Climate anxiety has us all on our toes, like a cat on a hot tin roof in the dog days of August. 

But hold your horses; let’s take the bull by the horns (I’ll stop now) and pause to consider an unlikely companion in our quest to understand this anxiety: the humble ostrich.

You might wonder, what do ostriches have to do with climate change?

Well, bear with me (last one, I promise) as we explore the curious connection between the ostrich’s behavior and the psychological/economic concept known as the sunk cost fallacy.

Just as the ostrich is known for burying its head in the sand, humans too sometimes metaphorically bury their heads in the sands of decisions past, ignoring changing realities. (The ostrich burying its head in the sand is actually a myth, but let’s roll with it. In reality, when ostriches sense danger, they just lower their heads to the ground to better blend in with their surroundings.)

This tendency to “hide our heads in the sand” is often seen when we encounter proposals that require substantial changes in behavior, policy, or infrastructure over extended periods. Instead of addressing forward-looking solutions, we often choose to focus on short-term gains or resist altering our familiar routines. Just as an ostrich might momentarily avoid a threat by lowering its head, we too might avoid contemplating significant, though necessary, transformations.

Meanwhile, the sunk cost fallacy is a cognitive bias that leads individuals to make decisions based on past investments rather than future outcomes. In the context of climate anxiety, this fallacy can be observed in the choices made by communities and businesses to settle and invest in vulnerable areas prone to environmental hazards. 

Communities established on riverbeds, isthmuses, and below sea level often knowingly accepted the inherent risks associated with their locations. Similarly, oil companies like Exxon, BP, and ConocoPhillips invested significant resources in developing oil rigs in the Arctic, with full knowledge of the environmental challenges they might face.

While it’s crucial to empathize with the challenges faced by these communities and businesses, it’s also important to recognize that the sunk cost fallacy could be playing a role in their decision-making.

By focusing on resources already invested — i.e. sunk — these actors might be failing to adequately assess the changing landscape and make prudent decisions about the future. Their heads might be buried in the sand.

Now, the question of whether we should bail out communities and corporations that have made risky investments is a complex one. 

On one hand, providing assistance in times of crisis is a humane and compassionate response. After all, many of these communities are home to innocent residents who might not have had a say in the initial decision-making process.

However, a perspective centered on individual responsibility and accountability urges us to consider the broader implications. 

Just as personal financial decisions have consequences, so do decisions about where to build a home or establish a business. The idea of bailing out those who knowingly assume risks raises questions about moral hazard: the notion that people may be more likely to take risky actions if they believe they will be shielded from the negative consequences.

The case of oil companies like Exxon, BP, and ConocoPhillips provides an interesting perspective on the relationship between the sunk cost fallacy, climate anxiety, and corporate responsibility. 

These companies invested heavily in Arctic oil drilling, anticipating significant returns. However, the changing climate and associated challenges, such as melting permafrost, have raised concerns about the stability of their operations.

While it might be tempting to sympathize with these corporations due to the substantial resources they invested, a broader perspective encourages us to examine their accountability. 

These corporations made calculated decisions based on potential profits, and it is reasonable to hold them responsible for managing the risks they willingly assumed. Relying on bailouts to rescue them from unfavorable outcomes could perpetuate a cycle of risky behavior without appropriate consequences.

Shouldn’t that same logic apply to the people who, for example, willingly bought beachfront property?

Of course, climate anxiety is a genuine concern in our modern world, driven by the complex interplay of environmental changes, human decisions, and cognitive biases such as the sunk cost fallacy.

And while compassion and empathy must comprise part of our response to those facing the consequences of their choices, so must a sense of accountability; we should keep in mind the importance of responsible decision-making, adaptation, and sustainability. 

By striking a balance between support and accountability, while respecting individual liberty and property rights, we can address climate anxiety in a way that promotes long-term resilience and responsible stewardship of our environment.

I have four broad suggestions that should inform the search for that balance:

1. A re-evaluation of local zoning regulations and federal permitting processes. This would involve streamlining bureaucratic hurdles that often hinder adaptive and sustainable initiatives. 

2. A full embrace of market-driven incentives, because they naturally reward environmentally sustainable practices. (As sustainability grows in importance, entrepreneurs will respond to the demands and preferences of consumers who prioritize it.)

3. Other market-based mechanisms, such as emissions trading or cap-and-trade systems, to provide economic incentives for reducing environmental impact.

4. A re-dedication to property rights. When individuals and businesses have clear ownership over their land and resources, they are more likely to make informed choices that align with long-term environmental sustainability.

For more potential solutions to climate problems, see Learn Liberty’s video:

Above all, I hope we take the ostrich’s lesson to heart. The next time you feel like burying your head in the sand in the face of climate anxiety, remember: The challenges we face will not go away just because we look away. Nor will past investments that turned out to be bad ones suddenly get better.

By recognizing the signs of the sunk cost fallacy and addressing them head-on, we will no longer have to horse around; we can stand tall, break free from the shackles of anxiety, and make a beeline (sorry) toward a greener, more sustainable future. 

After all, our planet deserves more than mere puppy love; it deserves commitment and action from now until the cows come home.

Further reading

How sustainable farming is paying off for Australian farmers

The tragedy of the commons explained

How markets can save rhinos from extinction

Market-based solutions to climate change

How the profit motive can protect the environment

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This piece solely expresses the opinion of the author and not necessarily the organization as a whole. Students For Liberty is committed to facilitating a broad dialogue for liberty, representing a variety of opinions.