I’d like to see it divided up even more on the top 10%. To be in the top 10% of household income in the US, you would need to earn $184,000/year. That’s just two people earning $92k/year, which is reasonable for mid career or early mid career in or near a city.
I’d like to see it divided up even more on the top 10%.
Well the boy howdy do I have good news for you! If you read the article linked (and even better, the open access Journal article linked) you may find some cool nuggets like:
“Among the highest-earning 1% of households (whose income is linked to 15-17% of national emissions), investment holdings account for 38-43% of their emissions,”
And
Then there were “super-emitters” with extremely high overall greenhouse gas emissions, corresponding to about the top 0.1% of households. About 15 days of emissions from a super-emitter was equal to a lifetime of emissions for someone in the poorest 10% in America.
Clicking into the journal article you may even find cool figures like this one, showing breakdown of emissions by category for each income group:
Yea I read that. I said divided even more. I should have been clearer on that. I’d really like a top 7.5, top 5, top 2.5 and then top 1 and 0.1. There’s a HUGE gap between top 10 and top 1. Like 3-4 times more income.
I’d love for a statistician (or someone that remembers way more about statistics than I do) to give us an equation which allows us to more easily assign blame. My intuition tells me that the yacht-owning class would be a significant portion.
Yep. I’m barely in the top 10%, but I’m in a city and take transit and ride my bike, my wife uses the electric car to drive 5 mins uphill and gains about 60% back coming downhill. We eat local and do recycling and compost. The top 5% living in Texas or in suburbs driving trucks and SUVs are doing way more than me. I don’t think I’m an outlier in modern cities.
Every time I read about the ultra rich the exceed my negative expectations. 15 days = 1 lifetime is waaay more than I thought. My guess would have been like 1 year to build up that much. Wtf are they doing
TIL I'm in the top 10%. Yeah I can't believe I pollute any more than the other 90%. I work 100% from home, only my wife commutes 3 days a week. House is a modest 2200 sq ft. I don't have a boat or RV or plane or anything. I have some modest investment in hotels, cruise lines, and airlines (like under $5k all in). So yeah, this study leaves a lot to be desired.
EDIT: I guess my 401k or other managed investment accounts may have money in fossil fuels, but I'm not sure how I would know that or what exactly I would do about it. I have zero choice for the 401k as it's through my company. Other accounts maybe but how would one even track down managed investment accounts that don't include the largest pollution contributors?
What I got from the study is source of your wage and investments have more to do with how much of a high polluter you are than what you choose to do individually. So you could be a high wage earner who lives in a tent and bikes and invests a majority of their money that grows in profit, and that because of the growing investments and employer make you a higher polluter than someone who lives in a huge house and drives suvs and pick ups and doesn’t see their net worth grow due to so much of their stuff being financed.
With the money source being weighted this kind of feels more like an industry analysis despite the individual focus with how indirect it is, and based on some of comments here I guess people didn’t read the article either not realizing it has less to do with individual efforts like solar or private jets. At least that’s what I got from my attempt to understand the study.
Conclusion seems to be more that companies that pollute pay higher wages than a study of direct household pollution.
Like lots of data, it’s an average. There are lots of people, similar to you, who are not absolute gas guzzlers I’m the top 10%. The top 10% also includes the 1% and the .1%, which will greatly increase the average for the entire category.
Similarly to how an average doesn’t tell the whole story, neither does how you invest. Assumptions have to be made to come up with these articles, such as how much carbon emissions are created through investments, which isn’t exactly cut and dry.
TL;DR just because an article says that a group of people are the cause of something, it doesn’t mean that everyone in the group is causing it.
It also depends on how the data is being used. For this study source of wages is being heavily weighted as well as what companies an individual chooses to invest in. So while household is the focus of the headline companies are more the focus, since by the metric used it seems as though someone who lives a green life style on paper living in a tent and biking but invests majority of their money and sees it grow would be a heavier polluter than someone who makes less but lives in a big house, drives suvs and pick ups, but doesn’t see their net worth increase with most money not being used towards investments but paying off debt.
Kind of confusing study. I thought it would outline how specifically those 10% are emitting that many gasses, so doing breakdowns like how much it costs to operate their homes and breakdowns of their methods of travel.
But, it is taking into consideration stuff like company they work for so like someone who lives without electricity in a tent and bikes but gets a high wages from a petroleum factory while investing most of their money as an engineer would be considered to be a higher gas emitter than someone who works in insurance while driving suvs and pickup trucks and living in a huge house.
It’s pretty abstract. Makes for a catchy headline, but not the direct picture I was hoping for when it comes to a household because it’s more an industry revenue analysis.
For those that want to skip straight to the study here it is
Yeah and if the head of an oil company decides to just stop producing then the price will jump for a bit but then others will fill it’s place since demand didn’t change.
I feel as if this study is only trying to make people angry and have a scapegoat while making them not change anything relevant.
Sure the use of jets and yachts by the richest is a huge asshole move but the biggest leverage is when everyone would stop eating meat or using bikes instead of cars whenever possible
Yeah, because of the revenue and investment source focus of the study what I found interesting is that two people who work at the same place and earns the same salary could lead to the one who invests the money becoming the higher polluter according to the study. Even though the other person is the stereotypical polluter eating meat, mortgage on a huge house, and driving huge cars in contrast to the more minimalistic lifestyle of the other person being the stereotypical green individual who doesn’t eat meat and opts for public transport and a modest home.
Like this study is formulated in a way where the numbers are more appropriate for industry analysis than individual household analysis. Data is set in a way that it could be said it’s better in the long run to drive suvs than it is to invest, or high polluting companies pay more livable wages. Or if you have million dollars it’s less damaging to the environment in the long run to spend that money buying Suvs for your neighbors over investing it with the risk of the assets increasing in valuation leading to bigger polluter stats.
I kind of dislike studies like this. Because something like 70% of global greenhouse emissions is because around 20000 specific people that have names and addresses are choosing wealth over sustainability, these are people who literally have the power to stop what they are doing tomorrow and make a larger difference then 100 million voters. When you make things abstract and use terms like 1% you are hiding the real villains of the story.
Also market-based solutions like this:
The study asserts that “results suggest an alternative income or shareholder-based carbon tax, focused on investments, may have equity advantages over traditional consumer-facing cap-and-trade or carbon tax options and be a useful policy tool to encourage decarbonization while raising revenue for climate finance.”
Will never provide a solution to climate change, because market based solutions are designed to help the rich, not save the planet.
Mostly the latter, but more specifically 40% of the emissions generated by US household spending and activities. These emissions may not be strictly “domestic” as they can be produced abroad to support purchased goods and services.
I don’t know any good stew recipes, but I can make a mean billionaire sandwich.
Those "peasants" are responsible for the remaining 60 percent. And since those "peasants" also give these wealthy individuals money by buying useless stuff from them, you could even say that it's higher than that.
A valid critique, but also worth mentioning, as discussed in the article, much of the GHG emissions for the top 10% (which includes households down to ~$200k) comes from passive income.
Friendly reminder to check who you bank with and what’s in your 401k if you find yourself in that group.
Basically money is energy. You are using money to buy things which uses energy, stuff produced by machines which need something to run of, not from horses or ppl, but from oil and coal.
If you invest in companies that emit GHGs, then you are helping finance their pollution, and profiting from that.
If you keep your money at a bank that does business with major polluters, your funds are being used by the bank to back loans to those polluters to help them pollute.
Spare change invested in GHGs contributes to climate change.
https://youtu.be/NJ7W6HFHPYs - This video from Climate Town explains how the bank or credit union only keeps a fraction of your money in reserve when you deposit your money in a savings account, certificate of deposit, or other bank account. The bank/CU is investing the majority of your money, and ecological harm is not a consideration when they are choosing investments. When you deposit money with a financial institution it is almost certain that some portion of your money is being invested in ecologically harmful organizations.
Similarly, your 401k funds are likely in index funds or mutual funds that hold significant shares in ecologically and socially harmful companies like ExxonMobil, Nestle, Chevron, Coca-Cola, et. al.
Environmental, Social, and Governance (ESG) investment funds exist that ideally exclude ecologically & socially harmful industries, but every ESG fund I have ever encountered is not nearly exclusive enough and has significantly higher fees.
For example - the Vanguard ESG International Stock ETF VSGX excludes adult entertainment, recreational drugs, gambling, weapons, nuclear power, and fossil fuels, yet Nestle is the second largest holding in the fund, and many of the other stocks in the fund likely contribute to environmental and social harm indirectly.
Consider investing in small-businesses and organizations in your local community instead. It is truly bizarre and unique to our time that investing on Wall Street is more accessible than investing on Main Street.
It means nothing to the actual company other than a scoreboard they can point to, as the stock should reflect the performance and outlook of the company.
Except that scoreboard is exactly what they point to when they need a loan or other capital investment to grow their business. Better stock value = bigger/better loans.
Oh, and also the companies are able to release additional stock to raise capital outside of their IPO.
And their executives are rewarded for having high stock value.
This is about collective action, not just one or two people. You seem to be leaning heavily into the same excuses everyone uses when they don’t want to do the right thing if it’s even a small inconvenience. “Why should I do X when there’s a bunch of other people doing Y? It’ll never make a difference.”
would you rather invest at a valuation of $20B or $75B. You’re saying $75B, but the answer is $20B.
I’ve got no idea where you went overboard here, but what I’m saying is, if the company in question is doing significant harm to the planet, don’t invest. Not sure why you thought I meant invest later.
And if the moral argument against profiting from harmful industries isn’t good enough for you, financially you’re introducing risk to your portfolio by choosing to invest in companies that are at high risk of running into regulatory challenges and lawsuits globally.
Boy you sure are acting incredibly dense. You’re acting like I’m implying normal investing guidance doesn’t apply. Please stop making up worst case scenarios to try and justify supporting climate damage. I’m not saying dump all your money into a single solar stock somewhere.
There’s literally hundreds of ETFs & mutual funds focused on avoiding the major polluting businesses. For example, just look at things like SPYX instead of SPY, etc. (Adding an extra bit to emphasize I’m using this as an example, not telling everyone to only invest in SPYX, because I can already see your response coming in laser focused on that one example). There’s countless options, do some homework if you’re investing, as you should be doing regardless of whether or not you care about the climate.
The one that’s currently hardest is target date retirement funds which many use for their 401k. Not because there aren’t enough options, but because many fund managers don’t include those options in their offerings. Your hands may be tied but at least you looked. Contact your fund manager and let them know you’re interested in ESG investing.
I’m not saying dump your money down the drain, but check if your investments can be moved somewhere less harmful.
By contributing to demand for a stock you increase the valuation of that stock. Securities Based Lending is often how companies and executives secure loans and avoid taxable events. By contributing to demand for a stock we facilitate additional funding for the issuer of the stock and it's largest shareholders.
I absolutely agree, cash flow is a much more immediate concern to any company, but one wealthy shareholder divesting can have the same financial impact as ten thousand average citizens boycotting. Local investing is more difficult and risky, but also more rewarding and necessary. It is not just about a monetary return, it is about building social capital and local resiliency.
You're arguing that people should give no consideration to the long-term social and ecological harms of their investments beyond what will make them the most money. By directing our actions in that purely incentivized way we sacrifice everything unprofitable, and that alienation is exactly what causes so many chronic societal issues. I agree that an individual can have very little impact alone, but capitalism places this burden at the individual level.
One of the high-growth sectors in most american’s 401k’s is “Energy”. This is a euphemism for fossil fuel companies, such as Shell, BP, and the various supporting industries. Another high-growth sector is “home construction,” which is literally an industry that exist to pave over paradises and put in parking lots creating sprawling suburbs in it’s wake that are owned by companies like Blackrock.
To be fair, you can’t really get away from that, especially since you don’t really have the ability to manage your 401k that way. But passive growing investments absolutely feed Capitalism and directly contribute to the massive polluters.
Hard to say what the motivation of this article is, but yea I agree. The article seems listless. They make a grand claim “10% is responsible for 40%!!!” but they dont’ really examine the claim. I absolutely think it’s a true, but without further analysis and a conclusion to be drawn, what is the point? The point of the article as far as I can tell is to advocate for a market based solution that somehow a carbon-based tax will magically make share-holders stop destroying the environment? It’s drivel.
Probably has to do with the investments themselves. You may not be personally ‘picking’ the investments, however, most target funds include investments that have such investments. Source: wife works at a financial institution. Also I’m drinking so Google it ontop of it or something.
Having not read the article, I would wager a guess that because 401k balances are invested in diverse funds, and if the fund composition includes corporations contributing to emissions… and you are making money off their profitability… you are therefore contributing to those emissions. Pick other things to invest in.
I’ll make sure to only invest in hippy communes that are self sustaining and use indigenous clothing and tool making techniques.
Every company on the stock market contributes to GHG emissions. Every company is using electricity produced by fossil fuels, or produces or uses plastic products, or has vehicles that consume fossil fuels.
Companies you invest in benefit from your investment in a variety of ways. Your investment provides the financial resources needed for the company to grow and expand. Your investment helps companies develop new products, hire more talent, expand into new markets, and improve their overall operations. Your investment essentially contributes to the company’s success.
Not really. Share price has no bearing on financial health. Sometimes share prices have no connection with reality. Tesla is a perfect example. It has a market capitalization of 720 billion. Market cap. Is just the number of all classes of stock multiplied by their respective number of shares. I.e. how much it would cost to buy the company in it’s entirety. General motors has a market cap of 45 billion. Toyota, the world’s largest auto maker by sales, costs 264 billion. Without getting into P/E ratios and book values, stop to think about this. Tesla would have to sell more cars than Toyota, Volkswagen, GM, and Ford, COMBINED to be worth 720 billion. That is after a substantial drop in share price.
The way security analysts and prudent investors evaluate a company’s financial health is by looking at the financial statements they have to file every quarter with the SEC and make publicly available, calculating ratios, and comparing them to prior reporting periods, other companies in the same industry, and the overall market of the industry they are in.
As far as reputation, it probably doesn’t matter. The only shareholders anyone cares about are insiders and large shareholders (big enough to file a form 4) actively managed funds, and super Investors like Warren Buffett.
But paying stock owners their share of the profits is, when you get right down to it, the reason BP exists. Maximum profit for a company like BP, and their shateholds, means minimizing their expenses and maximizing revenue. So sell as much gas as possible, and pay as little to offset the CO2 as possible. I don’t think it’s grasping at straws.
Well 401k’s specifically replaced Pensions that were a much better bet for workers and required companies to fund them etc. Now all those other things exist so that people rich enough to leverage them all can minimize their tax burden. They are just Tax Shelters.
Pensions did go insolvent and laws were changed so that companies could include their pension fund as assets and leverage against them, also other companies could come and buy the fund and then claim that since they don’t offer a pension to their employees none of those pension protections applied.
Those situations could have been resolved in a way that was pro-worker, instead pensions were dissolved and all workers are encouraged to tithe to wall street since that is the “right way” to do things in our shitty society.
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