admin by Team Wayblaze | 7 Nov 2017

What are the underlying causes of our community capital and infrastructure challenges?

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Community Capital & Infrastructure

Community Capital refers to the stocks of environmental, social, cultural, built and financial assets that a community relies upon for its long-term well-being. The term “capital” refers to a “stock” of something that generates the yields (or income flows) from which the community derives its wealth. These stocks (or assets) include natural resources such as farmland, forests, soil, aquifers, wetlands and biodiversity but also include human-constructs such as money, knowledge and culture.

As anyone with a bank account can attest, if you constantly spend more than you earn, you draw down your personal financial capital, which in the long run leaves you destitute. We are quite familiar with thinking about this when it comes to our personal finances and the finances of businesses and government but we are typically not as literate about other forms of capital in our communities. In part, because we have grown apart from the natural world, and also because the predominant economic world-view focuses on the growth of incomes rather than stewardship of assets, we often don’t recognize that these others forms of assets are being depleted until it is too late.

This challenge is at the very heart of sustainable development (i.e. development that meets the needs of today without undermining the ability of future generations to meet their needs). Sustainability means living off the interest generated by our assets rather than depleting them to increase short-term income. Sustainable development involves taking care of those assets to ensure they stay healthy and go on generating wealth forever. A familiar example is fish stocks. If we overfish, we deplete the natural capital of our fish stocks so they cannot produce as many fish each year. This is what happened to the Grand Banks cod-stocks off the coast of Newfoundland, once one of the richest fishing grounds on the planet. Severe overfishing eventually led to an almost complete and total collapse of the fish stocks, eliminating thousands of fishing industry jobs along with them. Even after twenty + years, this fishery has still not properly recovered.

Too often, communities draw down their assets to realize short-term economic gains and in so doing, replace the “green” with the “grey”. As an example, natural lands (forests, grasslands, riparian areas) provide valuable ecological services to a community. These services include water filtration, wood products, biodiversity, flood control, recreation and stormwater management. Too often we develop on ecologically-productive lands or farmlands to create housing and neighbourhoods that, even after maturation, contain only a fraction of the ecological-richness of the lands that were lost. This means we are drawing down our natural capital assets and substituting them with built capital. A century ago, resources were plentiful and our impacts relatively small so this made sense. But now, with 7 billion people, the scale of human impact is so large that we are undermining the integrity of the very systems that we depend on for survival. Herman Daly has referred to this as “the shift from empty-world to full-world economics”. Daly’s idea is that once the world was incredibly rich in natural resources and comparatively empty of humans. At this time, it made sense to rapidly harvest natural resources to create better conditions for human health, because we were living only on the “interest” from our stocks of natural capital and not drawing down the principal. The relatively small human impact made this growth “economic”. However, due to the incredible growth of human populations, wealth and scale of impact, we are now in a world “full” of humans and their human assets. This means that further depletion of natural systems is now often “uneconomic” (i.e. growth is causing more negative effects than positive effects).

At a community-scale, conventional forms of real-estate development replace water-absorbing natural systems with built infrastructure such as storm sewers and stormwater management facilities. This grey infrastructure is costly to build, maintain and replace. Far-sighted communities and developers are working to protect their natural capital using green infrastructure systems that mimic natural systems and minimize environmental impacts. In addition to the loss of natural capital, many communities are experiencing loss of “social capital” – the relationships, knowledge, networks of support and institutions that help define community well-being. In his book, “Bowling Alone”, Robert Putnam describes the catastrophic loss of social capital in North America over the last several decades. Some communities experience this loss of social capital as feelings of isolation, lack of inclusion and a loss of the sense of belonging, which manifests itself as mental health and addiction challenges. Despite (and perhaps in part because of) today’s wealth, the social ties that bring people the deepest level of happiness and well-being are being eroded. This loss of social capital has complex underpinnings but seems to be tied in part to our reliance on technology, mass entertainment culture, the professionalization of services, and busy lives.

The “infrastructure deficit” facing many municipalities in BC is a stark reminder of how we have failed to invest in the long-term health of our built environment. In this case, the patterns of community growth and tax structures have not generated enough revenues to cover the high cost of maintaining and replacing community’s infrastructure systems, especially when these systems sprawl over large areas. This leaves an annual “deficit” that is accumulating in the form of a growing debt that at some point will become impossible to service.

Fortunately, some far-sighted communities and practitioners are starting to think differently about community capital and infrastructure. Rather than replacing natural assets with built infrastructure, they are asking “how can we steward our natural, social, cultural and financial assets and live off the interest that is generated?” One example of this new approach is the Province of BC’s Full-Cost Accounting Framework where municipalities consider the long-term life-cycle costs of development and infrastructure. Another notable approach is the Town of Gibson’s Eco-Asset Strategy. Gibsons is applying the principles of eco-accounting to ask if a service or infrastructure can be maintained and replaced within the financial means of the community and also whether or not a natural system (eco-asset) can be more cost-effective than conventionally built infrastructure.

What are your thoughts on the underlying causes of our community capital and infrastructure challenges? You can respond in the comment section below.

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