To save the climate, we have to reimagine capitalism
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0:01 - 0:02I am a tree hugger.
-
0:03 - 0:05I spent much of my childhood
-
0:05 - 0:07on the great lower limb
of a massive copper beech, -
0:07 - 0:11alternately reading and looking up
at the sky through its branches. -
0:11 - 0:13I felt safe and cared for
-
0:13 - 0:17and connected to something
infinitely larger than myself. -
0:17 - 0:21I thought the trees were immortal,
that they would always be here. -
0:22 - 0:24But I was wrong.
-
0:24 - 0:26The trees are dying.
-
0:26 - 0:29Climate change is killing
the cedars of Lebanon -
0:29 - 0:31and the forests of the American West.
-
0:32 - 0:33And it's not just the trees.
-
0:34 - 0:40Since 1998, extreme heat
has killed more than 160,000 people, -
0:40 - 0:44and unchecked climate change
could kill millions more. -
0:44 - 0:46How did we get here?
-
0:46 - 0:48There are many reasons, of course,
-
0:48 - 0:49but one of the most important
-
0:49 - 0:53is that we let capitalism
morph into something monstrous. -
0:54 - 0:57I'm a huge fan of capitalism at its best.
-
0:57 - 1:01After all, I'm an economist
and a business school professor. -
1:01 - 1:04I think genuinely free and fair markets
-
1:04 - 1:07are one of the great inventions
of the human race. -
1:07 - 1:09But here's the catch:
-
1:09 - 1:14markets only work their magic
when prices reflect real costs. -
1:14 - 1:17And right now, prices
are badly out of whack. -
1:17 - 1:20We're letting the firms
who sell fossil fuels, -
1:20 - 1:23and indeed anyone
who emits greenhouse gases, -
1:23 - 1:27cause enormous damage
for which they do not have to pay. -
1:28 - 1:29And that is hardly fair.
-
1:30 - 1:33Imagine for a moment
-
1:33 - 1:36that my hands are filled
with a cloud of electrons, -
1:36 - 1:3910 dollars' worth
of coal-fired electricity -
1:39 - 1:43that could power your cell phone
for more than 10 years. -
1:43 - 1:45That probably sounds
like a pretty good deal. -
1:45 - 1:47But it's only so cheap
-
1:47 - 1:50because you're not paying
for the harm that it causes. -
1:51 - 1:55Burning coal sends poisons
like mercury and lead into the air, -
1:55 - 1:58increasing healthcare costs
by billions of dollars -
1:58 - 1:59and causing the death
-
1:59 - 2:02of hundreds of thousands
of people every year. -
2:03 - 2:07It also emits huge quantities
of carbon dioxide. -
2:07 - 2:09So another part of the real cost of coal
-
2:09 - 2:14is the climate damage it will cause
and is already causing. -
2:14 - 2:18More than a million acres
burned in California this summer, -
2:18 - 2:22and massive floods put a third
of Bangladesh under water. -
2:22 - 2:26Hundreds of studies have tried
to put a number on these costs. -
2:26 - 2:28My sense of this work,
-
2:28 - 2:31and here I'm relying on my colleagues
in the School of Public Health -
2:31 - 2:33and my friends in economics,
-
2:33 - 2:37is that generating 10 dollars' worth
of coal-fired electricity -
2:37 - 2:42causes at least eight dollars' worth
of harm to human health -
2:42 - 2:47and at least another
eight dollars' worth of climate damage -
2:47 - 2:48and probably much more.
-
2:49 - 2:52So the true cost
of this handful of electrons? -
2:52 - 2:53It's not 10 dollars.
-
2:53 - 2:56It's something more like 26.
-
2:57 - 3:00The hidden costs of doing
things like burning oil and gas -
3:00 - 3:05and eating beef are similarly
enormous and just as unfair. -
3:06 - 3:10Everyone who's trying
to build a clean economy -
3:10 - 3:13has to compete with firms
that are heavily subsidized -
3:13 - 3:17by the destruction of our health
and the degradation of our climate. -
3:17 - 3:20This is not the capitalism
I signed up for. -
3:20 - 3:25This is not a market
that is either free or fair. -
3:25 - 3:27So ...
-
3:28 - 3:29What do we do?
-
3:31 - 3:35The "easy" answer
is that governments should insist -
3:35 - 3:40that anyone who emits greenhouse gases
pay for the damage that they cause. -
3:40 - 3:42However, at the moment,
-
3:42 - 3:44there's not much sign
that governments are up for this, -
3:44 - 3:49partly because the fossil fuel companies
have spent the last 20 years -
3:49 - 3:52using their heavily subsidized profits
-
3:52 - 3:55to deny the reality of climate change
-
3:55 - 3:56and to shower the politicians,
-
3:56 - 3:59who should be regulating them, with money.
-
3:59 - 4:02So here's my crazy idea.
-
4:02 - 4:04I think business should step up.
-
4:05 - 4:08I think business should fix capitalism.
-
4:09 - 4:10I know.
(Laughs) -
4:10 - 4:15Some of you are probably
thinking, "Fat chance." -
4:15 - 4:20Didn't I just say that companies
are the ones denying the science, -
4:20 - 4:23distorting the market
and lobbying the politicians? -
4:23 - 4:24I did.
-
4:25 - 4:29But fixing this is squarely
in the private sector's interest. -
4:30 - 4:35The truth is business is screwed
if we don't fix climate change. -
4:36 - 4:38It's going to be hard to make money
-
4:38 - 4:40when the great coastal
cities are under water -
4:40 - 4:45and millions of angry people
are migrating north as the harvests fail. -
4:45 - 4:48It's going to be tough
to keep free enterprise alive -
4:48 - 4:51if most people believe
the rich and the white -
4:51 - 4:55are using it to trash the planet
for their own benefit. -
4:56 - 4:59So let me tell you
what this looks like on the ground. -
5:00 - 5:04My friend Erik Osmundsen
left a cushy job in private equity -
5:04 - 5:07to become the CEO of a garbage company.
-
5:08 - 5:11That sounds like a slightly odd idea.
-
5:12 - 5:14But Erik wanted to make a difference,
-
5:14 - 5:16and changing the way that trash is handled
-
5:16 - 5:19could reduce emissions
by billions of tons. -
5:20 - 5:23Right away, he ran into a massive problem:
-
5:23 - 5:26the industry was thoroughly corrupt.
-
5:26 - 5:29Firms were cutting costs
by dumping waste illegally, -
5:29 - 5:31the regulations were poorly enforced
-
5:31 - 5:34and the fines for violation were tiny.
-
5:35 - 5:37Erik announced he was going to run clean
-
5:37 - 5:40and to raise prices
to cover the costs of doing so. -
5:41 - 5:44Many of his senior team
thought he was crazy. -
5:44 - 5:46Half of them quit.
-
5:46 - 5:48So did many of his customers.
-
5:48 - 5:52His competitors denounced him
for bringing the industry into disrepute, -
5:52 - 5:55and he started
to receive personal threats. -
5:56 - 5:59But corruption works best
when it's hidden. -
5:59 - 6:04As soon as Erik went public,
people started to step up. -
6:04 - 6:06A few customers were willing to pay more.
-
6:07 - 6:10His investors agreed that taking
the high road could pay off. -
6:11 - 6:15Those of his employees who remained
loved the idea of taking a stand -
6:15 - 6:18and found all kinds
of legal ways to cut costs. -
6:18 - 6:21Erik persuaded several of his competitors
-
6:21 - 6:24to join him in refusing
to dispose of garbage illegally, -
6:24 - 6:28and it got much tougher
for regulators to stay on the sidelines. -
6:29 - 6:33Today, Erik's company, Norsk Gjenvinning,
-
6:33 - 6:36is one of the largest
recycling companies in Scandinavia. -
6:36 - 6:38Let me generalize.
-
6:38 - 6:40These are the four pillars of change:
-
6:41 - 6:44Build a business
that can set the right price -
6:44 - 6:46and still be profitable.
-
6:47 - 6:49Persuade your competitors
to do the same thing. -
6:50 - 6:53Make sure that investors understand
there's money to be made. -
6:54 - 6:57And push governments
to put the right price into law -
6:57 - 6:59so that bottom-feeders can't survive.
-
7:00 - 7:03I'm not telling you we've got this nailed.
-
7:03 - 7:05Things are pretty desperate.
-
7:05 - 7:09But there are thousands
of businesspeople like Erik, -
7:09 - 7:12and there are millions of people like us.
-
7:12 - 7:18And we are customers, employees,
investors and citizens. -
7:18 - 7:22Instead of giving up
on capitalism, let's fix it -
7:22 - 7:26by making sure that markets
are truly fair and truly free, -
7:26 - 7:29and that no one can dump garbage on us
-
7:29 - 7:32and walk away without paying for it.
-
7:32 - 7:38We have the resources and the technology
to solve climate change. -
7:38 - 7:41Together, we can save the trees
-
7:41 - 7:43and each other.
-
7:43 - 7:45Thank you.
- Title:
- To save the climate, we have to reimagine capitalism
- Speaker:
- Rebecca Henderson
- Description:
-
"Business is screwed if we don't fix climate change," says economist Rebecca Henderson. In this bold talk, she describes how unchecked capitalism destabilizes the environment and harms human health -- and makes the case for companies to step up and help fix the climate crisis they're causing. Hear what a reimagined capitalism, in which companies pay for the climate damage they cause, could look like.
- Video Language:
- English
- Team:
- closed TED
- Project:
- TEDTalks
- Duration:
- 07:47
Erin Gregory edited English subtitles for To save the climate, we have to reimagine capitalism | ||
Rhonda Jacobs edited English subtitles for To save the climate, we have to reimagine capitalism | ||
TED Translators admin edited English subtitles for To save the climate, we have to reimagine capitalism | ||
Erin Gregory edited English subtitles for To save the climate, we have to reimagine capitalism | ||
Erin Gregory edited English subtitles for To save the climate, we have to reimagine capitalism | ||
Ivana Korom edited English subtitles for To save the climate, we have to reimagine capitalism | ||
Ivana Korom edited English subtitles for To save the climate, we have to reimagine capitalism | ||
Rhonda Jacobs edited English subtitles for To save the climate, we have to reimagine capitalism |