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A Response to McAfee: No, the “Environmental Kuznets Curve” Won’t Save Us

A RESPONSE TO MCAFEE: NO, THE “ENVIRONMENTAL KUZNETS CURVE” WON’T SAVE US

A number of people have asked me to respond to a piece that Andrew McAfee wrote for Wired, promoting his book, which claims that rich countries – and specifically the United States – have accomplished the miracle of “green growth” and “dematerialization”, absolutely decoupling GDP from resource use. I had critiqued the book’s central claims here and here, pointing out that the data he relies on is not in fact suitable for the purposes to which he puts it.

In short, McAfee uses data on domestic material consumption (DMC), which tallies up the resources that a nation extracts and consumes each year. But this metric ignores a crucial piece of the puzzle. While it includes the imported goods a country consumes, it does not include the resources involved in extracting, producing, and transporting those goods. Because the United States and other rich countries have come to rely so heavily on production that happens in other countries, that side of resource use has been conveniently shifted off their books.

In other words, what looks like “green growth” is really just an artifact of globalization. Given how much the U.S. economy relies on globalization, McAfee’s data cannot be legitimately compared to U.S. GDP, and cannot be used to make claims about dematerialization. If McAfee wants to compare GDP to domestic resource consumption, then he needs to first subtract the share of US GDP that is derived from production that happens elsewhere. He does not. Nor is this possible to do.

Ecological economists have been aware of this problem for a long time. To correct for it, they use a more holistic metric called “raw material consumption,” or Material Footprint, which fully accounts for materials embodied in trade.

…click on the above link to read the rest of the article…

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