Unpacked: S2, E20: Inside Rick Steves’s Self-Imposed Carbon Tax

AFAR

Can $30 per traveler really make a difference when it comes to carbon offsets? For Rick Steves, the answer is “absolutely.” For the past four years, his company has paid a self-imposed carbon tax—in 2022, they donated $1 million to a dozen, carefully selected nonprofits to mitigate the carbon cost of their travelers. In this week’s episode of Unpacked , we chat with Craig Davdison, COO of Rick Steves’ Europe, about how their Climate Smart Commitment program works—and the life-changing results.    Read the transcript here: https://www.afar.com/podcasts/unpacked/s2-e19-rick-steves-sustainable-travel Discover more episodes of the podcast here: https://www.afar.com/podcasts/unpacked  ---- CONNECT WITH AFAR Afar.com is a digital and print magazine that publishes travel tips, guides, news, and stories: https://www.afar.com  Get updates on the latest articles, travel news, and more from AFAR by signing up for the AFAR newsletter: https://afar.com/newsletters  Follow AFAR on Facebook: https://www.facebook.com/AfarMedia Follow AFAR on Twitter: https://twitter.com/afarmedia Follow AFAR on Instagram: https://www.instagram.com/afarmedia Follow AFAR on Pinterest: https://www.pinterest.com/afarmedia

Transcript

00:00 I'm Aisling Green, and this is Unpacked, the podcast that unpacks one tricky topic

00:08 in travel each week. And this week, we're unpacking the Rick Steves Europe Climate Smart

00:14 Commitment. If you listened to last week's episode, and you don't need to have listened

00:19 to last week's episode to follow this one, but if you did, you may be familiar with this

00:23 program. It's essentially a self-imposed carbon tax. See, for every traveler who joins a Rick

00:30 Steves European tour, the company donates $30 to a carefully selected group of nonprofits.

00:38 And in this episode, we're going to be hearing from Craig Davidson. He's the COO of Rick

00:42 Steves Europe about these nonprofits, how the company selected them, and the really

00:48 incredible things they've seen come from this program. It's very impressive. Like I said,

00:52 you don't need to have listened to last week's episode to follow this one, but it is a helpful

00:56 primer to kind of understand Rick Steves, his values and how they've evolved over the

01:02 years and how he and his company view the world. I have found them to be an impressively

01:09 ethical and sustainable organization, one that I really hope inspires other companies

01:14 to follow suit. All right, but that's enough fangirling. Let's get on to the show.

01:22 Hi, Craig. Welcome to Unpacked. Thanks so much for being here today.

01:25 Well, great. Thank you very much for having me. I appreciate it.

01:28 Of course. Yeah. I just had a wonderful chat with Rick about his ethics and what led to

01:33 the creation of the Climate Smart commitment. And so I am just hoping with you to get into

01:38 the nuts and bolts of that. And I know that you spent a lot of time on this, creating

01:43 it. And so I would love to start off by just having you explain to our listeners what exactly

01:49 this commitment is.

01:50 Well, the Climate Smart commitment is really, I like to say it's just the embodiment of

01:55 our values. Rick Steves Europe, we're teachers first. We like to teach good and thoughtful

02:01 travel. We're role models personally and professionally. And then we advocate for humanness in a world

02:09 that's becoming increasingly materialistic or isolated. So we always try to put humans

02:13 at the center of everything we do when we travel or our programs. And so this is the

02:19 culmination to me of all of those values. And the Climate Smart commitment is just,

02:25 I look at it, it's the big number of what we do, but it also ties into all our philanthropic

02:30 work. So I come from a world from economic school and everything else that you come through

02:35 of your job as a manager is to maximize shareholder value. And back in school, I used to think

02:42 that doesn't make any sense. If maximizing shareholder value is short-term gain, gain,

02:48 with the dividend, and I make you a millionaire, but you can't drink the water or breathe the

02:54 air, I've kind of not done my job in maximizing your value. And so I've always felt there's

03:00 got to be some sort of ethical, social issue inside of management. And then when I met

03:06 Rick and joined his company, like Rick is very much interested in social justice issues

03:11 and has given money for years to support causes that he believes in. So we formalized all

03:18 of that from an organizational perspective and created the shareholder, but really stakeholder

03:23 model where we said the earth and the community are shareholders of ours. And so the community

03:30 receives a dividend and we partner with local organizations here to give back to the community

03:35 to make our community stronger. And then the Climate Smart commitment is the dividend we're

03:40 giving back to the earth, really to pay it back for the resources that we use in order

03:46 to earn a profit. Like I can look at it no different than any other investor. And we

03:50 know that when you travel, especially plane flights can emit carbon and that causes climate

03:56 change. So we structured this program to pay back that dividend to the earth by attempting

04:03 to help creatively mitigate the carbon created while traveling, while putting humans at the

04:08 center of the program.

04:10 Yeah, I love that. And there are of course carbon offset programs and I know that you

04:16 looked into that. And so why did you decide to not go in that direction instead form this?

04:22 We did look into them. I just don't think they, they don't meet who we are as an organization.

04:29 We like to be really involved and be in partnership with the organizations that we're involved

04:35 with. We want to understand the stories and have a relationship and know exactly where

04:39 our money is going. And we, we like entrepreneurial, empowering, systemic change kind of projects

04:46 that stabilize people's lives and then give them the opportunity to grow and be entrepreneurs

04:52 and really change the system that has put them in the situation that they're in.

05:00 And so when you talk about carbon offsets, just the simple answer for us is we know there's

05:06 a lot of administration costs. There's a lot of overhead costs and things that are inside

05:11 of this mechanism to buy an offset. So we thought we could get more bang for our buck,

05:18 you know, by donating directly to an organization and understanding the projects they're working

05:22 on.

05:23 That's great. I love that. And so as I understand it for every tour member, you take $30 and

05:29 invest it in one of this handful of organizations. How many organizations are within this portfolio?

05:36 As you refer to it.

05:38 That's right. It's a portfolio. I'd like to refer to it as my mutual fund of organizations

05:43 where the primary investment is in people. So based on the number of travelers who went

05:48 with us in 2022, that million dollars has gone to 13. Generally the portfolio will float

05:55 between 10 to 13. A hundred thousand dollars each tends to be the big number.

06:00 Okay. And how did you go about selecting and vetting these organizations? It sounds like

06:05 you've done a lot of homework.

06:08 I mean, the initial go round, I mean, that's where a lot of, you'd say there's a lot of

06:13 vetting went on with that. I think our program has migrated over the years. I think it's

06:17 become cooler in a way. I think of what we've learned and what I've learned in this about

06:24 global systemic injustice and all sorts of stuff. It's migrated over time. We love the

06:29 idea. There's a book called Drawdown that we had read really when we were formulating

06:34 this and it's all about what carbon or climate environmental projects you can invest in and

06:40 which ones had the biggest impact on climate change. And when you get to number six, when

06:45 you read the list, it's about the education of women and girls in the developing world.

06:51 And the impact of that is basically immeasurable. So it was this idea of saying, I really love

06:58 the idea of education. That's who we are as teachers first. And so if we can make communities

07:05 stronger and educate women and girls, that ensures the lasting impact of any of the programs

07:11 that we're doing. It ties exactly into what we want to do as an organization. And so everything

07:17 had to have an element of that. And then of course, we were looking at the social injustice

07:23 really of the global capital market system. And we're capitalists, we like making a profit,

07:28 but the problem with maximizing shareholder value or all of those issues is that the capital

07:34 system doesn't really care about the inputs. It cares about the value of the output because

07:39 it wants to make money on it, but the people or whoever who are producing the product are

07:44 often left behind. So we wanted to look at something that way to say, how can we really

07:52 impact the lives of, it ended up being farmers in the developing world to help farmers farm

07:58 in a way that had less of an impact on climate change, but also help them mitigate the impacts

08:03 of climate change. Because for farmers, they're caught in the middle. They make less and less

08:08 money every year because commodity prices drop. We don't want to pay more money at the

08:13 grocery store for food. So they're the ones who make less and less money. It happens in

08:18 the US too, to US farmers, but the poorest people in the poorest countries are being

08:22 hit the hardest by climate change. They don't have the resources to really fight back against

08:28 it. And what they do to just make enough money to survive or just to live could be deforestation.

08:37 It's trying to use more chemicals. It's just trying to get more out of the land that they

08:41 have. And by doing that, it's causing climate change. It's deforesting chemical production

08:47 emits carbon into the atmosphere and all of that slew of things. So that's why we centered

08:52 on those two ideas. And then it was really just organizations can apply to us for grants.

08:58 And we look at those grants under those criteria.

09:01 Interesting. And what specifically in your work with organizations that work with farmers,

09:08 what do they do? Like how does the money used?

09:10 There's two pieces to it. It's helping farmers farm in a way that mitigates their impact

09:17 on the climate, but helps them adapt to the climate change. So there's that section of

09:21 it. But then there has to be an ongoing education component. So our partners tend to partner

09:27 with local organizations. So this isn't about us showing up and dumping a bunch of money

09:33 or telling people what to do and keeping ourselves in a project forever. This is about organizations

09:39 partnering with local organizations and local people to bring in the technology and bring

09:46 in the tools for farmers to farm more efficiently. So it's teaching things like organic farming.

09:53 So that if they can make compost, it's as simple as that. If they can make compost,

09:58 that's now free. They don't have to spend money on chemicals. That increases their income

10:02 because now they don't spend money on something. It's an investment in hydroponics. And we

10:07 like to talk about it. It's an investment because many of our farmers opt into these

10:12 programs. Many still say, no, the old traditional way of fertilizer and the way I farm is the

10:18 way I know. Farmers elect into these programs to become entrepreneurs. We provide that investment.

10:25 And with hydroponics and water saving techniques now allows farmers to get through the dry

10:30 seasons and the droughts and all of the crazy weather we see here, even in the United States.

10:37 But now they have more than one harvest. So now that increases the yield on their land.

10:41 There's no need for them to deforest to try to get more land, to plant more crops, to

10:46 make up the income that they're losing through the commodity price. If they don't deforest,

10:50 of course, that helps climate change so they can make more on the plot of land they have.

10:56 But then the next step of it is bringing in technology to help them. A lot of these farmers,

11:01 because they're stuck in extreme poverty, they live in constant search of firewood.

11:08 An open pit fire generally in the center of their house burns constantly because they

11:12 have to boil water. That means the kids and women are generally always either going to

11:18 try to find water or go find firewood. The firewood, of course, is deforestation. You

11:23 can argue the smoke from the fire is climate change causing carbon emissions, but it's

11:27 keeping kids from school. So if we can bring in climate smart cook stoves, and one of our

11:33 partners has said one cook stove can save the equivalent of 30 trips to Europe worth

11:38 of carbon. So if you bring in a climate smart cook stove, they might never have to cut down

11:44 trees again, but we can teach restorative farming so that they constantly replenish

11:49 their fuel supply, but they use less. If we can bring in chemical water filters, now they

11:55 don't need to boil water all the time. They have clean water. Kids can now go to school

12:00 and it creates a whole different community aspect. At the same time, with the increased

12:06 farming and the increased yields, if it's organic food, they can make more money at

12:10 market. Farmers can start to make enough income that stops this ongoing need for deforestation.

12:18 We reforest a lot of nurseries, a lot of replanting so we can restore the biosphere or the biodiversity

12:23 of the area to really bring the planet back to where it was. That way, these farmers can

12:29 live and thrive in this global market with a reduced footprint. Really, we stabilize,

12:36 I argue, we stabilize the food supply.

12:38 Yeah, absolutely.

12:39 Yeah, because once farmers lose hope and if they can't farm, they migrate. That's a whole

12:46 other issue. So we're trying, from a systemic point of view, we're trying to say if we tackle

12:51 this this way, we can help the climate, but we can also solve all of these other side

12:57 issues that are stemming from just climate change and the impact on farmers.

13:02 Yeah, I mean, that's huge, and especially in terms of global food supply and food security,

13:09 right? So something that we've struggled with at afar and balancing this out, I'm just curious

13:15 to know your take on this is going back to the idea of mitigation. So, okay, the carbon

13:21 that we emit by say, flying to Europe or wherever we're flying to is immediate, but these programs

13:27 can take a longer period of time. So how do you view that?

13:31 I think we wrestle with it too. You know, it is very hard. There's the immediacy of

13:37 offsetting, if you use that term, but we don't like to use the term, but it's like that flight,

13:44 we just, we look at it, you know, I guess in a, in just a different sort of way. I mean,

13:50 I'm sure that's what you guys wrestle with as well. It's like, we don't want to get hung

13:57 up necessarily on the intricacies of that immediacy. And we want to be accountable for

14:02 what we're doing and we want to take action. So we want to take action now, while we try

14:07 to figure out the rest of these issues, because we learn more every day. And our program,

14:13 like I said, is slowly migrating as we learn more to attack more of these issues.

14:17 Yeah. I mean, we don't have the answer either. I think what we've settled on is, you know,

14:24 encouraging people to offset in whatever way and I love the program you guys have developed

14:29 and also at simultaneously encouraging people to be more thoughtful, because we do think

14:34 that it's important to travel and to kind of, you know, be a citizen of the world and

14:38 that you learn so much and there's value in that, but to, you know, maybe do fewer short

14:44 flights or if you can take an alternative form of transportation and then looking at

14:49 airlines that are really doing interesting things in terms of sustainable aviation fuel

14:54 and carbon capture and things like that. So I feel like it's like a mix. We landed on

14:59 that hybrid.

15:00 Yeah, I'll say I think that's, that's right. And from our travel concepts, you know, we've

15:06 always been very much of when you travel to Europe, stay in a hotel, stay in a place longer

15:10 than one day. So on our tours, we don't have as much housekeeping as we used to have, but

15:16 just from the way we travel, we've always promoted public transportation. It's about

15:21 getting to a place and living like a local, staying in local hotels, which have a smaller

15:26 footprint staying in local or eating at local establishments so that your money stays in

15:32 that community and then really impacts the community that you're in. So we're actually

15:37 fortunate in that way that we're, we've always tried to be and if you're in Europe, a lot

15:42 of times you'll take trains between cities if that's the way we're moving. So we're lucky

15:47 that our style of travel has always had a low footprint.

15:50 Yeah, getting there.

15:53 Getting there. Yeah.

15:56 I was curious to know what, because now any traveler can contribute to the Climate Smart

16:03 Commitment, right? Like it's not just you, you do it still for your tour members, but

16:07 I as a traveler, if I wanted to offset my next trip to say France, I could donate. Do

16:13 you have a recommendation that you would give to travelers in terms of how to do that?

16:18 You know, we come back to a lot of what I like to talk about. I think you've just said

16:22 it too. It's about accountability. If you're a citizen of the world, you understand that

16:27 your actions have repercussions. So if people take personal responsibility and understand

16:33 the issues and understand what they can do, then we like to say, just be accountable for

16:39 that. And if you like a project like biofuel or something, contribute to that. If you feel

16:43 like that's the answer, our program matches the values of our organization. So if you

16:50 like our program, yes, you can donate to us. You can go to our website, it's ricksteves.com.

16:55 And at the bottom, there's a link to Climate Smart and your money will be added to our

16:58 self-imposed carbon tax and then allocated out to the organizations who apply to grants

17:04 that make it through the grant process. You can also go to, if you get to our website

17:08 and read our portfolio, there's always a link for people to donate directly to those organizations.

17:14 If someone likes that organization more than another one. And right now, taking action

17:20 to me is the most important thing any of us can do.

17:25 So you launched this program in 2019. What have you seen change or grow since then?

17:40 In terms of our projects and the project success, I think, we've brought three villages out

17:45 of extreme poverty. So that's pretty exciting. We've seen impacts. We've actually had one

17:51 of our partners, it's the same partner, but that partner say to us, when we started this

17:58 and we gave them the idea of Climate Smart farming techniques, and this is what we wanted

18:04 to invest in. They didn't think it was going to work. They were traditional agronomists.

18:09 This is about chemicals and all of how this was going to work, but they started to do

18:15 it. And in the three years, what we've done has become the now foundation for all their

18:21 future work in the developing world. So that to me is exciting. We've gone from this idea

18:26 of will it work and let's try it out to, wow, this really does work and the results are

18:32 so amazing. Let's continue on. That's changed my knowledge of the way the world works and

18:38 the capital market systems and food productions and how governments of countries are trying

18:45 to do the right thing, but maybe aren't and they harm their citizens. So like now we're

18:50 trying to help tribes who have been kicked off their land because they've created a national

18:55 forest. Well, these tribes can no longer sustainable farm or sustainable hunt or do a subsistence

19:01 hunt really or subsistence farm anymore because it's protected land. So we're helping those

19:07 groups buy back what was their traditional land from the government so that they can

19:12 manage it in a better way and still live in it and be part of that, part of that ecosphere.

19:19 It's that and really understanding how organizations turn a blind eye to illegal deforestation

19:27 of rainforests and how I can deforest a rainforest, produce a product that a brand buys and the

19:36 brand sells it, but there's no repercussions because the organization that deforests, they

19:41 do it, their government doesn't care. We displace a whole bunch of people that used to live

19:46 on the land. Nobody seems to care. The brand buys the product that makes a profit and the

19:52 government earns the tax off the sale. So there's like a reward for doing it as opposed

19:57 to a penalty. And the other side of it is there's this huge humanitarian issue being

20:03 created by the displacement of people that would be on the land. Farmers are being displaced.

20:09 You can see a lot of news stories. We're losing the wild for food production or urban areas.

20:15 It's accelerating climate change, which makes the food supply even more unstable and which

20:20 creates a bigger humanitarian crisis. So it's like, it's all interconnected. It's not just

20:26 climate change and it's hard to explain in a nutshell.

20:30 Yeah. Well, it seems very concrete. Like you can sure go down, dig into the weeds, but

20:36 it seems pretty, pretty easy on the surface level to kind of grasp and understand. I was

20:42 wondering, I had read that you were setting up some kind of training center for farming.

20:46 Is that right?

20:47 That's right. That's the same group that brought the three villages out of extreme poverty.

20:52 Now the next step is to build a training center. All of our organizations really have some

20:57 element of training when farmers come and learn. A lot of it's basic literacy training.

21:02 It's understanding just basic accounting so that they can become entrepreneurs and know

21:07 profit and loss off a farm, that kind of idea. But in this project specifically, we're going

21:14 to build a training center where farmers now, instead of building a village from scratch

21:18 and doing it, we're going to bring farmers in from other villages to this training center

21:23 where they can live. They'll be given a plot of land where they can learn all these new

21:28 techniques. And that way, if that plot of land works and is productive, they can earn

21:33 the income off the plot of land. And we will compensate them for leaving their village

21:39 to come and giving up their farm really, because they have to give that up to come learn the

21:43 new techniques. But it's the idea of bringing people in to learn and then letting them go

21:48 back to where they were and adapt the new techniques because we can reach more people

21:53 that way. Instead of doing it village by village, we can teach a lot of farmers. And then we

21:58 empower those farmers to go teach those people in those villages. And that's what a lot of

22:04 our organizations do too. That's the education of women and girls. Women and girls are learning

22:09 how to maintain all these programs. They're learning how to train the trainer idea. They

22:14 are the trainers and it's keeping young people in the villages and giving them careers so

22:21 that they stay in the villages. The community stays stronger. It stops migration, but it

22:25 also ensures continuity of the food production.

22:28 Nicole: Absolutely. And where is the training facility

22:32 located?

22:33 Dr. Tom: This one is in Nicaragua.

22:34 Nicole: Nicaragua. And most of the farmers will also

22:36 be from Nicaragua for now?

22:37 Dr. Tom: That's right.

22:38 Nicole: Okay. Got it. Is there anything else that you

22:40 think is important for listeners to know about this or the company's take on climate change?

22:46 Dr. Tom: I would just say the world is an interesting

22:49 place at the moment. We run the gamut from people who believe in what we're doing and

22:54 believe in our point of view and support us. And we get, you've been taken in by the hoax

23:00 and there's no such thing as climate change and everywhere in between. So from my perspective,

23:08 I like to look at it this way. We've developed a program that's based on our values. We believe

23:12 climate change is real. We don't believe there's a debate. And by the way, even if there is

23:18 a debate, at some point in time, I will not be here anymore. And if I meet my maker or

23:24 whatever you want to say that is, and there's judgment day, I want to be able to say, "I

23:29 thought there was a problem and I did what I thought was right." And if you say, "Well,

23:33 you got fooled." Okay, but at least I did what I thought was right. And I improved the

23:39 lives of hopefully thousands of people in the world while we did it. And at the core

23:45 of who we are at Rick Steves Europe, that's what we're trying to do. We're trying to create

23:49 those human connections and make the world a better place through travel, the same as

23:54 your company is. And it's becoming a global citizen and understanding issues and really

24:00 just trying to make the world a better place. And that's what we're doing. And that's what

24:04 I would say to everybody, just be accountable for what you do, act ethically and take action

24:12 in whichever way you think you should, because that's how we're going to make the world better.

24:18 Hear hear. I agree. Yeah, no, we're very much values aligned in that way. Thank you so much

24:25 for your time and for being here today. I really appreciate it.

24:28 Yeah, I enjoyed it. Thanks very much for having me.

24:32 All right, thanks for listening, everyone. If you want to learn more about the Climate

24:38 Smart commitment, or donate to any of the nonprofits you heard about in this episode,

24:43 visit ricksteves.com, which we'll link to in our show notes. Next week, we're going

24:48 to be talking to a Delta flight attendant about flying with kids and all the joys and

24:53 challenges that that can bring, and how to do it without losing your mind. It's a great

24:58 episode, definitely tune in for that. And also just a reminder that we'll be releasing

25:03 season four of Travel Tales by Afar on Thursday, October 5. So make sure you subscribe now

25:09 if you haven't already. See you next week. Ready for more unpacking? Visit afar.com and

25:16 be sure to follow us on Instagram and Twitter. We're @afarmedia. If you enjoyed today's exploration,

25:22 I hope you'll come back for more great stories. Subscribing makes this easy. You can find

25:27 Unpacked on Apple Podcasts, Spotify, or your favorite podcast platform. And be sure to

25:32 rate and review the show. It helps other travelers find it. This season, we also want to hear

25:37 from you. Is there a travel dilemma, trend or topic you'd like us to explore? Email us

25:43 at unpacked@afar.com. This has been Unpacked, a production of Afar Media. The podcast is

25:50 produced by Aislinn Green and Nikki Galteland. Music composition by Chris Gawlin. And remember,

25:56 the world is complicated. We're here to help you unpack it.

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