2015-10-29 16:53 GMT+01:00 Razer <Rayzer@riseup.net>:

On 10/29/2015 08:19 AM, Lodewijk andré de la porte wrote:
> Truecost being some unrealistic form of cost determination?

True cost economics is "Unrealistic"?

Surely you jest...

I jest you not.

It's difficult to measure because the variables in
/"An economic model that seeks to include the cost of negative
externalities into the pricing of goods and services.//"(1) /can be
enormous, but the ability to 'do the math' is hardly unrealistic.

It definitely is. A selective enumeration (which it will always be) is merely a political tool. A comprehensive enumeration is impossible to assure and costly to produce. And who should bear the costs of such an enumeration? Society as a whole?

It is simply not fair to make law requiring such enumerations. It is much better to make theft illegal.

/"Economics, in its current form, is a very limited science."(2)/ and
true-costing acts to de-limit it.

Words without meaning.

1 http://www.investopedia.com/terms/t/truecosteconomics.asp
2 http://www.utne.com/community/truecosteconomics.aspx

Link 2, by line analysis:

Economics, in its current form, is a very limited science. Classical economists are accustomed to quantifying cost in gain in simple monetary terms while ignoring the more sweeping ramifications of a particular decision.

Untruth. "Classical economists" are used to not involving terms they needn't in providing a price quote. I don't pay the costs? I don't charge the costs. It is logical, simple, practical.

Air pollution, for example, costs residents of Ontario at least $1 billion a year in medical costs and missed work, but these figures do not make their way into the analysis of the businesses doing the polluting.

This is the fault of governance, not economics. Simply, the company should arrange a license to pollute. The license's cost should equal or exceed the damage to the community - such that individuals in the community are bottom line not negatively affected by the alteration.

Neither does the appalling destruction that China is currently wreaking on the environment, the cost of which damage more than outweighs the country's rapid economic growth.

I need a citation on this. It implies there's "environmental value" being sacrificed for "value of economic size". Apparently the Chinese do think their economy is worth the damage to the environment. This is also a cultural issue. Simply put, the author is being an ignorant presumptuous prick, pushing his values onto the Chinese government planners. There is absolutely no evidence of economic miscalculations - merely of a different subjective valuation of nature (or economy). (And even that is not substantiated in the article)

There is no room for such crucial factors in neoclassical economics, the predominant school of economic thought that assumes that people's decisions are guided by totally rational thought processes.

It merely implies that people that are less rational will lose the economic game. (it's true, they do generally lose) (it's also untrue, there's no rational people. Only coincidence of the particular insanity and reality)

Clearly, the destruction of one's habitat is not an entirely rational decision to make, and critics blast the isolated, 'autistic' manner in which modern economics employs a narrow scope and and a limited conception of cost and value.

There's just no God in it, you know? These pointy nosed walking calculators just ignore all our warm fuzzy feelings! I LIKE THAT TREE! NO I CAN'T AFFORD BUYING A TREE I OWN NO LAND

etc...

A number of economists, fed up with the limitations of classical economics, have put forth a new paradigm; in which pricing includes a number of factors beyond an item's market value. The environmental cost of aviation, for example,

(is not beyond an item's market value so long as governance is proper / people aren't being poisoned without compensation )

adds at least $500 per passenger to airline travel. Recent mad cow scares have cost the cattle industry $6 billion dollars,

Disease is definitely a hard to model and price item. There's lots of factors, like how the disease spreads, population densities, countermeasures, who should carry risks, etc. It goes for humans too, infectious and unhygienic as we are. I'll think on it some other time.

and a World Health Organization study of France, Switzerland, and Austria found that 1.7 percent of the GDP was taken up by the costs of traffic pollution.

I thought traffic pollution wasn't in the GDP? We do have pollution related tax in most nations. Uninterpretable (and uncited) statistic.

By using these figures to paint a more complete picture of the transportation and cattle industries, economists will be able to more easily create value, not just in terms of raw profitability, but in terms of overall health and environmental impact.

Uhh... I really don't know what this is supposed to mean.

In fact, the new paradigm substitutes the more broad Genuine Progress Indicator (GPI) for the limited Gross Domestic Product, factoring leisure time, crime, and resource depletion into the measurement of a nation's success.

Oh, more leisure time is "Genuine Progress"? Less punished activity (crime) is Genuine Progress? Having natural resources is good, but using them is what makes them resources in the first place. GPD doesn't factor it destroyed potential, but GPD is just what it is and nobody is pretending it's more or less.

I appreciate the idea of a better "how good is your nation doing" indicator. It's very political, and it's best to avoid bullshit in statistics.

With global warming racking up a yearly bill of $304.2 billion, businesses would be forced to take note of their own environmental practices in a way that the current model does not encourage. True Cost Economics is currently creating a sizable ruckus in the academic world, and its value as a system of thought is starting to be recognized by the economic establishment.

"We should make those responsible bear the cost for their actions" != "True Cost Economics"

True Cost Economics is a way for one nation to tell another it needs to do something. It's just another way to do politics, not economics.

Oh, and making those responsible bear the cost for their action is absolutely essential for capitalism. Without it we're only doing the horrible parts of capitalism, not the magical parts.