The economic costs of inaction will be large and span regions and industries, House Budget Committee Chairman John Yarmuth (D-Ky.) concluded in a post-hearing report titled, “The Steep Costs of Climate Change Call for Congressional Action.” An excerpt of the report follows.
Two major national-scale assessments, from the Climate Impact Lab and EPA’s Climate Change Impacts and Risk Analysis project, have projected significant climate damages across industries such as health, labor, coastal property, agriculture, and energy. They independently concluded that, if we continue business as usual with high emissions and limited resilience efforts, annual losses will likely grow to exceed $500 billion, or roughly three percent of national GDP, by the end of the century – and that is just in the examined sectors.
“Unmitigated climate change is likely to have substantial negative impact on the U.S. economy” — Dr. Solomon Hsiang, Chancellor’s Professor of Public Policy at the University of California, Berkeley and a co-principal investigator of the Climate Impact Lab, warned: “Expected damages are on the scale of trillions of dollars.” For example, increasing temperatures alone would likely reduce incomes nationwide over the next 80 years, a loss of roughly $5-10 trillion in net present value, primarily due to reduced crop yield and labor productivity; and losses from intensified hurricanes would approach $900 billion. Each 1°C increase in global average temperature costs the United States an additional 1.2 percent of GDP. Losing large fractions of GDP due to climate change, he said, is like paying a tax – except you get nothing in return.
“The nature and magnitude of projected costs differs between locations” — Dr. Hsiang testified that each region of the U.S. will experience climate change differently: “extreme heat will impose large health, energy, and labor costs on the South; sea level rise and hurricanes will damage coastal communities, particularly Florida; humidity levels similar to those of modern Louisiana will force a restructuring of infrastructure in New England; declining crop productivities will transform land markets throughout the Plains and Midwest; and more frequent fires and water shortages will harm the West.”
“Each industry exhibits different responses to climate change” — Dr. Hsiang’s research concludes that the economic impacts vary by sector but are almost always negative. The largest estimated climate impacts nationwide would be reduced labor productivity, damaged coastal property, and lost lives (more than 10,000 additional deaths per year by 2090), with further losses associated with energy use, agricultural productivity, air quality, and transportation infrastructure.
Read the full report from the House Budget Committee Chairman.