Adam Smith (1776) stated that labour is the real standard by which the value of commodities can at all times and places be estimated and compared, and money is only a nominal price. How far we have gone in those 240 years! Today the notion that labour represent the real value would be seen as quaint or perhaps communist, even if Marx was the one that realised that through capitalism, labour is no longer a standard value, but a commodity to be bought and sold for profit. Money is like an alphabet with only one sign says Alf Hornborg (2010). That is the reason for why you can't communicate any meaning with money, anything more nuanced than a call to consume, i.e. to use up resources. In the market society the only way to assign a value to anything is to sell it, which means that things that are outside the market circulation almost by definition has no value. Well, reality is a bit more complex than that, we know that our personal relationships are not traded and we certainly enjoy them, and most people still enjoy many free pleasures, but policy makers are increasingly discussing access to those freebees, such as a forest, in terms of willingness-to-pay-for.
In economics, there are attempts to add more "real" values to ecosystem services and assign costs to the depletion of natural and social capital as well as to pollution. However, in order to have an impact on "policy makers" all this has to be expressed in dollars, in money. It's like the system of bride prices or dowry, where you assign material values to the union of two people. But as little as a dowry is an indicator of love are the values assigned to ecosystem services an expression of their real values. With money as the determinant of value, we make nature a subsystem of the economy. That is one reason for why the efforts of valuing environmental services are not sufficient to re-direct our economy from the path of self-destruction - and why it even can be negative in the long run. A similar problem we have in the valuation of work. By definition, market prices are always "right". This serves as a justification of that a business leader earns 100 times as much as his workers, or that an worker in the rich countries are "worth" twenty times as much as a worker in a poor country or fifty times as much as a small-holder farmer. In this way, money obscures the reality, and justifies the logic of exploitation and inequality. In the short term, as measures to slow down or even reverse environmental destruction, assigning values to environmental services, and fees for their use, or assigning costs to pollution makes a lot of sense, exactly because it works within the capitalist economic paradigm. In the longer term though, we need to find other ways because ecologist can't do a better job of managing capitalism than economists.
We can also discuss the economic system in ecological terms, in biophysical terms. This makes a lot of sense, at least for analytical purposes, because our economy is a subsystem of the physical system we live in. The idea is to instead of expression of the economic system in monetary values, it is expressed in "real" values, such as land use, labour, tons of minerals extracted. What comes out of that is certainly very interesting as it clearly exposes destruction of nature; increase in entropy as well as the social disparities. From this, there is of course a big step to implement a system whereby our current currency would be attached to one or more of such "real" values. In the end, you would have to select one parameter, like gold was such a parameter for a long period, and once you do that you would experience problems.
(extract from Garden Earth)