The really scary thing about the current environmental crisis

Environment buzzwords have been on everyone’s lips recently. Global warming, carbon footprints, eco-friendly, sustainability – you can’t open a newspaper or magazine without seeing them. More people are thinking about the environment than ever before. We are walking to work, buying reusable shopping bags, eating organic, replacing incandescent bulbs with energy-efficient fluorescents and countless other small measures we hope will add up and save the environment. The United States government is promising the EPA will step up to the plate and save us from ourselves, while the president – in the name of Homeland Security – sets aside more than 30 environmental regulations [Richard Marosi and Nicole Gaouette, “Environmental rules waived for Mexican border fence,” Los Angeles Times, April 2, 2008, News section, Online edition.] to finish the precious Mexican border fence before the Mexican economy collapses when we’ve burned through all their oil. Television advertisements show how you can be green while wearing cotton – that oh-so-environmentally-friendly fabric – and offset the carbon emissions from your totally unnecessary SUV by purchasing recycled paper. It’s chic to be environmentally conscious.

But I’m actually not here to talk about the efficacy of small steps taken by consumers, or how both the government and the corporations talk out of both sides of their mouths on this issue. I’m not even here to try to convince you of the reality – and gravity – of global warming. My question is even more serious, I feel. What if the government imposed – and took more steps to enforce – stricter environmental regulations. Would large corporations comply? Does the government, in this age of outsourcing and endless litigation, have the power to make the business world stand at attention anymore?

There are several factors I think it important to discuss while I explore answers to this question. First, I will explore a brief description of globalization, then an outline of views on what the government’s role in environmental protection should be, followed by a description of the goals of corporations and how these relate to concerns for the state of the environment. I will use Martin Wolf’s opinions, expressed in Why Globalization Works [New Haven: Yale University Press, 2004], to contrast my own on the given topics.

Wolf defines globalization as the “free movement of goods, services, labour and capital, thereby creating a single market in inputs and outputs; and full national treatment for foreign investors so that, economically speaking, there are no foreigners.” [pp. 14] For the purposes of my discussion, it is appropriate to point out that this includes the ability of corporations to outsource their labour.

There are as many views on how involved the government should be in people’s lives as there are people, it seems. They range from a government limited to only protecting from force, fraud and theft and enforcing contracts to a government that controls everything from business to religion. I am going to assume, for the sake of space and time, that we can agree environmental regulations, at least to some degree, are beneficial to us all, and therefore compliance with them and enforcement of them is desirable.

At this time it becomes relevant to describe the two broad economic categories into which the world falls: the centre and the periphery. The centre has also been referred to as the First World or the developed world, and includes mostly democratic industrialized countries such as the US, the EU and Japan. The periphery has been known as the Third World or the developing world, and includes sub-Saharan Africa, some Asian and Latin American countries, such as Nigeria, Indonesia and Guatemala.

A common concern with increasing globalization is that corporations will move their unskilled manufacturing away from centre countries that have higher environmental regulation standards to periphery countries that have lower standards. Besides just having lower standards in general, several factors, including lack of infrastructure and, in some cases, abundant corruption, cause periphery countries to have a harder time enforcing their laws, including those regarding taxes and environmental regulations. [pp. 274]

So what do the corporations want to do? I think it is quite clear that, no matter what the PR department says, no matter what shows up in the ‘mission statement,’ corporations are here to make money. That is what capitalism is all about, after all. So, when trying to imagine what a corporation will do in a given situation, just remember that bottom line. In fact, let’s imagine a typical American corporation (we’ll call it TAC). For each scenario I describe, we can use the corporate prime directive to figure out what the course of action for TAC would be.

The government imposes new, costly environmental regulations. TAC can choose to stay in the US and abide by the new regulations – either through new technologies or new procedures; stay in the US, disobey them and tie the government up in litigation; or move the offending processes to a country that either doesn’t have strict regulations and/or can’t enforce them. While Wolf thinks TAC will usually decide to go with the former [pp. 266], I don’t see this being cheaper a vast majority of the time, because if they choose to move labour costs are less and they wouldn’t have to follow any of those expensive regulations. If they choose to litigate and stay, they’re probably not changing their practices. Wolf suggests that leaving may tarnish their public image [pp. 272], but as we tend to be as financially motivated as TAC, I don’t see it being a problem as long as the product stays cheap and they throw us a feel-good advertising bone or two (such as the ‘green’ cotton ad).

TAC has decided to stay in the US, but not follow the regulations. Eventually, the government catches on – probably only after it affects some third party in a major way. TAC could pay up ASAP or litigate ad infinitum; meanwhile, are they going to stay and shape up or leave?

Although I think these few examples have shown quite nicely that it’s money, not upholding the law, that concerns TAC, there are a few other objections to my position I wish to address.

What am I complaining about? Wolf would ask; after all, “[e]nvironmental laws are generally much tougher than they were twenty years ago.” [pp. 254] Shouldn’t I be glad about that and stop wishing for the stars? I don’t think it is unreasonable to reach for the stars in this case. Yes, laws are tougher than they used to be – but we also know so much more about the effect we have on the environment than we used to. The pace of our law-tightening is not keeping up with our research advances. The point is not to get away with as much pollution as we possibly can, the point is to do as much as we can to eliminate negative externalities in the future, and make up for all past ones.

But what about factors dependent upon location? I am not saying that every corporation will move everything to the periphery. What I am saying is that those factors that are cheaper to do overseas, will be done overseas. And when factors are moved to the periphery, they will be executed in a way that is less environmentally conscious than it would be in the centre. This doesn’t affect every corporation, every field, every sector, but it affects enough of them to be concerned. And I would like to remind everyone that communication is only going to become faster and more streamlined. It will become easier and easier to do in the periphery what you once needed to do around a hotbed of research and development.

I want to make it clear that it is not outsourcing itself that is of chief concern here – while that might also be unethical, it is a debate for another time. I am just as outraged at the corporation that stays and ignores regulations as I am at the corporations that outsource so they don’t have to bother with piddledy regulations. The environment is a collective, global entity. Raping Mother Earth in China is just as bad as raping her in the US, even if we Americans don’t feel the effects right away.