Freedom—the ability of all to live how they so choose, up to the point that this undermines the ability of others to do the same—and a thriving natural environment—the supply of the environmental goods and services as well as climatic stability upon which civilization depends—provide the common, fundamental keystones for a prosperous society composed of diverse individuals with unique pursuits. While the former has spread across the globe over the past few centuries and led to the widespread adoption of democratic principles, the latter has been a recipient of neglect.
Assessments of the present status of environmental quality like the Intergovernmental Panel on Climate Change’s Fifth Assessment Report and the Millennium Ecosystem Assessment are not just comprehensive and rigorous in their analysis but also unified in their conclusions: the imperative for action. Nevertheless, these assessments have not spurred the scale and scope of action required to restore the health of the planet’s ecosystems, decarbonize the global economy, and in so doing strengthen this societal keystone.
Environmental protection and climate action, similar to the protection of individual freedom, are collective action problems with multiple actors. As such, although environmental quality and a stable climate may be in the best interest of society, actors will defect to the sub-optimal outcome reflected in the aforementioned assessments until the incentives motivating their decisions—be they social, political, economic, or something else—exist.
The economic motives for climate action in particular are growing and becoming clearer. Research suggests there are both negative and positive economic incentives for climate action: Some research—such as Risky Business and the White House’s The Cost of Delaying Action to Stem Climate Change—highlights the broad economic costs of inaction to mitigate the effects of climate change. Other research articulates the public and private economic benefits of decarbonizing the global economy. The Global Commission on the Economy and Climate’s New Climate Economy report shows that low-carbon economies provide a route to lasting economic growth that improves quality of life. Rocky Mountain Institute’s Reinventing Fire provides a roadmap for the United States to concurrently cease its use of coal, oil, and nuclear power, reduce CO2 emissions by 80 percent, unlock $5 trillion in net savings, and run a 158 percent larger economy by 2050 compared to business-as-usual using currently available technologies at normal rates of return and without an act of Congress or any new national taxes, subsidies, or mandates.
There are also political motives for climate action. For the political left, the transition to a decarbonized economy will improve social welfare over the status quo, promote more equitably distributed economic outcomes, and better protect society’s most vulnerable individuals from the effects of climate change. For the political right, the transition will improve the functioning of markets by resolving market failures and—being that government action to address climate change does not distinguish individuals on arbitrary terms and can be diminished over time as the issue is resolved—provide an example of limited government. And for those across the political spectrum, the transition away from the old fossil fuel economy to a new decarbonized economy will ensure future generations have access to nature’s splendor and will, like other instances of creative destruction, unleash an abundance of economic opportunities, many of which are relatively low skilled and cannot be outsourced.
It is powerful to demonstrate through analysis and logic that the transition to decarbonized economies is technically possible, economically prudent, and politically agreeable. What may prove even more powerful to enabling decarbonized economies, however, is the budding, albeit disperse, network of cities, companies, universities, and other institutions that aspire to do better than just less damage to the environment and climate but rather near-zero, net-zero, or net-positive impact. These cities (including New York City, Vancouver, Copenhagen, Seattle, Portland (OR), Cleveland, Boston, Palo Alto, Fort Collins (CO), Hillsboro (OR), and Beaverton (OR)), companies (including and Deutsche Bank, Google, Microsoft, Tesco, Walmart, Apple, Ikea, Nestle, Proctor & Gamble, Walt Disney, Mars Inc., Staples, TD Bank, Kohl’s), universities (including Arizona State University, University of British Columbia, Santa Clara University, UC Davis, and Middlebury College, Oberlin College), and other institutions exude leadership and provide examples for others to follow to meet the challenge presented by the current state of the earth’s environment and climate.
The historical neglect of the natural environment—one of two keystones underpinning societal prosperity—need not continue. It is possible and economical to transition to a decarbonized global economy, even with today’s technologies and policies. Moreover, a plurality of motives to decarbonize the global economy and examples of climate action leadership offer reason to believe that the global pursuit of decarbonization is approaching a tipping point. In turn, preserving the status of fossil fuels is becoming increasingly difficult to justify or maintain.
Douglas Miller applies his background in environmental and behavioral economics at Rocky Mountain Institute (RMI) to pioneer the global transformation to energy efficiency and renewable energy. Douglas holds a MSc in Environmental Economics and Policy from Imperial College London and a BA in Philosophy, Politics, Economics (PPE) and Environmental Studies from the University of Pennsylvania. You can follow him on Twitter at @DouglasMiller89.
The views expressed in this article are solely those of the author and do not express the views of Rocky Mountain Institute.