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A Prosperous Europe in Times of Scarcity

Submitted by on 12 Jul 2012 – 12:33

Judith MerkiesBy Judith Merkies MEP

Groundbreaking developments in industry, technology and business evince a tendency towards dematerialization and sustainable services. Leasing models and made to measure manufacturing can put us beyond the problems associated with consumerism. Disruptive ideas have to be nurtured to give Europe a head start in the sustainability questions that are facing us in the next decades.

A disruptive mind is a joy for life. Jihyun Ryou, a graduate from Eindhoven in The Netherlands, constructed a new and energy efficient way to conserve food. By interviewing elderly people she collected product-specific and time-honored methods for conserving food. She came up with a wide range of low-tech methods to protect perishable fruits and vegetables. Along the way, she discovered that through experimentation with sand, trays of water and pots with cork lids as well as through paying attention to the lightness and humidity that a product is exposed to, optimal circumstances to store provisions could be obtained without a fridge or freezer. She concluded that by applying the right product-specific information a partial cost effective alternative will be created by allowing a non-electric closet to replace the fridge.

Send in the clouds

Thinking in terms of performance to counter ecological footprint escalation will hallmark the 21st century. Smart, innovative ideas can put services at the center of the economy and can subvert the light bulb conspiracy problem: the problem that a producer rather manufactures a vulnerable light bulb that has to be replaced every few years than selling a bulb that lasts forever, because the latter will lead to the bankruptcy of his business model. We have to stimulate the technical, industrial and in business developments that lead to more focus on services and less material intensive consumption patterns. These include: the tendency towards dematerialized built-in services, the rise of the 3D printer and the business model of a leasing society.

To start with the latter, the leasing society offers a model where consumers pay monthly fees to obtain services while the manufacturer retains ownership. A company that adopts this model has to consider not only what happens the moment a product is sold, but also what happens when it comes back. As a result, companies have an economic incentive to make their products more durable and easier to reuse and recycle, since their expenses will be minimized once they use as little virgin raw materials as possible. The incentive to launch flimsy goods is gone, and more people will be hired for rendering maintenance and services. The model is already applied in a plethora of branches, including tire leasing, consumer electronics leasing and chemical leasing. However, to get to a circular economy, this concept needs to be introduced on a far broader range of products.

On a technical level, there is a notable trend towards dematerialization. The demise of analog databases in offices and libraries as well as answering machines, electric alarm clocks and pocket calculators – now standard services on mobile phones – shows how multiple services can be built into smaller products; the rise of the music service Spotify shows that services are moving to ‘the cloud’. Moreover, social media enables consumers to stand up against the foreseen end of life of products. In the Netherlands, a ´repair cafe´ is opened to fix the often minor defects of home appliances that normally would have been discarded.

In industry, the emergence of the 3D printer, heralded by a recent issue of The Economist as the ‘third industrial revolution’, forms an example of how ‘the lines between services and manufacturing are blurring’. Made to measure manufacturing that adheres closely to the customers’ desires becomes economically affordable. In the same way that the aforementioned digital revolution has freed offices from card indexes and a plethora of small electronic devices, the factory of the future could be moved to the office and design can be done on personal computers. As a consequence, fewer people will be involved in manufacturing, but as The Economist argues, this keeps down labor and production costs, which entices producers to move the supply chain of a product back to rich countries. This makes a company more agile and creates new jobs for Europe.

Back to the future

A service oriented economy is not new and focus on performance has been paramount in the past. Not so long ago, one would pay for music per song in a jukebox; one visited a shoemaker to mend his or her footwear and hired a handyman to patch up the couch. But as welfare grew, along came reckless consumption and relentless production. We are now in a society where people buy several pairs of shoes a year, the couch is dumped even before it is worn and shelves are crammed with CD boxes that are only gathering dust. We are in an era of stuff. A perpetual carrousel of goods has to be kept in circulation to keep the economy running. When there is a crisis, elites seek ways to incite people to go and shop more. ‘Stimulating consumption’ has become a synonym with economic growth and mistakenly with bigger well-being.

Mercenary, not missionary

We have quite a way to go to tackle our old consumerist and producers reflexes. For reasons of shared prosperity and environmental stewardship, a mind-set change is required. Sustainable approaches have to gain ground in the main stream economy and therefore mercenary, rather than missionary, green ideas have to be fostered.

Perhaps tomorrow will not be the day that we exchange digital information to print zero-carbon conservation methods for a specific fruit or vegetable on a leased 3D printer. But Europe has to see that its import-dependency leaves us no choice but to outsmart the rest of the world through innovative ideas and new approaches to the economy.