Lear Jet, NASA, Public Domain

Unfortunately, any agreement by governments at the end of this week at the climate change conference in Paris will probably not be ambitious enough to keep the rise in global average surface temperature below a ‘safe’ level. That said, it’s reasonable to assume that at some point governments are going to put in place concrete measures to reduce greenhouse gas emissions from areas such as energy, industry, transport and agriculture. My focus here is on people’s individual carbon footprints.

When governments introduce these policies they need to factor in extreme inequality because people have different sized carbon footprints. Just last month French economists Thomas Piketty and Lucas Chancel highlighted “the unequal contributions to pollution” by individuals within countries and attempted to calculate carbon footprints by a person’s income. They estimate the richest 1% in the United States (around 3.9 million people) emit around 300 tonnes of greenhouse gas emission per person in a year, while in Honduras the poorest 10% (around 800,000 people) each emit just 0.09 tonnes a year. Oxfam published similar findings this week estimating that “the richest 10% of people in the world are responsible for around 50% of global emissions”.

If it is true that the richer you are the larger your carbon footprint, then it makes sense to target the richest people because they are probably doing the most damage. In my recently published working paper I focus on High Net Worth Individuals who have investable wealth of at least $1m.

I try to quantify their ecological footprint (emissions of greenhouse gases plus all other natural resources consumed in a year) in the main countries where High Net Worth Individuals live including the United States, Japan, China, United Kingdom and France. Although there is hardly any data I use household expenditure surveys to also tentatively conclude that higher income probably equals higher footprint.

Targeting the rich

In a context of extreme inequality it will be very difficult to get the richest to reduce their ecological footprints and that’s why it’s time to have an honest debate about what will actually work. For example, there is currently a big focus on providing information to encourage people to make their consumption more sustainable. But is it realistic to expect awareness raising campaigns linking the burning of fossil fuels to melting glaciers to reduce the amount the richest fly in their private jets? Even if the richest people are fully aware of the increasing frequency and intensity of extreme weather events like typhoons will this stop them competing over who has the biggest super-yacht? Clearly, information by itself is not going to be enough. 

What about regulations such as environmental taxes that would make personal pollution more expensive? They could be a good way to target people differently according to expenditure. But if the tax is not high enough it may have less effect on the richest because they are constantly making money on their existing investments so they could afford to pay to continue polluting now and in the future (as Piketty has shown the rate of return on wealth is rising faster than the rate of economic growth).

What these issues highlight is that there needs to be a frank and open public debate about what will make the richest actually reduce their carbon footprints. Governments will then have to think very carefully about how to tailor policies to target the richest effectively.

Would income redistribution increase people’s carbon footprint?

Looking ahead, if wealth affects carbon footprint this raises a fundamental question that needs to be explored further. This is: if measures were put in place to reduce inequality by redistributing income (and/or wealth) would this increase the carbon footprint of the people who received this additional money? For example if wealth was redistributed from the richest 1% of people in the United States to the poorest 10% would these people now fly more because they could afford to? In a response to my working paper Alex Cobham, an expert on inequality, says: “it is quite possible, indeed plausible, that substantial redistribution may succeed in raising the consumption and footprint of lower-income beneficiaries, while barely affecting High Net Worth Individuals who absorb any changes through saving behaviour.” The fact inequality and ecological impact are so intertwined means work on inequality must factor in the challenge of keeping within planetary boundaries.

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