There is an old model of the economy that is well lodged in the heads of my generation of business people and politicians. It envisions the economy as a sequence of functions—extraction, processing, manufacturing, distribution, and consumption. And, oh yes, then there is the environment and environmental protection. But note that in this model, attention to the environment is usually an afterthought—a latter day “add on”—and not an integral part of the economic model.

Notwithstanding the usefulness and long standing entrenchment of this model, next generation Canadians have a very different and more holistic way of conceptualizing our economy. This involves explicitly recognizing the tight and all-pervasive inter-relationship between the economy and the environment—that the economy draws all its resources from this planet’s soil, minerals, vegetation, water, and atmosphere and discharges all its wastes into various ecosystems with finite carrying capacities.

The science that best informs this linkage between the economy and the environment is not climate science but the much older and long established Laws of the Conservation of Mass and Energy.*

From this perspective, environmental conservation and protection is an integral feature of every economic function. A key political question thus becomes who is going to initiate, perform, and pay for environmental conservation and protection? Is it the state and the taxpayers? Is it the marketplace and consumers? Or, if it is some combination of both, what is the right combination?

Unfortunately, it has often been left-of-centre commentators and politicians with a predisposition toward government interventions that have seized the high ground on many environmental issues, with conservatives taking a largely defensive posture or even denying that environmental problems require serious attention. This puts conservatives in a very disadvantageous position in addressing such issues and in securing the support of next generation Canadians.

So what can be done to enable conservatives to take a positive, proactive stance on environmental issues? What should be the essence of a “green conservatism?”

Here are three suggestions:

First, recognize that “conservative” and “conservation” come from the same root. There is nothing philosophically incompatible between economic conservatism and environmental conservation. Conservatives by definition should be conservationists.

Second, expand the application of the basic principle of “fiscal conservatism,” namely that we must “live within our means” financially. Living within our means is actually an ecological principle—we cannot put demands on ecosystems beyond their ability to carry those demands. Thus fiscal conservatives especially should be open to broadening their conception and application of the “living within our means” principle and become champions of measures to eliminate ecological deficits and to balance the ecological budget.

Third and most important, conservatives believe in the efficacy of markets. A pure market is simply a device to efficiently bring supply to bear on demand by means of pricing signals and financial incentives. In theory, a market doesn’t care whether the demand is for widgets or automobiles or oil, or whether it is for clean air, clean water, or reclaimed soil.

Thus, should not the signature contribution of conservatives to environmental issues be the harnessing of market mechanisms to facilitate environmental conservation? This approach is of course in stark contrast to the micro-regulation and massive government interventions offered by left-of-centre commentators and politicians.

For example, with respect to energy production, conservatives should be on the forefront of advocating that we:

• Identify any negative environmental impacts associated with the production of energy from any source;
• Identify, cost out, and implement avoidance or measures to mitigate those impacts;
• Include the costs of those measures in the price of the energy through a pollution levy or tax; and,
• Adopt other necessary and complementary policies—such as revenue recycling and reduction of the regulatory burden—required to make the concept of pollution pricing environmentally effective, economically sound, and politically feasible.

If you are a conservative and are skeptical about global warming and the role of human economic activity in contributing to it, then apply this concept of pollution pricing in some other area where you do acknowledge an environmental problem, for example, as a means of dealing with industrial waste, household waste, water shortages, or traffic congestion. But don’t throw the market-oriented pollution-pricing concept out with the climate-change bathwater. Using pricing signals and financial incentives to deal with pollution of all kinds is the conservative alternative to massive government intervention in the economy in the name of environmental protection.

Summing up, in my judgment there would be great merit in conservatives adopting “Green Conservatism”as a major component of our policy platforms going forward, in particular, offering market-based solutions to environmental challenges as an alternative to the government-centric offerings of others.

*The Law of Conservation of Mass and Energy states that in a closed system matter and energy are neither created nor destroyed but are simply changed from one form to another. Thus if it takes 1000 mass/energy units of material (oil sands, water, natural gas, and other chemicals) to produce 100 mass/energy units of gasoline, the question arises “what happened to the other 900 units of mass/energy?” And the challenge becomes to recognize these “waste” elements—sand, polluted water, combustion products, etc.—process them in some way to return them as harmlessly as possible into the ecosystems, and incorporate the cost of doing so into the price of the gasoline.

Preston Manning is the Founder of the Manning Centre.