Bill Knight column for Thurs, Fri, or Sat., May 18, 19 or 20
The insurance industry is probably the most vulnerable to the financial consequences of climate change. Already, storms occur more often and with greater severity, according to the Federal Emergency Management Agency (FEMA), which adds that rising water alone will increase areas of higher risk for flooding by 45 percent by the year 2100, almost doubling the number of flood-prone properties.
The number of declarations of major disasters, meanwhile, has increased five-fold in the last 30 years, FEMA says, from a median (midpoint) of 103 annually in the last 30 years compared to a median of just 24 in the previous three decades. There were 103 last year, and 34 already through May 14.
Storms that hit the Midwest in March cost insurance companies about $1.7 billion, with Illinois alone costing insurers about $300 million between January and April, according to Aon Benfield, a reinsurance firm, and $225 million of that was between Feb. 28 and March 2 due to severe weather, the type that authorities say is becoming the rule rather than the exception.
Besides private insurers, the 45-year-old National Flood Insurance Program (NFIP) helps cover losses, but disaster funding isn’t in the federal budget. Such relief is considering “emergency spending,” while preparedness is chronically underfunded. So the government spends billions afterward but little beforehand. The Government Accounting Office says the NFIP is about $24 billion in debt, which led to the Homeowner Floods Insurance Affordability Act of 2014, seeking to phase out subsidized flood insurance for more than a million people by raising premiums some 10 percent and encouraging elevating structures in flood-prone areas.
As the Oval Office Occupant continues to postpone action on U.S. involvement in the Paris climate agreement that the Obama administration signed, other, respected voices urge participation.
It would be unfortunate if the Trump administration chose to relinquish leadership on climate change, says Natalie Mahowald, a professor in Cornell University’s Department of Earth and Atmospheric Sciences.
“Not only is climate change and the movement to sustainable energies important for the environment, it also represents and huge new business opportunity,” Mahowald says. “Since the U.S. excels at technological innovation, and our business competitors in Europe and Asia are committed to converting to sustainable energy, trying to stall U.S. conversion to sustainable energies will adversely impact U.S. business.”
About 70 percent of U.S. citizens favor remaining in the Paris agreement, according to a survey by the Chicago Council on Global Affairs. Further, Fortune 100 companies are voicing strong support for remaining in the Paris accord, wrote George Shultz and Ted Halstead last week in the New York Times.
“The breadth of this coalition is remarkable: industries from oil and gas to retail, mining, utilities, agriculture, chemicals, information and automotive,” they said. “This is as close as Big Business gets to a consensus position.”
Schultz was Secretary of State under Ronald Reagan and Secretary of the Treasury under Richard Nixon, and Halstead is the president of the Climate Leadership Council.
“Our companies are best served by a stable and predictable international framework that commits all nations to climate-change mitigation,” they wrote. “The Paris agreement overcame one of the longest-standing hurdles to international climate negotiations: getting the developing world, including China and India, onboard. If America backs away now, decades of diplomatic progress could be jeopardized.”
The effects of climate change also pose a national security threat, according to some military leaders.
Speaking to an American Security Project conference at the University of Pittsburgh in February, Rear Admiral David Titley (USN) described three reasons why climate change must be on policymakers’ agenda: “It’s all about people, it’s not polar bears,” he said. “It’s about water – too much, too little, wrong place, wrong time. Finally, it’s about the change.”
Another military leader and the 34th President of the United States in remarks to U.K. Prime Minister Harold Macmillan in 1959 indicated the importance of public opinion.
Dwight D. Eisenhower was talking about peace, but the Republican and former Army General could just as easily have been addressing climate change and the need for politicians to actually represent constituents.
“I like to believe that people in the long run are going to do more to promote peace than our governments,” Ike said. “Indeed, I think that people want peace so much that one of these days governments had better get out of the way and let them have it.”
[PICTURED: Illustration from The Green Market Oracle.]b>