Climate deniers tell us we will simply “adapt” to changes in climate. But when our built infrastructure, as well as the financial infrastructure that props it up, is predicated on predictable climate of the 20th century, which no longer exists, well, that’s a problem.
So we need to adapt, but climate is changing so fast that we are not even sure what the worst case scenario would be like at any given moment, because the background conditions have shifted so quickly.
Bloomberg has a good new piece on this. The part that popped out to me was one expert’s observation, that when “Every part of our financial and legal system at this point is devoted, singularly devoted, to keeping the status quo in place, ..It will be difficult for us to adapt.”
Also below, 3 UK experts explain the rapidly changing baseline.
Bloomberg:
Years ahead of the financial crisis, David Burt saw trouble brewing in subprime mortgages and started betting on a crisis, winning himself a cameo in The Big Short by Michael Lewis in addition to lots of money. Now Burt runs DeltaTerra Capital, a research firm he founded to warn investors about the next housing crisis. This one will be caused by climate change.
In a webinar with journalists last month, Burt argued that US homeowners’ wildfire and flood risks are underinsured by $28.7 billion a year. As a result, more than 17 million homes, representing nearly 19% of total US home value, are at risk of suffering what could total $1.2 trillion in value destruction.
“This is not a ‘global financial crisis’ kind of event,” Burt said, noting the total housing market is worth about $45 trillion. “But in the communities where the impacts are happening, it will feel like the Great Recession.”
Burt’s estimate may actually be on the conservative side. The climate-risk research firm First Street Foundation last year estimated that 39 million US homes — nearly half of all single-family homes in the country — are underinsured against natural disasters, including 6.8 million relying on state-backed insurers of last resort.
The issue is that in many parts of the US, insurance premiums don’t reflect the risk of climate-fueled catastrophes, which is growing as the planet warms. A record 28 weather disasters in the US last year did $1 billion or more in damage, according to the National Oceanic and Atmospheric Administration. This year is on pace to at least match that record, with 15 such events so far — a tally that doesn’t yet include Hurricane Beryl, which might have caused $30 billion in damage.
Continue reading “When “Adapting” Becomes Impossible”
