Since the end of World War II, the capitalist model transformed itself to a model of mass consumption. The consumer, it is argued, is the driver of a healthy economy and the most efficient economies are those that can ratchet up the pace of consumption ever more conveniently: instant credits, liberal loans, one-click shopping. Synthetic everything in oversized packages and “I-want-it-now-service” are the orders of the day. This pace boosted economic activity. But overnight air delivery across continents all came courtesy of jet fumes.

The first trillion barrels of oil was consumed over a period of 100 years. A two year supply shortage in 1970s, leading up to the Iranian Revolution in 1979, was dismissed as an anomaly. Everyone wanted ample supplies of oil during the Reagan-Thatcher Era. The politicians made sure that oil flowed at deeply discounted prices, cheaper than 1950s in real and purchasing power terms. Such short-sighted politics were touted as part of the “economic miracle” of their time. Bigger cars and cheaper airfares were delivered along with fresh discoveries of oil in rough waters of the North Sea. It all set the background for the jazz age of irresponsible energy consumption. As a result, the second trillion barrels of oil is slated for consumption over a measly 30 years or less.

This pace is not sustainable. If Chinese and Indian consumption of hydrocarbon fuels (and other primary commodities) catch up with the average rate of consumption in industrialized countries, the world will simply run out of natural resources in less than 20 years. It will also have to survive the pollution around a planet and deal with an atmosphere about 15 degrees warmer. Fresh water resources will be reduced by about one-third.

To remedy this, the first bold step must revise how we measure economic activity. Facts of environmental impact must accompany “success stories”. The damage to the environment must be reported as liabilities against headline rates of capital and asset growth. Total prices paid by the consumer must include the hidden liabilities and long-term impact to the planet. Extra costs must fund specific clean-up projects to reverse direct the impact. Last December’s historic legislation by the European Parliament mandating a detailed content disclosure of environmental hazards of more than 1300 chemicals used in everyday products is a promising, albeit expensive, step in that direction.

The World Bank applies environmental impact benchmarks to projects in the developing world. Such strict practices must also be applied to the industrial world where most of the world’s greenhouse gases are produced. This will inevitably raise the financial cost. However, the removal of the “carbon imprint” damage will create additional jobs and economic activity.

Concurrently, the big drivers of pollution must be reconsidered, even though this will be costly. A serious redesign of the internal combustion engine is long overdue. People have dismissed the conversion to battery or hydrogen powered cars saying they require too heavy an investment. But the sum required for conversion in North America, for example, is less than the sum lost in the jumbo bankruptcies of Enron, WorldCom, and the tech bubble of 2000, not to mention the gigantic sums spent on the Y2K bug.

Second, industrial production systems must radically change the output of emissions. New techniques of air scrubbing are no longer luxuries. Radical methods of pumping industrial emissions deep into the ground merit further examination. A fertilizer plant in Algeria is the first large scale test of this method and results are encouraging.

Third, immediate diversification away from hydrocarbon fuels is necessary. More energy must be produced from renewable sources (such as wind, solar and bio-mass fuels) as well as nuclear reactors.

Finally, we all must change our habits and consume less. Conservation must rank higher in our daily decisions. This may well be the most radical step because it could weaken the financial structure of all economies. El Niño and La Niña deliver a somber reality to us; we must not give them an oversized SUV to punish us with.