Understanding the Roots of Poverty

Taken from The Woodstock Theological Center Web Site
at Georgetown University Energy, the Economy, and the Environment

The energy crisis in California, together with President Bush’s decision to pull out of the Kyoto convention on climate change, has refueled the public debate over energy, the economy, and the environment. Those three “E’s” were the subject at Georgetown University on April 25, when Woodstock held a forum that mined questions of fact as well as values. What is the state of global climatic change and our dependence on fossil fuels? What place do conservation and renewable energy resources have in our national future? What values are embedded in our decisions about such matters as emissions levels and the comparative obligations of rich and poor countries? Do we need to make tradeoffs in balancing these values along with the imperatives of economic growth, environmental sustainability, and global equity? Handling those and other questions were Robert T. Watson of the World Bank, Father Drew Christiansen of Woodstock, and former White House official Kathleen A. McGinty. Moderating the discussion was Father James L. Connor, S.J., Woodstock director.

INTRODUCTION: FACTS, VALUES, AND ACTION

Father James L. Connor, S.J.

The title of this evening’s discussion is “Energy, the Economy, and the Environment: Putting them all in Context.”

The issue. All three – energy, the economy, and the environment – are in the newspapers daily. We read of revolving blackouts in California, which may soon come to New York and elsewhere. We see stocks plunging on Wall Street as well as cutbacks in employment and downsizing and so on. We also read of changes in the environment – for instance, the ice cap that’s melting on the top of Africa’s Mount Kilimanjaro.

Each of these sectors is not independent of the others, but as we know, very intimately interlocked, such that when we attempt to remedy one situation, we might actually be disadvantaging one or two of the others. For instance, if we choose, for economic reasons, to maintain or increase use of fossil fuels, we may be adding, wittingly or unwittingly, to global warming. And that may be responsible for melting the ice caps. But how do we make these choices? How do we go about tradeoffs in a responsible way? What is our context, in other words, our worldview, our larger horizon? How do we locate the really important values in our lives, such that this worldview, this context, can guide us in the decisions we make about weighing options, and setting priorities in the case of tradeoffs?

Our aim tonight is threefold. First, a factual task. How do we want to describe and compare the competing needs and claims of (a) energy, (b) the economy, and (c) the environment? What is going on? What are the facts? You can’t travel far without correct information. Second, we want to clarify the values. We want to identify the social and the moral context and the principles within which we can adjudicate, judge, and balance the variety of claims for the legitimate needs of energy, the economy, and the environment. They’re real needs. But how do we adjudicate and equitably satisfy these needs, not only here in the United States but on a global level? Our third aim is to put number one and number two together. Having looked at the facts, comparatively and absolutely as best we can, having laid out the context within which we’re going to do our evaluating, how do we combine those two? What is the process of resolving our conscience and recommending courses of action or policy that most constructively satisfy the pressing claims of each of the three sectors and which thereby serve best the common good, the good of us all? This has to do with action.

We certainly don’t expect to answer all of the questions at hand. We want, rather, to identify the key questions and put them in context, such that we can then go on to a process of resolution and recommendation. Knowing and situating such questions, I would suggest, is the indispensable first step to arriving at answers. Not to have the right question is clearly to get the wrong answer. If we can get the right questions and put them in a healthy context, we will have come a long way. We hope to be able to continue this search in the months ahead here at Woodstock. In a sense, this evening opens up a process for us.

CLIMATE CHANGE: FACTS AND PLAUSIBLE FUTURES

Dr. Robert T. Watson is chairman of the Intergovernmental Panel on Climate Change (“IPCC”) and the World Bank’s director for environment. Dr. Watson has played a key role in the negotiation of global environment conventions and the evolution of the Global Environmental Facility. He has chaired a number of international scientific assessments, including the International Scientific Assessment of Ozone and the Global Biodiversity Assessment. Previously, he was associate director for environment in the Office of Science and Technology Policy in the Clinton administration.

What I would like to say first is that there is no dichotomy between environment, economic growth, and energy. It’s also quite clear that you need energy for economic growth, but it does not have to come at the expense of environmental degradation, which many people believe it does.

I also believe that climate change – the theme of my talk – is actually one of the key issues ethically. It’s an ethical issue within countries, between countries, and between generations. To put it in perspective, there are 1.3 billion people living today on less than a dollar a day. Half the world’s population lives on two dollars a day, and 800 million people are malnourished in developing countries. There are 1.3 billion people who have no clean water. Two billion people have no sanitation. Two billion have no electricity. Almost 1.5 billion people have dangerous outdoor air pollution, and probably 2 to 2.5 billion are exposed to dangerous indoor air pollution or vector (insect)-borne diseases. Many live in areas of civil strife and are vulnerable to natural disasters.

What’s this got to do with energy? Everything. We need energy to drive economic growth. But unfortunately the way we use our energy today is leading not only to indoor air pollution, outdoor air pollution, and vector-borne diseases, but also to climate change, which is threatening food security around the world and adequate supplies of clean water.

Now most people think of poverty in a very simplistic way, and that’s income. That’s not what the poor think about poverty. They want opportunity. They want capability, security, and they want to be empowered. They do want income. They want the ability to consume. They want to be healthy and educated so they can be productive citizens. They want to be free from vulnerability and civil strife. And they want to participate in everyday decision-making. In other words, they want to be part of a democratic society.

The climatic threat. So why again have I brought this up? Climate change, which threads amongst all of these issues – environment, economy, and energy – threatens all of this. Fundamental income for many poor people comes from natural resource use: agriculture, forestry, coral reefs, mangrove systems. Climate change threatens most natural resource systems around the world. Climate change threatens both the quantity and quality of water around the world. It threatens air quality and will increase vector-borne diseases and water-borne diseases. It absolutely degrades ecological systems, leading to ecological fragmentation and fragility. And it will lead to more severe weather, making poor people more vulnerable. So the issue of poverty is not only multi-dimensional, it’s absolutely embedded within an ethical system of how we produce and use energy.

What are some of the underlying causes for change? It actually doesn’t matter whether it’s climate change, bio-diversity, desertification, or acid deposition. It’s the same. It’s demographic shifts, population growth, and the rural/urban transition. That is, of course, on top of broad technological change and economic growth. Regarding the latter, there’s unfortunately also a failure to internalize what we call a “social cost” in environmental degradation. That is to say, we often pay the true cost of coal, digging it out of the ground and transporting it. But it causes health problems through urban air pollution, ecological damage through acid deposition, and global warming. And we don’t pay for those social costs. We also use our technology inefficiently and we don’t invest in research and development.

Climate change is occurring. Future change is inevitable. It’s a fact. Therefore, it’s not a question of, “Do we mitigate climate change, or do we adapt?” It’s both.

We humans have clearly changed the atmospheric composition of greenhouse gases due to combustion of fossil fuels. As we burn oil, coal, and gas, we increase the atmospheric concentrations of carbon dioxide and methane. Over the last 50 years, most of climate change is attributable to us, to human activities. We cannot blame this on natural phenomena.

If anything, the earth should have become colder due to less of an output in solar activity and less volcanic activity. But the last two decades are the warmest two decades of the last 140 years. Ten of the hottest years ever are in the last 15 years. (We measure temperature of previous periods through coral reefs and tree rings.) Fundamentally, temperatures were absolutely flat for 850 years until the industrial revolution and suddenly we increased .6 degrees Celsius. We humans are changing the composition of the atmosphere. And temperature will change more. In the high latitudes it could increase 8 to12 degrees Celsius, up to 20 degrees Fahrenheit. The middle of America is likely to increase about 5 to 6 degrees Celsius; 10 to 11 degrees Fahrenheit. So in July, we worry about 20 days over 90 degrees Fahrenheit. In this future world, we’ll have 20 days over 100 degrees Fahrenheit in Washington, DC, in July.

But it’s not only temperature. There’s now an increase in what we call “heavy precipitation events,” more heavy precipitation, less light precipitation. In a single area of the United States such as Mississippi or Missouri, that leads – it may seem paradoxical – to more floods and more droughts. Not exactly good for agricultural productivity. The “El Niño” phenomena leads to massive floods in Peru, but also to massive droughts in Northeast Brazil, Southern Africa, and parts of Asia.

There’s an ethical issue here. Why is climate changing? The emissions come from industrialized countries. That’s us, Europe, and Japan. Who’s going to suffer? Developing countries. We’re going to see decreases in agricultural productivity in the 2020s, 2050s, and 2080s. Where? In Africa, Latin America, throughout India, all developing countries, and Australia is close. In Africa 10 to 50 million people could be displaced due to a half-meter sea level rise. Fifty to 100 million people will be environmental refugees in Southeast Asia, tens of millions of people in Bangladesh alone. The Maldive Islands may or may not exist in the future – the complete loss of a culture, conceivably.

So who are the most vulnerable? The poorest countries and the poor within those countries. Therefore, climate change and our way of meeting energy today, the burning of fossil fuels – coal, oil, and gas – will exacerbate inequities throughout the world and access to adequate food, clean water, and other resources. Why are developing countries more vulnerable? They’re more flood and drought prone. A larger share of their economy comes from sensitive sectors such as agriculture and forestry; it will cost them more than half of their gross domestic product to protect themselves from expected sea level rises. And there’s a very poor nutritional and health infrastructure in developing countries, so they’re much more sensitive to vector-borne diseases. Loss of agricultural productivity will mean that nutrition will go down even further.

What does all this lead to? You could say it’s a mess. The other way to view it is as a very wide range of plausible futures, which we have control over.

We can help developing countries become less vulnerable to natural climate variability today as well as long-term climate change. We can now predict the so-called El Niño events, so we need to bring our scientific forecasting into sectors of management decisions about water and agriculture. We need to manage our water at the watershed level, look at all sectors whether it’s agriculture or household water needs. And we need appropriate water-pricing policies. It sounds sensible. But in the Muslim religion, water is a God-given gift. Why would you charge for it? But water is like any other resource, whether it’s energy or food. If you don’t charge for it, it’s wasted. It’s used totally inefficiently. So should there be appropriate water-pricing policies in countries where religions say it’s a God-given gift? We also have inappropriate subsidies that lead to wastage that leads to climate change. There are agricultural subsidies on fertilizer that encourage people to use it excessively. It leads to greenhouse gas emissions, which leads to more flooding. And of course, we need to increase our infrastructure design so that when we do have the massive floods, we can be more resilient to them.

The near term target is that we need to reduce emissions; it’s called the Kyoto Target. But the longer-term target is to stabilize atmospheric concentrations of greenhouse gases at a level that doesn’t harm the climate system. This would mean that all regions, read all countries, would have to deviate from their business as usual within a few decades.

Drew Christiansen, S.J., is a senior fellow at Woodstock where he directs the International Visiting Fellows program. He is the former director of the Office of International Justice and Peace at the U.S. Catholic Conference, where he also acted as policy advisor for the Middle East and supervised the bishops’ environmental statement. He is co-editor of three books on moral theology including “And God Saw That It Was Good”: Catholic Theology and the Environment (NCCB, 1996). He recently contributed to a forum of the Pew Center on Global Climate Change.

As I look around this room, I see some in the audience who may remember Al Fritsch, a Kentucky-bred, Chicago Province Jesuit who a quarter century ago was one of the co-founders of the Center for Science in the Public Interest. A few years later, while on leave from the Center for Science, Al went on to found Appalachia Science in the Public Interest. A Ph.D. chemist, Al gave me my first opportunities to engage in science policy and to do science ethics. In the early 1980s he put together a marvelous program called the Appalachia Technical Assistance Project, bringing scientists and local people together to address problems of environment and justice facing people up and down the Appalachian Mountains.

One group, the West Virginia Mountain Stream Monitors, won awards from chemical companies for educating people in stream chemistry so they could monitor the effluent from their area’s coal mines and coal tailings. Another, the Mountain Women’s Exchange, worked a social revolution when it began teaching women simple ways to insulate their mountain cabins, resulting in a short time in a woman-run home improvement cooperative. Twenty years ago in Appalachia, that was a revolution, women doing carpentry, electrical and plumbing work.

By dint of circumstances I became a kind of guarantor of the Technical Assistance Project for the National Science Foundation. When the program was coming to an end, Al asked me to do a paper for the closing conference on land use. Naively I asked Al, “Tell me what is the most challenging problem you have to address.” He responded without hesitation, “Eminent domain.” It seems that in the mountain states, in Appalachia and the Rockies, railroads and utilities have the power of eminent domain, including the sovereign immunities ordinarily held by states. In effect, it means corporations can take land from people without making them whole again, as the common law once required, by compensation.

In Kentucky at that time, energy companies were buying up farmland on the cheap for the coal shale that lay under it, and threatening to take it by eminent domain if the owners did not take their offers. In Virginia, a power consortium was threatening to take farmland near a southwestern Virginia hamlet called Brumley Gap by eminent domain to build a pump-storage plant to provide power for the Midwest. The corporation chose to build the pump-storage plant because at that time the tax code permitted them maximum profits for building the most expensive kind of plant available. The residents of Brumley Gap, however, decided to fight the power company and, if necessary, to do civil disobedience to keep their land. They were fair-minded. If the utility could demonstrate the pump-storage plant was truly needed for the greater good, they would sell. If not, they would take their stand. Their motto was, “Not by a Dam Site.”

I did my research on eminent domain and discovered that only a state constitutional convention could rework the rights of utilities to eminent domain. So, following the conference, Dick Cartwright, an Episcopal priest and environmentalist, began a constitutional campaign to take back the power of eminent domain from corporations in Virginia. The residents of Brumley Gap did their civil disobedience. In one incident they prayed before the Federal Energy Regulatory Commission (“FERC”) offices here in Washington where they were joined one day by a new commissioner. They won the first ever delay in the award of a power plant license from FERC. (Aside: Perhaps Californians could use some prayer on the steps of the Commission in their effort to reclaim overcharges for power this last year.)

Lessons from the field. My time with Al Fritsch taught me many lessons about science ethics and public policy-making. The first is that the appeal to free markets is a shibboleth. There are only differently structured and differently governed markets. In the mountain states, eminent domain gives utilities an unrestrained hand in dealing with local citizens. Today, as in years past, FERC works almost always in favor of industry. Remember, the plant at Brumley Gap was the first ever in which the Commission delayed issuing a license. A few days ago the economist Paul Krugman wrote that the Commission allowed repayment of only three percent of the overcharges made by suppliers for power to California. When we hear about the marketplace in energy, we have to ask how that marketplace is shaped, by whom, and in whose interest.

The second lesson I learned from my work with Al Fritsch is that no one solution, no one policy array, is the morally required one. There are always a variety of possible, morally satisfactory solutions. It is a mistake to believe that my solution, my administration’s solution, my organization’s proposal, is the only moral one. There are many ways to peel an orange. It does not mean that some options should not be excluded on moral grounds. It does not mean that among a spread of policies some are morally-speaking more satisfactory. It means that I, or my party, shouldn’t claim the high moral ground exclusively for our proposals.

A third lesson is that some constraints established by public policy and favored by public opinion can be changed in light of emerging problems. In other words, we can’t realize all our preferences all the time. For example, the United States is almost unique in its attachment to wilderness. I believe wilderness protection has been needed. Preservation as well as conservation ought to be a national priority. Still, a case can be made that for much of the world wilderness is an amenity, not a necessity. And, for ourselves we must at least ask whether another increment of preservation is not a necessity but a preference. We must acknowledge, too, that there is kind of preservation-creep that would make the larger part of federally managed lands immune from any interference.

I am not arguing against preservation. I am simply noting that if we put too many unqualified constraints on resources – opposing nuclear power, maximizing wilderness protection, eliminating hydropower, favoring NIMBY (“not in my back yard”) zoning policies – then we hasten a crisis, whether in terms of wholly unacceptable price rises or even collapses in energy availability. Intelligent, responsible policy-making demands that we identify the margin where we are willing to compromise our preferences in the interest of more exigent values. On the business side, the preference for hyper-growth seems to be unrealistic, as is the American tradition of a lifestyle built on the private automobile. In each area, new balances need to be struck.

Finally, a lesson I began to learn in the years I worked with Al, but which has become clearer with time: there are some choices we can try to evade but only at our own peril. In the United States, chief among these is making aggressive, direct cuts in carbon emissions. Global warming and climate change are so complicated, the development of the problem over time so complex and long-lasting, and the U.S. role in creating the problem so enormous, that there will be no quick fixes.

Rich and poor on a warming planet. The context in which we must address climate change is, of course, a global one. But not everyone is equally situated with respect to the problem. Some have done more to create global warming; some will be impacted more by climate change. Some have benefitted from fossil fuel economies; others are only beginning to do so. Finding a solution requires cooperation from all, especially between the First World countries and developing world giants like China and India. The Kyoto Protocol was to have been the basis for such a global compact, but the present U.S. administration seems to have walked away from it because it regards the exemption of developing countries from first-round reductions as “unfair.”

I can’t construct an argument for global justice or equity in the time we have. But simply consider the obvious facts: Who has gained by use of fossil fuels? Who is the greatest polluter of greenhouse gases? Who has failed to make real reductions in emissions? The United States, of course. Who is most likely to be impacted by adverse climate developments due to global warming? Who has contributed least to the current problem? Vulnerable developing countries, especially in the tropics. Now, under such conditions, are staged reductions and differential obligations unreasonable? I think not.

“Fairness” demands the United States pay its own freight. Or, as I put it in a talk last week, “Adults take out their own garbage.” But our obligations to the developing world go deeper than that. Allow me to summarize. First, as I have said, exemption from stage one reductions is accept-able because of the relatively low level of greenhouse gases for which the Third World and especially “the giants” are responsible to date. Second, attention needs to be given, up front, to the negative impact of climate change on island states, coastal countries like Bangladesh, and to tropical regions in general because they will bear the greatest disruption from climatic change. Third, long-term, sustainable development, consistent with reducing and eventually reversing global warming, will require pursuing an alternate technology path for poor-country development to which the wealthy nations can contribute through cooper-ation in technological innovation and technology transfer.

Sacrifice. Talk of sacrifice is notoriously unfashionable. By some accounts, Jimmy Carter lost the presidency two decades ago for endorsing such an idea to the American people. Responsible adjustment to a global climate regime can take place in many ways: by technological innovation, by regulation, through taxation and other forms of public policy as well as through collective restraint. All the same, attention must be given to dealing with the very real sacrifices that will need to be made when gaming and gimmicks prove insufficient. However clever the market mechanisms, however ingenious the technological innovations, hard decisions on reducing emissions will prove inescapable. Some real sacrifice of lifestyles and technological preferences will be in order. The emblematic lifestyle shift is a move away from the SUV, but more substantial changes may lie ahead in diminishment of the automobile economy and limits on sprawl. And if such decisions are not taken now, still more difficult cuts will await us in the future. If “sacrifice” sounds unappealing, just think of it as “internalizing cost.”

Concluding remarks. Before concluding, I need to finish the story of the dam at Brumley Gap. The delay in licensing created incentives for the power company to back off its proposal, and, in the end, tax reform made the pump-storage plant a less inviting option for the utility. It was never built. The residents of Brumley Gap, as far as I know, returned to farming and the quiet life.

For a while Dick Cartwright went about his campaign for a constitutional amendment in Virginia to take the right of eminent domain from utilities, but had to give it up to save the family business that permitted his citizen action work. Al Fritsch still works with Appalachia Science in the Public Interest.

A POLICY PATH TO CLEANER AND MORE EQUITABLE ENERGIES

Kathleen A. McGinty serves as senior policy advisor to the Democratic National Committee and as counselor to former Vice President Al Gore. She is the former chair of the White House Council on Environmental Quality. In 1999, she was a senior visiting fellow of the Tata Energy Research Institute in New Delhi, India. There, she worked to build partnerships among business and government leaders in the United States and India to address priority energy and environmental matters, including global climate change and transportation-related pollution.

First, I absolutely agree with Drew’s point about not presuming our course of action to be morally superior. But I also feel strongly that our orientation in decision-making is essential in that moral action will only follow if we start from what I call a “preferable position” from an equitable point of view. And that is, when we are in a situation where essential values are at stake, it seems to me at the very least a failure of leadership and, I would argue, an ethically suspect course of action, to pursue actions that foist upon people a false choice. “You will either have environmental integrity or you will have economic well-being brought to you through robust, available, and affordable energy supplies.” In this instance of energy and the environment, that’s not a real or essential choice. But there are vested interests that would have us believe that there is an inherent conflict between these essential values.

In the Clinton/Gore years, we succeeded in preserving and protecting more land than any administration since that of Teddy Roosevelt. At the same time, we developed resources. For example, gas and oil production, on shore and off, rose significantly (between 60 and 80 percent). So we need to respect and value our need for a clean and healthy environment while pursuing policies that satisfy our energy needs. That can be done without the kinds of painful tradeoffs that we often are subjected to.

I would argue further that even if we were willing fully to sacrifice our environment, we could not achieve energy security. To take one small example, the current administration has proposed the opening of the Arctic National Wildlife Refuge – and now some of our new national monuments – to oil and gas drilling, and in particular to oil development. Is that the solution to the California energy problem? Absolutely not. We could sacrifice all the Arctic National Wildlife Refuges for all time to come. But California’s energy situation is not one that is derived from or caused by a shortage of oil supply.

So if that is not the route to energy security, what is? Look at our current situation. Fully 80 percent of our electricity comes from fossil fuels and nearly 100 percent of our transportation energy needs comes from fossil fuels. In that situation, can the increase of fossil fuels help us achieve security? It can’t. As too many of us are already learning from our investments in the stock market these days, to increase your security, you need to diversify your portfolio. Further investment in fossil fuel supplies will do nothing to diversify the portfolio we have in our hand. The only way is to take the environmentally sound path leading to cleaner energies than fossil fuel supplies.

What are the domestic equities involved in this situation? The first is the regressivity of energy prices. It is the low-income family that most feels the pinch in their vulnerability to disruptions in fossil fuels, electricity, or transportation fuel. Given the essential nature of energy, an ethical course of action would have to be premised on reducing that regressivity and the cost of this essential commodity to the poor among us. How can we reduce it? One potential path is not necessarily to increase the supply but to decrease demand and the need for energy. At least three kinds of actions come to mind. The first includes interventions like weatherization that improve or reduce the amounts of energy we use per current unit of activity – increase insulation in our home, for example. The second two kinds of activities are tougher politically: to insist on enhanced efficiency, and to move aggressively towards renewable or cleaner sources of energy.

From an international view, I want to share an experience I had while living in India for a year. I had seen figures that coal in India and in China is much dirtier than the United States. I understood there would be a pollution problem. What I didn’t understand is that this translates into huge and severe displacement of people. Why? Right now in many parts of India, the ash content of their coal makes up most of the resource itself. Well, what happens to all that ash when you dig it out of the ground? You can’t burn it; it’s not part of the energy-generating stuff. What happens is that mountains and mountains of this ash accumulate in a country with more than a billion people. The only place you can put it is someplace where somebody used to live. And when you put it there, the metals and toxic contents in that ash are so high that the water resources are destroyed and agriculture is adversely affected. That’s a part of the equation, the human refugee part of the equation. This and other examples point away from a 100-percent, fossil-fuel-dependent, centralized energy system towards cleaner, more dispersed, and distributed energy systems appropriate to the resources and contexts, both domestically and abroad.

In closing, just to show that I did follow my studies at St. Joseph’s University, a Jesuit college, I remember a Catholic social principle called “subsidiarity.” It’s about trying to handle issues, decision-making and problem-solving, as close to the issue and the problem as possible, instead of at ever elevated levels. And that’s relevant to decentralized energy sources. Rather than the one central command and control, fossil-fuel-dependent system, the subsidiarity principle tells us we should have local, flexible, distributed, and clean energy as chosen by local people.

Father Connor. And in order for local people to make informed and responsible decisions, they will need not just to understand the facts, but to recognize the social and moral elements that shape their perspective. Each one of us in this auditorium consumes energy, and shares in a single economy and environment. So gaining such an awareness is a challenge that each of us needs to face. And hopefully – thanks to our panelists’ thoughtful remarks – we have all made a step in the right direction here this evening!