Decline turns the environment

Economic development initially worsens environmental externalities such as deforestation and pollution, including the accumulation of climate-damaging greenhouse gases in the atmosphere and oceans. But long term, pollution and deforestation can start to improve as economic growth boosts the incomes of once poor people. The wealthier people become the more they demand and get improved environmental quality via regulation and market mechanisms that promote cleaner and less resource-intensive processes and technologies.

For example, since 1980 carbon monoxide, sulfur dioxide and nitrogen dioxide air pollution is down 85, 80 and 60 percent, respectively, even as real U.S. GDP more than doubled. Data from the Food and Agriculture Organization of the United Nations’ latest global forest trends report shows that deforestation halts and reverses when per capita incomes reach a threshold of around $4,200. Economies increasingly grow by squeezing more value out of less stuff. The Worldwatch Institute reports that U.S. carbon intensity (the amount of CO2 emitted to produce a dollar of GDP) has fallen 60 percent since 1990.

Boosting agricultural productivity in poor countries will mean more land for forests. Expanding forests soak up carbon dioxide, thus slowing warming. Right now cereal yields in India and Nigeria average 2,962 and 1,537 kilograms per hectare, respectively. This contrasts with the U.S. average of 7,340 kilograms per hectare. Agronomist Paul Waggoner of the Connecticut Agricultural Experiment Station has calculated that “if during the next 60 to 70 years the world farmer reaches the average yield of today’s U.S. corn grower, the 10 billion [people] will need only half of today’s cropland while they eat today’s American calories.”

Jesse Ausubel, head of the Human Environment Program at The Rockefeller University, now finds that humanity is already near peak farmland. If bioethanol subsidies that encourage the conversion of food into fuel could be eliminated, then up to 160 million hectares of land could be restored to nature by 2060. That’s an area about double the size of the U.S. east of the Mississippi River. And as farming efficiency improves, more people can move to cities, freeing up land for nature.

Finally, faster economic growth provides the wherewithal to spur innovation and create cheaper and more efficient technologies. Swanson’s Law is an example of increasing economies of scale: Every time global solar panel production capacity doubles, the price drops 20 percent. At the current rate of growth, electricity from solar panels will be cheaper than that produced by burning natural gas in less than a decade. Similarly, climate scientist James Hansen and his colleagues have urgently argued that there is “no credible path to climate stabilization that does not include a substantial role for nuclear power.” A recent study published in PLoS ONE by Swedish and Australian researchers estimates that replacing all fossil fuel energy generation with nuclear power could be done in 25 to 34 years. Economic growth supplies the capital needed to fund the global no-carbon energy transformation, not mandates to deploy current, expensive, clunky versions of renewable energy and nuclear technologies.

Just as cell phones enabled poor countries to skip over landline telephone infrastructure, economic development coupled with increasingly cheap solar panels attached to inexpensive, high-efficiency energy-storage systems, including batteries, could help them bypass centralized fossil fuel plants and power grids. To truly address climate change, responsible policy makers should select courses of action that move humanity from slow- to high-growth trajectories, especially for the poorest developing countries. This includes honest bureaucracies, the rule of law, free markets, strong property rights and democratic governance. Whatever slows down economic growth will also slow down environmental cleanup and renewal.