A sobering new study finds that the world's biggest industries burn through $7.3 trillion dollars worth of free natural capital a year. And it's the only reason they turn a profit.
The notion of “externalities” has become familiar in environmental circles. It refers to costs imposed by businesses that are not paid for by those businesses. For instance, industrial processes can put pollutants in the air that increase public health costs, but the public, not the polluting businesses, picks up the tab. In this way, businesses privatize profits and publicize costs.
Here’s how those costs break down: "The majority of unpriced natural capital costs are from greenhouse gas emissions (38%), followed by water use (25%), land use (24%), air pollution (7%), land and water pollution (5%), and waste (1%)."
Of the top 20 region-sectors ranked by environmental impacts, none would be profitable if environmental costs were fully integrated. Ponder that for a moment. None of the world’s top industrial sectors would be profitable if they were paying their full freight. None!
That amounts to an entire global industrial system built on sleight of hand. As legendary environmentalist Paul Hawken put it, “We are stealing the future, selling it in the present, and calling it GDP.”