This is going to be a somewhat rambling post about the nature of environmental concern and how it relates to economic growth. (See Lee's ponderings here for a recent example.) A lot of the debate over environmentalism is: to what extent does improving our environment hurt our economy. I don't think that has to be the question, though. I think the question can be something more like: can we move to an economy that is a healthy part of the environment and that meets everyone's needs, broadly construed (so: material needs--do you have enough to eat? clothing? leisure time and materials?--but also our needs for useful work and meaningful relationships).
I'm going to start, though, with something that just plain tickles me. The Journal of Industrial Ecology (here is a rough and not-great explanation of what industrial ecology is) recently gave free access to a proof of an upcoming article, The Changing Metabolism of Cities, about how our cities have changed their use of materials, energy, and water over time. It's an interesting article and not too technical, though it's also not intended for a lay audience. However, I'm going to skip all of that, and just post a funny picture:

That's the urban metabolism of Brussels, Belgium, in the 1970s. If you look closely, you can see that it has flows (arrows) for solar energy, for precipitation and evaporation, for materials coming into the city, and solid waste going out. (I'm a goof for this stuff; here's a slightly more legible flow chart, showing how all energy in the US (in 2002) began and ended.)
The serious point lurking here is that these kinds of flow tools are stolen wholesale from the science of ecology (heck, industrial ecology even stole the word). And that gives a useful way in to understanding the relationship between our environment and our economy.
People often say that nature is incredibly efficient. And it is. But it's useful to understand that it's Nature As a Whole that's efficient; any one part of it is likely to be incredibly inefficient--for example, the tree in my front yard produces thousands of seeds every year; even if it weren't surrounded by the road, sidewalk and my pristine, glistening lawn, this is an amazing amount of effort with very little possibility of return. But it's because nature has so many layers of uptake--that is, that any waste becomes food for someone else--that the system overall becomes efficient. If it weren't for decomposition--which is a living process, composed of innumerable kinds of decomposers--my tree would soon be up to its elbows in seeds.
And this is where I think we go wrong in talking about the environment. We want to lessen our impact. Some of the highest praise we have for a sustainable home, for instance, is that it's zero energy or zero impact. But my tree doesn't have zero impact: it has a beneficial impact. It's part of a healthy system. We should make our economy like that. What prevents us from doing so is that we harvest too fast and our waste products are toxic, or they evolve too quickly.
Biomimicry is one route into the change that we need. Another is the focusing on lessening negative impacts (which, yes, I just got finished criticizing). We don't know all the tools for this yet, but I think it's something we can grow into.
SOME OTHER STUFF: Lee follows up his post about growth and environmental quality with this one, about those two, plus happiness, plus the role of local economies. I agree with him that re-localizing is important. And I think that re-asserting traditional sources of identity, religious and community, is important, because these bring a sense of how to find happiness that we've been missing for awhile, as we've been left looking to just our material possessions. However, if you're not quite ready to make the culture shift yet, Matthew Yglesias has good news for you: When you hear people talk about how much fighting global warming is going to lessen how fast our economy grows, bear in mind that doesn't mean that we'll have less stuff, it means that we'll get more stuff slower in the future.