Since the Industrial Revolution the world has undergone an unprecedented transformation, largely a result of human activity. To the point, as proposed by Paul Crutzen, that we are now arguably in a new geological epoch – the Anthropocene 1, where humanity is the dominant force in world evolution.

The changes have been particularly marked since WW11 as the developed world has enjoyed rapidly rising standards of living and wealth creation. But in the euphoria created by this good fortune, we have failed to recognize that the global drivers behind it have been gradually turning into major strategic risks; that is risks to external to any institution which have the potential to fundamentally change that institution, for better or worse, whether it be at the level of business models or national security. In essence, they reflect an increasing gulf between narrow self-interest and the common good.

As population rises from 7 billion today toward 9 billion by 2050, and possibly 10 billion by 2100, the inevitable logic of exponential growth in both population and consumption is now hitting the limits of global ecosystems and resource availability. The immediate pressure points are energy security, climate change, biodiversity loss, water and food availability, issues which along with the related matter of financial instability, are converging rapidly in an unprecedented manner. But these are only the tip of the broader global sustainability iceberg; further constraints and limits are fast becoming evident as major developing countries, particularly China and India move up the growth escalator.

This situation is not unexpected; it has been anticipated for decades going back before the 1972 publication of “The Limits to Growth”. In the meantime the developed world has created a political and capitalist system which has proved incapable, so far, of recognising that the most important factor for its own survival is the preservation of a biosphere fit for human habitation.

The aftermath of WWII bred statesmen and women in both government and business intent upon creating a better world, re-building society, avoiding further conflict and genuinely prepared to take a long-term view. The results were far from perfect, but that vision did provide the foundations for the increasing prosperity the West has enjoyed ever since.

But with prosperity came complacency; the assumption that growth within a finite system can continue indefinitely. Hardly surprising, given that power and influence accrue to those who prosper under capitalism, and that technology until recently has enabled us to push back or ignore any physical limits. Enormous political and personal capital is now vested in preserving the status quo. As a result, our institutions have become predominantly short-term focused; politically due to electoral cycles and corruption of the democratic process; corporately due to perverse subsidies and incentives, particularly the bonus culture which became the norm through the 1990’s. Managerialism – “doing things right”, replaced leadership – “doing the right things”, statesmen all but disappeared, ethical standards deteriorated, so that we now find ourselves uniquely ill-equipped to handle the long-term challenges which lie ahead.

As London Financial Times columnist Gillian Tett put it recently: “Just as the past four years have raised questions about the way modern finance works, they are raising profound questions about our systems of government: we have no institutions to plan for the future, nor institutions that can quickly respond to a crisis. This is one of the reasons faith in so many public institutions is collapsing, alongside faith in the bankers. It’s why you’ve got this Occupy Wall Street protest.”

The upshot is a series of escalating crises, most recently the 2008 Global Financial Crisis (GFC), which is now cascading into a multitude of other crises as global leaders desperately attempt to reboot an outmoded 20th Century system of economic growth.

The developing world had been intent on slavishly following our example. However in the last decade that began to change as the reality of pollution, resource scarcity and increasing inequity hit home, and it became obvious that the developed world model has serious flaws.

The limits we now face are global, rather than regional, and cannot be circumvented as we have done in the past. What was workable in a relatively empty world of 2-3 billion people post-WWII is not workable in today’s full world of 7 billion, let alone the 9 or 10 billion to come. Humanity today requires on average the biophysical capacity of 1.5 planets to survive 7. If everyone lived at US levels, we would require 5 planets, at Australian levels around 4 planets. This cannot continue indefinitely as we are fast destroying the global “commons” of clean air, water and the fertile soil and oceans on which we depend for our food supply and life support.

Our ideological preoccupation with a market economy, based on political expediency and short-term profit maximization, is rapidly leading toward an uninhabitable planet, as sustainability issues of theoretical concern for decades manifest themselves physically, particularly in regard to climate and energy.

Source for graphic: Global Footprint Network