Did you notice how COP26 seamlessly morphed into Black Friday last month? How concerns about deforestation of the Amazon became concerns about Amazon not matching last year’s spike in Black Friday sales?
Presumably executives from H&M, Ikea and Walmart, hot from signing up to the UN’s "Race to Zero" initiative, rushed back from Glasgow to their head offices to ensure plans were in place for another record-breaking discounted sale of "stuff" on Black Friday.
The good news, if you’re in any way concerned about an evidently deteriorating environment, is that this year’s Black Friday global splurge was a disappointment. In the US traffic at retail stores was down 28% on 2019; online retailers fared better, but sales were still less than in 2020.
In SA it was also a more subdued affair, but South Africans are more sceptical, so Black Friday hasn’t ever held the same allure as in some other nations.
In the UK protesters blocked Amazon warehouses on the day, but while they may have slowed down the pace of deliveries, they failed to halt them. The largest retailer in the world outside China managed to annoy almost every social and environmental group in the UK. The protesters included unions as well as equality and environmental activists.
Evidently the environmentalists weren’t swayed by Jeff Bezos’s address to COP26. The Amazon founder and major shareholder said private industry had to play a central role in dealing with climate change. He pledged $2bn to restore natural habitats and transform food systems. That’s $2bn of the $10bn he had pledged back in 2020 to "explore new ways of fighting the devastating impact of climate change". He wants Amazon’s operations to be carbon neutral by 2040. Ho-hum.
But perhaps it’s not businesses or even governments that need to play that central role in tackling climate change. Perhaps it needs to be played by each one of us. The stuff that is produced by environment-destroying companies goes into other stuff that ends up being bought by us. Sasol and Shell produce oil, which transports us, and plastics that provide wrapping for something we think we desperately need. If lots of stuff is consumed, the environment gets trashed, but the economy notches up sparkling growth figures.
Our consumption is being subsidised by unborn generations
The global economy is living beyond its environmental means. Consumers of the 21st century are gobbling up environmental resources that belong to their children, grandchildren, great-grandchildren and so on. Our present-day consumption is being subsidised by unborn generations. This living beyond our means probably dates back to at least the beginning of the industrial age.
The creation of limited liability companies in the early 19th century provided the setting needed for the nonpricing of externalities. That nonpricing has enabled environmental destruction on a huge scale. By not pricing in those externalities we have been able to consume beyond our means, companies have been able to report hefty profits and economies have been able to boom. But it’s likely that only the most ascetic of environmentalists are willing to take on the necessary curbs in consumption. So here’s an idea: force companies to price in all environmental externalities.
Consider what might happen if the price of a Sasol product included the cost of destroying the environment around Secunda. Or if governments insisted that hazardous materials could not be transported without insurance to cover spillages. And this cost was added to the final price.
In May the X-Press Pearl container ship caught fire and sank in the Indian Ocean. The Sri Lankan government was terrified about the prospects of oil spilling into the ocean, damaging coral reefs and the fishing industry. It turns out the serious damage was wreaked by 87 containers of nurdles — lentil-sized plastic pellets destined for manufacturers across the globe.
If we were forced to pay the full price of what we consume, one of two things would likely happen: economies would grind to a halt as consumption plummeted; or the Bezoses of this world would quickly devise environmentally friendly ways to protect consumption.
The short-term effects could be devastating to our standard of living and economic growth, which is why governments won’t act. But at least we wouldn’t have to endure COP52.
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