debunking (current) economic practice
Would you attempt attempt a trip to town in a car with a leaking tire? You may, may not. That's called risk management. Risk is not something to play with when dealing with one's future yet strangely at the highest level - survival of our species, we've been disregarding all those warning signs saying 'bro you can't make it to town'. Go figure. The reason for this - let's call it anomaly, has everything to do with the model of economics we modernistas are holding on to.
Economic practice, as opposed to theory, dictates we optimize gain in the short term, devil take the hindmost. Selfish behaviour true, but again merely a trademark of the species. Something must be done about the monetary paradigm. What is wrong with it may be easy enough to understand yet its not a simple thing to change. One approach is to elevate within the big narrative. We've let the chase for more money run wild for too long.
Take the creation of wealth by mining. Mining has provided some of the biggest fortunes in the world, most of the 'real' wealth on the planet is pegged to stuff that somebody took out of the ground somewhere, sometime. Mining arguably has and still provides the core commodities that drive the various markets and its derivatives; such as futures - an ephemeral construct if ever there was one. This does not take away the historic value of agricultural goods, technology and even the soft products but mining was the first good that allowed for over and underproduction; debatably one of the key premises that drives the concept of speculation, now the pillar of many economic models.
There is an other side of mining, the risk incurring side which in the chase for wealth almost everyone on the planet pretends doesn't exist. Mining is a major culprit - an unseen but important-to-outcome culprit kinda like the nail that punctured the tire for the supposed trip to town mentioned earlier. Mining, even though it has, does provide comforts for so much and so long, needs to be rethought for the irreparable damage its doing to the natural environment. Which let's not forget, is what supports humanity.
Accounting is probably the softest target if we ever decide to revisit the way economies are viewed. A typical ledger of accounts disregards effects and therefore costs to the outcome so long as each period - like the financial year, shows profit. In the case of mining, where ecosystems are disrupted, the cost to people who probably aren't even aware, born even, is almost never an 'entry' for consideration come balance time. This is where we have deviated in the management of risk. To use the analogy of the leaky tire, we simply pretend the full flat will not occur on the actual journey. Looked at another way, by making the trip we hope to pass on risk though we want to extract value.
The obvious fix to economies once the problem is acknowledged would be to factor in every contribution, including what nature brings and allow for full not partial repatriation. Some work is ongoing in this field though it's not let's say, embraced by the accounting community. This again smacks of disregard for risk, something to which cost accountants reportedly are historically averse. Perhaps there is some justification for the way balance sheets were crafted. Long ago the body of scientific knowledge did not fully appreciate, hence did not contribute to the design of the economic field.
That time has changed. Most everyone these days maintain some form of understanding that the systems supporting modern life are taking more out of the planet than can be given. Again we can view this via our leaky tire allegory. Who is going to pay for the cost of removing the car from the gutter if say it had run off the road? What if it had hit a truck and someone had gotten killed? Daily we consider quantify and address risks such as that leaky tire. Daily we amend behaviours as soon as we can identify where it or they may hurt us. The economy? Same. How we manage economics will determine and soon, Life itself.