Q. Your research on air pollution finds this costs, on average, 2 years in life expectancy globally per person and 5 years in South Asia. This summer, we’re seeing large wildfires and intense air pollution in Canada and the United States—what are the likely economic and social fallouts?
A. It’s remarkable that in North America, we mostly thought while particulate matter wasn’t totally gone and air pollution hadn’t entirely vanished, it was largely defeated. I think of these wildfires now, drawing from Charles Dickens, as ‘The Ghost of Fossil Fuels Past’. These energy sources from the past are causing high temperatures, driving dry conditions which are very conducive to wildfires and suddenly, you have the return of the air pollution you thought was gone.
Many parts of the United States and Europe are now seeing air pollution concentrations we hadn’t experienced in decades. This will have all the usual health effects, causing people to lead shorter and sicker lives. There are immediate economic impacts, such as people not being able to go to work when air pollution rises or having to spend a lot on protecting themselves from it, the increase in the rate of air filters and filtration systems sold being evidence of that. Further, when people impacted by air pollution pass on prematurely, there’s a real economic cost associated with it.
Q. Do most governments then still see life as a series of growth figures, rather than a series of lives, thereby increasing the world’s fossil fuel dependence?
A. What governments usually want to do is help people lead fuller lives. And fossil fuels can contribute to that because they are inexpensive in many settings. As of now, fossil fuels in most regions don’t have to pay for the damages they do — if you ignore the climate and air pollution damages they cause, they look very inexpensive.
Until our political systems force the recognition of those costs, the world will continue to over-rely on fossil fuels because that unlocks energy consumption which facilitates well-being and economic growth. I think governments have a hard time connecting fossil energy usage to the fact that this is also causing climate change. Yet, governments must grapple with this now.
Q. How can they be encouraged to do so?
A. I’ll point out how most projected greenhouse gas emissions for the rest of the century are now expected to come from outside the OECD. If we, the world, are going to be serious about this, we need a system where every country finds it in their interest to participate in the decarbonisation program. We have clearly not succeeded in doing that yet.
I’ve written a new book now with Abhijit Banerjee and Esther Duflo that proposes a system to bring the entire world into the decarbonisation program. About 95% of the damages from climate change are projected to occur outside the OECD, with a very disproportionate share projected to land in India. Many heavily impacted countries are the least wealthy and focused on raising incomes—and 80% of projected emissions are supposed to come from those same countries. So, how can you devise a system where everyone in the world feels it’s in their interest to reduce carbon emissions?
Abhijit, Esther and I have proposed a system where the rich OECD countries pay Global South countries for the damages their emissions are causing inside their borders, in particular, the premature deaths of people. Naturally, this sounds like fantasy — why would the United States or Europe agree to send money to India, Bangladesh or sub-Saharan Africa? The answer is, they could do so if, in exchange, the non-OECD countries agree to institute carbon policies and carbon pricing.