Li Quanxi: A Critical Study of the Trend of Green Capitalism: A Literature Review
Since the mid-20th century, as global ecological and environmental problems have become increasingly prominent, scholars have proposed three theoretical models within the contemporary Western world for resolving these issues: "The first is the neoliberal model, which advocates resorting to the self-regulation of capital and the market, for example, through the creation of carbon and ecological taxes. The second is the eco-Marxist or eco-socialist model, which advocates a fundamental transformation of the capitalist mode of production and lifestyle. The third consists of various types situated between the two, which can be broadly summarized as the green capitalism model." Fundamentally, the focus of the Western academic community in proposing these three models lies in whether addressing global ecological problems requires limited refinements to capitalism or a thorough, holistic transformation. Clearly, the green capitalism model places its hope in achieving a reconciliation between ecological issues and the capitalist system through limited refinements of the latter. Once the trend of green capitalism was proposed, it received high level of attention from the academic community. Scholars have conducted critical analyses of its historical origins, essential connotations, hypothetical premises, developmental dilemmas, and future transcendence, resulting in a body of research. This article will provide a literature review of recent research findings.
I. The Background and Origins of Green Capitalism
Since the mid-20th century, alongside the rapid advancement of industrialization in Western capitalist countries, the growing severity of ecological and environmental issues has sparked intense public concern. While the concept of sustainable development proposed by Western nations has existed for over 30 years, practical experience suggests that environmental problems have not diminished; rather, the efficacy of sustainable development within the Western context has been minimal. In the view of some Western scholars, this "capitalist project of sustainable development is a cognitive error and was doomed to fail from the start. The reason is that maximizing profit and protecting the planet are inherently contradictory."
In 1991, "the World Bank launched the 'Global Environment Facility' (GEF), aimed at addressing environmental degradation within member states and on a global scale, marking the mainstreaming of 'green capitalist' global environmental plans." During this period, environmental economists represented by Paul Hawken, Lester Brown, and Frances Cairncross argued that profit-seeking and environmental goals could be "combined" through "green technology, green taxes, and eco-conscious shopping." A trend of green capitalism emerged, attempting to coordinate ecological environments and economic development within the framework of capitalism. Notably, Paul Hawken published Natural Capitalism: Creating the Next Industrial Revolution in 1999. "This book critiques traditional industrial capitalism, arguing that it only recognizes the value of money and commodities as capital while failing to acknowledge the status of natural and human capital. Thus, it ignores the accounting of natural resources and biological systems, leading to pollution and social injustice. The book attributes these problems solely to the failure to correctly account for capital, rather than viewing them as failures of the capitalist system itself." Western scholars gave this book high praise: Bill McKibben regarded its appearance as a timely rain [1]; David Orr believed it provided a planning guide for the 21st century; and Fritjof Capra viewed it as a conceptual milestone on the road to ecological sustainability. Consequently, it proposed the development of green capitalism. In 2002, the Taiwanese scholar Wu Hsin-ju translated this book directly as Green Capitalism: Strategies for a Win-Win Economy.
In 2007, Paul Hawken's The Ecology of Commerce: A Declaration of Sustainability was translated into Chinese. This book argues that "the key to environmental problems is a matter of design rather than management; creating a sustainable business model is our only real way out. In this model, corporate 'social responsibility' is self-driven and consistent with the market principle of profit maximization, rather than being constrained by morality or regulation." These works are considered representative of green capitalism. In summary, the primary social background for the rise of green capitalism is the public expectation for the coordinated development of the environment and capitalism. It is evident that, in terms of its origins, green capitalism does not exceed the conceptual background of sustainable development; it is the logical result of over 30 years of social practice under the sustainable development ethos.
II. The Essential Connotation of Green Capitalism
Etymologically, the prefix "green" in green capitalism manifests the expectation for an ecologically sustainable capitalism, while the suffix "capitalism" defines its systemic attributes. Some scholars argue that the concept of green capitalism is an oxymoron, blending "green" and "capitalism" into a contradictory term. "'Green capitalism' is an attempt to merge two opposing concepts. To 'be green' means prioritizing the health of the biosphere, which requires controlling greenhouse gas emissions and protecting biodiversity. Conversely, promoting the development of capitalism requires driving growth and accumulation, treating labor and nature merely as necessary inputs." However, in reality, this contradiction-filled category remains a vital concept in the policy systems of Western capitalist countries. What, then, is the essence of this trend?
According to Hawken and others, green capitalism is a theory that "systematically integrates the business principles of profitability, operability, and sustainability into its theoretical foundation, forging a new generation of industrial development models that balance economic costs with ecological benefits." Other scholars suggest that green capitalism is "the incorporation of green capital—composed of resources, living systems, and ecosystems—and human capital—expressed in human, intellectual, cultural, and organizational forms—into the logical system of capitalism." From these definitions, it is clear that they are saturated with the flavor of environmental economics; their substance is the hope of providing society with an operational model for sustainable economic development within the framework of the capitalist system.
How should we understand such a model? Some scholars believe its essential connotation includes at least three aspects: "First, green capitalism posits that economic growth can provide favorable conditions for solving environmental problems. Second, it proposes that natural resources can be protected through capitalist market principles. Finally, green capitalism is highly confident in solving ecological problems through technological progress." That is to say, proponents of green capitalism believe that economic growth can facilitate the resolution of environmental issues. This view overlooks the natural resource base of economic growth and ignores the fact that any resource within a specific time and space has quantitative limits. Simultaneously, it must be noted that there is no necessary link between economic growth and the improvement of public social welfare. This implies a political subtext regarding the just distribution of the fruits of social development. Furthermore, proponents believe market principles can protect the environment, which in substance attributes the root of environmental problems to market failure. Therefore, as long as market mechanisms are perfected, environmental problems can be effectively solved through market-based means. Additionally, they believe technology has a prominent function; as long as technology is continuously innovated, environmental solutions can be achieved. Thus, a fundamental definition can be made: the trend of green capitalism is an ideological system that, within the framework of the capitalist system, hopes to achieve coordinated development between the ecological environment and capitalism through market means and technological innovation.
III. The Deep Roots of Green Capitalism
Why do proponents of green capitalism confidently believe that coordination between the environment and capitalism can be achieved through market means and technological innovation within the capitalist framework? Where does this confidence originate? As is well known, the essence of philosophical thinking lies in the critique of premises. To reflect on the constructive confidence of green capitalists, we must further interrogate the hypothetical premises upon which the trend is built. The academic community has researched this issue and believes that green capitalism is established upon the following premises:
First, adherence to the "iron rule" of profit maximization. In capitalist society, the pursuit of maximum profit is the ultimate direction for capitalists to expand production. This nature of capitalism creates a fundamental contradiction between protecting the planet and capitalist development; in the capitalist vision, the conflict between ecological demands and profit maximization always persists. This fundamentally illustrates the anti-ecological nature of the capitalist system. In this context, "profit maximization is the iron rule of capitalism, a rule that overrides all others, thereby setting the possibilities and scope for ecological reform." Consequently, under such an iron rule, the innovative measures taken by capitalist states to address environmental issues are necessarily restricted to the capitalist framework and cannot break through the fundamental capitalist system to conduct thorough ecological reform.
Second, a serious underestimation of the severity of environmental problems. An important root of the green capitalist proposal to solve environmental issues within the capitalist framework is their belief that the contradiction between the ecological crisis and capitalism has not yet reached the point of qualitative change [2]. Therefore, they see no need to break through the overall framework of capitalism to seek solutions. Although global ecological problems have reached a point where they threaten human survival and sustainable development, "green capitalist theorists generally underestimate the severity, scope, and speed of the global ecological deterioration we face. They imagine that if we use a few incentives here, a few penalties there, plus green taxes and the like, the economy can continue to grow." This means green capitalism assumes the environmental problems faced by capitalist society have not exceeded the range and magnitude of capitalist self-regulation.
Third, the unrestrained exaltation of market-centrism. Currently, due to the influence of neoliberalism in Western countries, people seem to place more emphasis on the role of market-centric measures in solving environmental problems. From the perspective of market-centrism, all environmental problems "can be transformed into studies of the increase or decrease of utility. One of the most important issues to resolve is how to tackle market failures caused by externalities and public goods. This implies the root cause of environmental problems is the market's failure to allocate resources efficiently. Solving this requires internalizing externalities by defining property rights and appropriate forms of economic organization, thereby using market mechanisms to improve resource allocation efficiency and reach Pareto optimality." Supported by market-centrism, green capitalists seem to feel there is no problem the market cannot solve. Naturally, when addressing environmental issues, they are inclined to devise countermeasures from a market-centric perspective.
Fourth, the blind worship of technological omnipotence. Since entering industrial society, the social function of technology has become increasingly prominent, and humans have exerted unprecedented pressure on nature through technology. It is precisely because green capitalists see the powerful social function of technology that they lean toward technological innovation to solve ecological problems. Supporters of "green capitalism" believe that "the birth and development of new technologies can improve energy efficiency and resource utilization, reducing the raw materials required for production or the amount of waste and harmful emissions generated per unit in the production process." To an extent, this view attributes environmental problems to technical issues, suggesting that technological change alone can achieve environmental transformation. This view warrants reflection. First, the negative effects of technology itself are an important cause of environmental problems. Second, any technology has its scope of application; once it exceeds this scope, its function may not necessarily be positive. Finally, there is no necessary link between technological change and the resolution of environmental problems. In this regard, the Jevons Paradox [3] is the best illustration.
Fifth, a superstitious belief in active and forceful government support. In the view of green capitalists, achieving the coordinated development of the ecological environment and capitalism through market mechanisms and technological change to facilitate the continuous satisfaction of economic interests aligns with the needs of governments governing under capitalist political systems. Theoretically speaking, such a program should receive vigorous support and active promotion from governments. Within the framework of the capitalist system, no government will "dig its own grave"; therefore, if a government is willing to promote the development of green capitalism, the measures taken must be top-down reforms, never a thorough, bottom-up dismantling of the old state apparatus. Consequently, green capitalism can never break through the existing institutional framework to engage in an ecological practice that transcends the current government. Viewed from reality, this hypothesis is clearly untenable. The Trump administration’s withdrawal from the Paris Agreement in 2017 fully demonstrates that within the vision of a capitalist government, the ecological demands of the masses are not important compared to maintaining regime continuity and safeguarding the interests of financial consortia.
IV. The Practical Dilemmas of the Green Capitalist Trend of Thought
Given the five hypotheses mentioned above, green capitalists believe that green capitalism will be the latest form of capitalism in the future. How does the concept of green capitalism translate into reality? Some scholars have researched the development programs of green capitalism, suggesting that green capitalists primarily adopt measures such as the "Green New Deal, green stimulus, and the green economy." However, these programs have not achieved substantial development in reality; on the contrary, they have fallen into developmental dilemmas, fully exposing the limitations of green capitalism.
First, green capitalists are unable to resolve the fundamental contradiction between capitalism and the ecological environment. This fundamental contradiction is prominently expressed as the conflict between the capitalists' unlimited pursuit of profit maximization and the scarcity of natural resources. Within the capitalist system, realizing profit maximization becomes the code of conduct for capitalists. However, any resource is scarce within a specific time and space, which invisibly intensifies the tense antagonism between the capitalist system and the ecological environment. With the emergence of new changes in contemporary capitalist countries, capitalists focus on how to maximize expanded reproduction [4] while complying with the requirements of the new situation. "Since the nature of capital is infinite accumulation and the constant pursuit of growth—where more growth is better and faster is better—the capitalist system will surely and ruthlessly crush everything that stands in the way of its expansion." In this process, capitalists increasingly tend to increase investment in constant capital and decrease investment in variable capital. Accompanied by the rise in the organic composition of capital [5], the pressure exerted by the capitalist class on natural ecosystems will only increase with each passing day. Therefore, within the capitalist framework, the desire of green capitalists to resolve the fundamental contradiction between capitalism and the ecological environment is undoubtedly a delusion.
Second, the failure of "market-centrism." Since the outbreak of the 2008 economic crisis, the global economy has remained sluggish, and some Western capitalist countries have not yet fully emerged from the effects of this crisis. In this context, the attempt to address global ecological issues through market mechanisms like "carbon taxes" and "cap and trade" is merely a green utopian idea. To begin with, increasing carbon taxes will inevitably affect corporate production costs and profit maximization. Within the capitalist institutional framework, the political participation of enterprises is extremely powerful; through "personal unions" [6] with the government, they force the state to issue policies and guidelines favorable to them. Thus, objectively speaking, enterprises never want the government to introduce such regulations. Furthermore, "cap and trade" for carbon emission rights faces the same awkward practical situation. "Many countries and enterprises avoid participating in this plan as much as possible, and even if they agree to the proposal, they set the emission caps at a relatively high level."
Third, the loss of control over "technological omnipotence." "Supporters of green capitalism often treat technological breakthroughs as a tenet of faith. Indeed, technological progress brings many surprises, but green technological miracles cannot save us. The current capitalist system, lacking moral guidance, has lost control; no amount of green tinkering will help." Entering the 21st century, humanity has achieved rapid successes in technological development, yet this has not changed the severity of global environmental problems. People use new technologies to attempt to solve the negative environmental effects brought by old technologies, only to find that the new technologies create their own negative effects, leaving humanity constantly facing the risk of technological alienation [7].
Fourth, the interference of ecological imperialism in government governance. Since the start of the 21st century, ecological imperialism has exerted an increasing influence on the ecological governance of governments. First, the "imperial mode of living" [8] inherent in ecological imperialism has become deeply rooted in Western countries; it is unrealistic in the short term for governments to attempt to change people's lifestyles of overconsumption and extravagance. Second, the developmental concepts of ecological imperialism have become deeply ingrained in some Western nations, and the wanton trampling of the developmental rights of other countries is no longer a new occurrence. Third, government governance under the influence of ecological imperialism prioritizes seeking the maximum support from financial consortia. In the contemporary West, "as a rational political actor, a government’s primary goal must be to seek the maximization of political support. When a government finds that these plans and actions may have a negative impact on them, they will continue to move forward with loose fossil fuel policies." From this, it is evident that within the framework of the capitalist political system, the government’s primary concern is not ecological governance, but how to win regime stability. Therefore, once a conflict arises between ecological governance and regime stability, the government will abandon its concern for the former.
V. The Future Transcendence of the Green Capitalist Trend of Thought
The aforementioned dilemmas will seriously constrain the practical effectiveness of green capitalism. How can the defects of the green capitalist trend of thought be transcended? Are there alternative schemes to green capitalism? Scholars both at home and abroad have engaged in prospective thinking on this. Some scholars point out that green capitalism "will be selective, allowing certain people to obtain more income and enjoy higher living standards, while simultaneously excluding other people and regions, and even destroying the material life foundations of the latter... This limited greening of the capitalist mode of production, development, and regulation is almost inevitably exclusionary—it not only cannot stop or eliminate destruction, but also signifies the reproduction of structures (relations) of dispossession and domination." Therefore, the transcendence of green capitalism is not a single-level issue but should be a systemic one. Some scholars suggest that transcending green capitalism requires "politics that reduce energy consumption, mass movements seeking an ecological society, and breaking the deadlock on the world stage." Others point out that "transcendence under the dominance of the green capitalist order and discourse will be fraught with difficulties. Beyond the power of the capitalist economy and its operational logic itself, what deserves our deep reflection is how to create a global 'Green Left' or 'New Left' solidarity." In recent years, the ideas of socialist ecological transformation appearing in Europe, the "Buen Vivir" (good living) and degrowth ideas appearing in Latin America, radical ecological democracy in India, and the socialist ecological civilization [9] thought appearing in China are all transcendences of green capitalism. Regarding contemporary Chinese ecological civilization construction, the socialist ecological civilization thought proposed by Xi Jinping "takes Beautiful China as one of the core goals of the second centenary struggle [10], and actively constructs a new pattern of harmonious coexistence between man and nature from the four levels of green development, environmental governance, ecological protection, and institutional supervision." By taking the unification of social fairness and justice with ecological sustainability as an important value orientation for ecological civilization construction, it effectively demonstrates the internal unity of socialist and ecological attributes, representing a practical transcendence of the "neither just nor ecological" nature of green capitalism.
VI. Conclusion
The green capitalist trend of thought is a developmental concept that vainly attempts to achieve the coordinated development of the ecological environment and capitalism through market mechanisms and technological innovation within the framework of the capitalist system. Its emergence has a profound social background and has exerted significant influence in Western countries. However, viewed from reality, green capitalism cannot resolve the fundamental contradictions between capitalism and the environment, nor can it solve the dilemmas of market failure, technological loss of control, and governance failure. Therefore, green capitalism cannot save the historical fate of capital. The transcendence of green capitalism has become a focus of intense scholarly attention. Of course, in the analysis of the green capitalist trend of thought, one should also recognize the active role of market mechanisms, technological innovation, and government governance in constructing an ecological civilization. Thus, in the process of building a socialist ecological civilization, we must clearly see the false essence and historical limitations of green capitalism, while also critically drawing upon its reasonable components to advance the construction of a socialist ecological civilization.
(The author’s affiliation: School of Marxism, Beijing University of Posts and Telecommunications)