A New National Strategy to Reflect Natural Assets on America’s Balance Sheet
By Dr. Sabeel Rahman, Senior Counselor, Office of Information and Regulatory Affairs, Dr. Eli Fenichel, Assistant Director for Natural Resource Economics and Accounting, Office of Science and Technology Policy, and Dr. Jed Kolko, Under Secretary for Economic Affairs, U.S. Department of Commerce
Our planet’s water, soil, air, and other natural assets play a critical role in sustaining and powering our economy—from supplying the food we eat, to supporting critical supply chains, to spurring innovation and providing recreational opportunities, and more. The challenges of climate change, pollution, and environmental injustice carry implications for the economy, the environment, and public health that Americans across the nation have been experiencing for decades. Yet, the data we rely on to describe and measure our economy are largely disconnected from the realities of the natural world. This disconnect in data prevents us from reaching our full economic potential while protecting the environment, and ensuring future opportunity for Americans.
That’s why today, we are announcing a new draft National Strategy and calling for public input to bridge the disconnect and ensure the natural resources all Americans enjoy and depend on are accounted for in the economic decisions that affect the American people.
On Earth Day 2022, President Biden signed an executive order charging us to develop guidance to better account for nature and its benefits in federal decision-making, leading to the first government-wide natural capital accounts. As Secretary Raimondo announced, these natural capital accounts will measure the economic value that natural resources provide to society and illustrate how a robust economy depends on a healthy natural environment.
The draft National Strategy outlines recommendations for developing “Statistics for Environmental-Economic Decisions” to reflect natural assets on the national balance sheet. Additionally, the strategy highlights a framework for investment opportunities that would work to address the causes of environmental injustices by shedding light on environmental dependencies. We are also inviting members of the public to share their perspectives to inform this important work.
The draft National Strategy recommends that the Federal government produce a new, ongoing set of statistics to take stock of our wealth of natural assets, how those assets are being enhanced or depleted, and the impact that has on our economic strength. The draft National Strategy also makes several specific recommendations on the process of developing natural capital accounts and environmental-economic statistics, including:
- The natural capital accounts should be integrated into the broader existing U.S. economic statistical system, using the expertise that Federal agencies already possess, so that these accounts can be as useful as possible to decision-makers at the Federal, State, Tribal, and local levels, as well as to the private sector—which has repeatedly called for government leadership in developing these statistics.
- The natural capital accounts and environmental-economic statistics should measure our progress over time.
- In developing these accounts and statistics, we should work with the international community to advance implementation.
- The U.S. government should follow a 15-year phased approach that will generate new information early in the process while iteratively and rigorously building a long-lasting set of statistical products that are regularly reported.
This strategic approach will result in a more complete view of our economic vitality and progress—one that appropriately reflects the fragility and value of nature in supporting it. By following the National Strategy and implementing its recommendations, we can begin to accurately account for our natural assets as we measure the economic strength of our country.