In a recent Earth Magazine article, and just in time for the 40th Anniversary of Earth Day, an interesting argument was made regarding so-called “Green GDP.” Garrett Groves and Michael Webber point out that in the United States, as well as in many developed nations, current economic measurements of GDP are intended to assess national income and wealth exchange using a pre-World War II model created by Simon Kuznets, a Nobel prize winning economist. Within this model, there is little room for the quantifiable benefits of preservation or conservation of natural resources, or for decreasing carbon emissions. This model also fails to account for waste and pollution. Instead, our economic system measures “success” purely through monetary growth, development and exploitation of the Earth’s natural resources.

Clearly, given climate change and our ever-increasing global demand for energy and natural resources, there is a serious and urgent need to re-evaluate economic definitions of prosperity and gain. To do this, a new indicator would need to be developed, one that reflected both economic prosperity and ecological health. Many international conferences have addressed this exact question, starting with the Rio 1992 Earth Summit. This discussion continues through talks in Kyoto, Johannesburg, Montreal, Copenhagen and soon, Cancun.

Unfortunately, there has been much political debate and little focused action with regard to a unified economic environmental measurement.  Some economics argue that to do so would require privatizing the “commons”—or shared public goods such as atmosphere, ocean, and fresh water. A similar argument was famously discussed by Garrett Hardin in 1968.  Others argue that the developing carbon “market” will be pivotal in defining further environmental economic measurements of its kind. One thing is certain: environmental economics must play a key role in public policy if we want to sustain a healthy planet for generations to come.