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Sustainability And The Unabashed Capitalist

Capitalism has been getting knocked around pretty good


November 12, 2008
By Brian Martell

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Capitalism has been getting
knocked around pretty good these days.  The disciples of John Kenneth
Galbraith have been wringing their hands over the apparent demise

Capitalism has been getting knocked around pretty good these days.  The disciples of John Kenneth Galbraith have been wringing their hands over the apparent demise of Milton Friedman’s economic theories and in general the rhetoric from the left has the strange air of a school yard taunt.  In a paradoxical twist, one of the Left’s darlings has become one of the first victims of the economic downturn: the Green Movement.  Observe how poorly the party promoting a carbon tax tanked in the polls at the last election, or how the one trick party of the environmental movement failed to garner one single seat in the House of Commons; in spite of a bi-partisan sweetheart deal to get their leader elected.  As a whole Canadians may be concerned with the environment, they just don’t want to pay for it.  Poll  after poll suggested that there was a tolerance to added taxes for the environment when the question was asked in the theoretical, but when the time came to put their money where their inner (David) Suzuki was, Canadians sided with rational self interest.  Now it could be said that if the economy was not on the brink of recession at the time of the elections, perhaps the generosity of Canadians to pony up for a carbon tax of sorts would have passed.  But if this did happen, it would not have been Friedman’s head on the block when the inevitable market reversal happened, but rather Al Gore’s.

So does this mean the Green Machine has stalled on the highway like so many Louisianans fleeing New Orleans afore Katrina?  Not really, it just means that those who may be carrying the torch are the ones who have always brought positive change to the world – the entrepreneur.

Like it or not, the closest theory to reality that we have in business was penned over two hundred years ago by Adam Smith who spoke of the invisible hand of the market.  This theory has been re-packed recently as the “Wisdom of the Masses” and others but essentially comes down to one thing: the market will find its own equilibrium.  Individuals in free markets have always pursued their self interests by meeting demand in the most efficient way possible.  So what does market economy have to do with environmental sustainability?  Well, plenty.  As Sir Francis Bacon put it, “Nature, to be conquered must be obeyed.”  The economy and our natural world around us are as inextricably entwined as the warp and the woof of high thread count fine Irish linen.  Economies adapt to the reality of climate change and can effect change in and of themselves.  The trick is to let them work net of the distortions brought on by the interference of governments.  Observe what happens when governments decide that growing fuel is better than growing food. Government programs designed to boost the use of biofuels such as corn for ethanol have had a disastrous effect on the poor who are now paying nearly twice as much as before for staple foods while it becomes painfully clear that corn ethanol
production is not necessarily the most efficient way of generating energy. In the end, those who could least afford the market distortion caused by government fiat are the ones who have been sacrificed on the altar of state sponsored environmentalism.

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Entrepreneurs who are left to decide what would be the best course of action to meet demand will take in as much available information as practically available and make an informed decision based on the facts presented.  If they are wrong, then something will be learned at their own expense (not yours and mine); and if they are right, they shall reap the rewards due to them.  If the demand exists for green products and green process (as it appears to be the case) then they will do what is necessary to
efficiently fill that demand. 

So where in the coffee business will the green movement take us?  There could be more efficient coffee brewers using coffee produced in environmentally friendly packaging; all market driven.  Delivery vehicles could be powered with less costly fuel (better efficiency, weighed out, of course against other costs such as maintenance and parts). New roasting equipment could be made to work on hydrogen instead of natural gas, producing a carbon neutral product. Personally, I have often fantasized about having a self-sustaining coffee roasting plant where solar panels or wind power were the catalyst for electricity that would produce hydrogen for the roaster and the afterburner.  This dream was not born of the ideal to create a greener planet, but rather not to have to be beholden to utility monopolies.  This would also purport well with those who want to see less fossil fuels used in industry for environmental reasons.  Parenthetically, roasters across North America use hundreds of millions of cubic feet of fossil fuel every year to fire up afterburners, not because they like spending the millions of dollars on natural gas, but because the various incarnations of the Ministry of the Environment or the EPA south of the boarder force roasters to do so.  Apparently, the aroma of roasted coffee is much more offensive in the government’s mind than the obscene waste of non-renewable fossil fuels, which the environmental movement has targeted as the main contributor to increased carbon in the atmosphere.

In closing, the environmental movements ultimate White Knight may well come to the rescue not wielding hammer and sickle, but rather riding a bull.


Questions or comments?  Visit Brian at www.heritage-coffee.com.