I read “Economics don offers unique perspective on Nature Conservation” in the “Battle for Singapore’s Green Spaces Blog” and it’s really infuriating. This is coming from one of the people being consulted by Singapore’s government ministries and statutory boards.
He, on the flawed basis that “Nothing is free” proposes auctioning the forests like the one in Mandai, to decide if the land should be developed. The extremely flimsy way of calculation makes no sense at all. There is no way in hell that the amount calculated from surveying so-called “stake-holders” will beat the price offered by developers (henceforth termed “destroyers”). If anything, it might allow them to escape with destroying forests at a lower price! Perhaps that is what Professor Quah would like to see? Buildings everywhere, with the only greenery being roadside trees?
He assumes that he is a more “educated” person than other Singaporeans (arrogant or ignorant?). What does he know of ecology? Of climatology? Has he considered the quality of the air we breathe when we are shorn of all forests? How that would affect our drainages? Would that drive investors away? It seems that in his ideal world, there would be no forests, no animals, no other forms of life apart from Homo sapiens and destroyers running everywhere offering more and more money for more destruction projects.
Taking this outside of Singapore, destroyers have cleared mangroves (number one target for economists like him, muddy, and smelling of Hydrogen Sulphide, and apparently costly to leave alone) and mined corals (to make lime for construction of buildings) in Sri Lanka. Christmas Eve of 2004, a tsunami hit and everything was wiped out. That tsumani took between 30,000 and 40,000 lives in Sri Lanka displaced 2.5 million others. In contrast, Bangladesh, with miles and miles of undeveloped mangroves reported a grand total of 2 deaths. In the Tamil Nadu village of Naluvedapathy, villagers had earlier planted a forest of 80,244 casuarina trees, which broke up the waves and only 7 deaths and “no psychological trauma” amongst the people were reported.
Yes, in Singapore we are sheltered from these. But we are still flood prone, and still subject to the effects of sea level rising. There is a whole lot of environmental processes to go into, besides the sentimentalism and aesthetics put forward by Prof Ng. It takes more than an economist to understand this. Economists, it seems, “must be educated” to use Prof Quah’s own words.
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the problem with such economic thinking is that results that are economically 'sound' or 'optimum' in theory can be disastrous in real life because economists simply don't take into account factors (e.g. loss of ecosystems services or welfare resulting from forest loss) that they can't quantify.
I think in the 1970s there was an economic study that concluded it was more economically efficient (and therefore desirable) to hunt all the whales to extinction then to conserve them. Does that make sense to people other than those for whom a monetary-centre value system trumps all other ways of valuing the environment?
'The Price is Right' approach to development is what gets us eventually into trouble. Well, most certainly our children.
Even if we don't consider ecosystems services etc, nature adds directly to real estate prices. Witness the astronomical prices for housing next to or facing the sea and nature (Sentosa, East Coast, and more recently West Coast).
If Prof Quah proposes adding full externalities into the price, he might indeed have a "unique perspective".
Otherwise, it just boils down to making every inch of Singapore generate cash. And places that don't are considered 'wasted'.
Should we extend this cash-value price to all our resources? Including our people?
If Singaporeans indeed become people who know the price of everything but value of nothing, Singapore will become a very sad place to live in.
To be fair, Prof Quah did once mention the importance of pricing externalities.
"There should not be a ready presumption that just because they have no (monetary) values that they are of little value to society.
"Increasingly in Singapore, we see people complaining about noise everywhere, so that is something perhaps where more should be done to put a price on quietude."
Full article in http://www.wildsingapore.com/news/20070910/071011-8.htm
It's the pity the Battle blog article did not gather alternative views or fully explore what Prof Quah meant.
budak: For some reason, people seem that the economics-centred way is THE way. Something must change here.
Ria: They did get one alternative view from Prof Peter Ng. =p I think Prof Quah should come out and clarify it though. Maybe he didn't mean to sound so extremist.
What Prof Quah proposes is outrageous.
Land plots in commerce may have price tags but woes begone to those who think that nature has a price tag too. And his suggesting that Chek Jawa is too ‘ad hoc in guiding future decisions’ is dead-pen irrationality. Anything that is first and defining in occurrence is a possible benchmark. What make Prof Quah think we should follow him to the opposite direction?
Not only is the nerve of reasoning negative, it is also nothing new at all. It is invocating the same old ways of our present economy that is destroying the fabric we call Nature – the very same life-sustaining fabric for human beings, DAH! It is precisely this same old problem we are grabbling to resolve. So, in the end, Prof Quah has really nothing to offer except to say, ‘let’s just carry on what we are doing’. And I may add to his line of thought – ‘…. and die!’
Increasingly, people across the world are beginning to realize that the source of our redemption lies in our most primitive cultures that advocate 'living with nature'. This is particularly true in eastern philosophy. There is a lot of enlightenment to be found. Prof Quah should look here, not the West for answers (since he is on this side of the globe). However, if he is still inclined towards the West, why, he should look to the American Indians for inspiration, not half-baked new economic models.
The nature of the auction that he advocates is as questionable and controversial as the ‘representative sample of the stake-holding segment’ that he is advancing. Who is he going to ask? Well, don’t ask it in my name. The future of our children cannot be decided this way.
As to Prof Peter Ng’s reported statement, I am a wee-bit confused. But alas, should I be surprised at all by now? Isn’t he part of the team that has pitched for the conversion of the 30ha plot of Mandai forest into a spa? Well, in all eventuality, I think Prof Quah and Prof Ng should make good bedfellows indeed.
Find out what the true value of a forest is: Forest Science Crapped in Singapore at:
http://www.eart-h.com/text/mandai.htm
Joe Lai
original post at:
http://flyingfishfriends.blogspot.com
After reading the interview, I was quite disappointed that such an outmoded way of thinking of nature continues to exist. And the interviewer really should know better than blindly than to adopt wholesale the views of the person interviewed without critically probing or challenging or asking the interviewee to justify his views. This sort of substandard interview should only be published in one place - the Straits Times.
I will only give brief commonsense comments since I am not an ecological economist (an economist who applies ecological principles to economics), the best sort of person to demolish the arguments of an environmental economist (an economist who applies economic principles to ecology).
"The reasoning is common sense. The government of any country works towards economic growth. By developing their industries and housing their people, they degrade the natural environment. After achieving the prosperity they
want, they can then look after the remaining green spaces."
Comment: Often, when the environment is degraded, it is the rural poor that suffer even as the urban elite benefit from the degradation. Sustainable development is about giving priority to meeting the basic needs, and the poor often rely on heavily their local environment to meet these needs, so degrading their environment only serves to further deprive them of their needs. Look at China. Even as it develops, its rural citizens suffer health and economic problems. Is this the right model for other countries to follow?
"Wealthy Singapore can - and is - is now doing just that, both at a
government and citizen level, observes Professor Euston Quah, the head of Nanyang Technological University's economics department."
Comment: Singapore has achieved prosperity, but continues to pay lip service to nature conservation. We have embarked on a development path that compels us to always give priority to economic growth over nature conservation, just to keep up, rather than balance the two.
"Every parcel of land has a price tag, he says, and how it is used should be decided by the highest bidder. Prof Quah's maxim: "Nothing is free"."
Comment: Nothing is free does not mean everything has a price. To attribute a price to something implies it is the equivalent of something else and can be exchanged for something that has the same price, that there is at least a close substitute for it that roughly serves the same function. When something has no equivalent or substitute, it is priceless.
"Use the 'auction method', advocates Prof Quah. For example, to find out how much are people willing to pay to keep the Mandai area, one should create a hypothetical admission fee to the area. Ask a representative sample of the stake-holding segment above what price they would not pay to enter. Multiply this by the number of stakeholders, and one can arrive at the monetary value
of the appreciation of the area - say, $30 million. If $30 million falls below the developer's estimate of its value, the land should be given to the
developer. If it is higher, it should be preserved as it is."
Comment: Isn't this also as ad hoc? The behavioral economics literature has already established that contingent valuations are not reliable due to issues such as framing/referencing, and can be manipulated. Also, nature conservation is a public good while development is a private good. How can the two be valued in the same way? Another objection is that the public is also seldom fully informed of the ecological losses. The authorities and the state-owned and controlled monopoly mass media simply gloss over them while overestimating the economic benefits. And what about the positive and negative externalities? Those don't get captured in contingent valuations. Furthermore, I question whether it is enough that land be put to its highest economic use. The distributive equity of such allocation seems to have been ignored. In other words, is it fair that land be put to its highest economic value use if to do so results in results in land be taken away from the poor without adequate compensation (since they were only asked about their willingness to pay and not their willingness to sell, which is a higher figure) to be given to the rich, or if the development benefits the rich, but impoverishes the poor. Are all these considerations irrelevant? And is the issue only to be seen as a human-centred one - do only the views of humans matter? What about the cost of the development to the leopard cat? If our survival is not at stake here, is it right to deprive other members of our land community such as the leopard cat of their home so that some of us can become more prosperous as a result?
""This has been done in the west, with a proper auction in a proper survey," he says. "Singapore can and should do it too.""
Comment: We have never done something just because the West has done it. Otherwise, we would be using the political process to make land use decisions, as the West does. This is democracies recognise that land use questions are questions about values rather than prices (only an economist who thinks that value can only be measured in terms of price cannot see the difference). The West also provides for mandatory EIAs and extensive public participation before environmentally sensitive decisions are taken. Perhaps Euston Quah supports this from an economic standpoint, such openness and transparency result in more informed valuations of the gains and losses by the public.
"He says Singaporeans must understand that if the government leaves expanses green spaces alone, there would be housing and industry congestion. This would cause rental prices and business costs to balloon. Investors would
eventually leave."
Comment: Yes, the public need to know there are opportunity costs to whichever way the decision is taken. My argument is that this cost cannot and should not be measured and quantified as a price because the number cannot capture the quality of the richness of the value. And for the same reason, to allocate land use to the highest bid is to oversimplify a complex question.
""It's not the answer that's important," explains Prof Quah. "If you follow the process, the answers will be roughly correct. Without it, how will they
decide?""
Comment: I'd say public debate and deliberation are a better way of forging values about what our natural heritage means to us collectively as a country, and how much of our heritage is for sale in the name of economic prosperity. I think that is probably at least a more honest question than pretending we are all bidders for land with no emotional attachment.
"Not everyone agrees with his ideas. Dr. Peter Ng, the director of NUS' Raffles Museum for Biodiversity Research, says the only link that the economy should have with the environment is that a first world economy like Singapore should have a first world conservation plan."
Comment: And a third world economy should have a third world conservation plan? Not sure if Peter Ng is actually being quoted out of context or his argument has been truncated to the point of being meaningless, but it does sounds like he actually agrees with Euston Quah's point. I have expressed my comment to that.
"If you want to conserve biodiversity for economic reasons, then give up," he says. "Why should we keep our natural heritage? For emotional, sentimental, aesthetic reasons. The more people there are who do this, the more we will achieve."
Comment: Same comment as above, i.e. don't know whether Peter Ng is actually trying to say something her and what that is, but it does sound like he is echoing Euston Quah' s argument. And don't forget that biodiversity performs ecological services too; it's not all just lovey dovey soft values.
""You must understand, what drives Singapore is not the environment," he says. "Singapore's bread and butter is industry, growth. Singapore operates on this principle.""
Comment: Ah, finally we agree on something. Singapore is short-sighted in that way. It doesn't mean everything Singapore does is the right way, though.
This proves my point that many politicians and decisions makers ought to take up basic ecology courses before they take up office with big-headed thinking and screw-up our environment.
I have come to the firm conclusion that Jared Diamond's Collapse should be made compulsory reading for all economists, policymakers, government bodies, and corporate businesses.
hi, new to the site, thanks.
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