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INTERGENERATIONAL AND INTRAGENERATIONAL EQUITY AND COMPENSATION IN THE CONTEXT OF SUSTAINABLE DEVELOPMENT

INTERGENERATIONAL AND INTRAGENERATIONAL EQUITY AND COMPENSATION IN THE CONTEXT OF SUSTAINABLE DEVELOPMENT

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Economical and juridical aspects

The definition of sustainable development induces the notion that its achievement becomes feasible only when between generations and within the same generation an associative spirit, tolerance, solidarity and mutual care can develop and ensure that the wellbeing of one must never, in any way, harm the other person’s wellbeing. In other words, the sustainable development project leads to the Pareto optimum.

The Italian sociologist and economist opposed the manner in which the equilibrium theorists determined the collective welfare as an arithmetical sum of individual well-being. Pareto considered that one cannot add up individual utilities in order to obtain the measure of collective welfare, as inter-personal comparisons of utilities cannot be made because utilities are interpreted according to subjective criteria; Pareto also realized that the optimum cannot be defined as a sum of individual utilities and cannot be understood outside the income distribution pattern, therefore, when the incomes are given, welfare can only be relative. Pareto thus defines the optimum as being that balanced starting position, from which is impossible to improve one’s situation without diminishing the other or others well-being.      The sustainable development theorists use, in varying degrees, the “Pareto optimum” to explain how equity can be realized and sustained once the individual and collective wealth accumulates. Pareto’s approach is also used in order to reveal the degree in which equity survives when the population demand is related to the average capital. We attempt to provide answers in three sections:

a) Equity between generations

Equity between generations covers concurrently the solidarity, generosity and time aspects and as long as we claim to be attentive and equitable towards the future generations, the problem of resources, regardless of their nature, but especially the natural resources, must evolve into a centenary planning, instead of annual or decennial.

Placing the present generation interests ahead of those belonging to future generations should not represent a sacrifice of the former. It is not possible and it is not moral. Each generation has its time and interests, own needs and belongs to the cultural matrix that defines it. Moreover, the existence of a generation represents, in itself, a unique “resource”. Future generation right to existence cannot be denied or questioned under no circumstances. It is a right BEYOND us and the access to the resource called Earth is a fundamental right of any man, regardless of the fact he lived in the 5th century or 21st century. Nature or God created this resource to be not only unique but also available only once for everyone, no matter when we enter the world.

The objective need to pay attention to those that will live in the future can only be achieved, in our opinion, if a balance line is identified, using political means and avoiding two extreme types of approaches:

  • On one hand, the total preservation, for preservation sake, of existent results and sacrificing the present generation interests;
  • On the other hand, the predatory, irrational exploitation of all resources and causing irrecoverable and irreversible changes and shocks.

Between these limits, an equitable social and political policy can follow a balance line, starting from and considering the fact that :

  • There is a specific relation, inherent to each generation, between its needs and aspirations and, on the other hand, the necessary and familiar resources to satisfy them;
  • The scale of resources known by a generation varies, among others, according to its degree of technical and economical knowledge;
  • If it is accepted that, regardless of the acquired knowledge level, the scale of resource called Earth is limited and each generation contributes to diminish this resource; agricultural areas are reduced and replaced by civil or industrial buildings, etc., the positive environmental factors that provide life support are also greatly reduced (oxygen, ozone, drinking water);
  • Using reason, humans always found the necessary means to avoid waste, substitute rare or limited resources, to find the complementary elements between the production means or to encourage recycling some of the resources, reducing the aggressive approach on the environment and preserving the quality of life. Once these stances are understood, we will all have to become supporters of sustainable development and face ethical but also political problems.

The already acquired experience in the field of sustainable development seems to suggest that ensuring the equity spirit cannot avoid the political medium. From an intellectual point of view, the present generations are prepared to understand the future generations have to be provided with the same chances. The quintessence of sustainable development lies within this hypothesis. The simple positive perception, at the mental level, is not yet enough. Concerning the attitudinal level, a problem that has yet to be resolved is the relation plan-market in ensuring the equity between generations.

It is known that the free market functions on the principle of assigning resources according to the most efficient: the resources must be owned and used by those who know how to use it with maximum efficiency. According to this approach, the owner’s prosperity is ensured but also shared with all the others. The liberal discourse fosters and supports the narrative that the poor people of the wealthy world (their existence within a social, pyramidal structure considered normal and natural) are sometimes richer than the poor people of the poor world thanks to redistribution mechanisms through which the wealth surplus reaches the former. This advantage is diluted by the fact that the free market is based on and promotes the philosophy of “now”; the entirety of classical rules of free market, the interest in future is vaguely represented or even absent. The concern to internalize the costs resulted from pollution, to account its liabilities, to establish a strategy for exploiting the resources and protect the environment, etc. do not seem to be easily solved by the free market arbitration. Within this context, the sustainable development strategy, especially when the equity and compensation between generations are in question, seems inconceivable without a plan and state intervention. The necessity of a state strategy is supported also by the need to change the perspective even at the mental level; a change that can convince people the environment is, concurrently, an exploitation object and object of protection. It is difficult to believe that this necessary change will be realized without an educational program.

As a conclusion, the choice between how much planning and how much market, as operational tools, represent, from this point of view, a serious problem should be decided by the sustainable development strategists.

b. Intragenerational equity

The sustainable development strategy must take into account when the same generation is concerned:

Firstly, a generation is not, in fact, a unique generation: there are three generations coexisting in the same time: young people, adults and elders. Each segment of the social pyramid has its own cultural matrix; that is why, when approaching the same environmental proposal the demand differs, according to level and especially to structure. The young people, with future ahead of them, are interested in long-time preservation of environmental features and resources level.  They are more conservative with their possessions and with everything surrounding them. Instead, the elders are faced with another, more ingrate fact of life, namely that life is rather short. Driven by this statement, they are more selfish and have a more “consumer-like” attitude. They also enjoy as much as the younger people a clean park or fresh air but in contrast with them, are tempted to exploit more intensely the available resources in order to profit, while they still can, from the benefits offered by the economical advance. The equity spirit should encourage them to employ cheaper and economical procedures: use fire wood, animal fertilizer for agriculture, recycle vegetal residues, etc. It is hard to believe though that an elderly person will act in such a manner. If he/she warmed throughout the life using a wood stove, he/she will be tempted to try a new air conditioning installation, if the budget allows it or the market provides such an offer.

Secondly, the social structure of a generation’s members is very different. All are interested in maintaining at a higher level the “environmental capital”. This attitude is costly. The contribution to this cost also differs. On the other hand, it seems that the access to natural capital is also unequal. The environmental goods are inherently public goods. They should be available to public, equitable profit, without any restrictions determined by social status. There is no reason for any social group to be excluded from the benefits offered by environment. The political and material powers alter greatly this frame of mind. The diversity of environment conditions also contributes to the alteration. The water and air quality are not identical everywhere, they vary in space. The wealthy have the chance to choose their place to work and live. It seems logical these places are best placed related to “environmental capital”. As a result, goods that are public, global become local or even private goods. The property law institution can act to limit the goods (public – private) that are contrary to the equity spirit. We do not have to forget that the environment qualitative pluses can be natural but also artificial, manmade, with certain costs. To cover these costs, regardless of the political approach, the contribution is unequal. The same percentage, applied to different incomes, mean, in absolute value, different contribution to the fight against pollution. This fact justifies, for some, why the wealthy profit more from the environment quality without being qualified as a violation of equity.

In this context, the most used procedure in fighting pollution is PPP (principle – “the polluter pays”). Those who pollute and therefore those who pay are mainly wealthy. Is equity achieved then? It is hard to find an appropriate answer when the conditions in which the negative effects measurements of the pollution are also a problem. There are numerous studies in this field, none of which does notexactly documents the frequency of pollution effects on the ozone layer, global warming, etc. How can we exactly assign the “contribution” share belonging to the wealthy in contrast to poor people and establish the equity?

Thirdly those contained by a generation are “distributed” in different spaces, namely in areas, countries, continents. Taking into account this “distribution”, humans have no contribution, it is God or hazard work. What an individual can do is to move from one place to another, searching for a new place of work or a new way of life. This movement is not far-reaching and has no significance according to the principle stating that each is destined to be born and live in a certain place.

In terms of economical theory, the environment demand does not have too much relevance, it is a given, with rather fixed limits. On a global scale, this demand is very diverse, but also very unequal. It is hard, maybe even impossible to talk about equity in this field. How equitable is that John is born in London and lives in reach and clean London, while Hans lives in the “garden” called Austria and little Atef is born in African Sahara and as a result of these circumstances, their perspective on life is so different? The “spatial” localization of those born concurrently is not equitable from the start and sustainable development strategy cannot offer a solution

c. Compensation between generations

The concept of compensation derives from the concept of equity. Also here the starting premise is that the resource called Earth, in a context given of knowledge, is limited and, as a result, through production and consumption, the present generations willy-nilly decrease its dimension. In order to fill with content the sustainable development strategy, it is neccesary to put into function a compensation mechanism so that the future generations will not be affected by the minuses produced to the resources by the present generations; ensuring a constant reserve of capital, which will provide the future generations with at least the same legacy with the present generations. This idea was first discussed by Robert Solow.