Daniel Lawse, Chief Century Thinker at Verdis Group, helps many organizations, such as Seattle Aquarium, become more sustainable and contribute positively to the environment. Daniel joins Gene Tunny to discuss how organisations can make meaningful climate and environmental actions. They cover so-called regenerative practices, the journey from sustainability to net-zero emissions, and the crucial role of long-term strategic planning. They also discuss the degrowth movement and how Warren Buffett’s annual Berkshire Hathaway meeting boosts local businesses in Omaha, where Verdis Group is based.
If you have any questions, comments, or suggestions, please email us at contact@economicsexplored.com or send a voice message via https://www.speakpipe.com/economicsexplored.
You can listen to the episode via the embedded player below or via podcasting apps including Google Podcasts, Apple Podcast and Spotify.
What’s covered in EP242
- Introduction. (0:00)
- Climate action plans and sustainability implementation for organizations. (3:05)
- Regenerative systems, circular economy, and ecosystem types. (10:29)
- Sustainability and environmental economics, enlightened self-interest and long-term thinking. (16:09)
- Sustainable growth and development, comparing nature’s regenerative approach with human economies. (23:15)
- Growth vs degrowth. (29:20)
- Warren Buffett’s impact on Omaha. (34:20)
Takeaways
- Through climate action plans, organizations can take practical steps to reduce their environmental impacts and work towards goals like net zero emissions.
- Shifting mindsets from short-term to long-term thinking and considering impacts on future generations can drive more sustainable decision-making.
- Nature provides many examples of regenerative and circular systems that organizations can learn from using approaches like biomimicry.
- Enlightened self-interest and purpose-driven values can be strong motivators for sustainability action in addition to regulatory requirements.
- Balancing economic and environmental considerations is an important topic for debate.
Links relevant to the conversation
Verdis Group: https://verdisgroup.com/
Seattle Aquarium case study: https://verdisgroup.com/case_studies/seattle-aquarium/
Patagonia – Don’t Buy This Jacket, Black Friday and the New York Times:
https://www.patagonia.com.au/blogs/stories/don-t-buy-this-jacket-black-friday-and-the-new-york-times
Books on the role of energy in growth and relevant to the degrowth debate
https://www.e-elgar.com/shop/gbp/the-economic-growth-engine-9781849804356.html
https://www.amazon.com.au/Civilization-Distinguished-Professor-Emeritus-University/dp/0262035774
https://www.amazon.com.au/Growth-Microorganisms-Megacities-Vaclav-Smil/dp/0262042835
Previous episode on degrowth:
https://economicsexplored.com/2023/10/06/growth-or-degrowth-w-oliver-hartwich-nz-initiative-ep208/
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Transcript: Helping Seattle Aquarium & Others Go to Net Zero and Beyond w/ Daniel Lawse, Verdis Group – EP242
N.B. This is a lightly edited version of a transcript originally created using the AI application otter.ai. It may not be 100 percent accurate, but should be pretty close. If you’d like to quote from it, please check the quoted segment in the recording.
Daniel Lawse 00:03
The Planet Earth is a relatively closed system, except for Sunlight. Sunlight is an energy input coming into the planet. And if we can figure out photosynthesis like nature has, we will have an abundant source of energy. So put a pin in that for a minute. Yeah.
Gene Tunny 00:28
Welcome to the economics explored podcast, a frank and fearless exploration of important economic issues. I’m your host gene Tunny. I’m a professional economist and former Australian Treasury official. The aim of this show is to help you better understand the big economic issues affecting all our lives. We do this by considering the theory evidence and by hearing a wide range of views. I’m delighted that you can join me for this episode, please check out the show notes for relevant information. Now on to the show. Hello, and welcome to the show. Today we’re joined by Daniel lossy, the chief century thinker at Virtus group, where he works with a diverse range of organisations including airports, zoos and aquariums to embed environmental sustainability into their business practices. Daniel aims to make climate action meaningful and impactful, steering clear of mere greenwashing. He wants his clients to achieve genuine environmental improvements. If you’re a regular listener, you’ll know that I’ve been thinking a lot about how we balance economic and environmental considerations. To what extent are the unavoidable trade offs? To what extent are their win win solutions. I’m keen to hear a wide range of perspectives and to learn about practical measures that different organisations are taking. Okay, I’d love to hear your thoughts about the discussion that I have with Daniel today. My contact details are in the show notes, so please get in touch. Before we get into it, I need to say that this episode is presented by Lumo coffee. So Lumo coffee is the coffee company set up by my occasional co host, Tim Hughes, who if you’re a regular listener, you’ll probably remember from his previous appearances on the show Luma was a specialty grade organic coffee with triple the antioxidants of regular coffee. I drink it regularly and I can confirm it’s actually very good. So if you’re a coffee drinker, then please consider getting some Lumo coffee. Tim’s offering a 10% discount on Lumo coffee purchases until 30th of June 2024. Check out the show notes for the promo code and for details of where you can buy Lumo coffee. Seriously healthy organic coffee. Check it out. Daniel aussi Welcome to the programme.
Daniel Lawse 02:50
Thank you so much Jean. Happy to be here.
Gene Tunny 02:53
Excellent. So Daniel, you’re the chief century thinker at Virtus group. You’re based in Omaha in Nebraska. Could you tell us a little bit about what you do at Virtus group? And where do you work is across the Midwest across the US around the world? Can you tell us a bit about Virtus group, please?
Daniel Lawse 03:17
Yeah, Veritas group, we do climate action that counts. We co create a world where everybody can thrive and is resilient. And that’s kind of like our purpose. But what that actually means is we work with a lot of large, complex organisations across the United States, on climate action plans sustainability implementation, we both help them think strategically and we help them do things and drive towards their goals. So planning and implementation, everything from netzero pathways and other decarbonisation planning to implementing emissions reductions and governance structures to effectively integrate and align sustainability across an organisation.
Gene Tunny 04:01
Right? And what does a climate action plan look like? Do you have any examples with people you work with them? And to the extent that you’re able to talk about client work?
Daniel Lawse 04:12
Yeah, climate action plans are a fantastic kind of I’ll talk generally and then I’ll bring it specifically. So it’s really simple a plan, any good plan is assessing where you are today, identifying where you want to go in the future, that vision piece and then having a roadmap or steps to get from here to there. So a good example is the Seattle Aquarium. We started actually with them. It was a sustainability plan. That over the course of the project turned into a regenerative plan because they realised that sustainability wasn’t going far enough for them. We could talk about that later. Yeah. And so we were baselining things like what’s your energy use? What are your waste? That’s outgoing think of a systems flow diagram, what are the inputs into the organisation? What are the outputs out so procurement and purchase Seen electricity and natural gas and other fuels that you’re using for in a case of aquarium, they not only have vehicles like fleet vehicles, but they also have boats, because they’re out doing research on the water and working working on the ocean. We have a really fun tool called the sustainability engagement surveys. So one of the baselines we take as the pulse of organisational sustainability, how do people understand it? How are they acting? Do they have sustainable behaviours? We asked them how their peers are modelling sustainable behaviours, because most people will over report what they think they’re doing from a sustainability perspective. And under report what their peers are. And the truth is usually somewhere in between. We asked to about how do they understand their organization’s commitment to sustainability. So there’s some some perception pieces there. And then that’s like as a score from zero to 100. And it gives them a baseline of, hey, we’re at 45. So we really want to get to 60, that might be a goal that they set. And then there are strategies that you can do to further engage your employees create different mechanisms where they can share ideas, take actions in their department. So engagement, transportation is another big one that has a sustainability impact. How are people coming and going commuting to your place? If it’s a zoo, and aquarium which we work with a lot of those? What What about the guests? Are they coming by foot? Are they coming by in Seattle, a lot of people get off of the cruise ships and walk over. It’s a destination from cruise goers. But understanding how your guests are coming and going. water use is another big one, right? What’s the water coming in? What’s the water going out? How are you using it? The pumps that are moving it around the heating and cooling for, especially with aquariums right life support equipment, making sure that we have the right temperature water and quality of water for the animals that are in their habitats. So that’s the baseline piece. And then it’s really like, what’s the goal, what’s your vision is it to, we always encourage everybody to set a netzero goal. And then we work with them for what year that would be some people are able to set a net zero emissions target in a few years from now, because they already done a lot and they’re on a clean grid or they have on site renewables and others set it further out. 2035 2040 2050 is the latest we really let anybody go wrong. But we use a science based target initiative to inform that net zero emissions pathway mapping. And then we do strategies. But one of the things that I think sets us apart is that we believe that people participate in what they helped create. And so we’re very people positive and complexity conscious. In our approach, we engage a lot of individuals across an organisation so that they have ownership of the plan that’s been written. It’s not just a plan that sits on a shelf. Yeah, gotcha. Okay with the
Gene Tunny 07:50
the aquarium. And that’s really, that’s really interesting. I’m just thinking about it. So. But do they have renewable energy? Are they are they using renewable power? You may have mentioned this, I’m sorry, I forgot? Do they? Do they recycle their water? What are some of the practical measures that they’re taking?
Daniel Lawse 08:08
Yeah, so the Seattle Aquarium in particular, is primarily powered by hydro electric. So clean energy, right up in the Pacific Northwest. And so any electrification that they can do, will be moving them towards their net zero emissions goal. So anything they can take off of natural gas and move towards electric is going to be one of the strategies that they’re implementing. They’re opening up a new ocean pavilion this year. And they were really thoughtful about what are the systems that we’re going to have in this building? How are they going to be run early on, because this building, it takes years to design these things? It was in the design phase while the sustainability regenerative plan was underway. And so there were some really good conversations about if we want to be net zero if we want to be even regenerative. What does that mean for this building that we’re constructing right now today, or designing that will be around for 50 to 100 years, right? When you when you’re an aquarium, you build buildings to last. And so they they change some of the system design so that it would be more sustainable because of their planning efforts. You You asked about water. One of the things that an aquarium or zoo can do with water is have recirculation and life support systems. Years ago, when zoos and aquariums were built, you’d have these pools and you dump and fill them right when they got dirty, you drain them out, clean them, and then put new water in. And the best practice now is really to have recirculation filter systems, water quality monitors and management so that you’re really just topping off any evaporation from a water use. And while you think about there are pumps on site that are moving that water more regularly, what you forget to think about is that when you’re dumping and filling, the water utility is used In a lot of electricity and energy to clean that water and move that water, so it’s, while the organisation might use a little bit more electricity for life support system. From an environmental footprint standpoint, it’s far better to have recirculation and life support systems than to dump and fill.
Gene Tunny 10:18
Gotcha. Okay. And you talk about moving from sustainability or to regenerative plans? What do you mean by regenerative?
Daniel Lawse 10:28
That’s a great question. And I don’t know that I have a straight answer for it.
Gene Tunny 10:32
That’s okay. Is it circular economy? Is that the sort of thing you’re talking about? It
Daniel Lawse 10:36
is, it’s a variety of things. Like the most simple way I can think about regenerative is if you have a spectrum where degenerative is on one side and regenerative is on the other sustainability is right in the middle. So degenerative is you’re doing harm whether it’s intentional or not. Sustainability is doing no harm. Right? Yeah. I mean, here’s, here’s a good way to think about it. Do you want a sustainable relationship with your loved ones? Well,
Gene Tunny 11:01
I think you want to, you want to be growing, you want to be improving it over time, don’t you? So? Yeah,
Daniel Lawse 11:06
at a minimum sustainable relationship would be good, right? Yeah. But you named it right? Something that’s growing, that’s alive, that’s thriving, that’s what regenerative, it’s, it’s, it’s doing more good. It’s generating more good and we can get into the nuances of, well, in a truly regenerative system, I take a lot of wisdom from nature, right, biomimicry, living systems, nature has been doing this experiment called Life for 3.8 billion years, it’s learned a few things that we could, we could learn from it. And so a regenerative system in nature is think of a type three ecosystem, which is like a mature forest, or a mature coral reef, or a mature prairie. Every organism in there is giving back more than it’s consuming. The tree while it’s taking nutrients from the soil, and rainwater, it’s growing, and it’s providing shelter. And it’s providing compost when the leaves drop and turn back into soil. So it’s creating more good than its consumption. And so, and humans don’t have to do anything about that the system itself is regenerating itself. There’s a human aspect where maybe it’s restorative, where humans believe we have to come in and we have to change and fix things. And that’s better than sustainable in many ways. But a truly regenerative system is like, how can we create the conditions where life thrives human life, animal life, plant life. And that’s kind of the philosophical way of thinking that the practical piece you mentioned, it’s circular economy is one of those like in nature, there is no waste. One animals, bird poop is fertiliser. It’s a nutrient cycle rather than a waste stream. And so that’s one way to think about it from a mission standpoint, how do you be net positive with your emissions? Can you generate even more renewable energy than you consume so that you’re being a net benefit to the grid? Can you become more efficient, so that you don’t need as much and if you had, if you had the renewable energy for what that met your needs, but then you become more efficient, now you’re actually giving back to the grid. And it’s so regeneration also implies that you never can be done. It’s always moving sustainability, in the nuance implies that, like, we can become sustainable, we can achieve this goal, and then we’ve made it and we don’t have to do anything else. Regeneration means like, it’s ongoing. It requires constant nurturing. And so that’s why it’s hard to say specifically what it is. But it’s a way of thinking that allows people to engage and wrestle with a question rather than a statement. Yeah.
Gene Tunny 13:49
Yeah. Fair enough. And this term, you use top three ecosystem? Is that a term from a ecology or ecological sciences or environmental science? Okay, I’ll have to look that up. Oh, I haven’t encountered that before. Well,
Daniel Lawse 14:02
it so let me paint the picture. There’s a type one and type two and type three ecosystem and it helps understand so think of a forest type three, which are thriving, generous ecosystem, but a type one ecosystem is like a dandelion. Its annual seeds, organisms and a type one ecosystem spend a lot, a little bit of energy over a lot of offspring, because they know they’re not going to last very long. It’s weeds. It’s insects that are really prolific, and they live a short amount of time most of them die. But in that process of dandelions, scattering seeds, or locusts, breeding and consuming and devastating, they’re actually building soil, which allows for a type two ecosystem to emerge that has more perennials. So the the plants are putting more energy into the root system, and not just reproduction, so that they can last longer, right, they can last through drought, they can last through different environmental changes. As. And then as those shrubs are growing and other, you know, higher, higher complexity mammals are coming into the ecosystem and making homes and creating habitats, then that creates the conditions where trees can actually grow and take root and mature over time. And then you get to the type three ecosystem and the type three ecosystem is going to last potentially 1000s of years, if you think about the rain forest, right, yeah, they can even withstand some levels of disruption, kind of the the biggest disruption when we think about the forest example is a forest fire, right? If a fire comes through and wipes out, all of the trees are most of them. That carbon that was in the trees is now in the soil somewhere in the air, you’ve got a rich soil base. And it’s actually part of an adaptive cycle when you go from a type three to a type one, where you release a lot of energy, but it provides sunlight and nutrients for new seeds to take root that weren’t there. And it takes a while to get back to that mature forest. But that will go through the type one, type two and type three ecosystems. So I’m always talking to organisations about how do you create an organisation that’s a type three ecosystem, that’s more generous than it is consumptive?
Gene Tunny 16:08
Yeah. Okay. I want to ask you about this net zero pathway. So yeah, that’s a I mean, that’s a bold goal, for some organisations is going to be a lot harder than others. And there are going to be some industrial businesses, or, you know, factories, which is probably, you know, almost impossible. What drives the decision making that these organisations you work with? I mean, is this something only for nonprofits where there’s people on the board who, you know, who have these these values that they’re committed to? Net Zero? Is it enlightened self interest by some organisations? What’s driving the behaviour? Daniel?
Daniel Lawse 16:51
That’s a great question with some really good seeds planted. It’s a number of factors, right. In some cases, it’s regulation. If you have to measure your scope one and two emissions, then you might set a goal around it, or you might be required to power plants and utilities in the US are being regulated to reduce emissions. We typically work with people who are more purpose driven, we do have a lot of nonprofits, we do a lot of work with zoos and aquariums, we’re conservation as part of their mission. And they’re literally seeing the corals bleaching and the habitats being destroyed from climate change that is foreseen, that’s putting pressure on extinction rates. So there’s a purpose driven, I would say that for some, it is what I would call or what you said enlightened self interest, right? I firmly believe that a truly sustainable or regenerative business is actually a really robust and thriving business, even economically. And so as leaders gain an understanding that sustainability isn’t just costing them money, but it’s adding value for talent, attraction and retention. It’s adding value for customers, it creates a good story for them to market and share if they’re truly doing it not greenwashing. And so it does become this enlightened self interest of we’re going to do this because it’s the right thing to do. But it’s also good for us. It makes our company more efficient. It makes us more effective. At the end of the day, if I if I could take a segue here into environment, environmental economics, right? Yeah. So often, I see people forget that the economy really exists to serve humans. Right? It’s the exchange of goods and services. Most fundamentally, if we humans aren’t around, there’s no goods and services that need to be exchanged. So if you take away humans, the economy doesn’t exist. But so often we talk about it as it’s like, we’re at service to the economy, what’s the health of the economy? If the economy has these reports and numbers, then we’re going to hurt because we’re the people. But even beyond the people, we don’t exist without a healthy environment. If there’s not clean air, clean water, a stable climate, people could go extinct. And without people, there’s no economy, so re prioritising or just reordering. It’s not the economy and we’re at the service of the economy, and we’ve got to make the economy hum. It’s actually the environment has to be healthy for people to be healthy. And when people are healthy, then we can have an economy and the economy should serve us. Yep. So if you take that to the business level, enlightened business leaders realise that a good environment is actually good for the people and is good for their bottom line. It’s the triple bottom line two people planet and profits. There’s a sweet spot where they all overlap.
Gene Tunny 19:45
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Gene Tunny 20:20
Now back to the show. Now these don’t have to be clients of yours and possibly they’re not. But are there any major corporates or you know, exemplars of, of, you know, what you see as doing the right thing? I mean, what are some, there’s some companies out there that you’re impressed by that you can identify that might be helpful for us to think about, you know, some of the you know, what some of these companies are doing what what are some of the, the ones that are leading the way?
Daniel Lawse 20:52
Yeah, that’s a good question. There honestly, are so many out there, so many more than when we first started doing this work 15 years ago. Patagonia, you know, that’s kind of an easy one to call out. They even talk about Don’t be consumers buy our product once and let it last a lifetime. And we’ll even repair it. They’re really embodying the circular economy. They even market of buying nothing day, on Black Friday, because they said, it’s more important for you as humans to go and be with family and go outside and enjoy nature than to go shopping, because you have a day off of work. They’re a really good example and model to look to who enlightened self interest. They’re thriving as a business. Yeah, they’re doing phenomenally. I’m trying to think so kind of tying this to the previous question of what motivates people, one of the shifts that we’ve seen been in the Midwest of the US, which is relatively conservative, which is funny, because conservation is the same root word conserve, as in conservative and conservation. Most people started hiring us because they wanted to save money. They wanted to reduce utilities and save money. Yeah, great. There’s environmental benefits, we didn’t need to talk about that. Then it evolved to the reason that these leaders wanted to do more was because they wanted to be seen as leaders in their community. Yeah, and they wanted to leave a legacy, they started to realise, like, Hey, I’m gonna retire in five years, or 10 years, and I have grandkids now, and they’re talking about their future and the planet are heating up. What’s the legacy that I am leaving? So kind of to generalise a characteristic? Is anybody who’s thinking about what legacy are they leaving? And what is the future of AR this long term thinking? What’s the future of my children and grandchildren and not just their own, but other people’s the future generations? That’s going to be a company that’s doing things right, when they shift from short term thinking to long term thinking. You kind of stumped me on which companies? Because I don’t I don’t think about companies all the time, I usually think about the principles and the philosophies that they operate under technologies. I don’t know any more of those. I think Patagonia
Gene Tunny 23:14
is a good example. I’ll have to look into that Buy Nothing Day. I mean, we wouldn’t want to have too many bye nothing days, or the economy would collapse. So I mean, as much as I do accept your points about? Look, I mean, it’s, you know, clearly, it’s not just about the mindless pursuit of GDP, I don’t think any economist would say, that’s what we want to have. It is about well being. And we do need to think about the environment. And yeah, and one of the issues that I’ve been thinking about quite a bit, and I’d love your thoughts on it. There’s a big debate at the moment about it’s probably been going for 50 years, actually, now that I think about it, it’s just, it’s just sort of revived in the last five years or so there’s this concept of degrowth, you’re aware of the whole degrowth movement? There’s a concern really, yeah. So there’s this growing concern that all well, we’re reaching all of these planetary limits, or we’re exceeding them and we’re at, you know, we’re consuming enough for to planet earth or something like that. They’re all these sort of factoids out there like that. And, you know, an economist, the general approach to that economists take is that well, we’ve been here before, and there was a whole Limits to Growth Club of Rome stuff in the 70s. And, and that really didn’t. That was just a bit of doom saying, and, you know, we actually seem to innovate our way out of problems and in all of this talk is just a bit of catastrophize it’s I’m wondering, I mean, do you have any thoughts on? I mean, maybe this is a bit you’re really focused on businesses, maybe this is more, you know, this is a sort of question that you really can’t answer. But do you have any thoughts on this whole D growth versus growth? Debate?
Daniel Lawse 25:12
I’ve got a thoughts. I don’t know if they’re any good. I go back to how does nature do it? Yeah, right. And I think that there’s an interesting differentiation between the word growth and the word development. And I think of humans, right at a certain point, I stopped growing, I’m not growing any taller, maybe I’m growing wider, depending on my diet. But I’m not really growing as a organism. But I am continuing to develop, I’m getting smarter. I’m exposing myself to new ideas. I’m learning new skills and trades and whatnot. So I like the idea of how can we develop ourselves, and that should continue for a lifetime. But I do wonder if continuous growth is normal, and I don’t see any place in nature, where continuous growth is normal, it’s cyclical, right? So at some point, any organism peaks, and then it eventually dies. Any ecosystem will ever achieve? Well, not necessarily, but many ecosystems can achieve this type three ecosystem. And even in that there still is released and, you know, miniature disruptive things that occur. But that’s really what I go to like, if I think about what’s, what’s the regenerative economy, it’s a type three ecosystem. That type three ecosystem isn’t just growing and growing and growing. It’s dynamic and changing. And there’s an energy flow within that ecosystem, right? If we break it down to fundamental energy, of poop, and fertiliser and plants and harvesting sunlight and pulling nutrients from the soil. Man, you’ve got me going, this is exciting. Oh, yeah, you guys, right? I think about you know, we the planet Earth is a relatively closed system, except for Sunlight. Sunlight is an energy input coming into the planet. And if we can figure out photosynthesis, like nature has, we will have an abundant source of energy. So put a pin in that for a minute. Yeah, if you look at the population of the world over history, it was typically in the one to 2 billion population range for most of history. And it was only a few 100 years ago, if you look at the population charts. That population really started to skyrocket. Why is that? Why were we able to innovate our way out of the last kind of doomsday? What was that the 1970s limits to growth? It was because of an excessive amount of energy in the form of fossil fuels. Yes, raw fossil fuels are ancient sunlight. It’s really detest sunlight in the form of plants and dinosaurs that have been compacted over millions of years, to be an energy dense source of material on this planet. We mined that drilled that took it out of the ground, and burned through millions of years of sunlight to create the economy that we have today. Is that sustainable? I don’t know. I mean, there’s conversations about peak resources, anything, right? There’s not an infinite amount of oil on the planet, there’s not an infinite amount of coal. Is there a lot more? I used to follow that stuff really closely. I’m not in the weeds enough to start quoting statistics on it, but there’s a finite amount. And so one of the questions I ponder is, was it the cheap energy dense fossil fuel that allowed rapid growth, fertilisers, mechanisation of agriculture, because you can’t have population growth without food? And yeah, and is it truly sustainable? And I would say at some point, it’s not I don’t know any organism on the planet that has had unsustained growth and never had a hey, we’re going to peak the rainforests are the closest that that have an ecosystem that hasn’t been devastated by fire, but humans are doing a pretty good number chopping those rainforest trees down? Yeah, certainly
Gene Tunny 29:20
in in South America and in Brazil and the Amazon that is a big, big concern. I mean, we’ve we’ve protected them here in Australia, which is great. We’ve got some beautiful rain forests around well, in the rare my part of the world and also in near Brisbane, Lamington National Park and then up in the Daintree in North Queensland, that all through North Queensland, really there’s some great rainforests. So yes, I understand the importance of those. Yeah, thanks for your perspective. Daniels. It’s something I think about a lot. And I think that point about the contribution of fossil fuels. That’s, that’s an important one to the economy we have today what? And you know, that impacts been studied by various people. I might put some links in the show notes, Robert Ayers, I think it was and then fast love smell, who is Bill Gates as you know, favourite writer, he’s done a great book on growth. And he’s looked at, you know, he’s been thinking about the extent to which we can continue on exponential growth and what the ultimate limits are. So I’m I put my put some links in the show notes, it’s something I’m going to come back to on the show, because it’s an issue I’m fascinated by.
Daniel Lawse 30:37
Well, I’m just curious, are there any thinkers out there that think exponential growth can continue?
Gene Tunny 30:46
I mean, not in it’s probably not forever? I mean, that would be a bit. I mean, not forever, within the current constraints, I think that would be absurd. Because I mean, you basically have to assume, I mean, you have to have some sort of technological innovation or some expansion of the frontier. I mean, maybe if we move to other planets, or we start mining asteroids, you know what I mean? I mean, that’s on a long enough timeframe, all of that may become possible. I guess the debate is whether, like, are we facing those limits within the next few decades? And if we are that would, that would lend weight to the arguments of the environmental movement of the greens party, various parties around the world that we need to have, you know, rapid, we need to have a massive cut in our standard of living to be able to protect the planet. I mean, I don’t agree with that. I’m just sitting out, I think what you’d have to believe, to come up with that point of view.
Daniel Lawse 31:52
You know, that reminds me of another example that’s very organizationally focused of how do we think about growth versus development and how we think matters. If you really fundamentally look to kind of philosophy, our worldviews frame, how we go about our business, our day to day actions. So take an airport in Europe, who’s landlocked, and has some of the highest volume of flights in the world? Their mindset is not that they’re an airport, that is an infrastructure company, right? That build stuff so planes can land and people can go and on their way and materials can be exchanged. Their mindset, it is more like a technology firm of optimization. How do we optimise the space that we have? That’s a very different mentality than take a US airport that has a lot of land area around it. Who thinks Okay, well, we want to increase passenger numbers, we should build more runways and more terminals and gates. Yeah. And that, that, to me is maybe a microcosm of this conversation that you’re having about D growth versus growth. And maybe it’s how we think about growth. I think we’re always going to have this hankering for more, can we do something better or something more? Businesses often say, if you’re not growing, you’re dying. I honestly struggle with that philosophically and wonder, is there a regenerative business that isn’t growing but isn’t dying, but it is developing? I don’t know. But going back to the airport example, like an optimised airport is going to say we’ve got 100 gates, we’re going to make use of every minute of the day to maximise that, yeah, an airport that operates with more land space may say, like, you know what, in order to grow, we’ve got 100 gates. But airport air, the aeroplane partners really only want to use them in the peak hours of the morning, where business travel is, and then the afternoon and a few evening ones. And they’re not maximising all the hours of the day. And so then the airport airlines say we want to add 10 more flights and they say, shoot, we don’t have enough gates. So we need to build more gates. Instead of saying we need to just think differently about when the planes are taking off and when you’re scheduling. So there’s definitely a mindset that can lead to a growth means build more, spend more versus growth means optimising what we already have.
Gene Tunny 34:19
Yeah, yeah. I like the idea of optimising that’s, that’s very good. Excellent. Daniel, it’s been great. Really, really enjoying the conversation. We’ll probably have to wrap up, wrap up soon. Before we go, I’ve got to ask given you’re in Omaha, and this is a economic show. Do you ever see Mr. Buffett around town?
Daniel Lawse 34:42
Have I seen him personally? I don’t think I have but I’ve been in one of his favourite restaurants before where he eats pretty regularly. And you know, we host the Berkshire Hathaway every single year. So see all of the tourists who come in for that. The shareholders who come in and My wife owns a little tea shop. So that always gets a little bit more business during those Berkshire days. But I’ve not bumped into Warren myself personally, that’s
Gene Tunny 35:08
just Just thought I’d ask given when, when people hear Omaha, they’ll think that, you know, that’s often the first thing, rightly or wrongly people people think of in their minds, particularly if they’re in economics or finance or so to sort out ask.
Daniel Lawse 35:23
Well, on some levels, I think Warren’s actually a pretty sustainably minded person, we can argue lots of other things. But here’s the example. I drive past his house on a regular basis. Right, he does not live in a gated community mansion. He’s lived in the same house, I think for over 50 years. And he’s done some upgrades to it and add a few additions. But it is a very, what I would call a modest house in a nice neighbourhood of Omaha, but like, probably hundreds of 1000s of people drive past his house and would never know what’s even his. So the fact that he doesn’t go and just consume and build a big house because he has the money and he could, and I don’t I don’t believe he owns that many homes or second homes or third homes, he owns a couple different locations. But there are some people who have a lot of Wells who own a lot of homes that they travel and vacation to so in that regard, he’s making a sustainable choice by living in a in a modest house that he’s had for decades and maintaining it and regenerating it, perhaps we might if we want to throw that in there. Instead of tearing it down and and creating something new and bigger.
Gene Tunny 36:33
Oh, it’s, it’s a good story. I mean, he’s, he’s, he’s embodying the, you know, the, the virtues or the, the, the high point or what’s the right word to describe it he’s in he’s in borrowing. He’s embodying those, the real great values of capitalism or where it’s about saving and investing. So So that’s terrific. Good, I can last Yeah. Like it lasts. Good on Warren Buffett. Very good. Okay. Danny Lawson. This has been a great conversation. Any final points before we close?
Daniel Lawse 37:04
I love your questions. Jean, I think it’s so important to be aware of how we think, because it really does matter. And there are four critical shifts that I see at play and all the sustainability work that we do. And I’ve talked about probably all of them but shifting our mindset from a closed system to an open system, right? We’re not alone in this world. And so let’s acknowledge the impact that other organisations and communities and businesses have on us. The shift from like this mechanistic worldview to a living and dynamic worldview, like, change is the only constant thing in life and when we recognise that I’m a living being and organisations are made up of humans, so we’re more living. We’re more like a garden that needs nurturing intending, then a business is a machine that you just take a part out and replace it right, let’s let’s humanise our organisations is that a dehumanise them. The third is the shift from really feeling like and thinking like we’re separate from everybody else and shifting more to this interconnected way of being recognising that my actions have impacts on you, whether intentionally or not, when we do an organisational policy, it’s it can shift things in good ways, unknown ways and unknown ways. And then the last one is the short term thinking the long term thinking, I’ll end with this. The seventh generation principle comes from the Iroquois nation, the first peoples of the US, or of North America, I apologise. And they said, the decisions that we make for our community, we need to think about what is the impact going to be on seven generations, which, you know, it’s about 150 years, you can’t even predict that far out. But it forced them to think about what’s the long term impact of the decisions that are made at Council. I challenge your listeners to imagine a world where their elected presidents council members representatives didn’t think about the next election cycle and being reelected, but thought in seven generations, what would be different? Yeah. And what would be different if our business leaders weren’t thinking about quarterly profits, short term feedback loops, and instead thought forward seven generations? What, how different would our businesses look? And how different would our communities be? If we had leaders who are thinking in seven generations changes everything in, I think, pretty good ways.
Gene Tunny 39:24
Okay, that’s fascinating. And I’ve looked that up the seventh generation principle, very good. Daniel also really enjoyed the conversation and hope, you know, keep up the good work, and I hope we can catch up in the future because I’d love to explore this whole concept of D growth, etc, growth versus D growth. And, you know, just how do we balance all of these competing considerations? And I mean, can we get to a win win? That that’s, you know, with the economy and environment and society in the future, so that’s something I want to explore some more. So, very good. Thanks so much for your time really enjoyed it.
Daniel Lawse 40:05
Absolutely gene. Thanks for all the great questions and good ideas you spark in the world with this podcast
Gene Tunny 40:11
rato thanks for listening to this episode of economics explored. If you have any questions, comments or suggestions, please get in touch. I’d love to hear from you. You can send me an email via contact at economics explore.com Or a voicemail via SpeakPipe. You can find the link in the show notes. If you’ve enjoyed the show, I’d be grateful if you could tell anyone you think would be interested about it. Word of mouth is one of the main ways that people learn about the show. Finally, if you’re podcasting outlets you then please write a review and leave a rating. Thanks for listening. I hope you can join me again next week.
40:58
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Credits
Thanks to Obsidian Productions for mixing the episode and to the show’s sponsor, Gene’s consultancy business, www.adepteconomics.com.au. Full transcripts are available a few days after the episode is first published at www.economicsexplored.com. Economics Explored is available via Apple Podcasts, Google Podcast, and other podcasting platforms.
