Footprints as externalities and displaced environmental loads: the US case

This Conceptual Analysis traces who pays for environmental footprints, focusing on the current US economic system and environmental regulatory regime. With some important exceptions, carbon, water, and material footprints, and consequent waste generation, are largely uncompensated negative externalities. This leads to natural resources being underpriced and overconsumed, resulting in natural capital being depreciated, the ecosystem services it generates being underprovided, and the inclusive wealth of future generations being undermined. Through trade, atmospheric and hydrologic processes, nearly all footprints are geographically displaced at a regional to global scale. While inevitable and necessary, environmental load displacement is unequal to the extent that footprints are uncompensated externalities. The transfer through trade of unpriced or underpriced environmental footprints thus lies at the heart of challenges of environmental unsustainability and injustice.