Cross-posted from Wonk Room.
Yesterday, Doug Elmendorf, the director of the Congressional Budget Office (CBO), testified before the Senate energy committee about the “comparatively modest” cost of a cap-and-trade system to limit carbon pollution. The Washington Post and Wall Street Journal blared “Congressional Budget Chief Says Climate Bill Would Cost Jobs” and “Cap-and-Trade Would Slow Economy, CBO Chief Says.” Conservatives leapt on the reports to cheer the “end” of “cap-and-tax.”
Of course, Elmendorf’s testimony is nothing new. Elmendorf warned that jobs in the fossil fuel industry would be lost, and that overall GDP growth would be slowed by less than one percent by 2020. No one is arguing that there won’t be a shift from pollution-based industries to clean-energy industries. But doing so will create millions more jobs than are lost, as energy companies invest in American workers instead of foreign oil and mountaintop removal. The effect on GDP is within the margin of error of future estimates of growth. Even pessimistic studies by the National Association of Manufacturers find that U.S. GDP will increase by $9 trillion with limits on carbon pollution.
What upset me, however, was the portion of Elmendorf’s testimony that was not reported. Although he recognized that his estimates do not take into account the economic impacts of climate change, he testified that the changes that scientists call “catastrophic” would be barely noticeable in the U.S. economy:
Most of the economy involves activities that are not likely to be directly affected by changes in climate. Moreover, researchers generally expect the growth in the U.S. economy over the coming century to be concentrated in sectors — such as information technology and medical care — that are relatively insulated from climate effects. Damages are therefore likely to be a smaller share of the future economy than they would be if they occurred today. As a consequence, a relatively pessimistic estimate for the loss in projected real gross domestic product is about 3 percent for warming of about 7 degrees F by 2100. [Dale W. Jorgenson et al., 2004]
Elmendorf goes on to cite Nordhaus & Boyer (2000) to claim “the risk of catastrophic outcomes associated with about 11 degrees F of warming by 2100″ gives a projected “loss equivalent to about 5 percent of U.S. output and, because of substantially larger losses in a number of other countries, a loss of about 10 percent of global output.” (By way of comparison, U.S. GDP collapsed by nearly 50 percent during the Great Depression.)
This is frighteningly nonsensical. The CBO is arguing that the collapse of the national electricity grid, water supply, food system, and physical infrastructure from heat waves, desertification, disease outbreaks, wildfires, floods, and catastrophic storms would barely affect the national economy. In fact, 7 to 11 degrees F (4 to 6 degrees C) warming would lead to unimaginable changes in our planet by 2100:
– One to three billion people around the world exposed to “increased water stress” (aka drought)
– More than 40 percent of the world’s species go extinct
– Widespread coral reef mortality
– Terrestrial biosphere becomes a net carbon source
– Productivity of cereal grains decreases in low, mid, and high latitudes
– Sea level rise of 0.6 – 1.3 meters (2 to 4 feet)
– About 35 percent of global coastal wetlands are lost
– Twenty percent of world’s population exposed to increased floods
– About 20 percent of arable land disappears (same amount becomes arable in previously frozen north)
– Arctic warms by 27 degrees F
The effects in the United States would be similarly disastrous:
– heat waves of greater than 90 degrees F six months of the year in Texas, Florida, Arizona, southern California
– 5-month heat waves in California interior, Oklahoma, Louisiana, Arkansas, Mississippi, Georgia, South Carolina
– 4-month heat waves in Kansas, Missouri, Tennessee, North Carolina
– 4-month heat waves greater than 100 degrees F in Texas, Arizona, southern California
– 3-month heat waves greater than 100 degrees F in Louisiana, Arkansas, Oklahoma, California interior
– 2 to 3-month heat waves everywhere in U.S. except New England, northern Great Lakes, and the mountains, Pacific NW coast
– 1 to 2-months of greater than 100 degrees F everywhere except New York-New England, northern Great Lakes, mountains, Pacific NW coast
– 40 percent less precipitation in the Southwest
– Dust Bowl returns to Midwest
– Smog levels throughout summer above 10 ppb all across country
– Pollen count doubles again to four times pre-industrial levels
– Doubling of large wildfires in the West, as aspen and lodgepole pine disappear completely
– Tripling of coastal damage from storms
– Inundation of 10,000 square miles of U.S. land, including 25 to 80 percent of coastal wetlands
Texas and California, our top agricultural states, are already suffering from unprecedented heat and drought. Under 7 to 11 degrees F warming, they would no longer be able to support agriculture. Corn crops start failing at above 90 degrees F weather, and soybean fails above 100 degrees F. There would be no snow, maple, or cranberry industries in New England. The economists’ argument is that since the U.S. agriculture industry only represents about three percent of GDP, its total devastation would be hardly noticeable.
The above figures are actually misleading, because these are just the effects estimated under 4 degrees C (7 degrees F) warming, not the even more unimaginable 6 degrees C (11 degrees F). Scientists are now warning that our current emissions levels may lead to 4 degrees C (7 degrees F) warming by the 2070s.
It should also be noted that this kind of catastrophic warming would guarantee the long-term collapse of the Greenland and west Antarctica ice sheets, leading to sea level rise of over 12 meters (39 feet) in about 300 to 1000 years. But hey, I guess economists would argue that would spur growth in the floating-city industries.