All About The Clearwater Carbon Calculator© For information, contact mannajo@clearwater.org, 845-454-7673 x113. mannajo@clearwater.org |  Main Page  |  Press Release  |  Download  |  Instructions  |  Case Study  | It has been widely suggested that patterns of consumption exhibited by end consumers such as individuals and small institutions may be the fundamental engine driving environmental degradation. I will discuss this assertion, and then investigate price and non-price methods for encouraging rational consumer decisions that can achieve measurable, sustainable reductions in the destructive characteristics of that consumption at an appropriate scale. The principle of consumer sovereignty, according to Stiglitz, holds that “...individuals are the best judges of what is in their own interests and that their preferences should be respected.” Gottheil (7) states that “this right to choose what we want dictates what producers will ultimately produce, just as our right to choose our political leaders dictates what kind of government policies we ultimately get.” But what information do consumers use in making their choices? Need and availability are key factors, certainly. Price is another. The classic cost-benefit analysis, which takes place either explicitly or unconsciously before every market transaction, balances need (or desire) as measured in terms of marginal utility or benefit, against price. Put simply, the consumer is asking, “Is it worth the cost?” An individual, rational, and reasonably well-informed economic actor, having learned through exposure to various communications media that dirty air, contaminated water, and resource-driven global conflict persist and may indeed be attributed to functions of economic systems, might be motivated to examine and ameliorate his or her own role in relation to those economic externalities if the prospect of some meaningful outcome exists. I will suggest that this actor may not be inexorably constrained either by first principles of self-interest and price mechanisms or, at the other extreme, by nonspecific, shifting social values expressed as exhortations to voluntarily conserve, recycle, preserve, and There is no environmental impact statement required of the individual or small-scale economic actor. When corporations experience political or market pressures as a result of pollution events they attempt to exculpate themselves by blaming consumers, because in the simplest paradigm of an economic system it is the end consumer who creates demand, which in turn drives production. When environmental catastrophes occur, such as the Exxon Valdez oil spill of 1989, even environmental groups remind individual consumers that they are ultimately to blame, as when Greenpeace ran full page advertisements in key newspapers around the world showing a photograph of Exxon Valdez Captain Joseph Hazelwood, and beneath it the caption: “It wasn’t his driving that caused the Alaskan oil spill. It was yours.” If individual consumption patterns possess embedded destructive characteristics, and if consumer behavior is a significant influence upon the world’s environmental problems, then it follows that there should be small-scale impact assessment resources that have emerged, perhaps unnoticed, from the body of research studying consumer behavior and the environmental perspective. The Clearwater Carbon Calculator© has been developed after an exhaustive search and thorough examination of potential resources. I am suggesting that awareness of quantitatively-expressed specific environmental impacts at local scales may be able to empower and enable aggressive local (individual, household, small institution, bioregion) responses to that impact. In my opinion the Clearwater Carbon Calculator© offers an antidote to the helplessness and sense of futility that all-too-often pervades the discourse of environmentalism. Environmental degradation caused by non-sustainable patterns of human production and consumption has been amply documented. What concerns us here is the fact that despite decades of supply-side approaches to controlling or reversing this degradation, the air is still polluted and becoming increasingly so, water is still polluted, open space is rapidly disappearing, and even global systems such as ocean currents and atmospheric climate may be uncontrollably altered. Measuring environmental degradation is a piecemeal affair, taking place at all different scales and using every conceivable metric, from the number of spots on invertebrate worms in a local stream to the tons of an indicator pollutant being emitted by smelter smokestacks on a continent. It would be a gross oversimplification to state baldly that environmental degradation and economic activity are causally related, but certain economic transactions do unquestionably result in effects that impede the normal functions of environmental systems (e.g. electric power generation and acid deposition), and further, in trends that society deems to be undesirable (e.g. loss of open space to look-alike housing developments). Hence it may be useful to link environmental impact analysis with economic structures. Looking at the history of environmental concern in the western world, we find that society has overwhelmingly chosen to control environmental degradation by controlling events occurring at the supply—producer—side of the economic transaction. Largely overlooked has been the demand—consumer—side of the economic transaction. Certain controls aimed at slowing or halting the purchase of environmentally harmful goods or services have been implemented, such as the ban on sales of leaded gasoline or paint, but the net burden has fallen on the suppliers, and consumers were given no choice in the matter. In the case of lead this ban has conveyed a strong public benefit to consumers in the form of improved health, particularly among children. But a similar control, the imposition of oxygenated gasoline containing the additive methyl tertiary butyl ether (MTBE), has resulted in widespread groundwater contamination and health problems that have far outweighed the potential benefits. Consumers had no choice with regard to either lead or MTBE, but the range of outcomes swung wildly from strong success to unmitigated failure. Without intimating that consumer choice might have brought about a better outcome in either case, I suggest that the market for the public good ‘a healthy environment’ may be functioning poorly, despite command-and-control supply-side controls, because the high-quality information needed for a market to perform efficiently is severely constrained or altogether missing. The Clearwater Carbon Calculator© offers a simple method with which consumers can voluntarily measure their own contribution to a degraded environment, and a framework in which they can make rational choices regarding the environmental component of information involved in their transactions. Hopefully, the outcome of this exercise will be a more efficient market for the public good ‘a healthy environment’, when measured at the individual, household, or small-institution scales. In basic microeconomic theory, everything the consumer needs to know is supposed to be embodied in the price of a good or service. In their discussion of the assumptions underlying ‘perfect competition’, Browning and Browning say, “for consumers the relevant information is a knowledge of their own preferences and the prices of the various goods and services of interest to them.” In fact, all the details of research and development, the lengthy and risky start-up process, the interest rates on the company’s various loans and bonds, the costs of materials, complex labor transactions, shipping at many levels, advertising, storage, the thousands of discussions, calls, and e-mails that may have gone into production of a T-shirt in Sri Lanka and its subsequent arrival at the holiday open-air market on Union Square are buried in a single, simple number—the price. It seems almost sacrilegious to suggest that prices don’t tell the whole story because they tell so much. But, quoting Stiglitz again: “Some kinds of information, like information about the weather, are public goods: the marginal cost of an additional individual benefiting from the information is negligible, and the cost of excluding individuals from this information may be considerable. This kind of information can also be important for efficient functioning of the economy, but markets do not produce efficient amounts of it.” Stiglitz goes on to say that weather information is therefore supplied by the government, as a classic example of instances where government steps in to maintain economic efficiency in imperfect markets. But who is stepping in to tell us about the quality of life among the people sewing the T-shirt in Sri Lanka? Who is looking at the pesticides being applied to the cotton fields, and to the health impacts upon pesticide factory workers, farm workers, and farm neighbors? Who is telling us about the excessive demands for water upon the cotton fields, water which could be used to irrigate many more acres of arable land in food production? From where do we learn about the gradual, irrecoverable salinization of irrigated fields? Who is telling us about the impact on American workers from having the shirts manufactured overseas, and who can tell us about the particulates, oxides of nitrogen and sulfur, and carbon emissions from transport? To the extent that these elements of a good’s life cycle involve costs, they are accounted for in the price, without question or judgment. But some economists—Clifford Cobb, Ted Halstead, Jeff Hammond—would say that in “conventional” markets any transaction is a good transaction, whether it be a blood transfusion to an AIDS patient or the funeral of a soldier brought back from a war in the Middle East, where access to precious oil reserves is at risk. Hence, it is not enough to simply account for costs in the price of a good, and expect an efficient outcome. Prices do not include information about externalities—transactions that have escaped the accounting process throughout the good’s life cycle. Externalities include emissions of carbon to the atmosphere, particulates to the lungs of a black teenager in Hunts Point, pesticide runoff into rivers and their subsequent uptake by gamefish at the top of the food web, and social costs that arise from inhalation or ingestion of pollutants. Prices include the costs of process feedstocks, such as the PCBs that washed into the Hudson River for over twenty-five years from two GE plants near Glens Falls, but not the costs of recovery, cleanup, analysis, or the impacts of contaminated fish ingestion upon immigrants and communities of color: reduced intelligence, behavioral abnormalities, and cancer (although prices may be adjusted after the fact to include those expenses after the company is forced to undertake a cleanup). Prices include the costs of fuel oil for ships, trucks, and airplanes, but cannot address the threat of flooding in Bangladesh or Bimini that may ensue if Antarctic ice continues to melt. Prices do include the entirety—and many suspect that it is the entirety plus interest—of firms’ transaction costs with government over environmental regulation. The information buried within prices is not retrievable and is tightly bundled with all the other bits of matter. Price information is, therefore, a summary accounting, but not a detailed disclosure. In this document I suggest that prices, while remarkably effective conveyors of relevant transaction-related information, fall short of informing consumers about many or all of the environmental consequences of their transactions. Global warming, as a current environmental issue, is the result of an anthropogenically-induced imbalance in atmospheric composition leading to increased heat absorption as solar radiation passes through the earth’s atmosphere. Fossil-fuel combustion, deforestation, agriculture, and use of chemical refrigerants are the principal contributors to accelerated heat absorption. These activities generate emissions of carbon dioxide, nitrous oxide, methane, and chlorofluorocarbons (CFCs) — the most notable “greenhouse gases”. Researchers point out that anthropogenic global warming probably will induce an array of uncontrollable natural greenhouse gas emissions. Most notable among these is the probability, already supported by depth-to-permafrost data, that melting Arctic tundra will generate vast releases of methane, a greenhouse gas more potent than carbon dioxide by a factor of 63. Atmospheric carbon dioxide has been measured since 1958 at a monitoring station on Mauna Loa, Hawaii. In 1958, readings varied in a seasonal range from 315-318 parts-per-million (ppm). As of 1990, levels were exceeding 350 ppm, an increase greater than 10 percent in 32 years. Perhaps more alarming, while fossil fuel-attributable CO2 began do exhibit a slowing growth slope following the price hikes of the early 1970’s, and the onset of environmental regulations in parts of the world, atmospheric CO2 continued to increase unimpeded, evidence of poorly-understood positive feedback variables, such as continued deforestation (23% of CO2 inputs) and methane releases from melting tundra (ibid). Overwhelmingly, it is carbon dioxide that has become the target of the IPCC and the international community of NGOs working on global warming. Deforestation and fossil fuel consumption remain the most intractable and ubiquitous contributors to increasing concentrations of atmospheric greenhouse gases. As the policy paralysis of the past decade clearly indicates, international and governmental initiatives may not be sufficient to reduce anthropogenic carbon dioxide emissions enough, or in time, to avert serious, destabilizing global climate-related effects by the middle of the next century. The Kyoto Accords, for example, have not yet been ratified by most member nations, and while they establish a trading mechanism designed to reduce carbon emissions from large-scale point sources, there are no enforcement mechanisms in place or on the horizon. Therefore, the source for emissions reductions with the most near-term potential may be the small-scale emitters; the individuals, households, and smaller institutions among the developed nations—the most prolific producers of atmospheric carbon. These small-scale emitters require data regarding their carbon emissions, and a mechanism for monitoring and managing reduction. Toward that end, in the Spring of 1992, an ad hoc group of researchers at the Woods Hole Research Center undertook a study or their institution’s direct and embodied carbon emissions. Though unpublished, their report formed the starting point for the Clearwater Carbon Calculator©, and my readings in Ecological Footprint Analysis led to the use of a programmed spreadsheet as the most effective tool for delivery of a carbon audit tool. |  Main Page  |  Press Release  |  Download  |  Instructions  |  Case Study  |