mindtangle

Social Costs

Amy posted on her blog about the difficulty of buying responsibly. In her post, she links to an SF Chronicle article that traces the myriad social and environmental costs of real versus fake Christmas trees. Amy notes:

the article more or less concludes that the number of variables to consider when determining whether to buy a product or which product to choose over another in terms of sustainability are completely overwhelming, but even though sometimes it feels like the more informed you are the harder it is to make the decision, there is always a better choice and we should just do our best.

For sure, it’s really difficult as a consumer to make informed purchasing decisions. However, the armchair economist in me believes that good regulation would simply make these social costs a part of the prices of things (i.e. government forcing the internalization of externalities.)

For example, things like toxicity and fire safety are hard factors for a consumer to consider, but good tort laws can push those hard-to-evaluate costs to the manufacturer. If anyone can sue a christmas tree maker/seller when a highly flammable plastic tree burns down a home , those companies will have to decide how to make their products safer and how much more to charge in order to cover legal costs. Instead of every consumer trying to navigate a whole mess of social implications, the legal system just raises the prices of the trees to reflect their true cost.

Carbon footprints are even easier: Carbon tax! If you tax carbon at the source (right where the coal is mined, right where the oil is extracted) then the extra cost is distributed throughout the web of consumption exactly as those costs move through the economy. Every carbon emission going into a tree (transport, petroleum-based plastic, disposal, etc.) is accurately reflected in the increased cost of the tree.

Of course, by “easy” I mean that these things are conceptually easy, not politically. The solutions are clear as long as one is dealing with a populace that believe that the environment and health are worth preserving, even if there is potential drag on our economy. And as obvious as that seems to me and most people that I know, there’s not consensus on that issue, nation-wide.

So, what to do in the meantime? Well, we should muddle through as the author of that SF Chronicle writer does. I just object to the exasperated tone of the piece. It conveys the sense that do-gooder consumers are engaged in a futile exercise, which they’re not. We can make better purchasing decisions, learning about where our products come from is a good in of itself, and raising awareness can lead to the systematic, political changes that will cause all economic players to do the right thing.

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    thx eric, and i wholeheartedly agree that more regulation would help ease the consumer burden in aking these decisions. i know that this goes against "free market" advocates, but whatever. particularly since so many consumers ASSUME the government is "doing the right thing" in making sure that products/production processes are safe and healthy. so many americans assume that if something has been approved by the FDA, it's safe, and if something is sold in a store, it's safe, and unfortunately because of lobbying by industry and other factors, that's just not true, especially for things like cosmetics and food, let along things you don't eat or smear all over your body. i would be happy if at LEAST the government would take more responsibility regulating the quality and production of healthcare products and food - let along things like plastic christmas trees.

    i didn't get so much of an "exasperated" tone from the author, just a realistic evaluation of how difficult it is for today's consumers to be informed and make informed decisions.
 
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