The State of the World AIESEC IPM Ohrid, Macedonia, 25 February 2008

1. Arthur Lyon Dahl Ph.D. European Bahá'í Business Forum (EBBF)‏ http://www.ebbf.org and International Environment Forum (IEF)‏ http://www.bcca.org/ief The State of the WorldAIESEC IPMOhrid, Macedonia, 25 February 2008

2. HEALTH WARNING:THIS PRESENTATIONMAY CAUSE NIGHTMARES ANDDEPRESSION

3. Bank manager's warning to wealthy spendthrift

4. The State of the Worldis a dynamic condition • Not a static situation but a balance to be maintained in space and in time • Involving complex interactions in the whole system that maintains life on Earth (the environmental accounts)‏ • Including the human system (the social,economic and cultural/ethical accounts)‏ • That must maintain productive capital and respect planetary limits to be sustainable

5. Globalization • is the logical next step in human evolution, but • Economic globalization is driven by powerful governments and multinational businesses for their own benefit • Social globalization is being strongly resisted • Globalization of environmental problems threatens future sustainability

6. Environment: biodiversity loss, pollution, climate change Human society: energy, population growth, food, resource depletion Economy: unmanaged globalization, financial imbalances Ethics: sovereignty, corruption, materialism Some of the major driving forces for planetary unsustainability

7. NATURALCAPITAL:BIODIVERSITYLOSS - Human impacts on the natural environment are causing a major extinction event from uncontrollable population and development pressures accelerated by climate change - There will soon be no undisturbed natural ecosystems left, requiring increasing human intervention to maintain some biological diversity

8. Waste TreatmentCapacity:Pollution(image IKONOS – Lang, ESRI 1998)Man-made chemical pollutants have contaminated the entire planet, interfering with biological processes, upsetting hormonal balances and immune systems, causing cancers and other diseases, damaging the ozone layer, and having other as yet unknown effects

9. Environmental Stability:Climate change stronger and sooner • Global carbon dioxide emissions from fossil fuel have accelerated since 2000 • Rise in 1990s: 0.7%/yr; 2.9% since 2000 • Three causes: growth in world economy, rise of coal use in China, weakening of natural carbon sinks (forests, seas, soils)‏ • Growth in atmospheric CO2 is about 35% higher than expected

10. Polar areas are changing fastest • 14% of the permanent ice in the Arctic Ocean melted in 2005; 23% more in 2007(worst melting ever) opening the North-West Passage; permanent ice in the Arctic Ocean may be gone by 2030 • Greenland glaciers have doubled their rate of flow in the last few years, raising sea level 0.6 mm per year • Similar melting of the West Antarctic ice sheet could add another 4 mm per year • Sea level rise could drown Belgium, the Netherlands, half of Florida and Bangladesh, among others, by 2100

11. There is little time left to act • Glaciers and snow cover have decreased; cold days, nights and frost have become rarer; hot days, nights and heatwaves more frequent • Recent surge in CO2 levels • Global temperatures have already risen 0.6°C and will probably rise a further 3°, or even up to 4.5-5° by 2100 • A rise of more than 2° could be irreversable, requiring action within 10 years at most We may be approaching a tipping point where runaway climate change would be catastrophic

12. The most vulnerable areas risking catastrophic collapse this century: • Arctic Ocean and Greenland ice sheet • Amazon rain forest • Northern boreal forests • El Nino affecting weather in North America, South-East Asia and Africa (3°C rise)‏ • Collapse of West African monsoon • Erratic Indian summer monsoon • Result: 0.5-1 billion environmental refugees

13. Climate changeeffect on the economy • The Stern Report estimated the annual cost of uncontrolled climate change at more than $660 billion (5 to 20% of global GDP, as compared to 1% for control measures for greenhouse gases). • Climate change represents the greatest market failure in human history • IPCC 4 says stabilizing greenhouse gases by 2030 will slow global growth by 0.12%/yr or 3% of total global GDP

14. Human Population • The world population has tripled in one lifetime, and is expected by the UN to rise to 9.2 billion by 2050 before stabilizing • By some estimates, world resources can only sustainably support 500 million people • We seem to be following a classic ecological pattern of overshoot and collapse • The planetary carrying capacity depends on numbers versus standard of living; increasing one reduces the other • Science may find ways to increase carrying capacity, but only at longer time scales

15. Food Production • The Green Revolution of the 1970s postponed food supply as a limit to growth • Crop production has improved in the last 20 years from 1.8 to 2.5 t/ha. but such intensive agriculture requires high energy, fertilizer and petrochemical inputs • World cereal production per person peaked in the 1980s and has decreased slowly since • Feeding the growing world population and reducing hunger by half will require doubling world food production by 2050 • Land, water, phosphate, energy will be limiting

16. Global Food Crisis • In 2007, the price of wheat rose 100%, maize 50%, rice 20%, increasing staple food prices for the poor over 10% • Global food reserves are lowest for 20 years, with only 57 day grain reserve • Climate change, drought, floods, soil erosion, overfishing are reducing food production • With grain being diverted for biofuel, 800 m motorists are competing with 2 bn poor • There are 854 m hungry people, rising 4 m/y • Food is being priced out of reach for the poor

17. Planetary Capacity? • Water use for crops will have to double by 2050 to halve the number of hungry • But, by 2025, 1.8b people will live in regions with absolute water scarcity, and 2/3 of the world population could be subject to water stress as climate change reduces rainfall • One third of all non-ice-covered land is already used for agriculture or grazing • More than 40% of all ocean areas are heavily impacted by human activities

18. Resource Depletion Many key materials are being exhausted rapidly (estimated years left: predicted/today's rate)‏ • Phosphorus (fertilizer) 142-345 • Copper (wire, coins, pipes) 40-60 • Zinc (galvanizing) 20-46 • Hafnium, Indium (chips, LCDs) 5-15 • Tantalum (cellphones, cameras) 20-115 • Platinum (catalysts, fuel cells) 15-360 • Silver (jewelry, catalysts) 15-30 • Uranium (weapons, power stations) 30-60

19. Energy: driver of development • Industrial economy, agriculture, transportation, communications, trade, urbanization, consumer lifestyle all depend on cheap and abundant energy • Energy demand will grow 50% by 2030, but oil production is peaking and will decline 75% in 30 years; coal may also peak by then • Adaptation will be extremely expensive and the struggle for diminishing resources globally destabilizing • The fossil-fuel-based energy subsidy of civilization is unsustainable

20. Economic globalization by itself is not working • Rise of the Asian economies driving delocalizations and competition for resources • Difficult transition in Central and Eastern Europe; failure in Africa • Ageing societies of Europe and Japan • America is living beyond its means • Growing extremes of wealth and poverty; exploitation of the poor, child labour; worker stress • Failure to create adequate employment • Global economy threatened by internal imbalances and external perturbations • Recent sustained growth similar to late '20s, early '70s; increasing warnings of a crash; it may already have started

21. Financial ImbalancesExample: USA Current Account DeficitThe Cooper-Rogoff Debate, Davos 2006WEF Global Competitiveness Report 2006-2007 • Larry Summers: Global imbalances are one of the most important threats to global prosperity • Richard Cooper: US current account deficit ($660b in 2004) is natural and sustainable because US is attractive to investment • Ken Rogoff: US deficit mirrors government borrowing = beginning of the end. US eating up 70% of global net savings. US housing slump could cause drop in overvalued US$ of up to 40% and loss of its role as global reserve currency, precipitating a financial market crisis with serious impact on inflexible economies of Europe and Japan

22. CORRUPTION • The illegal economy from organized crime is now $2 trillion/year, or twice all the world's defence budgets • Bribery $1tr; counterfeiting and piracy $520bn; drug trade $320bn; human trafficking $44bn • Political corruption is everywhere; the vast majority of bribes go to people in rich countries • 10% of all public health budgets are lost to corruption • Resisting corruption requires great courage

23. Adding up the figures • A recent analysis of 40 years of data on human activity and environmental damage puts the cost of climate change, ozone depletion, deforestation and overfishing by rich nations at $47 trillion, more that the combined foreign debt of all poor nations • The annual investment necessary to restore the planet's productive resources is estimated at $93 billion

24. At the rootof all thisis what could be called an ethicaldeficit

25. Has nationalsovereigntybecomeunethical? Even at the UN, national sovereignty is jealously protected, yet global problems require a global response. Governments do not realize that true national self-interest today is best reflected in global solidarity and a willingness to make short-term sacrifices in the common interest

26. The materialistic interpretation of reality has become the dominant world faith in the direction of society Dogmatic materialism has captured all significant centres of power and information at the global level, ensuring that no competing voices can challenge projects of world wide economic exploitation Economics based onself-centred materialism

27. - Materialism's vision of human progress produced today's consumer culture with its ephemeral goals - For the small minority of people who can afford them, the benefits it offers are immediate - The breakdown of traditional morality has led to the triumph of animal impulses and hedonism - Selfishness has become a prized commercial resource; falsehood reinvents itself as public information; greed, lust, indolence, pride, violence are broadly accepted and have social and economic value - Yet it is a culture without meaning The unsustainable consumer culture

28. What are the implications for planetary sustainability? Integrating all the driving forces:environmental, social, economic, ethical

29. Ecological footprint • Surface needed to supply the needs and absorb the wastes of an individual, community, or country • Global average 2.3 ha/person • Italy 3.26 ha/person (lowest in western Europe), France 5.74 ha/person, Switzerland 5.26 ha/p. • Resources available 1.9 ha/person • We overshot the earth's capacity in 1975 http://www.globalfootprint.org/ http://www.ecologicalfootprint.org/ http://www.myfootprint.org

30. Scenariosplausible futures • Business as usual in a materialistic society ignoring the future • Retreating to a fortress world of old values • Making a transition to sustainability

31. Scenarios from World 3(Meadows et al. (1992) Beyond the Limits)‏ Business as usual Transition 1995 Transition 2015

32. End of the growth paradigm • What is more realistic? • Exponential growth? • The normal distribution, bell-shaped curve? • Economic growth has depended on population growth, energy growth, and resource growth, all of which end in this century Welcome to the new paradigm of balance, optimal size, efficiency and closed systems

33. Restoring the world tosustainabilityis fundamentally anethical challenge

34. Only fundamental change will save the world from continuing decline • Resolving such complex problems requires a united approach • We need to redefine "development" (= growth for economists) within a more universal framework including society, culture, science and spirituality • Sustainable environmental management must come to be seen not as a discretionary commitment to weigh against other competing interests, but rather as a fundamental responsibility and pre-requisite for spiritual development as well as our physical survival

35. - Economic thinking is challenged by the environmental crisis to change:‏ - Insisting that there is no limit to nature's capacity to fulfil any demand made on it - Attaching absolute value to growth, to acquisition, and to the satisfaction of people's wants - Making economic decisions at the national level when most of the major challenges are global The present economic system cannot deal with sustainability

36. The importance of values • Ethics and values are what determine how humans relate to each other • They are the social equivalent of DNA, encoding the information through which society is structured • The most effective way to transform society is to change its values • An emotional/spiritual as well as intellectual commitment is necessary to motivate real change and sacrifice

37. Values for a sustainable society • Justice • Solidarity • Altruism • Cooperation • Trust • Moderation • Service

38. Economics has ignored humanity's broader social and spiritual needs, resulting in: - Corrosive materialism among the wealthy - Persistent poverty for masses of the world's peoples Economic systems should give the peoples and institutions of the world the means to achieve the real purpose of development: the cultivation of the limitless potentialities in human consciousness. (adapted from Bahá'í International Community, Valuing Spirituality in Development, 1998)‏ Rethinking the values in economics

39. - further a dynamic, just and thriving social order - are strongly altruistic and cooperative in nature - provide meaningful employment - help to eradicate poverty in the world - give the right signals for challenges like climate change and sustainability We need new economic models that

40. To maintain a sustainable balance, we must: - reduce our material consumption with simpler lifestyles emphasizing social, cultural and spiritual wealth; - redesign material civilization based on decentralized communities, renewable resources, energy economy and materials recycling in closed systems; - reduce human impacts to a level appropriate to the vulnerability and resilience of natural systems; - restore damaged systems to the level necessary to maintain natural and human ecosystem services; - allow development and population growth only to the extent that system improvements extend the carrying capacity of planetary systems. We can live within environmental limits

41. Good for society Good for business The goal:an organicallyunited world

42. Global sustainability requires a new entrepreneurship We are in the middle of a major transformation in society The past is not a good predictor of the future Change is inevitable, and the rate of change is accelerating, requiring adaptive management Globalization cannot be stopped, but it can be transformed Institution building for international governance will continue We can consciously work for change, or wait for catastrophe to force us to change There will be new forms of wealth creation and business Creativity and innovation will be increasingly necessary for success Values and ethics will be fundamental to social and economic transformation

43. Value-driven Unity in diversity Entrepreneurial Creative Leadership and you can motivate them AIESECers have the perfect profile

44. Become the new responsible entrepreneurs The years ahead will be difficult, but you are the reason for hope

45. The planet will thank you too Thank you