Selling Nature by the Dollar - Webinar 2 summary:
The second session was dedicated to the environmental issue. Using the analogy of space launches, the first stage of the attack concerned more directly the agricultural producers (webinar 1), almost disappeared from the face of the earth, turning them into "mass workers" (in the sense that historically Tronti and Negri have given them talking about the industrial sector) leaving few niches of peasants who still resist but do not affect the world dynamics. But it will be on these niches that we will lean in the final conclusions...
The second stage is the environmental one, and even this time the origins date back to the end of World War II, when the profit rate began to fall, thus forcing capital holders (for the moment still physical capital) to look for new ways to make profits, the real key to analyze and understand what is happening in the world.
So here we are in 1971 and the turning point impressed by the Americans. The Nixon administration is put under pressure and decides to announce the end of the system called "Gold Standard", the parity between gold and dollar (and associated currencies). From that moment on, every currency will have to sail on the open sea without defenses other than those of the strength of the country represented. Needless to say, the dollar, the currency of the economically dominant country, as well as reserve currency for international trade and printed at will by the American Federal Bank, would have had a considerable advantage over all the others.
This decision opened up the front for monetary speculation, which would bring considerable profits. In addition, the following year (1972), a new market was opened on the Chicago Stock Exchange, that of "futures" (modern derivatives), which allowed speculation not only on currencies but also on commodities.
The following year, 1973, the main Arab oil-producing countries decided to break the bond of submission that bound them to the American "seven sisters" in the oil sector, used to force oil-producers to accept very low prices for black gold. What was defined as the first oil "shock" was actually a fair realignment of prices, which the Western narrative obviously presented as a sign of Arab greed. A massive transfer of capital was therefore made in favor of the Arabs, but they had no clear strategies on what to do with this mountain of money.
As already mentioned in the previous session, it was during this period that the debt industry was invented. With the support of the large financial institutions, the countries of the South were forced to accept proposals for mega-projects that would be financed with this capital. Written quickly and badly, almost none of these projects were successful for the local populations and the results were: a rampant corruption among the rulers and enormous debts for the countries. This would have been the fundamental justification for the subsequent structural adjustment programmes (SAP) we talked about earlier.
However, this new world in preparation, based on the "free" market for speculation, needed strong political cover and this came in 1980. Carter's Democratic America was swept away by Reagan populism, while Margaret Thatcher took the place of the labourists at the head of England. Thus began the neoliberal domination, whose preparation had begun years earlier in American university and political circles (just think of the policy imposed by the Chicago boys on Pinochet's Chile after the 1973 coup d'état). It was a mix of individualism and the absence of rules, where government and public policies were seen as part of the problems and never as solutions. One recalls the celebrated phrase attributed to M. Thatcher that "there is no society, only individuals".
From then on, pervasively and occupying all areas of daily life, from economics to culture, education and health, the new creed would begin its long and still unfinished journey.
As far as environmental issues were concerned, the change was generated primarily in the USA: thousands of employees of the Environmental Protection Agency (EPA) were laid off and a number of environmental protection laws were repealed. Reagan's successor, Bush Sr., who had been his vice-president, continued along this path and during his term of office the famous "No Net Loss Policy" and the creation of the first Wetlands Mitigation Bank were approved. In this way an operator (financial, industrial) who wanted to "develop" a wetland (i.e. a particular and fragile ecosystem), had to buy "compensation" shares from these WMB to obtain government permits. The money collected in this way would have been used to protect endangered species (we will come back to this later).
The successive democratic administrations maintained this policy, and it should also be remembered that it was during the first Clinton presidency that the Kyoto agreement was signed, which brought the logic of environmental compensation to the whole world. Being able to speculate and/or destroy natural resources in the South of the world thus became a policy approved by the United Nations, in exchange for "compensation" to be acquired in the North. After Clinton came Bush Jr. who expanded these policies to cover other areas (Clean Air Act and Clean Water Act). The reduction in EPA staff continued, and new permits to drill in Alaska (other protected areas) were given to oil tankers (of which the Bush family was part).
In the meantime, the Soviet Union had disappeared, replaced by a weak and submissive Russia subjected to the raids of financial bandits of all kinds, thus leaving the field open to the only remaining power, the American power and its New Economic Order.
The new millennium arrived quickly: for many the starting date was September 11, 2001, with the fall of the Twin Towers in New York. I think it would be interesting to consider 2005, when Hurricane Katrina hit the city of New Orleans: the damage was enormous, highlighting the bad territorial defense policies carried out by the city administrations, all to the disadvantage of poor (black) citizens. The estimated insured damage was $75 billion, but if they included uninsured assets, the figure doubled: $150 billion, a stellar figure that no public administration could ever put together. The world of insurance and finance sensed that this was the opening for new and fruitful speculation.
New, increasingly complex financial instruments (options, swaps, CDS and Catastrophe Bonds, to name but a few categories) became common currency. Fundraising increased exponentially, thanks to promises of very advantageous interest rates, although the risks incurred were very large and above all very difficult to assess, even for the same institutions that issued them. The placement of these huge amounts of capital was not difficult since, as imposed by neoliberal theories, governments had to lower taxes to favour economically productive sectors and attract foreign investment. This meant that the debts of countries (even those of the North, as shown in the graph below for Italy) increased rapidly and steadily and that governments - whatever the political color - no longer had the resources for the policies they wanted to implement. Hence the need to go to the financial market to finance themselves.
As we can see from the figure below, the world economy accelerated its movement towards the financial world. More and more resources were diverted from the real economy to enter the world of highly volatile and precarious financial speculation. Capitals in search of immediate profit, at the expense of any qualms, moral, ethical, environmental or other.
In order for this "New Economic Order" to work at its best, it was also necessary to upgrade to a higher scale of the playing field. Just as the creation of the Nation-State at the end of the 19th century had been functional to the new mercantile economic system that was being prepared (homogeneous and larger market spaces than the limited regional or sub-regional markets that existed at the time), it now became necessary to further increase these homogeneous spaces beyond the narrow national dimensions. Here then was the great work to create supra-national entities (such as the European Union) or economic treaties that linked entire regions of the world (such as Nafta, Mercosur, ...). The dominant economic system (which had already subjected the social construction of the Nation-State to its needs) by now went beyond the national restrictions: we are beginning to talk about globalization, that is, the replacement of the national-state dimension with superior entities which all suffer from the same structural problem: lack of participation and submission of individuals and social groups to the dominant economic (and financial) power. The same process will be carried out with the previous political classes, which are gradually being replaced by new elites (formed in the new neoliberal creed), up to the entities without body or soul which no longer respond to democratic institutions but become self-referential (like the GAFA) and can afford to impose their policies on the various subjugated governments.
It is this mix of liberal orientation, with players of immense power, without controls and with the sole objective of making money and now, that leads to the crisis of 2007-2008. In the midst of this speculative Far-West, natural resources became an even greedier opportunity to do business. This is when, in 2005, the new religion of Ecosystem Services was launched. The group of experts in the Millennium Ecosystem Assessment, published that year, would have taken care of it. The basic logic was always the same, namely to make it possible to speculate (i.e. make money) on these limited resources: Nature must be managed through Ecosystem Services. So, first the problem is created, that is speculating and destroying natural resources, land, water, forests, and then medicine is invented to this evil: natural resources are not defended because people have no idea of their value (i.e. of their price), this will be the line followed since then until today, by the convinced neoliberals and naive experts who put their signature on policies whose result was evident from the beginning. Private capital needed new areas in which to invest to make money in the short term. To believe that environmental protection was a serious concern is to believe in fairy tales or, as often happens, to be conniving.
And in fact, in parallel with the development of this new religion, which will find subsidies for all those university, political and cultural centres that support it, and which still enjoys the support of many governments and United Nations agencies, we see a drift towards new levels of corruption at the level of the government institutions of the countries concerned. The cuts in education, imposed by the SAPs in the 1980s, are having the desired effect: a new class of unprepared, semi-illiterate officials are taking the reins of local government, while at the centre a few specialists, trained in the universities of the neoliberal creed of the North, ensure that the desired recipes are carried out. At the highest levels of politics, bribes serve to oil the system.
The intellectual battle, which is played out in universities and United Nations agencies, and which normal people have not understood, concerns the semantic change from the concept of "biodiversity" to that of "ecosystem service". While the basic concept of biodiversity was respect for life in all its diversity, with the new lexicon a small, but fundamental, change is introduced: respect for life according to its usefulness for the human being. In concrete terms this means moving from a logic of management as a common good to one that is the monetarisation of Nature.
Here then the real concept becomes evident: the "ecosystem services" that interest us are those that serve us humans, and to these we must give a price: the new publicity will begin to invade us with this new terminology: Payment for Ecosystem Services. Remembering that price is a relationship of exchange between two goods, we introduce the market as a premise to save nature; that same asymmetrical market where the powerful command and the weak obey. Nature, having no rights and no legal representative to defend it, becomes therefore the weakest among the weak. Here then opens up a world to the most unbridled speculation.
A basic philosophical element of the vision based on biodiversity was the necessary humility that we humans must have with respect to the complexity of ecosystems that existed before, during and after the arrival of the human race on this Earth. Too complex to understand everything in every detail; a vision that obviously does not appeal to the financial neoliberal world that now lives only on mathematics and algorithms. As a result, Nature is broken down and, within an ecosystem, the role of a single plant or animal is simulated to understand how important they are. By confusing reality and fantasy, the new compensation banks (created at the time of Bush Sr.) now become Species Banks. Those who want to do business in fragile ecosystems, mining or other, just have to go to these banks and buy shares dedicated to certain plants or animals, with which to "compensate" the negative effects of their work elsewhere. These funds will then be invested to protect element X of a real ecosystem, without knowing what will happen in real life and not in the model. But in this way the higher philosophical goal has been achieved: not only to make money, and immediately, but to declare the superiority of the human being over Nature.
We, the last species to have appeared on Earth, stand "dominus" of everything, in the name of the God Market and his son Profit.
The philosophy of Laudato Sì could not be further from this principle. By preaching the humility of man and the search for balance with natural resources, those who fight in his name immediately become an enemy to be destroyed, and it is good that you young people are aware of this.
The next evolution could be the emission of what I call the Indio-Bonds: in the name of the protection of forests and their function as CO2 absorbers (whose market has been created, even if it still works badly), the local indigenous peoples are removed, to prevent them from creating "negative externalities", thus leaving the forest area (whose CO2 rights have already been sold to the market) under the protection of armed guards who prevent the entry of those who have always lived there. At this point the indigenous population finds itself in danger, forced as it is in smaller areas and without the biodiversity to which they were accustomed. The solution becomes that of preparing a financial product (a derivative or other) to "save" these Indians. Here then the investor can buy shares on the CO2 market (to save the world, even if it destroys the habitat of local populations) and then also buy Indio-Bond to save those same populations that he also contributed to endanger. With all these "positive" actions he can compensate for any other destruction he wants to do in the South or North of the world.
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