Linking the Economy With the Environment : The growth of business and industry increasingly is seen as connected to the quality of life.


There's an election next week. The environment isn't a big concern this time around. It barely reached eighth place on the worry list this fall when pollster Peter Hart surveyed folks nationally. I think the environment's status as a non-issue is environmental news in itself. And I think I've got the story.

The environment has been discovered by economists.

While my fellow environmental journalists gathered in Utah for their annual meeting last month for the announced purpose of discussing "Why Isn't the Environment a Bigger Story?", I followed a personal hunch and chose instead to drive up to UC Santa Barbara. Why? To attend The Second Occasional California Workshop on Environmental Resource Economics and Policy.

I suspected that The Invisible Hand, which is what some economists say governs the marketplace, was somehow closing in on the environment.

There are clues everywhere.

Close to home, the latest reports out of Oregon are that the shift from cut-and-run timber operations occasioned by the rescue of the spotted owl has turned into some sort of economic bonanza. They've lost 15,000 jobs in the lumber industry and gained 100,000 in various environmentally regulated industries. No news in pictures of teeming owls and teeming Intel factories.

I did a little homework before driving to UC Santa Barbara. I called economist Frederick Cannon, author of the Bank of America's report "Economic & Business Outlook: Growth and the Environment."

"In the last year or so the conventional wisdom has shifted," he said. "Economic growth and improvement has to have a key element--quality of life. You have to have a quality environment."

But then comes the question, how do we mandate quality of life and who should be in charge of the environment?

This is a question one of the two dozen speakers at UCSB has been working on for a long time. Perry Shapiro, a Ventura resident and economics professor at UCSB, has been doing research on "Which Level of Government Should Be Responsible for Environmental Regulations?"

It is his assertion that "there's no theoretical reason why the federal government should be involved." He's talking about a pattern--largely unreported--of states being more efficient at environmental matters than the feds.

"Green and Gold," a study by economist Bob Hall for the Institute for Southern Studies, found that states that opted for weak environmental controls--such as West Virginia and Louisiana--are "becoming poorer, more polluted, less diversified." And states with the best environmental records--mostly not in the South--offer the best job opportunities and climate for long-term development.

In the Bank of America study I mentioned, Fred Cannon wrote that "states with strong environmental standards have grown nearly one-half percent faster per year during the past 14 years than states with weak environmental standards." California, of course, is in the happier group.

Another study was released this summer by UCSB's Community and Organization Research Institute. Its principal author, Harvey Molotch, surveyed the effects of the recession on Santa Barbara County, weaving in figures for Ventura and other neighboring areas. He said of his general findings, "environmental controls don't hold down growth but give it a different trajectory, attracting cutting-edge companies and preserving a pleasant lifestyle."

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