The World Bank has issued a scathing report entitled Detox Development: Repurposing Environmentally Harmful Subsidies that calls for reducing or eliminating the trillions upon trillions of dollars governments use to prop up the fossil fuel, agriculture, and fisheries industries, saying they are causing “environmental havoc.”
Many countries spend more on those harmful subsidies than they do on health, education, or poverty reduction, the report says. The subsidies are entrenched and hard to reform since the biggest beneficiaries tend to be rich and powerful. Reforming subsidies would provide vital funding to fight the climate and nature crises at a time when public coffers are severely stretched, the report says.
Just this week, world leaders gathered in Paris to try to figure out how wealthy nations could meet their obligation to help poorer countries respond to the challenges of a hotter planet. Redirecting those toxic subsidies could go a long way toward making that possible.
In addition to direct subsidies of more than $7.5 trillion each year, there are also implicit subsidies such as waived taxes and the cost of the damage caused by global heating and air pollution. Those cost another $6 trillion a year, or about $23 million a minute, every hour of every day, all year long. The report claims the bulk of the subsidies are regressive, benefiting the rich more than the poor, and that direct aid to the poorest would be far more efficient.
In the abstract to its latest report, the World Bank says: “…oceans support the world’s fisheries and supply about 3 billion people with almost 20 percent of their protein intake from animals. Yet they are in a collective state of crisis, with more than 34 percent of fisheries overfished, exacerbated by open-access regimes and capacity increasing subsidies.”