Environmentalism is a Luxury

In a time when global warming ceaselessly graces the front pages of the few remaining newspapers and is continuously hawked by the talking heads on twenty-four hour news networks, we are experiencing one of the coldest summers to date. (See Bloomberg News http://www.bloomberg.com/apps/news?pid=20601103&sid=as8EdCaoN0dQ). While the debate over the existence of global warming is largely and correctly closed, there are still many areas of debate that are still open and undecided. For instance, the extent of man's role in causing global warming, and hence his ability to mitigate it, is still open to discussion.

While such issues are being discussed at the margin, there is at least one issue that has been all together ignored. Most Americans, particularly the limousine-left of Hollywood, fail to see that environmentalism is a luxury. This missing concept is the source of much of the misunderstandings and failures to communicate with Third World countries. It also lies at the crux of disagreement between business and environmentalists.

Many environmentalists would dismiss such an argument on its face. The radical environmentalists argue that curbing global warming is a need. If we fail, the argument goes, so will our planet. Whether this is true or not and whether or not man actually has the capacity to make change is irrelevant and misses the key point. First of all, even by the most radical environmentalist standards there is little chance that those who are alive now will experience any catastrophic effects from global warming. Even in worst case scenario, it is our children or grandchildren that will be directly affected by our actions. While most people care about providing for our children, it is difficult if not impossible to claim that such forward planning is a need.

Secondly, most environmentally friendly actions cost money. Only recently have a significant number of such behaviors (such as purchasing CFLs) been proven to be the more cost effective option. This can, in part, explain the recent take-off of the pro-environment movement. Unless a behavior is the more cost effective option, individuals will need some ulterior incentive to spend their money.

This is often the case in modern America. Even when environmentally friendly actions are less cost effective, many Americans are willing to pay a premium for the products. A few extra cents for organic food or organic dry cleaning is worth it to those who can afford it. In other words, environmental consumers are gaining an indirect value from the organic or environmentally friendly product. At a minimum this value is simply ‘a good feeling’. If these products do not actually help the environment, the only value obtained is the cognitive notion that one is ‘helping the environment’. Alternatively, if these products do help the environment, then the extra money spent buys that same good feeling and helps avoid some environmental damage.

However, most people in the world cannot afford this extra premium. For them, the value of that good feeling or even the value of saving the environment is much lower than the extra cost. A rich New Yorker may be willing to pay double for his eggs if they are organic. The poor subsistence farmer who can barely scrape together a solid meal has no interest in ‘organic’ eggs. This is precisely why environmentalism is a luxury. More well-off individuals, and countries, can afford to pay more. They are able to pay for the benefits that they reap from being environmentalists. Whether these benefits are real or simply cognitive is irrelevant.

The failure to understand environmentalism through this lens drastically hampers political understanding. It explains why industrializing countries, such as China, are unwilling to change emissions standard; and subsequently why many Americans do not want to become uncompetitive by leading the way. It also explains why the Hollywood elite can justify buying hybrid Hummers and private jets (or explains Al Gore’s copious consumption of electricity in Tennessee). In order to accurately develop environmental policy, our leaders need to incorporate this understanding into their decision making process.