What does a burger truly cost, if you factor in carbon and obesity?

Yummy? Not really when you crunch the numbers
We don't know for sure.

It depends on which model you use, on whose basic numbers you work up or down from.

But what a burger costs society and the environment is definitely a lot more than you pay for it at McDonald's.

This article in the New York Times explores some ways of 'costing' burgers and their impacts on society.

If you consider the pace at which these kinds of methodologies are being developed and increasingly used, this becomes a really interesting story. Where else might these be applied?

The possibilities are endless. But we can guess. High impact activities first. In this case, burgers.

Here's a few extracts to, er, whet your appetite:

On climate change costs:

"The big-ticket externalities are carbon generation and obesity. Environmental Working Group’s “Meat Eater’s Guide” (2011) estimates the carbon footprint of beef cattle at 27 pounds of CO2 equivalent per pound; the use of “spent” dairy beef in burger meat reduces that slightly, but we can say that each pound of burger meat accounts for roughly 25 pounds of CO2 emissions. (Cheese counts, too: It produces 13.5 pounds of CO2 equivalent per pound, and even bread has a carbon footprint.)"

"The cost of this carbon is hard to nail precisely, but the government’s official monetary valuation of greenhouse gas pollution is roughly $37 per metric ton of CO2 emissions. Many experts, however, double that rate; others multiply it nearly tenfold. So the monetary value of the carbon emissions produced by the average cheeseburger might range from 15 cents (the official government rate), to 24 cents (conservative independent sources) and $1.20 (high independent). The average of these three estimates comes out to 53 cents per burger."

And on human health impacts:

"The link between obesity and a handful of deadly chronic diseases — arthritis, cardiovascular disease, hypertension, Type 2 diabetes and some cancers, among others — is well documented, as is their enormous economic burden. Direct medical diet-related costs are currently pegged at about $231 billion annually.

These numbers above would mean that this cost of burgers is about $4 billion per year (from fast food burgers only!), which averages out to 48 cents per burger. (Some put these costs five or six times as high, and there are indirect costs as well; again, we’re being conservative.) And between 2010 and 2030, the combined costs arising directly from diseases related to obesity could increase by an additional $52 to $71 billion each year. This could double the cost per burger in additional health costs alone."

Let's say that again shall we?

"And between 2010 and 2030, the combined costs arising directly from diseases related to obesity could increase by an additional $52 to $71 billion each year. This could double the cost per burger in additional health costs alone." (read full article here)

Wow. Ok, so there will be folks who disagree with these numbers.

These numbers may not even be right.

But imagine if they are more right than wrong.

Extrapolate this example to where we're heading on pricing externalities.

Consider the acceleration of this kind of research, and what it will mean for business.

More thoughts on this area on the blog soon.

Food for thought (sorry!)
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