Sir Nicholas Stern got the world’s attention when he said that global warming is the biggest market failure in history. In other words, it is because we failed to factor in the environmental cost of doing business that we have ended up in this possibly catastrophic mess. It would be nice if we could relax now that the market has come around to the environmentalists’ way of seeing things.

Unfortunately, we can’t.

Market solutions will certainly help ease the transition towards a low-carbon economy. But they’re not going to solve the underlying problem, which is almost never discussed, though it is hidden in plain sight.

Every time we read about China’s economic growth, it is coupled with concern over mounting scarcity of energy and commodities, the displacement of millions of Chinese citizens, and apocalyptic environmental degradation. Such growth, it is easy to see, is unsustainable. Well, what about our own economic growth? As resources and energy sources dwindle, as competition for them mounts, and pollution reaches what may prove to be suicidal levels, can we still make a case for economic growth?

The question seems absurd at first. Who could seriously advocate an end to growth? So let’s put it another way. Who could seriously advocate pursuing a path that leads almost certainly to disaster? Growth this year is great, and we’d be devastated if there were none next year. But the fact is that there cannot be growth every year indefinitely.

These questions are not merely rhetorical. They are in part a response to an extraordinary press release from the Canadian Chamber of Commerce in response to the Canadian government’s Clean Air Act. It can be difficult to spot the bias in a document like this. The CCC’s blind spots are our own. But the problems are there nonetheless.

Though there are plenty of instances of business’s sense of entitlement to government cooperation, and its certainty that it is up to the corporate world’s discretion to set greenhouse gas targets, none of this is particularly troubling. Indeed, as we’ve seen, the business world may decide to go green on its own. The real, and seemingly inescapable, problem concerns the link between emissions and growth.

When the Clean Air Act was first unveiled, it was slammed by environmentalists for refusing to set hard limits for greenhouse gas emissions, preferring instead “intensity” targets, which mean that companies would have to produce fewer emissions per unit of output, rather than stay under a hard “cap.” If a company or an economy stays the same size, there is no difference between an intensity limit and a cap. But if that company or economy is growing, an intensity cap means that you can actually generate more greenhouse gas, but be credited with emitting less. On the other hand, a hard cap means that any growth will have to be carbon-free.

That is to say, a hard cap makes growth, particularly within carbon-intensive industries, much harder to accomplish. So the CCC was happy they did not appear in the Clean Air Act. Here is their reaction: “Intensity-based targets for greenhouse gases do not discriminate against companies that are expanding and will focus on improving productivity and energy efficiency.”

It sounds wonderful, but is this what we want? The facts are in front of us in black and white. Our environmental footprint already far exceeds available resources. According to the World Wildlife Fund’s Living Planet Report, we have been in resource overshoot since the 1980s. That is, it would take 1.4 Earths to keep us in the style to which we are accustomed. And our demand keeps growing: if everyone in China had a car, there would be no oil left for everyone else. But before we blame the Chinese and the Indians, let’s be fair. The average rich Westerner has a footprint many, many times larger than an Indian villager. To blame growth in the developing world for mounting greenhouse gas emissions is no different from asking them to stay poor so that we can continue to live in huge, inefficient houses and drive huge, inefficient cars a little longer.

The problems of economic growth are not going to be solved right away. They will require huge, dizzying shifts in perspective (to say nothing of the possibility of violent upheaval) before we even approach a solution. No politician is going to run on a zero-growth platform, and mobs are not going to take to the streets to demand less growth, or less employment. But we can see where all this is headed, and something is going to have to give.

And so we come back to the phenomenon of business going green. Environmental concern is good for business. And insofar as it is good for the Earth, who is going to complain? Indeed, the idea that environmentalists would one day worry about corporations suddenly going green would have been laughable only a short time ago. But if “good for business” means a growing economy, then it is clear that the environmental revolution in the board rooms of the planet may not be green enough, and may be the first step on a route to a future nearly unimaginable to the businessmen and investors currently investing in the environment, and even less comprehensible to those who are not.