The super-rich's assets are causing a disproportionate amount of climate harm, according to a recent study. This isn't just about their lavish lifestyles, but also their bank accounts. Through their ownership of companies and private financial and physical assets, the top 1% of people by wealth are responsible for about a quarter of global annual emissions. Greenpeace has calculated the "climate debt" of these high net worth individuals, attributing to them their share of the damage done to the climate by the assets they own. By this reckoning, the world's richest cause nearly $1tn a year of damage to the climate.
This raises a deeper question: why should ordinary households shoulder so much of the burden while some of the world's wealthiest people continue to profit from the industries driving the crisis? The top 1% by wealth are responsible for about 40% of all "ownership"-based emissions, which make up 60% of global carbon output. The top 0.1% account for about 17% of ownership-based emissions, and the top 0.01% about 9%. The bottom half of the world by wealth, however, accounts for just 3% of ownership-based emissions.
One way to address this imbalance is through wealth taxes. Climate debt is about responsibility, and if we agree that those who contributed most to the problem should contribute more to fixing it, it's reasonable to ask whether that principle should apply to extreme wealth as well. The super-rich's carbon-intensive assets and investments are equivalent to the emissions of an entire country like France.
This issue is becoming increasingly prominent as wealth inequality soars around the world. The economist Thomas Piketty led a report showing that the world could live equitably within the planet's finite resources if excesses of wealth were curbed by taxes and the poor allowed to keep a bigger share of what their labour produces. As governments from around the world gather for talks in Bonn, Germany, in advance of the Cop31 UN climate summit in November, one of the items likely to receive most attention will be arrangements for a "just transition" to help workers affected by the transition away from fossil fuels to participate in the low-carbon economy.
