KEY POINTS:
The weather has become more extreme in recent years, fuelling the notion that pollution affects our planet. Now, almost 40 years after Woodstock, most of us feel that the hippies were right after all. "Sustainability" is the new buzzword.
The New Zealand Institute - an independent organisation funded privately with mostly business people as members - suggests that New Zealand should not move too fast when it comes to sustainability and that we may postpone our Kyoto goals as nobody else in the world complies.
The argument in their report entitled "We're right behind you" is straightforward. Early adopters generally pay a higher price for technology that will become cheaper in the long run. Acting first will increase short-term relative costs and reduces international competitive strength. Many economists feel this leads to the mother of all economic crimes: lower OECD rankings. Better to wait until the bigger fools start moving first.
Therefore our role as a small polluter can be the cheaper option: "follow the leaders". Every now and then we can shout: "No worries, bigger fools, we are right behind you!" and at the end of the day we will be all right. Good on the NZ Institute to address this issue, but reading the report an Oscar Wilde quote comes to mind: "A cynic knows the price of everything but the value of nothing." Economists can be quite cynical, apparently.
International competition and OECD rankings were no major concern to hippies. Their terminology would be something like a "better world". These sustainability gurus of the past would therefore have felt closer to a newer approach to international development as put forward by the United Nations in 2000.
In the Millenium Development Declaration the United Nations provides international goals for a better shared future. To be precise: goal number 7 is to ensure environmental sustainability.
It is surprising how many economists and politicians still focus on international competition and economic growth as the ultimate goals leading to happiness. In some cases, OECD rankings as a measurement of economic performance have become the actual goal.
Unfortunately, these OECD rankings are limited and general measures at best. Once a threshold level of economic development has been reached they say little about our overall well-being. Higher OECD rankings may even lower quality of life, as many Europeans currently experience. This focus leads to a never-ending rat race between nations with no winners. Sometimes it is important to look beyond competition and economics. Particularly when it involves our future. Building a better world requires co-operation between countries, not competition.
The waiting game the NZ Institute suggests may lead to similar results as we often see in a group of people trying to find their way in an unknown city. Most of the time you will ultimately get to your final destination, but hardly ever do you arrive there quickly and in the fastest way possible. This is fine if there is time to spare. But do we want the biggest fools to lead if the stakes are high and time is short?
The NZ Institute suggests we can afford to leave climate change issues up to the big guys like the US, China and Russia. "Yeah, right!"
We are independent, unbiased and far away from the rest of the world, with children and grandchildren for whom we want a future. We are a young nation looking for an identity; we have a very green image and natural greenness is a competitive advantage. This almost begs us to lead when it comes to sustainability or, in broader terms, the Millennium Goals of the United Nations. Yes, we are small polluters (0.15 per cent greenhouse gas emissions only) and we might argue that we do not need to do a thing. Not now. Not ever. But sometimes it may be good to signal to the bigger fools that there is more to life than just OECD rankings and international competition. Leading the way may be a strong and credible signal that helps in making the world "a better place". It may cost a bit in the short term, but it also may be beneficial in the long run. I know, it sounds almost hippy-like. How naive!
* Professor Ben Jacobsen is a Professor of Finance and Head of the Department of Commerce at Massey University.
