Following up on the post I wrote on Monday (https://franklytalking.com/is-the-coronavirus-pandemic-sending-us-a-wake-up-call-on-climate/) I am attaching two more articles about how ill prepared the U.S. is for anticipating and preparing for a rapid change in the climate and the consequences thereof. Just look at the title of this post and think of how totally incompetently the current Administration is in dealing with the current Pandemic to contemplate what is coming, as I’ve said time and again, like a runaway freight train coming right at us.
I’m simply going to let the quotes from these articles tell the story…it will sound very familiar to what you’re hearing on the news now every night.
“The authors say governments should take advantage of the time they have now to fix these increasingly fragile systems. Once they start to slide, the transformation will be quick.”
“understanding how changes are actually likely to occur — slowly and then all at once — may be the first step in addressing them”
“Financial risk experts warned Democratic lawmakers yesterday that climate change likely would lead to catastrophic economic distress — and that the United States is woefully unprepared for the fallout.”
“Litterman described the United States’ progress on climate risk as “unconscionable.” He noted the Federal Reserve so far has refused to join more than 50 of its foreign counterparts in supporting the Network for Greening the Financial System — a global coalition pushing the financial sector to meet the goals laid out in the Paris Agreement.”
“a panel of witnesses said Congress and federal regulators must move quickly if they hope to shield the United States from climate-related threats to the global economy.”
“There was resounding consensus among lawmakers and witnesses that setting a carbon price would be the most effective response because it would force financial markets to abandon industries that are the principal drivers of climate change.”
“what’s most important is protecting against drastic financial turbulence, the kind that can “drag down the entire economy.””
“it’s past time to begin pumping capital into climate-friendly sectors and solutions.
“We have to change the incentive system. It’s a bug in the tax code,” Litterman said. He said the coronavirus pandemic and the 2008 financial crisis are examples of other instances when major risks weren’t adequately priced into the markets — with catastrophic results.”
“The U.S. is so far behind in dealing with these issues that it is almost embarrassing”
Global Tipping Points Could Arrive in a Matter of
Years
E&E Climatewire
Wednesday, March 11, 2020
A new study published yesterday in Nature Communications examines the mechanics of these tipping points in 40 separate ecosystems, including forests, coral reefs and marshes. Drawing on preexisting studies and modeling, the authors suggest that the apparent stability of the world’s largest ecosystems is “a deceptive guide to the potential speed of their collapse.”
The findings bring new rigor to the study of how ongoing pollution and degradation of earth systems may transform the global environment. While precise predictions are still out of reach, the authors write, “we must prepare for regime shifts in any natural system to occur over the ‘human’ timescales of years and decades, rather than multi-generational timescales of centuries and millennia.”
The authors say governments should take advantage of the time they have now to fix these increasingly fragile systems. Once they start to slide, the transformation will be quick. The Amazon rainforests, they write, could become open savannah within a half-century. Caribbean coral reefs might need just 15 years to die off.
The analysis joins a rapidly expanding collection of studies trying to bring light to risks to the earth systems most critical to ecological stability and human systems. This larger body of work also focuses on the Atlantic warm-water currents that keep Europe temperate, African and Indian monsoons, and melting polar ice sheets that contribute to rising seas.
In everyday life, cause-and-effect, linear thinking can take people quite far. But understanding how changes are actually likely to occur — slowly and then all at once — may be the first step in addressing them, particularly when it comes to the planet’s massive carbon-storing rainforests. “There are effective actions that we can take now, such as protecting the existing forest, managing it to maintain diversity, and reducing the direct pressures from logging, burning, clearance and climate change,” said Georgina Mace, professor of biodiversity and ecosystems at University College London, in a statement. — Eric Roston, Bloomberg
Financial Experts Warn Panel About the Risk of Inaction
Avery Ellfeldt
Friday, March 13, 2020
Rhode Island Sen. Sheldon Whitehouse and other Senate Democrats heard testimony yesterday from financial analysts who said the U.S. so far is unprepared to handle the economic impact of climate change. Francis Chung/E&E News
Financial risk experts warned Democratic lawmakers yesterday that climate change likely would lead to catastrophic economic distress — and that the United States is woefully unprepared for the fallout.
In testimony before the Senate Democrats’ Special Committee on the Climate Crisis, a panel of witnesses said Congress and federal regulators must move quickly if they hope to shield the United States from climate-related threats to the global economy.
Sen. Sheldon Whitehouse (D-R.I.), who led the hearing, seemed to agree. “We had better get off our butts,” he said.
There was resounding consensus among lawmakers and witnesses that setting a carbon price would be the most effective response because it would force financial markets to abandon industries that are the principal drivers of climate change.
Bob Litterman, the former head of risk management at Goldman Sachs Group Inc., said the move would help resolve ongoing “policy uncertainty” among investors and money managers and would send a powerful signal that it’s past time to begin pumping capital into climate-friendly sectors and solutions.
“We have to change the incentive system. It’s a bug in the tax code,” Litterman said. He said the coronavirus pandemic and the 2008 financial crisis are examples of other instances when major risks weren’t adequately priced into the markets — with catastrophic results.
Carbon pricing aside, Sen. Jeff Merkley (D-Ore.) was among the lawmakers who asked the panel to brief the committee on what the Treasury Department, Securities and Exchange Commission, and Federal Reserve should do to protect the U.S. financial system from climate risk. They also wanted to know how the institutions compared with their foreign peers.
“The U.S. is so far behind in dealing with these issues that it is almost embarrassing,” said Sarah Bloom Raskin, a former member of the Federal Reserve Board of Governors and deputy secretary of the Treasury Department.
As an example, she pointed to the Bank of England, which in December made headlines when it announced plans to require that insurers and banks evaluate their vulnerabilities to climate impacts. Carbon pricing projects and task forces on climate disclosure, Raskin added, are also popping up in an effort to reduce the chances of a climate-related economic collapse.
As is the case around the world, the United States can’t adequately price climate risk into the market without “systemic, uniform [and] common disclosure,” Raskin said, which would fall under the purview of the SEC.
Litterman described the United States’ progress on climate risk as “unconscionable.” He noted the Federal Reserve so far has refused to join more than 50 of its foreign counterparts in supporting the Network for Greening the Financial System — a global coalition pushing the financial sector to meet the goals laid out in the Paris Agreement.
Fed Chairman Jerome Powell did, however, recently signal that the central bank is changing its tune when he confirmed it is considering how to ensure U.S. institutions are “resilient to the longer-term risks from climate change” (Climatewire, Feb. 12).
The Fed and SEC have drawn criticism for dragging their feet on these fronts, though some Democratic lawmakers have introduced legislation that would address some of the concern.
The “Climate Change Financial Risk Act,” introduced by Sens. Elizabeth Warren (D-Mass.) and Brian Schatz (D-Hawaii), for example, would require that the Fed include climate change in stress tests that were implemented after the 2008 financial crisis. The “Climate Risk Disclosure Act,” introduced by Democrats in both the House and Senate, would require major companies to report climate-related information to the SEC.
In regard to systemic risk — whether rooted in a pandemic virus or rising global temperatures — Raskin said what’s most important is protecting against drastic financial turbulence, the kind that can “drag down the entire economy.”
“From that perspective, the work of providing markets with a framework with which they can begin to do this pricing accurately is the role of policymakers right now,” she said.
