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Identifying and ending subsidies for extinction

Imagine teams of ecologists, economists, and forensic accountants tracking subsidies and forecasting their environmental and social effects.
February 19, 2020

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A decade ago, the world’s governments pledged to stop subsidizing activities that drive species to extinction. No more would they tip the economic scales to favor nature’s destroyers. It sounded good—but in the years since, little has been accomplished.

“Few governments have even identified such incentives, never mind taken action on them,” write researchers led by geographer Jessica Dempsey in the journal Conservation Letters. And if halting biodiversity loss indeed requires transformative economic change, they say, then confronting subsidies is a necessary next step.

Joining Dempsey is forestry scientist Tara Martin and fisheries biologist U. Rashid Sumaila, all from the University of British Columbia. They call for “subsidy accountability”: a thorough evaluation of all the ways in which government funding for economic development impacts the natural world.

They offer some well-known examples—the Canadian government’s $3.4 billion (USD) for pipelines; Australia’s $3 billion mining handouts; $18 billion provided by China for nitrogen fertilizers; Japan’s $2.2 billion underwriting of overfishing; and, globally, some $4.7 trillion of governmental fossil fuel subsidies, an amount equivalent to more than 6 percent of global economic output. “In a time of empty pockets for nature, or what we might call biodiversity conservation’s perennial austerity problem,” write Dempsey and colleagues, “it is hard to stomach the annual numbers.”

Not all subsidies are quite that straightforward. An ineffective policy that allows overfishing is also a form of government support, but not as easily quantified as a tax break. Ditto a forestry permit that requires its holder to cut trees or be revoked. Identifying and ending such subsidies is precisely what 193 nations agreed to in 2010 as part of the global Convention on Biological Diversity, the international treaty that’s supposed to protect biodiversity and promote sustainable development.

Not many people are even aware of that pledge, say the researchers, nor of a 2018 finding that only 19 countries have made progress. Those countries also promised to harness economic development for biophilic ends—taxes on pollutants, ecosystem service payments, linking subsidies to improved environmental practices, and so on—yet these efforts are still “dwarfed by subsidies driving land use change and biodiversity loss,” write Dempsey and colleagues.

A recent study by Sumaila found that subsidies for sustainable fisheries amount to $10 billion, for example, while those funding overfishing tipped the scales at $22 billion. Other researchers calculated that while Brazil’s government spent $158 million to curb deforestation, it also spent $14 billion supporting deforestation—a ratio dwarfed by Indonesia’s $165 million respective figures of $27 billion.

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The slow pace of reform results partly from the political power of these industries, but more academic challenges also exist. “Such subsidies are difficult to identify and hard to track, even for governments who create them,” write the researchers. “Many government departments operate in silos without awareness of harmful subsidies on offer by other ministries, or vice versa.”

Piercing this cloud of opacity and ignorance is the task of subsidy accountability. “We imagine teams of ecologists, independent advocates, policy wonks, economists, and, importantly, forensic accountants—all tracking subsidies, forecasting the positive or negative environmental and social effects of their redirection or elimination,” writes Dempsey’s team.

“But just knowing these subsidies exist and their impacts only goes so far,” they continue. “Subsidy accountability also needs to identify, and where possible, quantify who benefits from these subsidies. Do harmful subsidies flow to corporate actors and elites? And, on the flip side, are some harmful subsidies important for vulnerable communities and people? Or does a single subsidy disproportionally benefit the rich, but with important, even if much smaller benefits for marginalized communities?”

The social side is just as important as the environmental. Any reforms must address the human impacts, especially for working and marginalized people. Where appropriate, subsidies might be reconfigured: instead of paying people to fish, for example, they might be paid to protect and restore oceans. And when subsidies unfairly benefit a few already-wealthy recipients, that fact might be used to galvanize popular support for truly transformative changes.

“Big, public money is out there,” conclude Dempsey and colleagues. “We need to redirect these funds towards efforts that support ecologically sustainable economies and full pockets for nature.”

Source: Dempsey et al. “Subsidizing extinction?Conservation Letters, 2020.

Image: Envato Elements

About the author: Brandon Keim is a freelance journalist specializing in animals, nature and science. He is now writing Meet the Neighbors, a book about what animal personhood means for our relationships to animals and to nature. Connect with him on Twitter, Instagram and Facebook.

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