ImageThe word “sustain” means to maintain or endure.  Sustainability involves the environment, society, and the economy.  With this we can extrapolate and define sustainability as the idea of keeping the economy unharmed while maintaining the environment and limiting societal externalities.   This definition answers the second question of the prompt.  No, sustainability and capitalism are not mutually exclusive.  Capitalism, as we have read about and seen so far, creates externalities that threaten the environment and affect society, but it is also capitalism that have, can, and will fix these externalities.  For example, in the past decade or two people have become increasingly worried about the use of fossil fuels and high level of carbon emissions that threaten the world’s climate.  It is through capitalism that these problems are being addressed and solutions are being proposed.  Solar, hydroelectric, and wind energy companies are innovating and creating ways to solve the issue of fossil fuel dependence.  Well within the next few decades we will see these forms of energy capture become competitive with and eventually replace fossil fuels.  Oil and gas are much more expensive to extract from the ground than capturing energy from the wind or the sun.  Once the technology is there, fossil fuel dependence will be a thing of the past.

Though this is only one example, it can be broadly generalized to every other externality created by capitalism.  Even if one deems the sole goal of capitalism is maximizing profits, there is a great deal of profit to be made in solving externalities.  Consumers also put a value on environmentally friendly companies, often making it more profitable to strive towards sustainable means of production.  Profit maximization through capitalism is still accomplishable when accompanied with sustainability.

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7 responses »

  1. Charles says:

    I think the idea of sustainability becoming a means of generating revenue is brilliant.However, I don’t think capitalism can solve every externality that it causes, for example it can be said some advertising causes over-consumption. Can capitalism solve over-consumption? Or health costs?

    • Matt says:

      Just out of curiosity Charles, what system do you think can solve these issues? Capitalism is a democratic system that rewards individual innovation, that will provide incentives to the best solution to problems plaguing society (at least that’s what capitalism is to me). The beauty of it is that anyone can contribute, that the sum of human knowledge, initiative and capacity are used, and that this often comes from unexpected places. So for me, I would think that the entirety of society working towards solving these issues would bring some solution. And regarding social issues like over-consumption, culture shifts are the result of capitalism as well. Judging from your blog post and other comments you seem to have a relatively negative view of capitalism, at least in regards to sustainability, and you seem to view humans as inherently greedy and short-sighted (which, to be honest, I agree with, but I think capitalism is the solution to that). So I would be very interested to know what your solution would be?

  2. wesmw says:

    Great post. I especially like how you state that the problems that have been created by capitalism can also be fixed by it. This is really important because I think if people realize this we will be able to get back on track with the correct version of capitalism that Adam Smith envisioned.

  3. Abby says:

    I really like the points you brought up, and completely agree with you. I think that capitalism is just the system based on what consumers want, so when consumer mind-set changes, so will the capitalist view on sustainability. It like you said, just like the horse and buggies were replaced by cars, fossil fuel dependence will be replaced by something else as soon as it comes out and is accepted by consumers.

  4. Steph P. says:

    I really like you point about the externalities. It’s actually very interesting and convenient that we’ve implemented a capitalist system in order to compensate for our materialistic-capitalist attributes. It’s almost as if we knew society would consume more and more as we progressed, so we made sure there was a system to balance our consumption needs.

  5. Jordi says:

    But how? How do the externalities get “brought back into da house” of normal markets and capitalist processes such that “problems” such as energy can be exposed to the powers of innovation, markets, and competition?

    Do we have the capacity to change the overall political economy to allow this?

  6. Jordi says:

    Good title! 🙂

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