Global Warming Effects on the Economy

Winners and Losers

Hurricane Harvey
People walk down a flooded street as they evacuate their homes after the area was inundated with flooding from Hurricane Harvey on August 28, 2017 in Houston, Texas. Photo by Joe Raedle/Getty Images

Global warming is the increase in average temperatures of the world's atmosphere and oceans. The warmest 30-year period in the Northern Hemisphere over the last 1,400 years was between 1983 and 2012. Each of the past 16 years was among the warmest on record. 

How much has it warmed? For the last 45 years, the Earth's average temperature rose 0.17°C (around 0.3° Fahrenheit) per decade. That's double the 0.07°C per decade increase that occurred during the entire period of recorded observations (1880-2015).

Temperatures in colder zones are rising even faster. In the past 60 years, Alaska has warmed by 1.7°C. That's twice as fast as the rest of the United States. Glaciers in Antarctica are losing their mass at an "unusually rapid" rate. For example, satellite pictures taken between 1992 and 1996 showed that the Pine Island Glacier lost thickness at a rate of 1.6 meters per year. That’s 42 times faster than 3.8 centimeters annual loss over the last 4,700 years. 

Antarctica holds 90 percent of the world's ice. If it all melted, sea levels would rise 200 feet. In 2014, the sea level was 2.6 inches above its average in 1993. That's because it's rising at a rate of one-eighth of an inch per year. A recent study revealed that the levels may be six feet higher by 2100. 

Melting ice caps aren't the only cause of higher sea levels. Higher temperatures also cause sea levels to rise because warm water expands.

 

Higher sea levels mean more flooding from hurricanes and other storms. Thanks to global warming, floods hit U.S. coastal communities 300 percent to 900 percent more often than just 50 years ago. 

Climate change cost the U.S. government more than $350 billion between 2007 and 2017. It will cost $112 billion per year in the future, according to the U.S. Government Accountability Office.

Global warming will affect each are differently, creating winners and losers.

Winners

The colder areas of the U.S. farm belt will receive a longer growing season. Alaska could become open to new development. The same goes for Scandinavian countries. Already, the growing season in Greenland is two weeks longer than in the 1970s. Washington, DC has an earlier tourist season, as the cherry trees have started blossoming a week earlier than 20 years ago.

Russia and Canada might become the biggest benefactors because they have the largest frozen land masses. That could significantly change the balance of power.

Shippers along the Northwest Passage will benefit from the melting ice cap. New channels will create cheaper shipping costs.

Losers

Forests throughout the United States have been suffering for years. A shorter winter means that many pests, such as the pine bark beetle, are not dying off in the winter. As a result, they are killing millions of trees. Warmer summers have led to an increase in forest fires. The dead trees have increased the intensity of these fires, leading to destruction of timber and danger to people, property and wildlife. 

Longer summers have lengthened the allergy season.

Asthma and allergy sufferers will pay for increased health care costs. Stanford University professor Mark Jacobson estimated that 1,000 people would die from air pollution for every 1 degree Celsius rise in global temperatures. 

The National Academy of Sciences predicted that melting ice caps will cause the ocean to rise at least four inches by 2100. That would be enough to flood coastal Florida and the Carolinas. Waters could rise as much as four feet. That would be enough to wipe out Shanghai, Hong Kong, the Netherlands and Bangladesh.

Warmer and rising oceans could shift the North Atlantic current away from Europe. Most of Europe is north of the state of Maine. Without the warm waters of the current, Europe will become as cold as Newfoundland.

Increased Hurricanes Cost Billions

More than half of Americans believe that global warming increases the size and frequency of hurricanes and other extreme weather events.

That's more than the 39 percent who said so 10 years ago. 

Here's a record of hurricane damage to the economy. In 2005, Hurricane Katrina created $108 billion to $250 billion in damage. It caused GDP to decline from 3.8 percent in Q3 to 1.3 percent in Q4 2005. In 2008, Hurricane Gustav and Hurricane Ike hit the United States. Though they did not cause as much damage, they support the trend of more frequent and more severe hurricanes caused by global warming.

In 2012, Hurricane Sandy flooded New York City at its 500-year flood mark. It cost $70 billion in damage. That means flood insurance could increase by $2,000 per person per year

Scientists predict that hurricanes like Sandy will occur every 25 years on average. By 2030, they will hit New York every five years. That's because rising sea levels make storm flooding that much worse. As a result, New York's subway system would experience regular flooding.

In 2017, Hurricane Harvey dropped 51 inches of rain on Texas in four days. It forced 30,000 people out of their homes in Houston. Experts predict the damage will be at least $150 billion. Then Hurricane Irma devastated Florida, creating $100 billion in damage.

Climatologists agree that global warming make hurricanes like Harvey worse. First, it raises temperatures. Warm air holds more moisture, so less rain falls during normal storms. Instead, it dumps buckets during the strongest storms. In the last 50 years, the amount of precipitation that fell in the heaviest one percent of storms has increased in the United States. Some regions saw a 71 percent increase in the precipitation from their heaviest storms. 

Second, warmer global temperatures melted more polar ice and glaciers. That raised the sea levels around Houston by six inches over the past 20 years. 

Third, global warming has stalled weather patterns in the region. That allowed Harvey to hover over Houston instead of moving back out into the ocean. The convergence of all three effects allowed Harvey to drop feet of rain instead of inches. 

How Global Warming Contributed to Trump's Victory

An article in Der Speigel, Germany's newspaper, observed how global warming might impact U.S. elections. In 2007, the Nobel Committee awarded Al Gore a Peace Prize to send a signal to U.S. policy makers. It was a warning to the United States to live within its means. 

But the Gore factor is having its most powerful effect in a sphere beyond partisan politics, penetrating deep into the insecure American middle class. Its way of life – and this is the real message behind the Nobel Committee's decision – is no longer sustainable.

 

The newspaper predicted that there would be more green party candidates as a result. At first, it seemed to work. In 2007, the Department of Energy invested $1 billion to spur the biofuels industry to reduce greenhouse gases. Over 100 biofuel factories produced 6.4 billion gallons of ethanol using 18 million acres of corn. This was 20 percent of total U.S. corn production, which drove corn prices to a record $4 per bushel. Since most of corn production is used to feed livestock, this caused food prices to increase four percent. (Source: "Biomass 2008: Fueling Our Future," Department of Energy, April 2008. "The Price of Biofuels," MIT Technology Review, January/February 2008.)

But 10 years later, America's "insecure middle class" rebelled against the "Gore factor." In 2016, it elected Donald Trump to the presidency.

On June 1, 2017, Trump announced that the United States would withdraw from the Paris Climate Accord. His 2018 budget slashed funding for climate change research. It cut the Environmental Protection Agency's budget by 31 percent. He ordered the EPA administrator to reverse standards on tailpipe emissions. 

Trump and other Republicans believe sustainable practices will hinder economic growth. But even conservative Newt Gingrich disagreed in his book A Contract with the Earth. He argued that environmental sustainability and economic prosperity are far from mutually exclusive. He said, "if environmental quality declines enough, the economy won’t be able to function at all.”

What You Can Do

If you want to support efforts to reduce global warming, there are some simple steps you can take. Cut your heating bill by living in a small house and ensuring it has good insulation. Buy EnergyStar home appliances. Eat less meat. Purchase more local products to cut down on emissions from shipping. Turn off lights and unplug appliances when not in use. 

The way you drive and maintain your car can significantly improves mileage. Keep the tires inflated, change the air filter, accelerate slowly after a stop, and drive under 60 miles per hour. That will reduce your emission of greenhouse gases. For more great tips, see "Mean Machine," The Economist, April 9, 2007. (Source: Intergovernmental Panel on Climate Change, 2014.)