Burning Down the House?

I think that comparing the attack on the twin towers to climate destruction is a bit far fetched. It isn’t because I don’t believe the earth is endangered – instead it’s because the contexts are different. On 9/11, if you had any chance of surviving, it is because of the decisions you made in the span of an hour or so. In other words, if you were in a position where you could have made it out of the building, you only survived if you did make it out of the building. Choosing to listen to building management or not was a quick decision made with little time to consider how the actions would affect your livelihood. In addition, damage control was poorly applied because people in charge couldn’t really comprehend the situation.

In the case of the environment, people in charge are well aware of the effects they have on the environment. Indeed, scientists have been advising the population for years about their habits. In this case, it isn’t that damage control is being poorly applied because people don’t comprehend what’s going on – it’s because applying it effectively is inconvenient and costly. The effect is less resemblant of failing to escape from a burning building because of bad decisions, and far more consistent with ignoring the hazards that could set it on fire in the first place.

But the building isn’t really going to burn down either – instead, it will just become an unpleasant place to live.  Regardless, scrambling to react properly when tragedy strikes is different than choosing to ignore what could cause tragedy in the first place. One response is reactionary, the other careless.

Investors who pump billions of dollars into companies that harm the environment do so because it is profitable. That doesn’t mean they do so blindly. They understand the industry just as well as the scientists do – but they approach it with a different goal: making money. Few successful investors would ever put money into something they didn’t understand. While they likely won’t have an answer as to how to react to the deteriorating environment, they likely will have a financial exit strategy. The reason their investment behavior is careless to people who care about the environment is because it ignores the possibility of environmental destruction – but it doesn’t ignore the possibility of how profitability will change when oil dependence is no longer possible.

I think there is a mismatch of incentives that results in careless environmental behavior by people who make investment decisions regarding the environment. I don’t think its because they used the old tactics to make new decisions.  I think divestment will be driven by economic conditions, and I am not convinced the same types of behavior preventing divestment are at play.  It’s way more complicated and manipulative, and that’s why I don’t find the metaphor 100% useful.

 

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