For too long and by too many, confronting climate change has been seen through the prism of economic sacrifice. Reducing greenhouse gases is viewed as a burden to growth and employment opportunity, the cause of global warming a fixation of left-wing environmentalists and against the interest of business, big or small.
But in reality, the exact reverse is true. Unchecked climate change would be a disaster for the U.S. economy, a point a bipartisan report released Tuesday, "Risky Business: The Economic Risks of Climate Change in the United States," makes clear. Property losses from rising sea levels and worsening storms alone could run in the billions of dollars by 2030 in coastal states.
The science is inescapable — a point reaffirmed by Monday's Supreme Court ruling that upheld the U.S. Environmental Protection Agency's right under the Clean Air Act to regulate carbon dioxide and other greenhouse gases. That the court set limits on that authority — restricting the EPA to major emitters already regulated for at least one other pollutant — is no big win for the business community if it merely reduces the agency's flexibility.
Congress has demonstrated little ability to address what may be the single biggest economic threat facing the nation, and so President Barack Obama has been forced to go the regulatory route, and the Supreme Court has upheld that strategy, not once but several times. The high court's affirmations began with the 2007 ruling on tailpipe emissions and include last April's decision to let EPA regulate the downwind impacts of coal-fired power plants.
The Risky Business report doesn't exactly break new scientific ground but instead demonstrates that Wall Street is paying attention to the dangers of climate change. The effort's co-chairs include former New York Mayor Michael R. Bloomberg and former Treasury Secretary Henry Paulson, a Republican who knows a thing or two about crisis management having served under George W. Bush during the stock market's near-meltdown.
Writing in The New York Times, Mr. Paulson recently called for a carbon tax as the best possible response to the problem. And he's undoubtedly correct. Such a tax would allow the market to decide the most efficient and cost-effective strategies for reducing greenhouse gases rather than force the heavy hand of government regulation. Unfortunately, it's an idea that the current Congress is simply unable to accept, chiefly because of the tea party-driven realities of Republican politics.
That leaves the EPA and it's imperfect regulatory response. If conservatives in Congress want a better answer for climate change, they're going to have to first admit the threat posed by global warming is real and then suggest better strategies for dealing with it. Simply bashing the administration for an alleged "war on coal" isn't productive — it's know-nothingness akin to claiming a war on religion because schools teach the science of evolution.
Make no mistake, the stakes for the economy are high. The report estimates that as much as $106 billion worth of coastal property may be below sea level by 2050, perhaps $507 billion by 2100. Meanwhile, extreme heat is bound to have an impact of human health and make it virtually impossible to work outdoors for an increasing amount of the year. The number of days when temperatures reach 95 degrees or higher could triple by mid-century, the report notes.
And that's not even factoring in the impact on agriculture, freshwater resources and global political instability as certain parts of the country are no longer able to grow certain crops and weather patterns shift. Such possibilities are not lost on the insurance industry, investment managers and others who are bound to be adversely impacted. The suggestion by Robert E. Rubin, Treasury secretary under Bill Clinton, that publicly-held companies disclose their specific climate-related risks to investors seems not only logical but overdue.
Ignoring climate change in favor of business-as-usual would spell an eventual end to business as usual. In Maryland, it has become commonplace to speak of a "business climate" in terms of excess taxes and regulation hurting employers. Ironically, protecting the climate is itself a pro-business, pro-job creation, pro-prosperity strategy that requires both taxes and regulations. And if the U.S. can't take these rational steps toward addressing the global threat of climate change, there's little chance the rest of the world will either.
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