Academic journal article The Yale Law Journal

Environmentally Sustainable Competitiveness: A Comment

Academic journal article The Yale Law Journal

Environmentally Sustainable Competitiveness: A Comment

Article excerpt

At the United Nations Conference on Environment and Development, held in Rio de Janeiro in June 1992, countries reached a consensus that environmental protection and economic development must be partners to achieve the common goal of environmentally sustainable development.(1) Economic competitiveness must take place within the framework dictated by this common goal.(2) Sustainable development implies that future generations have as much right as the present generation to a robust environment with which to meet their own needs and preferences. Elsewhere I have argued that we hold the environment in common with all generations--past, present, and future.(3) As members of the present generation, we are both trustees of the environment with obligations to care for it for future generations, and beneficiaries entitled to use it for our own economic and social well-being. In brief, each generation has both rights and obligations in relation to the environment.

The notion that future generations have rights to inherit a robust environment provides a solid normative underpinning for the idea of environmentally sustainable development.(4) In its absence, sustainable development might depend entirely on a sense of noblesse oblige of the present generation. Intergenerational rights require environmentally sustainable development by the present generation.

Environmental regulation must therefore be viewed from a long-term perspective. The same is true of competitiveness, since nations and firms may be tempted to pay a heavy price in environmental degradation in order to compete for economic gain. For this reason, competitiveness among countries is not simply a short-term economic issue, but rather an intergenerational one.(5) Future generations may have to pay more for the same goods and services that we receive today because of the increasing funds that must be allocated to cover interest on the national debt.(6) Similarly, if a country degrades its environment or otherwise fails to maintain environmental robustness, it may impose large remedial costs on future generations which will divert resources from other investments and activities. Moreover, contemporary environmental degradation may reduce the natural resource options available to future generations to satisfy their demands, such as by limiting the uses of lakes, rivers and forests. In these ways, today's environmental damage may affect tomorrow's competitiveness.(7)

Sustainable competitiveness, which combines the interests that underlie sustainable development and international competitiveness, puts environmental protection and methods that facilitate economic growth under a common umbrella. If nations adopt sustainable competitiveness as the appropriate context for considering the relation between environmental regulations and competitiveness, several important points in response to Professor Stewart's article emerge.

First, sustainable competitiveness means that environmental protection is not an amenity, or luxury good,(8) to be indulged in after a country has achieved a given level of economic development. Nor is the environment appropriately viewed only in the context of comparative assimilative capacity.(9) Rather, sustainable competitiveness limits the extent to which we can treat environmental conditions as a factor of comparative advantage or as a luxury good. Certain kinds of environmental protection must accompany economic development if competitiveness is to be environmentally sustainable.(10) Actions in pursuit of competitiveness today must be conceived so that we do not borrow from our children and our grandchildren a debt we cannot repay.

Second, Professor Stewart recommends "international harmonization" of standards through international agreements to address transboundary externalities(11) but is skeptical about harmonizing other national environmental standards, largely because of different environmental assimilative capacities among countries. …

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