According to the Oxford Dictionary to sequester – se·ques·ter [səˈkwestər] – means to ‘isolate or hide away (someone or something)’.
When people talk about slowing climate change, they talk a lot about sequestering carbon. Over the last 100 years or so, humans have burned and released more ancient carbon from the earth’s crust in the form of fossil fuels than earth’s natural systems are able to reabsorb back into the ground. When those gases hang out in the atmosphere, everything warms up. So, smart, pragmatic planners say, ‘we need to sequester all that excess carbon from the atmosphere back into the ground,’ as part of a solution to climate change.
Sequestering carbon is compelling and practical. Plant a tree, save a rain forest, develop machines that capture carbon from power plants or mineralize rocks faster while producing valuable products, and you help mitigate the catastrophic effects of human caused climate change.
Sequestration, or drawdown, as a key part of the solution has become a unifying theme for scientists, technocrats, non-governmental environmental organizations, and social justice advocates. However, it is only part of the answer.
The fact that humanity needs to sequester carbon on a global scale begs a question: how is it that, despite our extensive knowledge of climate change, our economic system continues to incentivize releasing more greenhouse gases into the atmosphere even when we know the financial and moral costs are going to be very, very high? The answer is simple and almost surely true: everything for sale is mispriced. The true cost of the thing for sale is not accurately reflected. Future costs are externalized onto future generations. This is not a new concept. The challenge of externalities is taught in basic economics. When my neighbor’s honeybees pollinate my almond trees, I accrue economic benefits not accurately reflected in the price of my almonds. This is a positive externality: it isn’t costing my neighbor anything to provide an unintended benefit to me. On the flip side, when my farm’s fertilizers run off into the river and destroy the oyster industry downstream, I am economically benefiting at the economic expense of my downstream neighbors. It is these negative externalities, in the form of real economic costs, passed inadvertently along to other people, that incentivize practices and policies and perpetuate the status quo. All governmental environmental regulation is, at its core, an inefficient and often ineffective attempt to deal with the problem of negative externalities. The Paris Climate Accord and major global commitments from Glasgow are, fundamentally, the mother of all attempts to deal with negative externalities.
What is the true value of clean water to drink, clean air to breathe, a stable climate to live in, and healthy topsoil? Moreover, what is the value to all the individuals, farmers, foresters, and fisheries that depend on these things? In 2018, economists estimated that the value of these ecosystem services, what it would cost people to produce what the earth provides for free, was $125 trillion – yes trillion – per year. They are surely wrong, but no matter how one slices it, it’s a big number.
The challenge of large-scale negative externalities that contribute to climate change is what experts call a wicked problem which Wikipedia defines as, ‘a problem that is difficult or impossible to solve because of incomplete, contradictory, and changing requirements that are often difficult to recognize.’ Climate change is so big and so complex, and its causes so ingrained in our economic and political systems, that as a species it’s possible that we may not be able to solve it. But unless we do, it is a matter of time – within the next 50 years surely – before humanity passes certain ecosystem thresholds and big, expensive, and immoral things happen at a grand scale.
And this all leads back to sequestration. I propose that in addition to research, technology, investments, and policies designed to sequester excess atmospheric carbon, we must also immediately start sequestering the excess capital floating around in our economic system. Like the excess atmospheric carbon associated with climate change, the trillions of invested dollars growing year over year chasing mostly short-term returns, is also unsustainable. Because everything is still mispriced, our hyper-global liquid capital looking for market rate returns will mostly tend to be invested in projects that reinforce negative externalities. When will we reach a global economic tipping point? Taking a small portion of this capital ‘out of commission’ and putting it back into the ground – literally – in the form of conservation of nature and biodiversity seems to me to be a perfectly reasonable, moral, and enjoyable thing to do.
So, like carbon, let’s start sequestering some of that ready-to-be-deployed capital into ecosystem services. Let’s take a relative fraction of the global monetary supply and invest into a long-term bond called Healthy Water, Air, and Land. This is already happening today with public/private initiatives like the 10-million-acre Route of Parks project in Southern Chile, the 150 million acre Project Finance for Permanence project in the Brazilian rainforest, the Forever Costa Rica Program, and the ~600 thousand square mile Papahānaumokuākea Marine Monument in the Pacific Ocean. Last September, philanthropists announced a $5 billion fund to do just this.
These and many other large, landscape-level conservation projects are the grand hedge against the system failures surrounding negative externalities and our political and economic inability to price things correctly. Now, while society and the wealthy are awash in inexpensive capital, it’s a good time to make a long-term investment for the future. Personally, I’d just as soon bet on the positive hundred-year returns associated with half of the Chilean Patagonia being protected as National Parks, as I would the hundred-year returns associated with stock in Amazon, Apple, or the US Treasury.
A $5 billion fund is a good start. How about a $1 trillion fund?