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The Story Of Solutions

October 8, 2013

The “Story Of” series tries to step up with some new ideas. I’m sympathetic but just not sure they go far enough. The ideas are good, just not big enough to change the world.

Personally, I think the single most powerful change (regular readers know where I am about to go) would be to price everything we buy differently. Instead of just pricing the cost of production (labor and materials), every good should be priced according to its production cost AND its social and environmental costs. Imagine how quickly everyone would change their behavior–the impact on consumption and the impact on carbon-heavy goods–and how quickly businesses would change what the create and sell, and how they do it.

5 Comments leave one →
  1. October 10, 2013 12:58 pm

    Hey Tim. I haven’t read your past posts, so maybe you’ve already explained this, but how would your determine the environmental and social costs and then enforce payments? Would there be some UN-level committee that assesses such costs? I’m guessing the only way to do it would be through a new bureaucratic institution. If so, how would you prevent the inevitable corruption of said institution? Just an idea here.. but perhaps a global treaty could be created that empowers a new UN committee to assess the per capita impact of each country on the environment and then bills them the amount along with their UN dues. Each country could recoup the costs in consumption taxes. The cash would either then be removed from circulation (as an inflation fighting measure, corruption prevention and to get buy in from conservatives) and/or to pay for worldwide disaster mitigation and disease research. Just some random thoughts.

    • October 10, 2013 1:10 pm

      I haven’t come close to sorting through that very challenging question, Rik, but I believe that it has to be done and can be done. My general thought is that you would start with some global targets to reduce various climate and environmental impacts, and then ramp up taxes on products that contribute to those impacts until you hit those targets. And likely the way to deal with the fact that different products have different impacts is to tax constituent elements of a product. So if a product uses a lot of oil to produce there would be a commensurate carbon tax. If it includes plastic, a plastic tax. Toxic chemicals, a toxic chemical tax. You can’t figure out every impact of every constituent element in all the products we make, but you could go a long way by focusing on the most problematic. But as you said you would need to get global buy-in at some sort of international level. Which goes to show that a different future in which humans take better care of the planet will likely involve a different international system that gets beyond the problems of trying to deal with these issues as nation-states.

      • October 10, 2013 1:30 pm

        What about starting with an opt-in certification system? A price for each element (carbon, rare-earth metals, etc.) would be set and then manufacturers could pay the amount to a trusted NGO like the Clinton Global Initiative or the Gates Foundation in order to get the certification. The money would be used to fund those organizations in their work to eradicate disease, disaster mitigation, etc. The NGO would also fund a global campaign to promote the purchase of certified products.

        I think the governmental approach would be doable too, but I think we would need to get buy-in from influential conservatives, who would only go for a market driven approach unless convinced that it’s impossible. The essential challenge of a market driven approach is that markets are notoriously bad at dealing with common goods. So step one with conservatives is to get them to agree on the definition of common good, and them convince them this is that.

      • October 10, 2013 1:38 pm

        Now you are thinking. I put aside for the moment the question of whether you could get ANYONE, especially the consuming public, to buy into the idea that the price of a good should reflect its full costs. But this would be a market-based solution to the fact that the market fails to price in the full costs of goods. And the idea is that the market, and consumers, would respond most rapidly to this sort of pricing signal. It would be the most powerful tool for change that I can think of. And you could start by pricing carbon, and move on to other goods over time according to relative negative impact.

      • October 10, 2013 1:47 pm

        I agree 100% that if the cost of the product was greater then the cost for innovating a more sustainable approach it would be a powerful force for change. I’m very intrigued if there is a way to make the whole thing realistic. What about this:

        Build an app that would simulate a certification program (for example donations are made to the NGO based on products you buy). The app would allow you to work the mechanics and gauge market sentiment. Then pitch the idea to CGI or some other to scale it into a global campaign/movement. And then get governments to adopt it last when the momentum is overwhelming.

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