by Paul Hawken, Amory Lovins, and L. Hunter Lovins, Little, Brown and Company 1999

reviewed by Larry Caswell

If those interested in the development of a sustainable world economy had time to read only one book, then Natural Capitalism by Paul Hawken, Amory Lovins, and L. Hunter Lovins might likely be the book they should choose.

Natural Capitalism is remarkable in several ways. First, it recognizes that the world's economies are operating in a manner which is destroying the natural living systems of the world-the very living systems which are indispensable to humankind's economic pursuits. Second, the authors emphasize that the world's environmental problems will only be solved in conjunction with meeting the legitimate needs of the world's expanding human population. Perhaps the most remarkable aspect of this work is the authors' contention that these two vitally important problems can be solved in a manner that will benefit all parties-a win-win situation! How can this be? The answer lies in the development of what the authors call Natural Capitalism.

According to the authors, Natural Capitalism involves four essential strategies. The first is what they call "radical resource productivity." This increase in productivity involves "obtaining the same amount of utility or work from a product or process while using less material and energy." This is essential to the development of Natural Capitalism for several reasons. It slows human use of the world's resources. It reduces the pollution that results from the use of these resources. It provides the basis for increasing meaningful employment for growing populations. Even if we consider industrially "advanced" countries like the United States, the opportunities for increasing efficiency in all areas are huge. For example, with the use of existing technologies, production processes could be made in the order of tens to hundreds of times more efficient than at present. The authors point out that our country wastes approximately one million pounds of materials per year for each and every American (page 52). We waste and deplete vital resources and pollute our environment. But equally important, we are wasting human capital: the working people of America and the world. Nearly a billion people in the world have no work, or work that does not provide enough income to support their families (page 53). We have invested heavily in resources to reduce and trivialize the role of labor, when we should be investing in human labor, which can help to minimize the amount of resources needed per unit of output.

The second important strategy involved in Natural Capitalism is "biomimicry." Our present industrial systems are designed along linear, mechanical lines. We attempt to get the least expensive product possible in terms of labor and production capital costs. We tend not to account for the very real costs of degradation to living systems and other resources and the wastes involved in the production process. We must redesign our industrial systems along biological lines. This will allow, among other things, the continual reuse of materials in closed cycles. This holds the promise of eliminating wastes and toxicity in production, including nonrenewable carbon producing energy sources. Even if we consider the relatively efficient U.S. economy, it is estimated that only 6 percent of the materials we use actually end up in products (page 14). The application of biomimicry to our production processes is already happening where companies are "emulating nature's life-temperature, low-pressure, solar-powered assembly techniques, whose products rival anything human-made." The authors give fascinating examples of companies already involved in the redesign of their production. The third strategy of Natural Capitalism is the "service and flow economy." At the present time the role of business involves the production of a product at the lowest cost and then the final sale of the product to the consumer. Beyond a limited short term warranty that may accompany the product, the role of the producer is completed. It is then up to the consumer to use the product, maintain it, and dispose of it when it is no longer serviceable. In a service and flow arrangement the producer manufactures the product and maintains ownership of the actual product. The company then leases the service provided by the product to the consumer. It is the company's responsibility to maintain the product for the consumer, replace it when it no longer functions, and then dispose of the product. Instead of buying an elevator system one would lease a vertical transportation service. Rather than purchasing a carpet one could lease a floor covering service. There are many advantages to this arrangement. To begin with, the manufacturer would have a great incentive to produce a long-lasting, trouble-free product. There would be further economic incentives to make the product easy to restore, recycle, or remanufacture once its useful life was over. This arrangement then begins to emulate nature's closed loop processes.

The fourth strategy of Natural Capitalism is "investing in natural capital". Natural capital cannot be produced by human activity. In fact, we aren't even sure how natural capital works in all its many forms. It can "be viewed as the sum total of the ecological systems that support life." Natural capital provides many services which are essential for economic activity and the existence of human life on our planet. Just a partial list of these services would include the production of oxygen; the purification of air; the storage, cycling, and global distribution of freshwater; the sequestration and detoxification of human and industrial waste; flood prevention and regulation of runoff; formation of topsoil and maintenance of soil fertility; regulation of the local and global climate; the pollination of plants; and natural pest and disease control by insects, birds, bats, and other organisms. We have treated the valuable services provided by natural capital as if they were free, inexhaustible and of no value. The book contends that it is the decline of these services worldwide that threatens the further expansion of economic activity on our planet. Assigning a value to the services of natural capital is difficult, and most likely it would be equal to the value of all goods and services produced by humans (page 154 ). We must take this value into account when organizing our economic activities. This would involve minimizing the natural capital used in the production of a given product and investing in the maintenance and improvement of the world's natural capital. Through various means we must engineer our cost accounting systems so that any process which eliminates the degradation of natural capital and results in its improvement will be the most profitable alternative available. Once Natural Capitalism is widely adopted around the world, the protection of the world's environment will be complementary to the thriving of human economies.

The book, Natural Capitalism, goes into all of these strategies in great detail and provides numerous examples of the practice of Natural Capitalism by businesses, organizations, and governments around the world. It is of note that this movement towards the next industrial revolution is more grass roots than top-down. Individuals, businesses, organizations, and local governments, as well as national governments, are becoming involved. This bottom-up involvement is happening because it is profitable for businesses, beneficial for individuals, and tends to produce solutions with a broad base of support that benefit all parties concerned. The principles mentioned in this book encourage integrated plans and programs that can solve many diverse problems at once. Perhaps the most inspiring example in the entire book is that of the city of Curitiba, Brazil. This city, the size of Houston, with a budget a fraction of the size and problems much greater than the Texas city, has managed to create an environment for living and working that is the envy of the world.

Finally, Natural Capitalism not only provides hope that mankind might be able to solve its enormous problems, but it implies courses of action for concerned individuals to follow. These range from individual actions, to business plans, to the need for political pressure aimed at encouraging government action from local to national. For example, local governments can do much to help with the creation of sustainable communities where we live, and the U.S. government maintains many outmoded subsidies and regulations that are working against and slowing the Natural Capitalism movement towards "the next industrial revolution". The ideas in Natural Capitalism are one aspect, along with the reevaluation of our life styles, the redesign of our transportation systems, and a more regional approach to our lives, toward the goal of sustainable living on this planet.