Resource Consumption and Economic Production in Canada and the United States:: How Economic Activity in North America Benefits People Everywhere

Ben Eisen, Publications, Regulation, Uncategorized

In Brief

• North Americans are frequently criticized for consuming more than “their fair share” of the world’s resources. For example, the complaint is often heard that although Canada and the United States make up only 6 per cent of the world’s population, we represent 25 per cent of the world’s annual oil consumption.

• The implication behind the criticism is clear: North Americans consume too many of the world’s resources, leaving “less to go around” for everybody else. The corollary implication is that if North American consumption of resources were to drop, there would be more resources available for others to use, and people elsewhere would be better off.

• This line of argument has intuitive appeal, but it fails to recognize the inextricable link between North America’s high level of resource use and the extraordinarily high levels of productivity achieved on this continent that have created vast amounts of wealth, products, services and innovations that have brought immeasurably large benefits to people across the globe.

• If Canadians and Americans were to drastically reduce their consumption of resources, thereby slowing down economic production, people all around the world would be worse off, as the world would have considerably fewer charitable organizations, new medicines and thriving companies.

• North America’s contribution to charity, innovation and prosperity is disproportionate to the size of its population. For example, although they contain just six percent of the world’s population, Canada and the United States contribute 26 percent of global Official Development Assistance to developing countries. When other forms of assistance such as private philanthropy and remittances are taken into account, the contribution of these countries appears to be even more disproportionate to the size of their populations.

Introduction

North Americans1 are frequently criticized for consuming more than “their fair share” of the world’s resources. For example, the complaint is often heard that that although Canada and the United States have just 6 per cent of the world’s population, we represent more than 25 per cent of the world’s annual oil consumption.2 Largely because of high levels of energy use, North Americans are also among the world’s largest per capita emitters of greenhouse gasses. Because of fossil fuel consumption, North Americans are responsible for approximately 20 per cent of the world’s annual emissions of carbon dioxide.

Similarly, North Americans are often criticized for high levels of water consumption per capita. For example, a recent publication from the Safe Drinking Water Foundation disapprovingly notes that water consumption per capita in the United States and Canada are the highest in the OECD at 1730 cubic meters per year and 1420 cubic meters per year respectively.3

The implication behind these criticisms is clear: North Americans consume too many of the world’s resources, leaving “less to go around” for everybody else. The corollary is that if North American consumption of resources were to drop, there would be more resources available for others to use, and people elsewhere in the world would be better off than they are now.

This line of argument has intuitive appeal, but it fails to recognize the inextricable link between North America’s high level of resource use and the extraordinarily high levels of productivity that create vast wealth and vast numbers of products, services and innovations that bring immeasurably large benefits to people across the entire globe. In this Backgrounder, we will discuss the link between high levels of resource use and high levels of production in North America as well as how the continent’s incredible productivity levels enhance the quality of life experienced around the world.

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