Dr Bernice Maxton-Lee is the author of Forest Conservation and Sustainability in Indonesia: A Political Economy Study of International Governance Failure, published in 2020 by Routledge. She submitted this Guest Post about deforestation in Indonesia.
Forests, carbon markets, and capitalism: How deforestation in Indonesia became a geo-political hornet’s nest
By Dr Bernice Maxton-Lee, August 2020
If I have 5 apples, and John takes 4, how many apples do I have left?
This is a basic question of arithmetic, a simple question from school days, in which teachers would ‘make maths fun’. In those easy, childhood days, there was a right answer to that question, and a wrong one. If I answered ‘1’, I’d get a ‘tick’ next to my homework. If I answered ‘well it really depends on how you look at it. John has turned my apples into a complex basket of fruit-based derivatives, to better exploit their full market potential, so the overall situation, though complicated, is actually improving’, I’d probably have got detention for talking nonsense.
Yet such numerical fancy footwork is frequently present in discussions about deforestation. Rather than focusing on how much original, intact forest is being lost, the debate gets diluted and sidelined by issues that may, in their own right, be important, but which don’t actually stop deforestation. Take, for example, clever financing mechanisms underpinning REDD+. Vast amounts of money, time, and imagination are invested in making global financial markets invest in carbon as a way to justify the existence of trees. This fails to work because ownership is difficult to codify, because uses of forest change over time, and because forests and people are so much more complex and sophisticated than ‘trees’ and ‘owners’. It fails because the financial returns from a basket of carbon are nowhere close to the vast financial returns from cutting down trees, burning the remains, and converting the land into something more profitable. Finally, ‘the market’ can’t tell the difference between newly planted fast-growing monoculture trees, and old, dense, ecologically-complex forest, so financial solutions to the deforestation problem are hailed as a step in the right direction when, in reality, they are nothing of the sort.
Well-meaning attempts to increase stakeholder participation and empower marginalised groups are also seen as a way to reduce the rate of destruction, with vast amounts of money, time, and effort devoted to improving these activities. Including a wide range of perspectives and voices in important discussions has many benefits, which is why these efforts are widely praised as a solution to the deforestation challenge. They are doubtless important in their own right. Yet they rarely have an enduring effect on the number of trees being burnt.
Are we there yet?
Examples like these show why Indonesia’s deforestation has become a geo-political hornet’s nest. There have been many attempts to stop the destruction, over many decades, but almost none has had any lasting effect and few people really understand why. Despite so much good work, the destruction, by fire and chainsaw of Indonesia’s old-growth tropical forests has continued and, particularly since 2000, increased. As with Brazil, Indonesia has seen variations in the rates of deforestation in the last several decades but the overall trend of forest loss has been upwards, which translates simply into ‘less forest’.
Optimists in the development-activist-academic world of sustainability and conservation say that too much focus on negative indicators is unhelpful. Better to look at the progress that has been made. They point to reports like those from WRI that deforestation from primary forests in Indonesia fell in 2018, compared to the average annual rate of loss from 2002-2016. Yet figures showing rates of forest loss are incomplete if they ignore secondary, or partially-degraded forest, where significant stretches of intact forest often still remain. In 2019, this accounted for 2/3 of forest loss. Forests are still being lost, no matter how they are categorised, and no matter how rates vary from one 12-month period to the next.
Whatever happens to rates of deforestation in the short term, it is clear that the current trend will continue long term, because the basic, underlying conditions driving forest loss are not being addressed. No matter whether the ownership of trees and forest land is clarified and codified, no matter how many stakeholders participate in sustainable development meetings, no matter how many clever financial instruments are developed in Frankfurt or New York or London, forest and peatland will burn, habitats will be destroyed, livelihoods and physical health will be damaged. This is because none of the ambitious, far-reaching, visionary mitigation, restoration, and rehabilitation programmes that have been implemented over the past decades has addressed the fundamental cause of problem.
What is the problem?
The major cause of deforestation and environmental degradation in Indonesia and elsewhere is not country-level lack of transparency, or corruption, or lack of stakeholder engagement. The crux of the problem is the global economic system in which the only measure of success is increasing short term financial returns. Capitalism, in other words.
Companies need to continually increase their shareholder returns. National governments are told by international business schools, pricey consultants, development experts, the media, and international organisations that they must boost economic growth. Well-established development thinking continues to peddle the idea that once countries have reached a magical level of economic development, all the other ‘nice-to-have’ things like equality, environmental sustainability, and life expectancy will automatically appear. This deeply-rooted ideology fundamentally contradicts the superficial message that countries should protect nature.
Deforestation is driven by the needs of this economic narrative. As most people are trapped within the same global economic system, this means that every country and every person is subject to the same truths:
- everything that can be commoditised, should be;
- the highest possible short-term financial return should determine the fate of a commodity.
Everything that can be commoditised, should be
The only recognisable value in the global economic system is money, and all forms of life, society, nature, and human potential must be viewed through this lens. How much is a tree, or a forest, worth? Is it worth more money standing in the ground or cut down?
It is modern economics which creates the logical quagmire where highly sophisticated, multi-faceted functions of nature and human-nature interactions must be mapped and codified, squeezing them into rigid, static terms of ownership. The transactions that follow cannot possibly take account of the infinite and measureless ways in which nature exists, or the real interactions between humans and nature that take place. Modern economics is a fantasy world where the realities of life are suspended.
The highest possible short-term financial return should determine the fate of a commodity
In the modern economic world, money always follows the path of least resistance. It manoeuvres around obstacles and exploits weaknesses in pursuit of ever-higher returns. Despite the growing number of ethical and responsible investment criteria, doing ‘the right thing’ remains a subjective, voluntary, fringe activity. Following the 2008 financial crisis, speculative investment in palm oil infrastructure boomed, increasing land clearance, for no purpose other than the growth of money in the world’s big financial centres. Investment workers in Wall Street did not think about the health and sustainability of the world’s rainforests when they bought into palm oil infrastructure; they thought about recovering their losses.
Not seeing the forest for the trees
The complexity of this process often makes it hard to understand. If John cuts down, burns, or otherwise destroys a million hectares of bio-diverse rainforest and then plants oil palm trees, is there more forest, or less forest, than when he started? The answer, in forest conservation debates, depends on how you look at it. But it shouldn’t. There is less carbon-dense, eco-complex, old-growth forest today than there was last year, or the year before that. However, if the forest was partially-degraded and therefore not recorded as primary forest, there is no less forest than when he started.
Almost regardless of what conservationists do, if short term profit maximisation is the central driving force, there will be more reason to extract and use resources, than to preserve them. Any lasting solution to the deforestation problem must therefore address the whole global economic system, and not isolated elements within it.
It is our approach to economics which lies at the root of the world’s deforestation, environmental degradation, and climate change. It is the elephant in the room which few people attempt to discuss, and few even take seriously. No matter how many clever financing mechanisms are dreamed up, no matter how many marginalised individuals are brought into stakeholder discussions, on the simple arithmetic of old-growth forest we are not making progress, because somewhere, decisions are being driven by the desire to maximise short-term financial profit. As Malcom X put it: ‘You don’t stick a knife in a man’s back nine inches and then pull it out six inches and say you’re making progress’. You don’t set a forest on fire, then pull out a couple of charred saplings for replanting, and say you’re making progress either.