The European Commission’s Joint Research Center estimates that the recent Northern-European floods will cost $9.25 billion in damages. By 2100, Europe’s flood costs could rise to $56.5 billion annually. Over the remainder of this century that totals $4.52 trillion.
According to climate.gov, major climate disasters cost the U.S. $30 billion in 1983, but $96.4 billion in 2020. The average annual cost over the past four decades has been $45.7 billion, totaling $1.87 trillion for the period.
However, 2016 to 2020 U.S. climate disasters cost an average $121.3 billion annually, which applied over the remainder of this century comes close to $10 trillion.
Damage from climate change is increasing steadily. But even without any increase, the U.S. cumulative climate damage from 1980 to 2100 will exceed $14.2 trillion.
Since 1980, the U.S. has had an average of 6.5 over-a-billion climate events per year. That rose to 14.6 such disaster events for 2017 to 2019. The number and severity of climate events is, of course, driven by global warming; and that, in turn, by greenhouse gas emissions. And human activities account for almost all of the increase in atmospheric greenhouse gas emissions over the last 150 years.
The primary sources of greenhouse gas emissions in the U.S. include: Transportation (29%, primarily burning petroleum based vehicle fuels); electric power generation (25%, two-thirds of our electricity is generated by fossil fuels); industry (23%, fossil fuels for energy and greenhouse gas emissions from chemical processes); the commercial and residential sector (13%, fossil-fueled heating, use of greenhouse gas emitting products, and waste handling); land use and forestry (12%, well-managed forests absorb more CO2 than they emit, but massive fires and clear-cutting turn forests into net emitters); and agriculture (10%, livestock, agricultural soils, and rice production).
No matter the sector, the climate problem is rooted in capitalism’s externalities. The concept of externalities, costs (or benefits) for third parties who did not agree to them, was developed by economist Arthur Pigou in the 1920s.
Pollination by bees from a neighbor’s beehive exemplifies a positive externality; air pollution from motor vehicles exemplifies a negative externality. Neither the producers nor the users of motorized transportation pay the cost of air pollution to society.
To correct the “market failure” of negative externalities, Pigou proposed a “Pigouvian Tax,” equal to their value. Unfortunately, such taxes have never been systemically applied. Consequently, externalities have become a hallmark of modern capitalism: An institutionally legitimized form of gross irresponsibility. Climate change is one major result.
Much can be done to mitigate climate change, beginning with understanding the true cost of whatever we consume. It is a necessary step towards remaking the incentive structure that drives the economic system and, ultimately, transforming it.
True cost accounting ensures that stakeholders understand the full benefits and costs of every product and service. It allows for informed decision making and helps ensure maximum value from limited resources. When applied across the economic system, true cost accounting helps identify and address inequities and opportunities for beneficial change, mitigating negative externalities.
Legitimate enterprises focus on meeting a need, not on monetary gain, its byproduct. “They don’t make them this well anymore” and “hand-made” imply higher quality than “mass-produced,” “best for the price,” or “the minimum the company can get away with,” not to mention “planned obsolescence,” another corporate gimmick.
Isn’t a tool maker’s job to make the best tools possible, rather than the cheapest for maximum profit? Aren’t good tools and machines repairable rather than disposable?
Products and systems that serve no real need, i.e., only provide perceived benefit for the buyer, exist for the financial benefit of makers and marketers.
Cheap “local” souvenirs imported from across the globe; seemingly low-cost but unhealthy food and drink; and products for which the perceived need is created by relentless promotion come to mind.
Was there a real need for internal combustion powered cars and buses to replace well-functioning public rail systems, other than the oil companies’ need to expand their market?
We must replace marginal products and systems with better alternatives. Why single-use plastics when glass containers are reusable? Glass is endlessly recyclable too, and less expensively produced from recycled glass than from virgin raw material.
Why not replace long-distance trucking with rail-based containerized freight and local-only truck delivery? It will conserve energy and minimize pollution, greenhouse gas emissions, environmental damage by noxious pollutants (like 6PPD-quinone from rubber tires grinding against pavements) and also the need for road repair.
Imagine a world where people think up multiple local solutions. Our “world order” is a human construct. We can change it. And, it seems, the sooner the better.
(Paul Kando is a co-founder of the Midcoast Green Collaborative, which promotes environmental protection and economic development via energy conservation. For more information, go to midcoastgreencollaborative.org.)