Environmental Problems,
economics and cows.
Chapter 1
Exponential growth
 You’ve probably seen the equation used in
calculating compound interest:
 FV= Future Value
 PV= Present value
 i= Interest rate
 n= Number of terms (usually years)
Calculate:
 If you owe $500 on a credit card that has a
13.5% interest rate, how much more will you
owe after a year?
 $567.5
 If you owe $150,000 to the bank on a loan
with 3.75% interest, how much will you have
paid after 30 years?
 $452,620 ($1257/month payment)
Economics of life
 Not unlike interest compounding, the
populations of organisms tend to grow at an
exponential rate.
 Between 1950 and 2005 the world
population increased from 2.5 billion to 6.5
billion.
Haves vs. Have nots
 Regardless of the great (8-fold) economic
growth between 1950 and 2000,wealth and
resources are not evenly distributed.
 Literally, 1 of 2 of the world’s workers tries to
live on less than $2 a day. (Data from World
Bank and UN).
Survival
 The problem lies in that in order to survive,
many of the poor must deplete and degrade
local forests, grasslands, and soils and
wildlife.
Degrade? But…How?
 How do people in poverty stricken areas
degrade their environment?
– Bushmeat
– Cutting wood for fuel
– Clearing land for agriculture
– Poor crop choice
– “Feast & Famine” lifestyle.
Sustainability
 None of these practices is sustainable.
 Sustainability is the ability of the earth’s
systems, including human economies, to
survive and adapt over time.
 Sustainability is only achieved through
careful management of the earth’s natural
resources.
Natural Capital
 Natural Capital refers to the natural
resources and services that help keep us
and other species alive, and support our
economies.
 For most people, capital is wealth that is
used to sustain a business and generate
more wealth.
 Natural Capital is different, but functions the
same.
Investing in nature…
 Smart people invest capital to provide themselves
with financial income.
 Smart societies invest in natural capital to provide
themselves with biological income.
–
–
–
–
–
–
–
–
This includes:
Air purification
Water purification
Food production
Pollination
Waste treatment
Climate control
Soil renewal (sustainable agriculture)
Natural Capital
 Natural Capital can be summed up as the
combination of Natural resources + Natural
Services.
Natural Capital
=
Natural Resources
Air
Soil
Land
Life
Minerals
Renewable energy
NonRenew. energy
Natural Services
+
Air Purification
Water Purification
Soil Renewal
Food
Climate control
Pest control
Environmentally Sustainable
 An environmentally sustainable society
meets the basic resource needs of its
people indefinitely without degrading or
depleting the natural capital that supplies
these resources.