We're not pricing carbon. We're discounting the future

The most accurate social cost of carbon ever calculated was just published in Nature.

$1,013 per tonne of CO2. Range: $500-7,056 depending on assumptions.

Five to ten times higher than any number any government currently uses.

And here’s the thing. This only measures GDP loss. Not health. Not ecosystems. Not cultural displacement. Not sea level rise. Not extreme weather. Just economic output.
The real cost is higher. We just can’t fully quantify it yet.

What Stanford researchers (Burke, Zahid, Diffenbaugh & Hsiang) found changes the entire economic argument around climate. Warming doesn’t just temporarily reduce output. It permanently slows growth. And that compounds. The temperature-GDP relationship hasn’t changed in 60 years. No adaptation. No recovery. Even 15 years after a temperature shock.

This means every argument that emissions reductions are “too expensive” is based on a price we now know is wrong. Not reducing emissions isn’t cautious economics. It’s the most expensive choice available.

The numbers:
One tonne emitted in 1990 caused $180 in damages by 2020. But will cause $1,840 more through 2100. Paying the past bill settles less than 10% of the total debt.

One long-haul flight per year for a decade? $25,000 in global damages.

Saudi Aramco’s past emissions? $64 trillion in future damages.

US emissions since 1990 caused $500 billion in damage to India. $330 billion to Brazil.

But these damages don’t fall equally. And this is where the social cost of carbon becomes a tool for redistribution.

The richest 0.1% emit over 290 tonnes of CO2 per person per year. At the true cost, that’s $294,000 in annual damages. Per person.

Someone in the poorest 50%? 0.7 tonnes. $709.

A 400-to-1 ratio in damages caused. By the people who will suffer the least from the consequences.

The current EU carbon price is around €75 per tonne. If we priced carbon at its true social cost, the revenue wouldn’t just reduce emissions. It would fund the largest redistribution mechanism in human history.

The paper outlines how this could work in practice: debt-for-climate swaps through the international system, or direct low-cost transfer payments to mobile phones of low-income households in developing countries, bypassing the institutions that have historically failed to deliver climate finance where it’s needed.

From those who cause the most damage to those who bear the most consequences.
That’s not ideology. Every other debt we ignore. The longer we wait, the larger the bill.

Not reducing emissions isn’t saving money. It’s borrowing from people who never agreed to the loan.

The debt isn’t shrinking. It’s compounding.

Source: Burke, M., Zahid, M., Diffenbaugh, N. S., & Hsiang, S. (2026).
Quantifying climate loss and damage consistent with a social cost of carbon. Nature, 651, 959-966.

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