Solution 3: Damage Taxes

There is much about food on the website – not least links to Feed Leeds, Leeds Edible Schools Sustainability Network, Leeds Edible Campus, KEEP and Back to Front, which between them take up a great deal of my time. This is largely because I know that the global food system is deeply vulnerable to ecological damage caused by climate change, and as a landscape architect I can see that growing food more locally is a sensible approach for any number of reasons, (though local food is not necessarily the only best option). In fact, the vegetation of all kinds is rapidly becoming a critical issue – hence my work with United Bank of Carbon. But my study of the food system has also delivered another unexpected outcome.

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In Neosufficiency I argued that one solution to the problem of overconsumption might be damage taxes. We’re probably all familiar with the concept of carbon taxes and environmental taxes (which are technically known as Pigovian taxes, after the visionary Arthur Pigou) – which must surely form part of the solution. But effective and necessary as these may be, there’s always going to be a problem fixing where the boundaries of the taxation should lie (much like the problem fixing the boundaries of means-tested benefits). For example, both Japan and Denmark recently introduced fat taxes, but Denmark soon had to repeal them – because they were a nightmare to administer, and people merely bought food from Sweden or Germany instead. But that doesn’t mean that the concept of damage taxes (my preferred term because it signals why the tax is being applied) has no merit. Introduced into a single country and picking out only one form of social damage, the fat tax was always likely be doomed. The only way to make Pigou’s approach work would be to tax anything and everything that causes harm, regardless of the nature of the damage, to set the tax precisely according to an independent assessment of the scale of the damage (so there can be no quibble or complaint), and to do it as part of a radical systemic change in the fiscal system. And, ideally of course, it should be introduced globally. Some ask, you’ll say – but which would be better? A complex and difficult social change, or the end of civilisation as we know it and the possible deaths of millions? So bear with me as I suggest how this might be done. Call me a fool, call me a seer, call me a cab – I really don’t mind.

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If damage taxes were introduced overnight there would likely be a massive rejection from producer and consumer alike, so here’s a possible solution. I have put the case elsewhere for the convening power of food, and I think it’s possible that efforts to sort out the food industry might help to deliver a benign, strategic means of introducing damage taxes right across the board. I suggest five stages:


1) The Development of Omnistandards


We may soon be seeing the introduction of food label Traffic Lights, but this is some way short of true ‘Omnistandards’ labelling.


This innovation was suggested by Tim Lang, Professor of Food Policy at City University (he also invented the term ‘food miles‘). Environmental and social damage (aka ‘market failures’) are measured, and then given a score between one and three – as represented by the colours below.


 Tim suggests assessing ‘greenhouse gas (perhaps this should include all atmospheric pollution)’, ‘fair trade,’ ‘biodiversity’, ‘packaging/waste’, ‘animal welfare’, ‘nutrition’, and ‘water.’ A graphic label then alerts consumers simply and quickly to the real whole-life costs and consequences (extraction, production, distribution, sale, consumption, recycling, disposal) of the purchase they are making. Here’s some alternative options from Tim.

Omni3Omin2Researching and defining values for food-based omnistandards will be a very challenging task, but I agree with Tim that it can be done.

In fact I would go further – much further. I believe that omnistandards can and should be applied to all products and services from food to transport, to education to power generation to pensions – to everything that is purchased.

To this end I would add ‘security’ (i.e risk and consequential weight of breakdown – re nuclear fission, criminality or terrorism, for example), ‘human health/wellbeing’ and – crucially – a ‘raw materials accumulator’ that puts a realistic conservation value on finite resources.

(There may also be a case for other standards, perhaps a ‘jobs’ score which reflects the ratio of jobs to production output, to rebalance the economies of scale created by mechanisation and robotisation, but this will need to be debated).

I would also suggest a five band range: Green (benign/beneficial), yellow (neutral), orange (minor damage; for ‘treats’ only), red (major damage; avoid unless essential), and black (serious damage; avoid at all costs).

Tim’s system does give consumers valuable information on which to base their choices, and it has the advantage that different consumers can make different decisions according to their personal views on each on the issues measured.

But it is also confusing because it’s difficult to weigh up, say, greenhouse gas damage against, say, nutrition. How does one value a flower with four green, two red and one yellow petal like the one on the right against another flower with the same numbers of coloured petals, but in different places?

The solution can only be to find a fair and reasonable formula which allows these very different values to be summed together, much like a balanced scorecard, to provide one simple central value.

This algorithm will resolve anomalies like the following: In their book ‘Time To Eat The Dog?‘ Robert and Brenda Vale have suggested that the carbon footprint of a medium-sized dog is the same as a Toyota Land Cruiser driven 6,000 miles a year, while a cat is equivalent to a Volkswagen Golf. But if we add, for example, human health/well-being into the calculation, then the target score is mitigated by the psychological and health benefits provided by the pets – as it should be (though cats, and some dogs under some circumstances, would also be marked down on the biodiversity score because of the damage they do to birds and small mammals).

‘Fair and reasonable’ will, however, be the challenge, because in setting comparative values across these topics we will be making deeply political decisions. Would the health benefits of pets, for example, actually save them? We don’t yet know. Just as we don’t yet know if running an SUV does in fact have health benefits which could be offset against the carbon tyre-print. So we need to find out. We will need accurate internalised values, and if we base our decisions on empirical evidence, using ecological assessments on a global scale, I believe can reach an equitable solution.

The system can and should be dynamic, so that it can reflect changes over time and to allow for continuous improvement. One way of doing this would be to have an independent, worldwide body (or perhaps a number of competing bodies) who would maintain databases upon which the omnistandards would be founded. It might even be possible for these to function a little like the financial indexes we have today (these will all disappear along with the financial markets, of course).

The summed target values could in theory now be represented by a single coloured dot, a traffic light – but this is probably too simplistic, as a single dot would fail to give people sufficient information to make sensible decisions, because there must still be room for personal choice and responsibility.

Two similar products may display the same colour traffic light, but because of the way have been made, and are expected to be used and disposed of, the individual scores in each of the 10 categories may be very different.

Consumers will also have personal preferences which they should be free to express. If the scorecard has been accurately calculated, this choice will not affect the total environmental and social impacts.

I would suggest small ‘petals’ around the larger central dot, which would provide an at-a-glance explanation for the colour of the central dot. Additional labelling and other consumer information in note form will still be necessary and advantageous.

petalsFive traffic lights, of course, will tend to create five distinct bands of product, which might prove to be too clumsy. If so, then more bands could be introduced (the more bands, the more accurate the system). Numbers will need to be included for the colour-blind.

2) Voluntary Omnistandards Labelling


The second step would be to introduce voluntary omnistandards labelling.

If supported by political parties and the media, even voluntary labels would begin to have an impact straight away – helping to change people’s purchasing behaviour, and gradually making it socially unacceptable to buy products with black or red petals.

This would immediately begin to internalise market failures, and would go a long way towards fixing the problem, but consumer choice will likely not be powerful enough to change the system while consumers are still being bombarded and brainwashed by advertising and marketing campaigns.


Cartoon from Polyp – who did the cartoons for Enough is Enough


3) Advertising and the Media


So should we simply ban advertising?


Well, it’s a tempting option and it has been suggested by the Green Party. (scroll down).


But we are still proposing a free market system, where citizens make their own choices based on real costs and values, and if the system we are proposing is as good as we think it is, then some advertising would be not only tolerable but beneficial.


Businesses will still need to start up and succeed, and competition will still be a differentiator of quality (a quality now forced to be about benign innovation and creativity), so customers must have ways of knowing what is available.


One way to focus the power of advertising is to make it a legal requirement that all adverts, packaging and promotion must display an omnistandard flower.


A truck displaying products on its sides would need to carry a flower representing the balance of all the products therein, for example.


And I agree with the Story of Stuff director, Annie Leonard, that we do need to outlaw manufactured demand, so some types of advertising will need to be curtailed – as will ‘aspirational’ TV programmes like Top Gear, The Gadget Show, Grand Designs and so on, which can encourage both unreasonable consumption and personal debt. We’ll still want some programmes like them, but they will need to be much, much more responsible in the messages they peddle.


Adverts aimed at children might need to be outlawed, along with any for products with a red or black traffic light. Loyalty schemes would also have to be looked at because they are essentially anti-competitive and manipulative.


The emphasis in advertising will need to be on providing true facts about products, not focusing on aspirations and self gratification (because, frankly, we are NOT ‘worth it’). We might consider outlawing the use of music in advertising (dramatic, but as a composer myself I know how emotive music can be), or there may be a case for banning all TV advertising and product placement (in fact perhaps all public advertising, as suggested by Compass) – though this would probably be impossible to achieve on the web.


Incidentally we will also need new TV shows which help to educate people on how to insulate their homes (Changing Rooms installing Kingspan, perhaps?), how to take up the Marshalls blocks they put down after watching Ground Force, and turn them into raised beds to grow vegetables, how to grow vegetables and what to do with your apples, how to mend things – and so on.


(Obviously, without advertising – and much corporate sponsorship, which will also need to develop, TV will play a somewhat smaller role in our lives anyway).


All this will be highly contentious, and a workable code will not be easy to develop, but major change is essential as George Monbiot concurs.


4) Compulsory Omnistandard Labelling


The next step is for governments to make Omnistandard labelling compulsory.


5) Fiscal Policy


The final stage is the most important.


For this, we work out an economic cost for each of the colours on each of the petals. This also will not be easy, but it will not be as hard as it might at first appear, (there are people working on it already). These values will be summed in the same ratios used when calculating the colour of the central dot.


Now we are in a position to introduce damage taxes which reinforce the consumer decision, but which also, more importantly, provide resources to repair any damage caused by the product.


At the same time, we do away with as many existing taxes as possible (some generic taxation, for health and community/business support etc will still be required, and Rates would be retained – see below), and instead start charging a fair price for the true cost on all products and services.


The omnistandard colours now announce percentage bands in the tax calculation.


Products with a green dot are (initially) subsidised (say 10% off), yellow has no tax, orange 10%, red 100%, and black 1000%. (Ok, those numbers will be wrong, and maybe we need more or fewer bands, but the principle is worth thinking about).


The money raised is then re-invested as required, to rectify whatever damage the production of that good or service has done back down the supply chain.


Benign products will thrive, while toxic products will be squeezed out as people wean themselves off them. Re-cycling (or to be more accurate, up-cycling) will become ever more efficient, while the amount of energy and materials being lost with every change of use/renewal will diminish over time.


Business and domestic rates would also be subject to the omnistandard system, but perhaps the categories would be different as this is an annual levy rather than a purchase decision – with green investment being the primary objective. Insulation/thermal and fuel performance would be the key measure, with site biodiversity, productivity, water control and microclimate also being taken into account.


Certainly those who choose to cover their drives with concrete paviours or tarmac would have pay for the damage this causes, as should those who prefer to have no trees, or no wild areas – or who seal their territory with fencing that prevents small mammal migration.


I would also we hope see my cousin Ebenezer Howard’s ‘rent-rate’ system finally come into its own.

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The end result should be a free market system, but one without the crippling market failures which have caused all the damage we see today. It will look superficially like a communistic system, but being untouched by the dead hand of control economics, it will in fact be truly (rather than neo-) liberal – something that has never really been tried by mankind.

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There are some challenges, of course.


1) It will not be easy to ensure that the money raised actually gets to the point of damage, and there is a major risk that funds will be stolen by corrupt intermediaries. But that is no reason not to adopt the principle, and over time the system should improve.


2) The rich will be able, initially, to go on buying damaging products, so these will not die out as quickly as we might like. But at least the damage will be ameliorated to an extent as products become first unfashionable, and then increasingly socially unacceptable.


3) Once the system has worked, there will, in theory, be no more damage, so the punitive taxes will cease earning revenue. At this point an income-based system closer to the status quo will need to be gradually reintroduced. Perhaps even the green dots will start to accrue a purchase tax, while the other percentages are reduced. But however the system is changed, it must continue to reflect the true social and environmental globally-calculated cost of products and services.


4) The steady state model has been criticised for not offering a solution to existing debt. This is indeed a big challenge, but it’s worth bearing in mind that most of the debt in the world today exists only on paper. It is indeed owned by people – some rely on it for their pensions, some governments rely on it for their economic stability – but most of it sits in banks creating unearned income for the Global North. A constructive global debt concatenation (or even a global domino default) would remove much of the problem.


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The delivery of a neosufficient society is not going to be easy. It calls for both new laws (‘top down’ change) and new behaviours (‘bottom up’ change).


Community/third sector-driven (bottom up) change is healthy in the UK, with many excellent initiatives taking place, but progress is slow because of the inertia created by social structures and habits. Likewise political/legislative (top down) change is taking shape, but nothing like fast enough for the same reasons. Meanwhile, academics produce illuminating papers that either never see the light of day or are bowdlerised by vested-interest media, while entrepreneurs launch innovative ideas which struggle to thrive in the current economic climate.


I am in fact suspicious of the ‘bottom up’/’top down’ paradigm. It forces an unrealistic triangular structure and an over-simplistic positive/negative charge on a society which is in reality vastly complex, presenting, as it does, a set of competing pyramids (politics, commerce, academia, celebrity etc.) each with conflicting forces driving in diverse directions.


As I said in 2012, in the foreword of André Viljoen’s book “Sustainable Food Planning: Evolving Theory and Practice“, ‘Top down’ is anyway only ‘bottom up’ fed very imperfectly – thanks, largely, to commercial interference – through the political machine, which is why progress to date has been so painfully slow. (I sometimes liken it to a letter G – that gap on the right represents the problem. Bottom up feeds on the left up to top down, but on the right it meets the barrier and gap where the top down system fails to connect).


I prefer to think in terms of ‘centre out’ change, by which I refer to an energising of the expertise within every citizen (specially those who consider themselves to be ‘experts’ and have therefore accepted what they feel are appropriate responsibilities, and rewards, within society); be it food growing, entrepreneurship, social organising, communication, education, academic analysis, professional practice, political power, or any number of other offerings.”

(I recently encountered this more academic definition of ‘middle out‘ change, from Janda and Parang. It seems I’m not such a lonely pioneer after all!)


The delivery of a neosufficient society (with it’s ‘Urbal’ cities) will depend on a surge of centre out energy, which will change behaviours as the legal framework is changed. This is not likely to happen soon. While there are many who are already convinced by the arguments for urgency, we are still a tiny minority (in the Global North, anyway).


That said, most people, when approached at the right moment, will admit to disquiet at the current situation, along with, often, an acceptance that major change is probably inevitable – and even, when pressed, a willingness to play their part.


The real issue is one of time-scale – how long do we actually have to play with?


There are those who think it is already too late, and those who think we may have a century or so. The truth is that science cannot help much here. It is too opaque, too nuanced, and the probabilities are too complex to call.


The reality is that it’s going to take an escalating scale of catastrophes to change public opinion – some economic (the Euro, oil supply), some environmental (extreme weather, ecological collapses), some social (wars and worse). This is not going to be a conventional dogmatic revolution. It will be event-driven and reactive


But it’s not a simple matter of opinion for or against change. Most people actually hold a simultaneous belief in both the need for urgent change, and the necessity of carrying on as usual (this paradigm conflict is similar to the denial systems employed by smokers and adulterers). One may be in the ascendent when watching a documentary about polar ice, and the other when booking a skiing trip.


There is effectively a membrane between these belief systems. Whatever the genetic and/or behavioural technicalities we explored earlier, I choose to believe (see what I did there?) that it is wafer thin – but elastic, and the elasticity comes from the flexibility of social habits, systems, patterns and forces (laws, prices, ownerships, debts, etc.) which make it easier to continue with ‘business as usual’ than to revalue and change behaviours. (This is why we continue to hear that economic growth is the solution to the current financial/ecological crisis, when actually it’s the cause of the problem).


But gradually the zeitgeist will adapt – driven partly by events, but also by the arrival of attractive alternatives.


So the struggle to warn and advise must continue, but our main challenge today is to seek good ‘centre-out’ thinking, to find optimal ways to link the ideas, and to stress test them as robustly as possible – so that as the membranes rupture (and each person has his or her own break-point according to where they are in the scheme of things) we will, with luck, reach a point where bottom up and top down start to circulate properly, and we move – just in time – from Plan A (failed) to Plan B (sustained).

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And there’s more…