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Ecological Economics

from Asad Zaman

Eurocentric history portrays the West as advanced, rational, scientific, and democratic, while the East is superstitious, unscientific, autocratic, and backwards. This poisonous philosophy enabled the incredibly brutal and ruthless violence required for the conquest of the globe, and continues to sustain extremely exploitative economic systems. A partial antidote is World Systems theory which portrays all human beings, nations, and cultures, as joint participants in weaving the rich fabric of human history. Ecological economics goes further to take the entire humanity as one element of the biosphere and geosphere of our planet. All of the biological species have their “economics” where they consume and produce, directly or indirectly affecting other species. All of these economies are closely interlinked. Viewed in this light, the environment crisis is easily seen as being due to human beings’ predatory consumption of vast proportions of the biosphere and the geosphere, without any compensatory productive replenishment.

Conventional economics assumes that . . . read more

  1. Ikonoclast
    November 29, 2020 at 12:43 am

    My general thinking is that Islamic finance and socialist finance would not be so different in some respects.

    A limitation on earnings from interest is most necessary as are limitations on rentier income. Lending at high and usurious rates should certainly be banned along with practices of lending at higher interest rates to the poor. A wealthy corporation can get large loans at zero real interest rate currently, whereas poorer and even middle class persons can pay up 15% of more real interest rates on consumer credit card debt. This is unconscionable.

    Lending for worthwhile investment and production should perhaps attract a modest real return of one or two percent. Lending for investment in the production of harmful consumption products, like alcoholic and soft drinks for example, should attract a pigouvian tax on returns. If investors invest in harmful stuff that people really do not need except from a human weakness and addiction point of view, then they should face extra and punitive taxes which markedly reduce their profits.

    A socialist system would not necessarily forbid things (although there are things it would still make completely illegal like slavery and sexual exploitation) but it would more heavily tax many other harmful products and activities and thus reduce them. There is probably an optimum pigouvian tax level, on a product by product basis, whereby total harmful production is curtailed significantly without excessively incentivizing black market and illegal activity. That optimum point would in turn depend on the revenue from the pigouvian tax and even possibly on its hypothecation to enforcement of compliance with law and regulation. If the entire revenue of a pigouvian tax on legal sales was being spent on prevention of black market and illegal activity related to the same product, the net good to society would still be positive on the side of the equation related to the negative externailities of the product. An oversight watch would have to be kept on the enforcement side to detect and prevent negative externalities resulting from over-zealous enforcement. The state should watch over itself and its servants with checks and balances as well as watching over its people.

    • Ikonoclast
      November 29, 2020 at 12:49 am

      I didn’t specifically touch on ecological economics in my post above, but the same logic of pigouivan taxes applies. All economic activities which cause harm and unsustainable consequences to the environment should be “taxed out of existence” in a “rampijng up” approach to phase out harmful products, like fossil fuels, as quickly as possible.

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