that party leaders feel they must do what it takes to regain or retain office.
In relationship to the press, Tony Blair described what was needed: "Our news today is instant, hostile to subtlety or qualification... To avoid misinterpretation, strip down a policy or opinion to one key clear line before the media does it for you. Think in headlines." Then when Labour came to power in 1997, the Government Information Service was taught the same rule. Alastair Campbell told Whitehall press officers a few months after the election: "Decide your headlines. Sell your story and if you disagree with what is being written, argue your case." But the more the political parties sought control, the more aggressively the press struck back.
Add to this the dramatic expansion of unregulated digital media. The first email was sent in 1971 (the two computers were sitting next to each other!). The first web browsers became available in 1978. The first social networking site saw the light of day in in 1994. MySpace was created in 2003, Facebook in 2004 and Twitter in 2006.
I don't describe the rise of the media and the financial markets to positions of great power to argue that something should be done about them, though they are both, in their different ways, crude and rough. I particularly dislike the untrammeled greed of bankers though doubtless they equally hate the untrammeled inquisitiveness of journalists. Where the power of media and finance is at its most objectionable, however, is in their ability to deter governments from protecting us from their worst excesses.
In the United States the banks, for instance, use their formidable lobbying skills and resources in Congress to deter lawmakers from curbing their abuses and this phenomenon in turn has the effect of holding back regulation in other markets around the world. In Britain, so far as the media is concerned, there is a strong case for a law on privacy, but I doubt whether any Cabinet would have the courage to propose such a measure. Of course even democratically elected governments can be frightening bodies, but so are their most formidable opponents, finance and media.