PHIL 2270 Lecture Notes - Lecture 22: Intellectual Capital, Resource Depletion, Human Capital
14 Jun 2018
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“Environmental Justice and Intergenerational Debt” by C. Wolf
A good start at understanding intergenerational debt is the national debt.
National Debt: borrowed money used to finance wars and other things.
Thomas Jefferson: deeply concerned that decisions made by past generations don’t
affect future ones, thinks the US constitution should be re-negotiated in each new
generation.
James Madison: argued that re-negotiating the constitution would cause instability in
the nation, and it is okay as long as the borrowed money benefits future generations.
Hicksian income: what can sustainably spent in that it does not leave them destitute in
the future – implying saving money
Prudent Person: spends sustainably, doesn’t borrow money, and invests their money.
Many of the debts that we pass on involve using up all the natural resources, destroying
land, and wiping out species of plants and animals.
The Hicksian model implies conservation of natural resources, not passing on depleted
resources, and any ‘borrowing’ must leave future generations better off than the
current generation.
Climate debt = Global Warming
“Making Capitalism Sustainable” – J. Eglington
Motives behind capitalism tend to be self-interested and disregard ecological
concerns.
Capitalism: an economic system in which individual owners of capital are free to
dispose of it as they please for their own profit
Eglington argues that making capitalism sustainable involves 3 ‘bottom lines’ –
economic, social and environmental. These bottom lines must be satisfied using the
concepts of capital, accountability, and accounting.
The Economic Bottom Line:
• Involves physical capital (machinery), financial capital, human capital
(experience, skills, knowledge), intellectual capital.
• For a company to remain sustainable, costs must be competitive, demand for
products must be high, human capital must not be lost to other companies.
Accountability: involves a CEO reporting to shareholders, annual reports about
expenditures and profits, and payment of dividends to shareholders.
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