Voting with our dollars

While climate change gets increasing attention and concern among voters, the daunting reality is that the United States has no real policies or regulations in place to substantially reduce carbon emissions. Other nations that have committed to reducing carbon emissions are far from reaching their goals.

I have come to believe that a large part of the solution must come from individuals changing they ways that the spend their money. Many people believe that reducing carbon emissions at scale requires public policy and regulation and that individual choice is almost meaningless. This is, however, equivalent to each person deciding that they don’t need to vote because their vote doesn’t make a difference. Democracy only works when everyone acts as though their vote matters. In markets, it is the same. Our consumption and investment decisions are voting with our dollars and we need every citizen to vote in a way that represents what they value.

How we spend money reflects our values, but also has a series of downstream effects.

First, there is the direct impact of directing our consumption behavior. Buying organic vegetables encourages farmers to produce more–the balance of supply and demand. If people stop buying gas-guzzling cars, fewer of these cars will be produced.

Second, there is the power of social influence. The more people who do something, the more others will follow. People choose what others around them are choosing, referred to as choosing the social default.

Third, there is social signaling and credibility. If people claim to be concerned about climate change but fly on private jets, people are likely to conclude that they are not really all that concerned. They invite accusations of being disingenuous or hypocritical. By changing our actions, we add weight to our words and nobody wants to be perceived as a hypocrite. Increasingly, there are calls for academics to account for their carbon footprints, and this is not just coming from the right:

Academics are probably among the people most aware of the threats posed by climate change. But might their own carbon-profligate lifestyles undermine their moral authority to demand that coal miners, Teamsters working on oil pipelines and mining-dependent Native American tribes sacrifice their own economic well-being to fight climate change?

Source: Huffpost, 2018

In 2019, 57% of American adults say that climate change is a major threat to the well-being of the United States. At the same time, the three best-selling vehicles in the United States in 2019 are full-sized pickup trucks. Politicians who look at these numbers might rationally conclude that most American voters don’t think that high carbon emissions are a significant problem, even if most voters say that they are very concerned.

I am strongly in support of policies that will limit carbon emissions. As an adjunct to efforts on the policy front, individuals must vote with their dollars. It is absurd for us to agree that climate change is an existential threat and then to be unwilling to make changes in our personal lives to reduce carbon emissions.