Does financial collapse prefigure social and environmental catastrophe?

The pattern of land use in the expanding cities of the South and West [of the US] - which have had the most rapid population growth, with very few people per square kilometer - was itself established over the period that has elapsed since the energy crisis of the 1970s. It is a consequence of prices as well as preferences, and of the changing distribution of public expenditure, or public partiality. Emma Rothschild, Can we transform the auto-industrial society?, 'New York Review of Books', 26 February

I'm glad to see a recognition that the, to my mind, disastrous, changes in land use that we have seen in the US owe a lot to government intervention. With its corrupt, insane subsidies to agribusiness and big landowners and its gung-ho promotion of the oil extraction and consumption infrastructure, the US Government is, sadly, not alone in favouring corporations and abstract economic indicators at the expense of the wellbeing of ordinary people - and the environment. Bio-fuels are the latest in the long litany of woeful government wheezes, ostensibly aimed at solving some genuine social problem, but mainly an effort to divert taxpayer funds to election campaign donors. Tragically, our social and environmental pathways seem to be paralleling those of the financial sector, and for much the same reasons: government and big business working hand-in-hand to postpone the solution of urgent problems and along the way grab what they can for themselves.

Politicians are almost as much the prisoners of this absurd system as the rest of us, and there's little point now in trying to allocate blame. The problems that the corporatist state has created are now so huge that they require further government intervention. I feel strongly that government should stop trying to prescribe solutions (a la bio-fuels) and instead switch to something like Social Policy Bonds, by means of which it can reward people for achieving such widely agreed goals as the avoidance of catastrophe, without imposing its own (or its paymasters') ideas as to how to achieve these goals. We need diverse, adapative policies and projects, not the dead hand of government and its friends in big business with their failed and fossilised thinking. We need to specify the outcomes that we want, instead of blindly aim for economic growth whatever its consequences and whoever benefits. To be frank, I'm not optimistic that anything like this will happen; not before some calamity anyway.