Monday, October 4, 2010

The TANSTAAFL Principle

British researchers set out the economic impact of species destruction – and their findings are giving impetus to an international effort to safeguard a global system worth at least $5 trillion a year to mankind.

Groundbreaking research by a former banker, Pavan Sukhdev, to place a price tag on the worldwide network of environmental assets is creating an impact on governments everywhere by making them to seriously start thinking on how to stop the destruction of rainforests, wetlands and coral reefs.

The Economics of Ecosystems and Biodiversity (Teeb) project is already calculating the global economic costs of biodiversity loss. Initial results paint a startling picture. The loss of biodiversity through deforestation alone will cost the global economy up to $4.5 trillion (£2.8 trillion) each year – $650 for every person on the planet, and just a fraction of the total damage being wrought by overdevelopment, intensive farming and climate change.

The annual economic value of the 63 million hectares of wetland worldwide is said to total $3.4 billion. In the pharmaceutical trade, up to 50 percent of all of the $640 billion market comes from genetic resources. Anti-cancer agents from marine organisms alone are valued at up to $1 billion a year.

The UK Government is championing this system of identifying the financial value of natural resources, and the potential hit to national economies if they are lost.

Last week, a study by the Royal Botanic Gardens at Kew, the Natural History Museum in London and the International Union for Conservation of Nature suggested more than a fifth of the world's plant species are threatened with extinction. The coalition hopes that linking the disappearance of biodiversity to a threat to economic stability will act as a "wake-up call".

Caroline Spelman, the Environment Secretary, believes the UK has a crucial role in bringing countries together to agree on action. In an exclusive interview with The Independent on Sunday, Spelman warned: "We are losing species hand over fist. I would be negligent if I didn't shout from the rooftops that we have a problem; that the loss of species will cost us money and it will undermine our resilience in the face of scientific and medical research. We are losing information that we cannot re-create that we may need to save lives and to save the planet as we know it."

But for many, the environmental and economic damage is already done. The collapse of the Newfoundland cod fishery in the 1990s is said to have cost $2bn and tens of thousands of jobs, while mangrove degradation in Pakistan caused tens of millions of dollars of damage to the fishing, farming and timber industries.

More than a quarter of the world's original natural biodiversity had gone by 2000, and a further 11 per cent of land biodiversity is expected to be lost by 2050. According to some estimates, the rate of extinction is up to 1,000 times that expected without human activity and, now, climate change.

"The way we are doing things is not sustainable," Spelman added. The scenario is already being played out in China, where the demise of its bees has led to workers climbing ladders to cross-pollinate plants. "We have to do everything we can to stop that happening here and elsewhere," said Spelman. Even Ban Ki-moon, the UN Secretary General, had demanded urgent action. "Too many people still fail to grasp the implications of this," he said. "We have all heard of the web of life. The way we live threatens to trap us in a web of death."

Things that we thought nature provides for free, is actually not free! I recalled the TANSTAAFL (There Ain't No Such Thing As A Free Lunch) principle I learned in Form 6 Economics many years ago, that everything worthwhile have a cost. Whenever you think you are getting something for nothing, look again – someone, somewhere, somehow is paying for it. Behind every free lunch there is a hidden cost to be accounted for. Governments better learn this quickly before it’s too late!

In the EPL, my two teams massively disappointed me again. Both Liverpool and Arsenal lost their respective games to Blackpool and Chelsea by 1-2 and 0-2 scores.

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