Climate change: Australia and US are moving in opposite directions

Extract from The Guardian

While the Liberals move to dismantle the carbon price, a new report in the US highlights the huge risks involved

The Risky Business report asserts that rising temperatures mean that some US states face up to a 73% average crop yield loss by the end of the century. Photograph: Graham Turner for the Guardian

Greg Jericho

Monday 30 June 2014 12.32 EST

The difference between the position of the Australian and the United States governments on climate change looks stark. Last week members of the Australian government celebrated the passing of a bill dismantling the carbon price, while last Wednesday US president Barack Obama delivered a speech arguing strongly for the need to act on climate change.
Obama’s speech came off the back of the announcement earlier in the month that the US Environmental Protection Authority was proposing new rules to force the power sector to cut carbon dioxide emissions by 30% on 2005 levels by 2030.

Last week as well, a new report on the economic impacts of climate change was issued by a bipartisan organisation headed by the “Risky Business project”, which is co-chaired by former republican mayor of New York city Michael R. Bloomberg; Henry Paulson, the former CEO of Goldman Sachs and the secretary of the treasury under George W Bush; and Tom Steyer, a billionaire hedge-fund manager with a long history of environmental philanthropy.
The Risky Business project seeks to look at the impact of climate change on the US from an economic perspective.

It is not the first climate change report to take this approach. The Stern Review issued in 2006 examined the impact of climate change on the world economy. The Risky Business report, however, looks purely at the US and argues that the response to climate change is essentially about mitigating risk.

Again this approach is not new. Even Rupert Murdoch’s essentially fatuous remark that “we should give the planet the benefit of the doubt” was based on risk management. In 1990 Margaret Thatcher was arguing much the same.

But the Risky Business report takes this approach a step further than other such reports by using econometric and climate change modelling to forecast the impact of climate change at a regional level of detail. And rather than talk just about increasing in temperatures in these regions, it talks about the impact of those temperatures on people’s livelihoods.

While the sole focus on the US and its specific regions may seem like typical American insularity, it is more about acknowledging that all politics is local.

As Upton Sinclair noted, “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”

And if that person is a corn farmer in Iowa, telling him about the impact of climate change on the Pacific Islands is unlikely to do the trick (important though it is).

President Obama noted the need to address this aspect in his speech, saying, “People don’t like gas prices going up. They don’t like electricity prices going up. And we ignore those very real and legitimate concerns at our peril, so if we’re blithe about saying this is the defining issue of our time but we don’t address people’s legitimate economic concerns, then even if they are concerned about climate change they may not support efforts to do something about it.”

The Risky Business report addresses these impact by noting the increase in temperatures across the continental US under various scenarios:

Projected and historical days over 37 degrees US. Photograph: Risky Business report/Rhodium

But it notes that these increased temperatures will drive an increase in electricity consumption owing to more people using air conditioners more often. The report argues that higher peak demand for electricity “will likely require the construction of up to 95 GW of additional power generation capacity over the next five to 25 years, the rough equivalent of 200 average-size coal or natural gas power plants”.
It argues “constructing these new power-generation facilities will, in turn, raise residential and commercial energy prices”. Thus, “climate-driven changes in heating and cooling will likely increase annual residential and commercial energy costs nationally by $474m to $12bn over the next five to 25 years and $8.5bn to $30bn by the middle of the century.”
The report also notes the impact of the increased temperatures on industry – with an especially harsh impact on crop yields. It asserts that some states “like Missouri and Illinois, face up to a 15% likely average yield loss in the next five to 25 years, and up to a 73% likely average yield loss by the end of the century”.

It also forecasts the humid heat stroke index (HHSI) in each region. The index measures the point at which people who work outdoors would be unable to do so without significant risk to health and potential death.

The report notes that “the only place in the world that has ever reached the unbearable HHSI of 95°F (37C) was Dhahran, Saudi Arabia, in 2003. At the time, the outside temperature was 101°F (38.5C) and the dew point was 90°F (32C)”.

But such temperatures are headed to the US midwest. It forecasts that on the current path of temperature rises “the average midwesterner could see an HHSI at the dangerous level of 95°F two days every year by late century, and that by the middle of the next century she or he can expect to experience 20 full days in a typical year of HHSI over 95°F”.

Humid heatstroke index for the US. Photograph: Risky Business report/Rhodium Group

But American climate change politics does have one similarity with Australia – the opposition to it. Republicans in congress reacted to the EPA’s new rules by suggesting the Obama administration was waging a “war on coal” and they were likely to try and block the new rules.

Economist Paul Krugman responded to Henry Paulson’s op-ed in the New York Times launching the Risky Business report by noting that the Republican party which “respects science and is willing to consider even market-friendly government interventions like carbon taxes, no longer exists”.

Given our government has dismantled a carbon tax, during which time Australia’s economy grew among the fastest of all OECD nations, Krugman’s comment might just as well be targeted at the Liberal party:

At least with reports like Risky Business politicians the world over have pretty much run out of the excuse of saying they weren’t aware of the risks.