Thread by @howardtayler

I've written about the principle of "external costs" before, but now seems like a good time to revisit it briefly.

External costs are expenses that an enterprise incurs, but which someone ELSE has to pay.

Put another way, an external cost is something imposed on someone who has no say in the enterprise incurring the cost.

"Secondhand smoke" is a fine example.

External costs are different than hidden costs. A hidden cost might be "producing this new product in our old factory is causing all our equipment to break down more quickly." In that example, the factory owner is the one paying the price.

Whereas an EXTERNAL cost is "producing this new product in our old factory is creating runoff which is poisoning the water downstream from us."

External costs are an injustice (the person paying them doesn't get a choice in the matter), and they're at the root of many, many corporate success stories.

Fortunately, like many festering rots, they can be killed by exposure to the light.

We, today, have more power to shine light on—to expose—external costs than we have at any other time in history.

Things may look horrible, but that's partly because we can see more, and better, than ever before.

It may feel like we're staring into the abyss, and being consumed by it.

Nope! We're taking pictures of the abyss, and sharing them, and getting that nasty abyss kicked off Twitter, and eventually taken to court for doing all those abyss crimes.

tl;dr—take pictures, but please make sure somebody's watching your back when you shine light into dark places.

You're not just making history out there. You're making the future.