Why billionaire Tom Steyer argues capitalism is the best tool to fight climate change

Calling for more regulation to stop global heating, Steyer says we must stop letting people "pollute for free"

By Matthew Rozsa

Staff Writer

Published May 29, 2024 5:30AM (EDT)

Technicians install solar panel plates on the rooftop of a house on a hot summer day in Karachi on May 27, 2024. (ASIF HASSAN/AFP via Getty Images)
Technicians install solar panel plates on the rooftop of a house on a hot summer day in Karachi on May 27, 2024. (ASIF HASSAN/AFP via Getty Images)

It may be unusual to hear the ultra-rich argue for increasing government regulation of the economy, but billionaire Tom Steyer believes such a thing is necessary to stop the onslaught from climate change. Steyer may be best known for his longtime investment in climate solutions, as well as his decision in 2012 to step away from a highly successful investment fund he had founded.

Like many people who pay attention to the overwhelming scientific evidence that humans are causing climate change by burning fossil fuels, as explored in his new book "Cheaper, Faster, Better: How We'll Win the Climate War," which was released this month. He sees climate changes as a multi-pronged menace, one that causes hardships from mass migration to extreme weather events like hurricanes, wildfires and droughts.

Yet unlike philosophers such as the University of Tokyo's Dr. Kohei Saito or the University of Massachusetts Amherst's Dr. Richard Wolff, Steyer is firmly convinced that climate change can be solved within the confines of capitalism. The solutions of the staunch left he describes as "panic."

"Cheaper, Faster, Better" is a testament to Steyer's conviction on all of these points. As the leader of a climate investment firm, he offers readers an entertaining and informative look into the world of green energy and the clean energy transition. He argues that capitalism can save the planet from the excesses of fossil fuel companies and provide people with the tools to better educate themselves. He is nothing if not an optimist.

This interview has been lightly edited for length and clarity.

In your book, you discuss your realization that climate change is important during a 2006 trip to Alaska and you discovered that one of your favorite glaciers had melted. Do you have other harrowing experiences like that one, which have happened since and which have also influenced your views on climate change?

You mean where I've seen physical evidence of climate change in a way that's irrefutable and scary?


Around two years ago, I went on a trip. Originally it was supposed to be to Greenland to see what's going on from a climate standpoint, but because of [COVID-19], we weren't allowed to go in. So we went up to the coast of Iceland and went to a series of glaciers and fjords to see exactly how much the ice had moved and what the pace was. And of course that was something which was similar to Alaska in the sense of you could see where it had been quite recently. You could see how far it had moved and you could see where it was likely to move.

So that to a very large extent is one of the places in the world where it's most obvious: in the far north and the far south, partially because the ice is changing so fast and partially because the poles are heating up three or four times faster than the rest of the globe. But because the places where you can see in the natural world that the human impacts are most profound and most significant are at the poles, there aren't that many people who live in the way, way far north or the way, way far south.

As a climate change reporter, the risk that I run into is I'm giving a lot of statistics, a lot of data, and a lot of concepts, but people need to visualize these things. They need to see it and hear it, not simply know it intellectually. What reforms should be implemented to help the people who need it most when climate disasters happen?

Let's start with the basic rule of global climate change, which is the less that you've done to cause the problem, the more you're going to suffer.

If you look at the people of Pakistan last year, I think one-third of the people there were displaced by huge floods. And yet Pakistan had produced numbers as low as one 10th of 1% of the cumulative greenhouse gas emissions around the globe. When we think about what are the rules, the real question is that we don't have rules at this point to reflect the pain that is being inflicted on people around the globe, nor do we have rules in place to charge people for the pollution, for the global greenhouse gas emissions that are causing the problems in the first place.

And so, before we even get to rules, one of the things that I think is absolutely critical for my standpoint is transparency. So that when we think about, how are we going to make this fair between peoples long before we get there, the question is, how are we going to measure emissions in a way that we now know what a specific company is doing?

We need a whole new information system so that we understand what's going on and can measure it. And then we need to say, under those circumstances, how are we going to make this in some way work for the people of the world in a way that's acceptable? 

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"When we think about what are the rules, the real question is that we don't have rules at this point to reflect the pain that is being inflicted."

How does one implement that? Because the problem that I'm seeing is that there is massive resistance on both the political and corporate level to everything you've just proposed.

Of course, corporations are pushing back against transparency and information because they love plausible deniability. But if you will notice, California has passed laws that go into effect somewhere around 2027 asking that major corporations that do business in California actually measure and make public their emissions profile. I think the EU is also pushing a regime of transparency around emissions. You know the old saying: If you can't measure it, you can't manage it, whether that's the corporate level, the individual level or the governmental level.

When it comes to rules, don't forget, I am acting as an investor in this. And so from my standpoint, I can see business-related means of setting up fair measurements to turn into ways to reward people for sequestering carbon and charging people for emitting carbon in ways that are verifiable.

That is the beginning of a system to try to get back into the marketplace some sense of paying off the cost to people and also charging people for the cost that they're incurring for others. 

What about seemingly more radical approaches to deal with climate change? Dr. Kohei Saito is a Japanese scholar who wrote a book, "Slow Down: The Degrowth Manifesto," advocating for Marxism as a response to the climate change controversy. He argues that we need "degrowth" in our economy, that we need to stop with perpetual growth and re-orient our entire economic infrastructure because any consumption-based economic system he argues will inherently cause climate change. When people accuse him of being socialistic, he doesn't deny it. He argues that that's a good thing. What are your thoughts about those kinds of ideas?

I just don't believe that any of those systems has ever worked. I think the system that has worked for producing people's needs and desires at scale in the world has been a capitalist system. One of the things I always say is there's no such thing as a free market. All markets have rules. And in fact, going back to the earliest Greek marketplaces, there are always rules about who gets to put their stall where. When the market opens, where the market is physically located, there are always rules.

And one of the rules here is that people don't have to pay for their CO2 emissions. God didn't come down and say that; that was just something that people didn't understand, that there was inherent cost to emitting CO2. 

And over time we've come to understand that, but we are allowing people, in a sense, to pollute for free. They make a lot of money polluting for free, and they want to continue to pollute for free. The answer to that is not anti-capitalism. The answer is to actually put into capitalism, to undo the mistake. And so, to a very large extent, what I'm trying to do is to show that actually clean technologies winning in the marketplace is the way to affect change at scale, at speed, in a way that solves this problem and also does it in a way that solves the needs of people around the world. That's what I believe in.

You mentioned earlier that there will be political instability as climate migration worsens. Do you think that political instability will reflect itself in part in people embracing more radical ideologies?

When people are under pressure, you never know which way they're going to jump. They jump a lot of strange ways, but that's why it's so important to do what we're talking about: to be ahead of the game, actually solve problems, don't appeal to people's fear and panic, but actually do the smart things to prove that it works and make that happen.

And then make the argument and make it happen better and actually do the right thing, as opposed to trying to play off people's deepest fears, which honestly, if people are worried about the health and safety of their families, those fears run very deep and people can jump a lot of different ways. And that's why, to me, doing the right thing and building the right businesses and winning in a way that really takes care of people, I think is the only way to solve this.

The whole point about this book is, yes, we have a big problem, but that isn't all we have. We have an amazing opportunity to create something great, a better life than people have ever known on this planet. And so let's not get so freaked out about the challenge. Let's meet the challenge and create the opportunity.

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Because if we in fact go to what you're talking about, which is kind of panic, you don't make your good decisions in fight or flight. Fight or flight is about not being able to see anything peripherally. Not being able to focus on anything but what's right in front of your face in an emotional way. What we're talking about is doing something that's much more responsible, much more optimistic, much more positive and will have a much better outcome.

As a billionaire, what would you say to people who are more critical of billionaires in general in terms of the issue of climate change? And what would you say to your fellow billionaires who could do more to assist with the problem? 

Look, I think [laughs], you know, the old saying: If you have a lot, you have a lot of responsibility too. 

Or as it goes in the "Spider-Man" movie: "With great power comes great responsibility."

Well, I don't know if it's great power, but I will say this: I think for the people who are lucky enough to have succeeded, particularly in our society where being just being part of the society is such a benefit, I think we have all have a responsibility to try and take care of the society that nurtured us, and the other people who are part of that and who help build this society. That's my basic going in philosophy.

By Matthew Rozsa

Matthew Rozsa is a staff writer at Salon. He received a Master's Degree in History from Rutgers-Newark in 2012 and was awarded a science journalism fellowship from the Metcalf Institute in 2022.

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