Finance and Economics

One of the central dilemmas of “going green” is that although it means lower costs in the long run—at least on the societal level—on the short-term, individual level, it can be a significant increase in expense, depending on how much one is spending already.

The gains of being more environmentally friendly may not be experienced right away by the individual consumer. Using a professional car wash that reduces its water usage, reclaims it, and treats it, rather than releasing harmful chemicals into the environment the [Page 147]way washing one's car at home does, achieves a definite good. However, the effect on the actor is minimal. The real effect is felt when everyone switches to green professional car washes, and even then some of the good achieved is distributed to entities never involved in the action—the fish and other wildlife who are spared the effects of chemicals in their ecosystem. Although green philosophy perceives a good shared by humankind when the environment is spared from harm, it is difficult for the individual actor to experience and appreciate that good.

The effect of one's actions on collective consequences, and one's participation in those consequences regardless of one's actions, is relevant because there is a dollar value associated with these actions. Furthermore, that dollar value can be complicated. When the cost of gasoline is high enough, the extra initial cost of a more fuel-efficient vehicle—or one that does not use gasoline at all—can seem less expensive, even if one does not quite believe the car will “pay for itself” through its fuel savings. However, if enough people were to buy those vehicles—in sufficient numbers to reduce the demand for gasoline—the cost of gasoline would come down. Then again, so would the cost of the vehicles, thanks to economies of scale. There is a push and pull of cost and relative savings that is difficult for consumers to predict, as it is affected so greatly by their collective actions. It brings to mind economist John Maynard Keynes' description of stock-market investing: a beauty contest in which the winner is not any of the contestants, but the judge whose scores come closest to the average scores of the judges collectively.