When Easter Island Failed: How Cultures Choke on Success

by | Apr 27, 2011

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Putting a price tag on biodiversity and ecosystems, part 1 of 2

The problem with our current free market system is that it does a poor job of putting a value on the benefits we receive from the natural world and incorporating them into the prices we pay for goods and services.

Biodiversity, essential to the health and long-term survival of the natural environments and our own species, is a difficult idea for markets to quantify.

However, other environmental aspects are somewhat more tangible. Pollution, the mineral resources we extract from the Earth, or seemingly free goods like clean air and water, are understood by most people to have value. We are able to state with some certainty that we need a certain amount of clean water or fossil fuels to live a comfortable life. We have some sense of how much timber is cut down to build houses or to construct other marketable products, and we know the levels of pollution that are being released into the environment.

In each of those cases the action taken could have a price tag associated with it (assuming we had the political will to do this). The price would reflect that a certain number of dollars should be placed on those goods to replace what is lost, clean up a spill, or prevent the environmental problem from getting out of hand in the future. That seems reasonable to most people.

With biodiversity however, the direct benefit we humans receive is less tangible and predictable, but no less important. An article written by Jared Diamond on the downfall of Easter Island presents a dramatic example of what the destruction of biodiversity can do to society.

Easter Island was once a highly productive island, rich in plant and animal life, capable at one point of providing for many thousands of people. By the time Europeans arrived, however, the population had collapsed to a fraction of its original size because the inhabitants had overexploited the island’s plant and animal resources. The loss of most animals meant little food, the loss of trees and other plants meant not only less food and fuel but also no means of transportation (http://www.hartford-hwp.com/archives/24/042.html). Granted, Easter Island is a relatively closed system, but so is the entire Earth. If we scale the problems they experienced to the national or global level, we can see that biodiversity is fragile and that without it, humans would face immense hardships since so much of what we get from biodiversity cannot be replaced by technology or building new machines.

Many environmental features are lost because there is no price on their consumption to act as a negative feedback mechanism and ensure their long-term availability. In order to address this, we need first to identify what we get from having biodiversity, and set some sort of control or pricing structure into our actions that decrease biodiversity.

Unfortunately, many of the services resulting from diversity are not known. In a recent European policy report, it was explained that until more thorough scientific study is done, we cannot accurately determine what services we are getting, and how important they are.

What is known, however, is that international ecosystem conservation efforts (which would help preserve biodiversity) are severely under-funded, so much so that it is clear we are not protecting valuable ecological services (http://www.easac.eu/home/reports-and-statements/detail-view/article//ecosystems-s.html ).

While we don’t know every detailed benefit we enjoy from the ecosystem and the associated dollar value, we do know what the major points are. To list just a few, aside from the obvious services of providing clean air and water, we can say that we benefit from:

–       the pollination of many food crops,

–       fertile soil,

–       climate maintenance,

–       pest and disease control,

–       medicines, and

–       the pure aesthetic appreciation that comes from the enjoyment of a broad assortment of species (http://www.ecosystemservicesproject.org/html/publications/docs/Internet_forum_Nature_and_Society.pdf )

While these may be hard to sum up and quantify, what is clear is that we will suffer as biodiversity continues to decline. If we do not place value on those things bulleted above via policy and economics, then we need only to look to Easter Island when the Europeans arrived to glimpse the consequences of negligent policies regarding commodity pricing and the under-valuation of biodiversity.

Chris Watts currently serves as an Environmental Regulation Expert at Actio Corporation in Portsmouth, NH. He is pursuing advanced studies in Environmental Science at Johns Hopkins University, Baltimore, MD.

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