The World's Richest Little Isle (1982)

Few islands in the South Pacific look less promising from the air. Instead of the usual verdant atoll -all palm trees and beaches - the island is more like a chunk of gray lunar landscape encircled by a thin ribbon of green along the shoreline. In the interior, a few sparse clumps of vegetation stand out amid stark rock pinnacles. Clearly, this is not an ordinary tropical paradise.

Yet this unprepossessing island - 26 miles south of the Equator, about midway between Hawaii and Australia and hundreds of miles from anywhere -is the envy of the South Pacific. For this is the Republic of Nauru - all eight and a half square miles of it. Nauru, with a per capita income surpassing that of any oil-rich Arab nation, is the smallest and wealthiest independent democracy in the world. ...

https://www.nytimes.com/1982/03/07/magazine/world-s-richest-little-isle.html

#Nauru #limits #NaturalResources #NaturalResourceEconomics #SouthPacific #LimitsToGrowth

@pluralistic On the "markets can't solve this" aspect ... there's one possible angle in which they might help.

Business function as accounting engines. They don't create wealth, they create accounting profits. (Interesting backstory, look up Alexander Hamilton Church on the origins of Cost Accounting, and yes, he's related to that A. Hamilton.)

Because Reasons, accounting considers some costs and not others. Natural resource accounting, and economics, its own special class of utterly fucked up, and that's also an interesting little tale of utter fuckwitted thinking. See Hotelling's Rule & earlier L.C. Gray (neither of whom cite any geology), and back to David Ricardo for what theory exists. It utterly fails to match actual pricing history (see BP's annual statistical rule, petroleum's got excellent data to 1860).

(Hotelling's relationship to Rockefeller-funded University of Chicago also raises eyebrows: petroleum monopolist-financed economist justifies petroleum monopolist pricing.)

Leo Tolstoy has an interesting alternative accounting, IIRC in "What Then Shall We Do" which includes sunshine and land and other factors excluded from traditional cost accounting.

The Rule of Capture (via an utterly fucked-up 1904 Texas Supreme Court ruling) creates a legal basis that again utterly ignores geological science. The principle is less used, but the legal precedent stands.

Jeffrey S. Dukes, "Burning Buried Sunshine" (2003), gives the information on primordeal primary production (plant growth) that resulted in fossil fuel deposits. A year of present consumption is 5 million years of ancient accumulation, a depletion cost not considered in present pricing.

If it were, depletion allowances for extraction would increase the cost of fossil fuels by a factor of millions. Simply by an accounting change, the resources would be effectively pinned to the ground by a force stronger than gravity: it would be a complete economic loss.

(Odds of this happening? Uncertain. Worth a shot? Um, hell yeah!)

Keep in mind that this is independent and in addition to accounting for sink costs, which is what a carbon or other pollution cost would be. Proposed carbon taxes are a very small fraction of what a full, geologically cognizant cost-accounting depletion allowance would be.

Links to follow.

#AlexanderHamiltonChurch #CostAccounting #HotellingsRule #NaturalResourceEconomics #HowardHotelling #LeoTolstoy #JeffreySDukes #BurningBuriedSunshine #DepletionAllowances #AccountingStandards #Petroleum #Economics