Monday, September 6, 2021

#249 / The True Cost Party

If I am right about what I said in my blog posting on July 29th, and that we need to do everything we possibly can to stop the combustion of hydrocarbon fuels, and that we need to do that as soon as we possibly can, the question that immediately comes to mind is this one: 


Adbusters, which definitely shares my diagnosis of where we are, presents our current situation in these terms:
The Global System Just Tipped Closer to Extinction

Catastrophic flooding in Germany and China. Record-breaking temperatures north of the 49th parallel. A “heat dome” that annihilated one billion marine organisms in one fell swoop. Wildfires which make the Plagues of Egypt look like small stuff.

It’s no mere coincidence. Climate change is unignorably here. And humanity’s in it neck-deep the world over.

But while ordinary people bear the brunt of the devastation, world leaders are content to sit by and twiddle their thumbs — “progressive” types not excluded.

Take handsome, smiling PM Trudeau. In 2019, his Liberal government gave the fraught $4.5-billion Trans Mountain pipeline expansion the go-ahead the very day after it declared a national climate emergency.

Pres. Biden, too, likes to blow a lot of hot air about his environmentalist cred. But the all-American likes of ExxonMobil continue to pump billions of tons of carbon into the atmosphere, despite having covered up the fact that for decades they knowingly imperiled the entire human species — and paid to keep it secret.

It’s the crime of the century. So where’s Joe when justice needs serving? If the U.S. won’t take the first big step onto a sane sustainable path, then who will?

These are dire days indeed. No one is safe. But whereas governments are asleep at the wheel, we’ve got a people-first solution to wrest climate-control back from the powers that be.
Adbusters' answer to that "How?" question is what they call "true cost" pricing. Here is how they pitch it:

The Solution To Our Climate Crisis
There’s a lot of brainpower converging on the global climate emergency, with green-energy and biosphere-repair ideas being floated in every country on earth. The hope is that each small advance is a piece of the puzzle, and a fair, just, sustainable and secure global system will emerge if we all just commit to reducing carbon emissions through every hack we can think of.

But let’s get real: Things are too precarious to continue to play the same game more intensely.

The late Stanford philosopher Paul Watzlawick had a way of explaining the thinking required to get out of impossible jams.

A “first-order” change is to stamp on the gas pedal. A second-order change is to shift gears. A third-order change is to get out of the car and find another way to get there.

That’s where we are now.

If you burrow deep into the innards of the capitalist algorithm, you’ll find a major flaw. It’s that the vast majority of humankind’s carbon emissions are unpriced. Out of the trillions of transactions made every day in the global marketplace, only a tiny fraction reflect their true cost. From the tires on our cars, to the phones in our hands, to the Big Macs nesting in napkins in take-out bags, every purchase we make is essentially a mistake. And each one drives us a little closer to global system collapse.

With every bogus transaction, another drop of meltwater slides off an iceberg, another puff of CO2 rises to the sky, another bubble of methane burps from the tundra. If we keep repeating that mistake, trillions of times a day, week after week, month after month, year after year, what do you think will happen?

Economists speak the language of efficiency, and they’ve taught the whole world to do the same. But why are so many economists silent on these, the greatest inefficiencies of all? Why are we selling off our natural capital and calling it income? Why is the profession of economics, when it should be rushing into the breach to lead us, so monumentally negligent?

Economists, this is your new brief. Let’s figure this out. What is the real cost of shipping a container load of toys from Chongqing to Los Angeles? Or a case of apples grown in New Zealand to markets in North America? And what is the true cost of that fridge humming 24/7 in your kitchen? That steak sizzling on your grill? That car rolling off the production line? How much are the byproducts of our way of living actually setting us back?

The Road To True Cost
The new accounting starts with the little stuff: plastic bags, coffee cups, paper napkins. Let’s say the eco costs turn out to be five cents per plastic bag, ten cents per cup and a fraction of a cent per paper napkin. We tack those on. Of course we’re already doing that with the various eco-fees and eco-taxes included in the price of tires, cans of paint and other products. But now we abandon the concept of ancillary fees and taxes and start implementing true-cost pricing from cradle to doorstep, across the board.

True Cost Plastic
How much plastic is coming out of the industrial bunghole annually? We ask economists to spin up a rough number. Say it’s a trillion tons. Then they make their best guess at the environmental price we pay for our clogged garbage dumps, polluted oceans and the shitspray of plastic microbeads through the food chain – say it’s $500 per ton. Every manufacturer, corporation and retailer that uses plastic in their business will be required to account for that. Maybe it’s a surcharge of a quarter on every bottle of Coke. Coca Cola can’t take a hit like that on their margin. They’ll have to change their business model. Likewise, the automobile industry will have to redesign their cars. Food producers will have to adapt.

The cost of living will rise, and that’ll hurt. But plastic packaging will gradually disappear from our lives. We’ll buy our milk in glass bottles and bring them in for recycling like we used to. We’ll wash our plates, knives and forks and use them year after year, some for a lifetime. The garbage gyres in the oceans will shrink and finally disappear. Blight will vanish from beaches and ravines. Microplastics will stop plugging the tissues of every mammal including us. And the horror of bringing our children up in a world awash in plastic will be over.

True Cost Driving
Once we add on the environmental cost of carbon emissions, the cost of building and maintaining roads, the medical costs of accidents, the noise and the aesthetic degradation of urban sprawl, your private automobile will cost you around $100,000, and a tank of gas $150. You’ll still be free to drive all you want, but instead of passing the costs on to future generations, you’ll pay up front.

Plenty of people will howl and moan – at least in the beginning. A bitter meme war will be fought about how true cost disproportionally punishes the poor. But once true-cost pricing is in place, car use will plunge and bicycle use will soar. City skies will be clearer. Breathing easier. Ride sharing will spike. People will live closer to work. Demand for monorails, bullet trains, subways and streetcars will surge. A paradigm shift in urban planning will calm the pace of urban living. Cities will be built for people, not cars. Catastrophic weather events like hurricanes, floods and superfires will subside. The spectre of global warming won’t feel so ominous anymore.

True Cost Eating
We tally the hidden costs of our industrial farming and food-processing systems. We raise the price of groceries to reflect the true cost of shipping them long distances. An avocado from Mexico will cost you $15. You won’t be able to indulge so often. And that shrimp from Indonesia? Once the eco devastation of mega-farming and container shipping are added on, it will run you about $35 a pound. A Whopper with cheese will quadruple in price. So will most meats, produce and processed foods. You can still eat whatever you want, but you’ll have to pay the real tab. Inevitably, your palate will submit to your wallet. But the cost of organic and locally produced food will go down, nudging us all in that direction. Local farmers will be celebrated. We’ll grow tomatoes on our verandas, eat at home more and maybe lose some weight and be a little healthier. Bit by bit, purchase by purchase, our global food system will heave toward sustainability.

True Cost Shipping
For years it’s been ridiculously cheap to use mega tankers to ship stuff across the ocean. All that will stop. Our current way of exporting and importing goods, the one economists have been touting as a way to spur growth but which depends on a mightily subsidized transportation system, will no longer fly. Globalization — capitalism’s bred-in-the-bone burden — will cease to be the dominant economic paradigm. Just about everything at the megamarts will cost more. The whole tenor of world trade will be transformed. Exports and imports will stabilize at a reduced level. Trillions of purchases every day will come back to your neighborhood.

Next-level Accounting: The Social and Psychic Costs
You’re cruising along an eight-lane highway and suddenly everything lurches to a halt. There’s a lot more going on here than a heft blast of carbon emissions. A traffic jam is a huge collective stress event. There are health costs to being pinned in your car, on a dammed river of steel, fingers tightening on the wheel, blood pressure rising. Mental health costs too. A recent Swedish study found that a daily commute to work of forty-five minutes or longer increases your chance of divorce by 40 percent.

What is the psychic cost of advertising, that daily broadside of pro-consumption messages? Or the mental toll of continually checking your phone — bridling against Big Tech’s surveillance algorithms, over and over and over? Or the social and psychological cost of losing the indie shops in your neighborhood as Starbucks, Home Depot and Walmart muscle their way in. All this is part of the True Cost story — and so must eventually be part of the final accounting — of the epidemic of mental illness now sweeping the planet.

For conventional economists, True Cost is a gut punch. A True-Cost Marketplace would slow growth, reduce the flow of world trade and curb consumption. It would force economists to rethink just about every axiom they’ve taken for granted since the dawn of the industrial age.

The efficiency of size would be challenged. The hidden cost of Walmart coming to town, revealed. The lie of never-ending growth on a finite planet, exposed.

“Progress” itself would be redefined.

There would even be angels-on-a-pin debates about the psychological and social costs of individualism.

True Cost could turn out to be one of the most traumatic and painful economic / social / cultural projects we have ever undertaken.

But also one of the most transformative.

In a True-Cost world, there’d be no need for pleading and hectoring, no need to wallow in conflicting consumer emotions. No one would be badgering you to eat less meat. No one would make you feel guilty about owning a car, or for going on that holiday to the Bahamas. All you’re being asked to do is become a consumer in a new kind of marketplace.

Instead of “lowest price wins, and don’t ask too many questions,” Adam Smith’s invisible hand would start working its magic in surprising new ways. We’d become part of a worldwide process in which every one of the trillions of transactions made every day are working for rather than against us.

Only a handful of economists have bothered to think of externalities as anything but marginalia — a few paragraphs in Gregory Mankiw’s Principles of Economics textbook. This would remake the entire profession. True Cost would put a shine on the dismal science. It would ground economists, give them something real to do. It would create a virtuous, progressive occupation out of a retrograde one. The profession would become something a young grad would be proud to devote their whole life to. Environmentally minded students would be streaming into Econ 101 because economics is the Queen of the Sciences now, incorporating sociology, anthropology and psychology. It’s the essential discipline for working our way out of our existential crisis.

How To Put It in Place
Implementing a global True Cost marketplace would actually be quite simple. It could be made to work through the UPC code that’s already on just about every product sold around the world. When you swipe it, a true-cost price adjustment automatically kicks in. All the ecological costs of making and marketing and shipping and distributing that thing you’re buying are baked in to the price. One swipe, one truth. Sticker shock: take it or leave it.

How To Spend the Money
True Cost would generate a vast pool of income — probably in the trillions of dollars a year. Agreeing on how to spend it would no doubt be a messy, angry, contentious affair. It may well torpedo the whole project. But it could also turn into a beautiful collective brainstorm. Humanity’s joint endeavor. The birth of a global mind, with the stakes as high as they go: our very survival.

The True Cost bounty would amount to a kind of global superfund. Money would flow to each nation, based on its population, to spend as it sees fit.

Many countries might choose to plow it into priority projects to help them reach their carbon reduction goals. Others might decide to bounce some, or even all of it, directly back to the taxpayers. A hefty check would arrive periodically in the mail, as compensation. People agree to take the pain up front, knowing relief will come.

The nations of the world may agree to pool some of the money into a Global Emergency Relief Fund, to be spent by the United Nations and NGOs when calamities occur. For the always cash-strapped UN and relief organizations, and for people anywhere in the world who suddenly cannot cope, that would be a godsend.

Is True Cost a Pipedream?
True Cost? Great idea! But it’s never gonna work.

That’s what they all say.

I get it. Nothing of this scope, on this scale, has ever been tried. It feels like about Plan D — after all the more ‘sensible,’ green-energy and techno options have been kicked around.

And our record of working together is pretty dismal. Look how we handled Covid. We couldn’t come up with a coherent global thrust to beat it back. Or to distribute the vaccines. Hell, some of us couldn’t even agree to wear masks.

But the global mood will change as our planet overheats. Ecological collapse is a slow-motion catastrophe. You don’t feel it yet, you can’t apprehend the urgency of it. Because your hair isn’t on fire. Yet.

But once we pass a tipping-point — and we’ll absolutely know it when it happens — when resource skirmishes erupt into full-scale wars, and slow violence turns into fast violence, and suddenly it’s your children who are hungry and your house that’s being swept away and your country that’s at war . . . that’s when you’ll forget “never gonna work” and reach for the ax on the wall.

Winning the Planetary Endgame
Sometime in the third decade of the 21st century, as Earth registers a rise of two or three degrees and we contemplate the possibility of total civilizational collapse, the world will be ready for a monumental pivot.

‍The True Cost Party of America
We put True Cost on the platforms of all the Green Parties of the world. Once they start winning elections, that’s when True Cost can start to jell into a unified global force.

The Adbusters' solution - the "True Cost Solution" - seems pretty attractive, particularly if that solution could be put in place before we reach the point of "total civilizational collapse." That point of total collapse is quite accurately described by Adbusters as the point at which "it’s your children who are hungry and your house that’s being swept away and your country that’s at war ... [the point at which you] reach for the ax on the wall." That point is coming; I'm pretty sure of that, and I question, when it gets here, that there will then be a move towards Adbusters' proposed "True Cost Solution."
I am not convinced, in other words, that the Adbusters' presentation successfully overcomes the "Pipedream" objection. Adbusters thinks that once the "tipping point" has been reached, everyone will suddenly understand the need for a "True Price" approach, which will then be promptly instituted as outlined and will work through our normal market mechanisms. Capitalism corrected, as it were!
Maybe that's true, but I have two reactions: #1 - In fact,  I think that the "tipping point" has been reached. We are not on the brink of a "climate and extinction crisis." We are already in such a crisis. So, if the tipping point is, itself, supposed to bring on the needed change, we ought to be seeing more change! #2 - As I said a few days ago, "Something For Nothing is Everybody's Plan." Are we all really going to be willing to give up our personal automobiles (which we won't be able to afford), while the super-rich will be able to drive around when and wherever they want (and with no traffic problems for them)? Maybe. But my instincts tell me no.
Adbusters indicates, without using the word, what is being suggested can occur only if our politics changes - and changes dramatically. That, I think, is indubitably true, and that kind of change will occur only when individuals start making dramatic changes in their own lives. We better not wait around for anyone else. We are going to need to do it collectively and cooperatively. I don't think the "market" is going to get it done!
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  1. This comment has been removed by the author.

  2. How does one go about determining a "true", "accurate" cost of the final product? It makes sense to tie consumers more to the overall labor and material costs of their consumption, but maintaining an accurate final cost of products would be very difficult.


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