What’s the real imperative of the migration to renewable energy and cutting back our consumption of fossil fuels via efficiency and conservation? Might you say: Climate change?
We’ll, that certainly one good answer. Of course, there are half a dozen others: dealing with peak oil, health issues, ocean acidification, the loss of biodiversity, human hostility, etc. When I’m interviewed on the subject and I encounter climate change deniers, I’m quick to change the subject. As I often say, “If you don’t believe in climate change, that’s fine, just pick another good reason to curb our addiction to fossil fuels; most of them have nothing to do with this dreaded subject whatsoever.”
But having said all this, the build-up of greenhouse gases, which will eventually culminate in the melting of the arctic and the release of the methane beneath it, carries with it a fairly hefty price tag in terms of climate change per se, according to European researchers Gail Whiteman, from the school of management at Erasmus University in Rotterdam, Peter Wadhams, professor of ocean physics at the University of Cambridge, and Peter Hope, from the Judge Business School in Cambridge. In an article they published in the journal Nature, they try to piece together the cost of global climate change. Their total: $60 trillion.
Now wait a second. If the total world economy is estimated at $70 trillion annually, isn’t this a very large number? Indeed it is.
Let’s look at how they got there. Part of it is the valuation on human life that will be lost due to loss of homeland, flooding, starvation, dehydration, disease, etc. That’s always amused me, btw, in some perverse way. Apparently, we feel fairly comfortable ascribing a certain dollar figure to a human life. Maybe our willingness to equate lives and dollars is why we’re in this mess in the first place. It seems unlikely that Jesus, or Socrates, or Confucius would do that.
Be this as it may. Obviously, a lot of the rest of the damage is easier to quantify: the value of the real estate in low-lying areas like New York, Boston, Miami in the U.S. – and dozens of other huge cities around the world, that will cease to exist as the result of sea-level rise. Dollar figures like farmers’ crop loss are equally easy to nail down with some level of precision.
In the U.S., we’re unique in that many of us question the validity of anthropogenic global warming (AGW). And it’s an issue that divides almost precisely across party lines, too: only 19% of Republicans agree with the 97% of climate scientists that AGW is a valid and potent threat to humankind.
That’s interesting in and of itself, but consider this: none of this is lost on the business community. At the very same moment that the debate leaves the cocktail parties at the country clubs and the polo fields and enters the boardroom, everything changes. When the financial people have a voice, e.g., the insurance companies whose empires rise or fall according to the effects of climate change that are happening right this minute, e.g., extreme weather events, the unsupportable political opinions instantly disappear and science robustly takes over.
Here’s a recent New York Times article that I just found from Googling “insurance companies climate change” – one of 20.5 million such hits, called “For Insurers, No Doubts on Climate Change.” Evidently, the insurance industry, known for centuries for its mathematical precision, see what’s happening, and is acting accordingly. From the article:
And the industry expects the situation will get worse. “Numerous studies assume a rise in summer drought periods in North America in the future and an increasing probability of severe cyclones relatively far north along the U.S. East Coast in the long term,” said Peter Höppe, who heads Geo Risks Research at the reinsurance giant Munich Re. “The rise in sea level caused by climate change will further increase the risk of storm surge.” Most insurers, including the reinsurance companies that bear much of the ultimate risk in the industry, have little time for the arguments heard in some right-wing circles that climate change isn’t happening, and are quite comfortable with the scientific consensus that burning fossil fuels is the main culprit of global warming.
“Insurance is heavily dependent on scientific thought,” Frank Nutter, president of the Reinsurance Association of America, told me last week. “It is not as amenable to politicized scientific thought.”
We know that our fascination with cheap energy, stored in the Earth from the sun’s rays over the last few billion years, is killing us, but it’s our de facto energy policy nonetheless. How to characterize the fact that we Americans are still dragging our heels and supporting our oil companies with continued subsidies and tax breaks, while letting them essentially run our government? In a word, it’s pathetic.