Sometimes the truest stuff is fiction …

[origionally posted as class assignment]
Response to “A Roadmap to Natural Capitalism”; What are natural capital and eco-system services, and why are they important for both business and the planet?

Natural capital is a way to express the productive value of ecosystem services, much like financial capital expresses the productive value of monetary assets. Ecosystem services are the basic biological functions that supply resources in the form of materials and energy, and provide a sink for wastes of various kinds.

Like financial capital, natural capital can be spent, conserved, or accumulated. Consider a five acre farm field, growing vegetables. We can view the ability of the land to support the crops as the natural capital inherent in the land, much as we view the ability of a tractor to support the farming operations as a form of fiscal capital. The productive ability of the field depends on both inputs.

Now, when we eat a carrot, are we extracting capital? Perhaps. We can farm in such a way that next year the field will not produce as many carrots. If we don’t replenish the soil with organic material, it will be a tad bit more tired. If we don’t rotate crops, the pests, accustomed to the same crops in the same places, will be a bit more bothersome. In this case, yes, that carrot represents a bit of spent natural capital.

On the other hand, we can farm in such a way as to leave the soil as productive next year as it was this year. We apply compost, we treat the soil with care as we plant and plow. Crops are rotated, and some land is always under cover. In this case, the carrot does not represent capital expenditures. It represents the use of the productive power of the natural capital.

How does the concept of ecosystem services tie in? Think of it this way. The land, the soil is not a thing - not simply a pile of dirt, or a place to walk – but a system. The soil is a complex system that cycles nutrients, manages moisture and water flow, builds up and builds up and breaks down stocks of organic and inorganic materials, and hosts whole communities of living organisms that both use and facilitate these processes. Any combination of these processes can be tapped into to do something useful for us.

We generally aren’t too specific or clear in our thinking about these services. We say we use the soil to “grow things”, and, unless we are a farmer, don’t think of which of the suite of the services provided by the soil-as-system we are making use of.
Natural capital then, is the productive capacity of ecosystem services. This is essential – capital is not inherent in the thing, but in the usable excess productive capacity generated by the system. This is perhaps counterintuitive, but, it is true of financial capital as well. The capital value of dollars in the bank is nil. The value of these dollars is in their power to increase productive capacity through the purchase of equipment that increases production efficiency.

The notion of natural capital is essential to a sustainable business model as the concept of natural capital changes the costs associated with natural resource use from production costs to capital costs.

Any business is loath to spend capital – it is suicide. This is especially clear when we view capital not as a thing, but as productive capacity. Give away enough productive capacity and you are done. So, a tight lid is kept on capital expenditures, and capital is always expended with an eye towards increasing productivity enough to recoup the capital, with some extra in the form of profit.

So, by putting casting resource costs as capital costs, the idea of natural capital brings the power of business to bear on the issues involved in preserving ecosystem services. This is essential to business, in that it prevents them from consuming their resource base. It is essential to the planet for the very same reasons.

Ridge Protectors, a citizens group opposed to a wind farm to be sited in Vermont’s North East Kingdom have filed an appeal to the Vermont Supreme Court to have the certificate of public good for the project invalidated.

The appeal contends that, among other things, the Public Service board found that UPC, the company developing the project, had failed to negotiate stably priced power contracts with Vermont utilities, and that, in the absence of these contracts, the project would not “provide and economic benefit to Vermonters sufficient to offset the project’s significant environmental impacts”.

The economic issue is one that is at the heart of the matter. One of the big selling points for the project, on the Massachusetts based UPC Wind’s Web site for the project is cheap local power. From the “power” tab, we are given a list of towns near Sheffield that “have shown strong interest in purchasing energy generated at the Sheffield project”. Another tab, under economic benefits states “Energy for Vermont utilities at competitive market rates”.

This is a bit disengenuous. As noted in the testimony before the public service board, and echoed in the final order itself:

“Unfortunately, the pricing terms of the Vermont Utilities power purchases do not capture one of the major economic advantages of renewable energy: the free, and thus stable, cost of the fuel. Instead the power contracts between UPC and Vermont utilities are largely indexed to regional power market prices, which are both highly volitile and expected to increase over time”.

Score a point for Ridge Protectors.

The Public Service Board does go on to address this in condition number three of the certificate of public good, which states that UPC shall “make all reasonable efforts to enter into diverse, long term, stably priced power contracts with Vermont Utilities”.

The ball bounces back across the court.

These contracts are to be produced prior to the commencement of construction. Has construction started without these contracts in place? If so, the Ridge Protectors appeal would seem like a sure win.

In either case, it seems that not only does the generation technology need to be developed to take advantage of clean power sources, the contracting and pricing mechanisms need development as well.

I was online checking my email and I noticed that CNN had called the winner in the Republican Caucuses in Nevada. I was a little surprised, as it was only 1:30 here on the east coast, and I wasn’t sure they’d even started, let alone finished.

Turns out CNN is calling this with 0% of the precincts reporting. They are calling it based solely on polling data.

I guess we no longer have to vote.

We ought all stay home, near the television, so we can answer the phone if a pollster calls, and to be sure to be watching as CNN tells us what our future is to be.

So, I am enrolled in the MBA program at Marlboro Graduate College - Managing for Sustainability. Studying Sustainable Business Practices. A two year program teaching the standard MBA nuts-and-bolts, but built from the ground up with Sustaiability in mind.

What is Sustainability? It means a lot of things to a lot of people. It can mean waste equals food design practices, or it can mean adding Social Responsibility to the mission statement - and then backing up the words with action. It can mean a Triple Bottom Line or Four Capital Accounting. It can mean buying fair trade coffee, a local carrot, or a Prius - or figuring out how to walk there.

It is a broad subject, and over the next two years I hope to be writing here quite a bit about it. I have started a new set of essays over in the sidebar, may add lists of books. Take a look, join the discussion - here or elsewhere.

[origionally posted at BlueHampshire]

Watching the debates with my New Hampshire host family, John Edwards really impressed us. He is passionate, he cares, and he has identified the problem — the corporate interests in Washington pushing their own interests at great cost to the public good. Edwards is a fighter, and it is clear he is going to go after them.

It is also clear that Obama has identified this as a root issue as well, and has been working to address it with his work in ethics reform. And, like Edwards, he is not taking dollars from the corporate interests, so he will not be beholden to them.

So what can I say to an Edwards supporter? On this issue we are very closely aligned.

Last night it became clear that the answer is in Obama’s deeper analysis of the situation. It is clear he is an architect, as well as a fighter. His roots in community organizing lead him to an analysis of the situation in terms of power. Where are we going to get the power to fight these interests that “have a strangle hold on Washington?”

We are going to get this power from organizing the American People. Obama is clear on this - he cannot do this without us. In fact, in his speeches he is repeatedly asking for us go get involved, to take back the government of this country. He is willing to build a coalition with republicans - not pander to republican leaders, but find republican voters who are disenchanted, for whom the neo-con promise has not come true.

This, I believe, is a critical difference. While Edwards has identified the problem, and is clearly a bulldog who will chew on the leg of corporate interests, his experience as a trial lawyer slots him into an “us-and-them” mentality. He will label them as bad guys and go after them. And, he will likely win a few.

Obama is seeking rather, to dismantle the structure that allows corporate interests to thrive. He is seeking to change the rules of the game, and he recognizes that in order to do this, he needs to build a broad power base. A power base rooted not in the politics of Washington, but in the ultimate source of political power in this country - the American People.

[origionally posted at VermontersforObama]

There is a lot being said about the health care plans proposed by Clinton and Obama - very strong language, with Clinton calling for the removal of Obama’s ads as his health care plan is not “Universal”.

But, let us look at the plans. Both are motivated by the desire to provide health care to all Americans in need. And, for better or worse, we do that in this country by providing insurance (though we must point out that there are some essential differences between health care and health insurance).

So, both plans seek to make insurance affordable to all. The difference, it would seem, focuses on a single point - The Clinton plan would Mandate that all had to buy insurance, whereas the Obama plan would Mandate insurance only for children.

Let us be clear. This from a very detailed analysis of the plans at slate.com, a good read

“Obama’s plan creates various mechanisms to make both private and public health insurance more readily available. Hillary’s plan does the same, but also creates an “individual mandate” requiring every American to buy health insurance.”

So, according to Clinton, what makes the plan “Universal” is that the government will be telling adults that they must purchase health insurance. That is what a “mandate” is, the government telling you what to do - not necessiarly providing the means, as we have found out so painfully through the unfunded mandates of the No Child Left Behind education legislation.

Let us leave aside for a moment the constitutionality of the notion that the Federal governement can compel it’s citizens to purchase something. There are, after all, some rough analogies with auto insurance.

So, I think this is, practically speaking, a small difference, given the amount of noise it has been generating.

Should either candidate’s plan succeed in making decent health insurance within the reach of all, making it truly affordable, this will be a great accomplishment, and almost all will take advantage of it. Close enough to universal either way.

But to me the difference speaks much more about the different views the candidates have regarding the American people, the take they have on the character of the citizens that they are running to serve, than it does about the details of policy.

I would think that the problem is not the lack of desire for health insurance. Most people I talk to want health insurance and they want it to be affordable. They are not looking for a reminder that this is what they ought to do, but some help on getting it done.

And a plan that focuses on the reminder as the key ingredient for universal health care misses the boat on the kind of people we are, and the kind of help we are asking for.

This difference runs deeper than the health care plan. Listing to Obama, the focus is on providing people with the tools they need to care for themselves. Providing people with the help they asked for - in this case affordable health insurance - so that those that asked for the help can take it. And, for those that that didn’t ask, or can’t or won’t pick up the tools … well, they don’t have to.

This approach respects individual circumstances, and is grounded in the faith that people can, given the opportunities, care for themselves and each other. This rings true for me. This reflects the people I know, the folks I see working together to help each other and keep the community strong - regardless of political persuasion.

So back to the heat the Clinton campaign is generating over “Universal”. Not many would turn down affordable insurance, regardless of the presence of a mandate. Truly affordable insurance would effectively be universal. So it seems to me that the fight that Clinton is waging is for the exclusive right to the term “Universal”, It is not so much a debate about policy as much as staking out a claim to a powerful buzz word, much as big corporations seek to protect their trademarks.

Universal plans have come and gone in Washington since the days of Harry Truman. The one thing we need is someone to get everyone — Republicans, Democrats, health insurance companies, doctors, nurses — to the table like Barack did when he fought for health insurance for 150,000 more in IL. All the candidates have good policies — Barack can get it done.