Sustainable Development and the Economy of the United States
By: @Nihonjin1051, Ph.D., M.S.
The United States’ crippling dependence on fossil fuels these past five decades is the antithesis of a sustainable economy. The paper expounds on the economic, political and environmental negative effects this dependency on non-renewable foreign sources of energy has had on the United States. The paper illustrates this dependency through examples of economics of inflation , due to the changing social and civil constructs and all societal factors such as religion and cultural diversity. The paper espouses the importance of a green revolution and a domestic production of some fossil fuels such as natural gas, petroleum and coal as a means to sever the United States’ dependence on foreign imports.
The Industrial Revolution of the 19th century ushered the development of new technology and methods within the United States, culminating in advances in Medicine, Engineering as well as the United States economy. The fires of industry that catapulted the United States into the manufacturing giant that it became in the 20th century was fueled by non-renewable resources such as coal and oil (Baumol and Oats, 1979). The United States’ dependence on non-renewable sources of energy such as oil, natural gas and coal has not only affected the nation’s economy, environment but also the nation’s foreign policy. This paper will attempt to expound up on how highly dependent the United States is on fossil fuels, how these fossil fuels have affected the economic performance of the nation, the environmental effects this dependence has done as well as the political effects this dependency has imparted on the United States. This paper will expound on the importance of a green economy and how the green revolution is a solution to the nation’s nefarious addiction to foreign imports of non-renewable sources of energy. The United States as well as the European Union have develop new sources of fuel namely renewable energy that has the ability to not only reduce the carbon footprint, but also to reduce the magnanimity of the nation’s dependence on foreign importation of non-renewable energy such as natural gas and petroleum and oil (Xi, Salovaara and MacElroy, 2012).
Mirovitskaya and Ascher (2001) define Sustainable Development as “A development path that meets the major needs of the present without endangering subsequent needs and aspirations of future generations, allowing for the conservation of nature to be part of this path” (p. 74). Sustainable Development has many facets that can be subject to various interpretations that are difficult in terms of operational criteria. A vast array of multiple interpretations at a practical and theoretical level would be ambiguous. Therefore, Sustainable Development will be further analyzed into three categories in this paper in terms of integration of environmental, economic and social concerns. Sustainable Development is most useful when there is a common interest of people to balance economic growth, conservation, and equity. This thereby allows the potential for ethical practices and policies to obtain sustainability in an effort to balance and achieve these objectives (Mirovitskaya and Ascher , 2001, p. 75).
The trends in environmental and economic quality have decreased through time. The rapid growth in population and industrial activity has largely contributed to environmental damage. The ecological stresses are that of pollution, deteriorating ozone layer, global warming, acute hazards such as oil spills in major waterways that affect business and wildlife. The cost of pollution is high. To illustrate the kinds of health hazards in a polluted environment, air and chemical pollutants, have been a prime concern for policymakers. (Baumol & Oates, 1979, p. 43). A few major air pollutants such as sufur dioxide, hydrocarbons, carbon monoxide and nitrogen oxides have posed a threat to the human race which in some cases induce cancers or other fatal illnesses that further increase illness and mortality (Baumol & Oates, 1979, p. 44).
“The ozone layer protects all living organisms from excess ultra violet radiation” (Weatherhead & Signe, 2006, p.39). The most severe signs of ozone depletion are located in the polar regions and are due to levels of pollutants and global climate changes. The goal is to decrease the depletion to levels that were recorded in 1980 and are considered less critical than the values today (Weatherhead & Signe, 2006).
The concept known as the Green Design was proposed as a way to introduce sustainable resources into the society; the design proposes to design products and processes from a Life Cycle perspective (Mirovitskaya and Ascher, 2001), which takes into consideration the end uses of energy resources but also product development, manufacturing, the use of resources, the disposal of resources, the recycling of resources. It is closely associated with the concept of Adapted products and interestingly enough these approaches are being implemented by the United States and key players in the European Union such as the United Kingdom and Germany (Mirovitskaya and Ascher, 2001).
To understand more about sustainable development, one has to understand the essential components of the sustainable development paradigm, which considers the variables of productivity, equity, empowerment and sustainability. In regards to productivity, the population must increase productivity and to participate fully in the process of generating revenue, representing a growth of the subsystem models of human development. In regards to equity, the population must have equal access to opportunities. In regards to empowerment, the man should fully participate in decisions and processes that change lives. In regards to sustainability, access to opportunities must be provided not only for the present generations but also for future generations. All forms of capital – physical, human and environmental should be united (Stelian & Dragomir, 2012). Stelian and Drogmir (2012) discuss the minimum requirement for achieving sustainable development and they include: 1) economic growth resizing, given the increased quality side of production; 2) elimination of poverty in terms of satisfying basic needs: a job, food, energy, water, housing and health; 3) ensuring the growth of population to an acceptable level, 4) preserving and enhancing natural resources, maintaining the diversity of ecosystems, monitoring the impact of economic development on the environment; 5) diversion technology and putting its risks under control and 6) forms of government decentralization, increasing participation in environmental decision-making and the economy.
The Green Economic viewpoint that is of interest in this paper was a product of the long confrontations between the different concepts on the protection of the natural environment. These viewpoints include the biocentrism concept, the geocentric concept and the anthropocentric concept. The biocentrism concept places a special interest the environmental concerns of living organisms, particularly non-human forms of life; the concept states that man should not intervene in life other than to protect the world in which he lives in (Trica and Papuc, 2013). The Geocentric concept puts importance on the protection of the earth, the natural factors ; stating that man is but just one of the elements that are required preserved for nature to remain untouched in its purity. The Anthropocentric concept states that everything must be subordinated to the needs of a growing and increasingly diverse people (Trica and Papuc, 2013).
Stelian and Dragomir (2012) introduce the Eco-Development concept , which emphasizes not only economic development in itself in relation to the natural environment, but the entire human development, societal issues, culture, science, civil constructs, equality and human equity. Stelian and Dragomir (2012) point out that eco-development represents the growth in the close correlation with environmental laws, as well as ecological protection. Thus, eco development is oriented to meet the practical requirements of long term, emphasizing harmony and complexity and evasion towards unilateral orientation of these branches.
To reiterate, the Eco-Development concept involves ecological caution, stimulation of development. Everything starts at the knowledge consumption, advocating a harmonious development, carefully in full agreement with existing opportunities. Livesey, Hartman and Shearer (2009) discuss the concept of Performativity in its relation to eco development within the greater subject matter of sustainable development. Performativity theory offers a framework for illustrating the role that organizational discourse plays in new social spectra. Livesey et al (2009) state that sustainable development , like many other abstract concepts, become realized for businesses and for society as a whole through local enactment.
The United States’ dependence on foreign imports of non-renewable resources has had a profound effect on the nation’s political landscape in the domestic dimension as well as in American foreign policy. The United States’ interest in oil in the Middle East goes back to the 1920’s because the concern was the right to secure access for American oil companies on grounds equal to the British, the main foreign power in the region (McIntyre, 2002). The United States took over when the British abandoned the region in the 1970’s and the culminating reason for this was to protect American oil rights through military support and financial backing of these certain nations (Cebula and Frewer, 1980). The United States foreign policy was shaped to ensure that American oil rights are protected, even if the ones who the nation was trading with was responsible for policies that would antagonize American interest abroad. An example of this was the Kingdom of Saudi Arabia.
Braude (2005) expounds how the Saudi government is supporting fundamentalist Wahabi Islamic militancy throughout the Middle East in the forms of financial backing of the mosques and madrassas. The Saudi government can afford to do this because the United States continues to purchase $30 billion worth of oil from Saudi Arabia, which Saudi Arabia uses to fund fundamentalist mosques to fight against secularism (Braude, 2005). The United States , which is currently fighting the War against Terror, is guilty of indirectly funding these fundamentalist sources by continuing to purchase oil from Saudi Arabia, which was indirectly responsible for supporting the Muslim Brotherhood, which was responsible for toppling over the secular governments in Egypt, Tunisia, as well as in Libya. Saudi softpower continues to antagonize the situation in the Middle East by supporting Hamas, which is a Sunni group (Braude, 2005). We can observe that back in 1991, Iraq invaded Kuwait, which was a major oil producing nation, and the United States as well as most of the NATO forces reacted to the former American ally by initiating Operation Desert Storm, which countered Iraqi gains in Kuwait and secured the oil pipelines of Kuwait, which was a major producer of oil for the United States. It’s interesting to observe that the United States mobilized the entire 5th, 6th and 7th fleet of the United States Navy and committed over 500,000 soldiers to the ground all for the security of the oil interests. This staunch military response illustrates the effects of American dependence on OPEC oil (Braude, 2005; McIntyre, 2002).
The United States currently is trying to remedy its dependency on foreign oil imports now in 2013 and manifests the spirit of the National Policy Act of 1969. Section 2 of the National Environmental Policy Act of 1969 states, “The purpose of this Act are: to declare a national policy which will encourage productive and enjoyable harmony between man and his environment; to promote efforts which will prevent or eliminate damage to the environment and biosphere and stimulate the health and welfare of man; to enrich the understanding of the ecological systems and natural resources important to the nation; and to establish a council on environmental quality,” (Thompson, 1972).
The United States’ implementing a green policy, one in which focuses on the growth of biodiesel technology, solar power, nuclear power, and wind power can lower the nation’s current intake of fossil fuel from foreign exporters. The United States’ might benefit from a mixed system in which the nation can increase solar power generators, wind mills, biodiesel facilities as well as tapping into the domestic oil wells found in the strategic reserves, in ANWAR, as well as in the oceanic coastline of the nation. The country can also tap into the natural gas reserves for sources of energy instead of importing natural gas from foreign producers (Keefe, Griffin and Graham, 2008).
In Economics when a product is scarce, market prices rise therefore decreasing the product’s demand for use and encouraging the substitution for other products of the like. The higher the price for the limited product will discourage immediate use and create a balance between current and future utilization of the remaining product (Baumol & Oates, 1979, p.115). In a free enterprise system, an efficient business satisfies the demand of consumers. Prices play a fundamental role in this process and these prices serve as a purpose for the conservation of scarce commodities (Baumol & Oates, 1979, p.74).
An example of a scarce commodity occurred in the 197-1974 energy crisis. There was a dramatic increase in the world’s oil prices due to the Arab and Israeli war and further prices increased enforced by the Organization of Petroleum-Exporting Countries (OPEC) (Mirovitskaya & Ascher, 2001, p. 304). This led to the price hike of petroleum and long lines in the gas stations during the 1970s. That energy crisis led initially to fuel shortages around the world and triggered inflation in many countries. The OPEC nations reduced the export of oil to the United States and most of the free world as a means to protest American support of the Israeli Government and the Israeli Defense Forces during the Arab-Israeli War. One sees that the United States’ dependence on foreign imports can lead to disastrous economic effects in case the United States has a falling with OPEC countries as it did in the 1970s. This is going to be discussed later in this paper, particularly the foreign policy effects of dependence on OPEC energy fuels (Mirovitskaya and Ascher, 2001).
Fuel dependence has its effects on the economic system. In a free economic system the more efficiently a business firm satisfies the demands of consumers, the more it profits. If its products do not meet the specification of the public or if it does not produce its commodity as inexpensively as possible, competitors will take advantage and affects the price of a commodity. Prices play a fundamental role in this process. Prices guide the functions of the economy by matching the output of goods and services that are desired by the consumers. If there is a limited supply of a commodity, the market price will rise (Baumol and Oates, 1979). Long before the advent of the fuel crisis, there were repeated warnings that the growth of demand for fuel in the United States was rapidly outstripping the resources. The United States government tried to artificially keep the prices low. The Federal power commission regulated the natural prices of natural gas and kept it lower than other fuels and thus discouraged the acquisition of this energy source during the time period (Baumol and Oates, 1979, pg. 116). Inflation occurred because during the 1970’s the United States energy sector encouraged the use of petroleum fuel and discouraged the use of natural gas as well as enacted policies that forbad coal mining, thereby leading to the crippling dependence on petroleum fuel (Baumol and Oates, 1979, p. 116-117).
The current situation the United States is in right now is that there is a risk of depletion. Any critical depletion of supplies of a certain mineral will cause the prices of that specific mineral to rise and thereby discourage its use. The situation the nation is in right now is experiencing crippling high prices for petroleum at the average gallon of gas being at $3.50 - $3.75 (Gotz and Gugler, 2006; Gupta and Sanchez, 2012).
The industrial revolution brought a considerable growing demand for power and raw materials. This rate of expansion has continued to increase throughout the first two decades of the twentieth century causing an increase in consumption of energy that it has used in previous centuries (Baumol & Oates, 1979, p. 104). Petroleum is a resource that is used heavily in the United States. It is used to make plastics, heat homes, carry out industrial processes, transport goods and drive people to work (Baumol & Oates, 1979, p. 104-105). As the price for petroleum increases, some poritions of the industry are ready to switch to substitutable fuels and people make adjustments by purchasing smaller vehicles that use less gas and cut down on less essential trips (Baumol & Oates, 1979, p. 106). During the 1973-1974 energy oil crisis caused the market for large vehicles to collapse and the production of smaller cars could not be satisfied with the demand ((Baumol & Oates, 1979, p. 106). Crude oil supplies in the United States from domestic production and imports declined dramatically from the peak of 9.6%. This reiterates the point of supply and demand, if a resource grows scarcer its price tends to increase as a result (Baumol & Oates, 1979, p. 107). This higher price serves to stabilize the commodity to recover and maintain the resources left. The growing world population and the rising incomes all lead to the direction of increasing the demand of resources. The pricing mechanism helps the economy in such that even with the high and rising prices that fluctuate, it serves to keep serious shortages out of control.
The OPEC nations such as Saudi Arabia and Venezuela are countries are able to sustain themselves economically because they have a competitive advantage with petroleum as their major resource. To be sustainable, a competitive advantage that undermines the resources and capabilities that are scarce or imperfectly mobile (Besanko et al, 2010, p. 416).
To curb the effects of pollution and the depletion of resources an environmental policy is created to enforce environmental regulations to encourage environmental improvements and discourage pollution and fleeting resources. This aim is to guide and direct government to clean, protect, and restore the ecosystem (Mirovitskaya & Ascher, 2001, p. 186). The two most important questions in regards to environmental policy are (1) How will the environment be used by consumptive and nonconsumptive uses? (2) Who gets to decide and who has the power to control decisions made for this policy? To answer these questions and facilitate a process to implement improvement information must be gathered for planning, it is then debated and justification is made, followed by a set of rules as to how the environment will be used. The plan of action is then implemented and handled with the resolution of disputes that may arise. The policy is then monitored for is effectiveness (Mirovitskaya & Ascher, 2001, p. 186). These environmental rules are governed by the Environmental Protection Agency (EPA).
The EPA provided government specification in terms of standards and environmental protection (Mirovitskaya & Ascher, 2001, p. 187). This agency enforces command and control to ensure that the rules are enforced efficiently. In the United States, the federal government has increased its monitoring of environmental regulations making business owners and executives liable for environmental pollution. Enforcement actions by the EPA takes hundreds of actions each year that lead to prison sentences and heavy fines for those who do not abide by the laws to protect the environment (Mirovitskaya & Ascher, 2001, p. 187). To get an idea of how expensive it can be for business owners that are non-compliant with environmental laws fines, 1 trillion dollars in the last twenty-five years have been collected from offenders. This is costly for the government as well which has spent 120 billion annually for implementation of reduction in pollution and control ( Mirovitskaya & Ascher, 2001, p. 187).
As stated in the body of this paper, the United States’ dependence on non-renewable energy fuels such as petroleum, natural gas , of which most were foreign imports, led to a foreign policy that led to religious and political ramifications for the United States with the Arab Muslim world. As discussed already in this paper, the American dependence to foreign imports of fossil fuels led to economic consequences when government was at odds with the interests of OPEC nations, case point the 1973 Arab-Israeli War. The movement towards green sources of energy, per se renewable resources have decreased the American dependence on foreign imports, at the same time allowed the United States to develop a healthy symbiosis and balance of green technology and green fuel with domestic production of petroleum, natural gas and coal mining. Due to this fusion, the carbon foot print won’t be as high, and at the same time, solving the issue of American dependence on foreign imports, which have affected US foreign policy. These new developments provide a remedy to those issues.
The graphs presented indicate the US dependence on foreign oil, particularly illustrating the rising consumption rates of oil and ethanol. The last graph shows the growing increase in biodiesel fuel, which shows the relevance of green technology and green resources as a modus operandi to severing US dependence on foreign oil and natural gas.
The United States of America remains the largest consumer of fossil fuels in the entire world, which remains the number one resource that powers industry in the United States, the source of power for transportation and the resource that powers homes and buildings in the country. Throughout history, the nation has implemented political dictum to support foreign states , particularly OPEC nations, in order to secure US oil interests. It has been apparent that this crippling dependence on foreign imported fossils fuels is antagonistic for the nation in that some of these nations are responsible for funding islamofascist rhetoric and empowering the terroristic ideology of fundamentalist Islam, which the United States is currently fighting. Data indicated that US dependence on foreign oil has risen dramatically the past 3 decades and this dependence can be seen through the foreign policy of the United States, namely its operations in the Persian Gulf and surrounding territories in the Arab world (Cebula and Frewer, 1980; Weatherhead and Signe, 2006; Babonea and Joia, 2012). The solution to this problem is to develop greater emphasis in green technology as well as to invest in domestic fossil fuels; natural gas, coal and petroleum. The premise of this paper is to show that the United States can maintain its industry and power supply through a combined power source through domestic fossils fuels and domestic green renewable resources. The benefits to this are economic, environmental and political; a cleaner, politically neutral and financially secure America.
Report of the Council of the Club of Rome (1991) defines a society “that is based in a long-term vision in that it must foresee the consequences of its diverse activities to ensure that they do not break the cycles of renewal; it has to be a society of conservation and general concern. It must avoid the adoption of mutually irreconcilable objectives. Equally, it must be a society of social justice because great disparities of wealth and privileges will breed destructive disharmony” (Mirovitskaya and Ascher , 2001, p. 103).
@Nihonjin1051 is a Ph.D. candidate in Industrial & Organizational Psychology, he is a college lecturer in New Jersey, United States. Topics of interest include corporate culture and personnel dynamic, organizational development, Middle Eastern , South Asian and East Asian political dynamics, cross-cultural qualitative analysis, and Quantitative Statistics. On his free time he enjoys hiking, kayaking, writing poetry, and engaging in martial arts.
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