Just briefly in response to your July 12 comment: LCA is useful, and I agree that Wal-Mart’s new sustainability index is a major step in the right direction.

The point of cap-and-trade for carbon, though, is that we don’t need full LCAs for every one of some 10 billion products sold in the world to then be able to price the externalities correctly. With a strong overall cap on carbon, we’ll be able to internalize the carbon externalities without knowing any of these individual product-by-product impacts.

Best,
Gernot

LCA makes a great construct for determining what processing aspects can have the greatest environmental impacts. LCA may also provide the foundation for determining the theoretical costs and benefits for pollution prevention or reduction to both producers and consumers. What LCA will not yet do is facilitate the finance necessary to install such improvements. Since prices for most environmental services remain deeply discounted (carbon, water, biodiversity etc.) from the prices imputed in LCA modeling, the financial industry is unable to carry them on term sheets and balance sheets as “public goods” so lending is tough for improvements without direct subsidies (like CDM credits). LCA, like the environmental accounting schemes of the 80’s nd 90’s, presupposes functioning markets for environmental services. Unless these services become operational and reputational risks, or competetive advantages, LCA will remain an obscure science with limited impact. Ask Bill McDonough.

Dave

That’s indeed a good puzzle, and LCA is one answer. The real answer to cut through this morass of tradeoffs and conflicting advice, of course, is to put a price on pollution through caps on carbon and nitrogen, and to get out of the way.

It’s the most scientifically sound and economically rational solution one could hope for, and it’s liberating for anyone who has ever tried to weigh the benefits of locally grown conventional apples against organic ones hailing from out-of-state in a grocery store aisle. (My answer, with or without cap-and-trade: get the organic one. It’s good for you, and good for the planet. Why would you want to increase pesticide use in your local community?)

That’s also a good case of regulation being truly liberating. It’s not a choice between “liberty and tyranny,” how Michelle Bachman would — and did — put it. Well, actually it is. The tyranny, though, is on the side of no cap. The liberty comes with smart regulation.

Looking forward to your follow-on blog post.

Best,
Gernot