October 4, 2023

Time to Wake Up 290: The Economic Costs of the Climate Crisis

Mr. President, I am back for now the 290th time to urge this Chamber to act on climate change. I have my trusty graphic here, which after nearly 300 of these is getting a little battered.

 This evening, I would like to talk about two things: First is the grim parade of climate-driven disasters the United States and the world has experienced over the last several months. Then, our hearings in the Budget Committee on the enormous budgetary and economic dangers caused by fossil fuel emissions.

Let’s start with the unprecedented warming the world is experiencing. This June was the hottest June on record. Then July became the hottest month on record. Then August became the hottest August and the second hottest month on record, and September was just declared the hottest September on record and by the largest margin. Here is what that looks like when you compare it to previous years.

We have popped out of the zone of previous experience. So 2023 will almost certainly become the hottest year on record, with the first significant chance that global average temperature will hit 1.5 degrees Celsius warmer than the preindustrial average. Exceeding that 1.5 degree-Celsius point will expose us to dangerous tipping points, things like ice sheet collapses that could cause dozens of feet of sea level rise.

More than 6,500 daily heat records were broken in cities and towns across the United States this summer. Phoenix experienced a record 55 days this year with temperatures above 110 degrees, with a 31-day streak. People who fell on Phoenix pavement required medical attention for burns. The Midwest experienced its worst drought in over a decade, with huge swaths of the Midwest, Southwest, and the South still under the most severe drought designation. Extreme drought in Hawaii set the conditions for its lethal wildfire.

In Vermont, New York, and Pennsylvania, storms triggered deadly floods. Florida’s gulf coast was hit by Hurricane Idalia, which intensified rapidly over warmed-up waters of the Gulf of Mexico. Wind speeds increased almost 55 miles per hour in just a 14-hour window. Around the world, Europe baked; China hit record high temperatures; Italy suffered its worst flooding in a century; and more than 21,000 Libyans are dead or missing after massive flooding.

Recordbreaking fires ravaged Greece and Canada. Canada’s fires burned an area roughly the size of Oklahoma.  Here is the annual acreage of Canadian wildfires, and here is this year. Top year before, down here. This is what we got last year. The smoke from these fires blanketed the eastern seaboard for weeks. Here in Washington, doctors said that breathing the smoke-choked air was worse than smoking a half pack of cigarettes. New York looked like this.

The list of unprecedented, recordbreaking, and worst in history climate events goes on and on. These disasters seen separately fail to capture the full scale of the problem. When you look at them together, you see that we are creating a climate for our own habitation unlike any in the history of humankind.

We are increasingly testing the limits of human habitability on this planet, and it will worsen if we don’t act— which brings us to the Budget Committee.

Set aside the destruction of lives and livelihoods, the 250,000 deaths around the world each year caused by fossil fuel emissions. Look just at the financial havoc. Last year, weather-related damage in the United States topped $165 billion, the third costliest year on record. This year, we have had 23 separate billiondollar climate disasters already, and that is just counting direct, physical damage. Just now, in the CR, we had to add $16 billion in disaster relief funds, and that is only a stopgap.

Failing at our climate responsibilities is immoral, but it is also irresponsible, fiscally irresponsible.

So the Budget Committee did a deep dive into the fiscal costs and risks of climate change. Across 10 Budget Committee hearings already this year, central bankers, financial experts, economists, insurance executives, political leaders, and other responsible experts described increased budget costs and systemic risks looming over the U.S. economy.

What is ‘‘systemic’’? Systemic means that the damage spreads beyond the immediately affected sector and cascades throughout the economy. Remember 2008 when a meltdown in the mortgage market cascaded through the economy and brought the Great Recession? Between October 2008 and April 2009, 700,000 Americans lost their jobs every month. American households lost $17 trillion in wealth. The Federal Government’s debt grew by $5 trillion from lost revenues. Our economy still carries the scars.

And in one of our Budget hearings, a former chief economist from Freddie Mac said that climate change could cause a crash in coastal property values that would be just as bad. Just as bad. Sea level rise and worse coastal storms are on their way to making more than a trillion dollars in coastal real estate uninsurable and, therefore, unmortgageable, and that is when you get that crash—not when the water pours in across your doorstep, but when 30-year mortgages won’t cover your property because that risk of the water coming over the doorstep is so foreseeable.

And it is not just coastal property either, we heard. There is a whole separate risk from wildfires that a similar death spiral occurs for Western property values, and we had a hearing on that. The other systemic threat we had a hearing about is that the fossil fuel industry is artificially propped up, both by massive political subsidies and crooked international cartel pricing and that, as inevitably declining demand for its products occurs, that, in turn, will cause a dash for the exits— when other countries that pump enormous amounts of oil and gas abandon the cartel pricing, sell it for what they can get, the dash for the exits. When that happens, it will strand hundreds of billions of dollars in fossil fuel assets in what is called a carbon-bubble collapse.

Each of these three systemic risks is well documented. Each could create a massive economic crash. And added to that is the steady, relentless cost increases, the climate inflation from insurance prices, from lost and damaged infrastructure, from increased healthcare needs, and from climbing food prices as increased temperatures, higher sea levels, and precipitation anomalies break up world food supply patterns. We have had hearings on those, too.

At our very first hearing, a former governor of the banks of England and Canada and a former Director of the nonpartisan Congressional Budget Office and Goldman Sachs former head of risk management all underscored the economic urgency of solving climate change and the foreseeable hit of climate change on public budgets. They all suggested that a price on carbon so polluters pay for harms they cause would be fiscally and economically responsible.

One Republican member of the committee embraced a domestic price on carbon and noted that a carbon border adjustment—a tariff on imports from carbon-intensive economies such as China’s—would use market forces to decarbonize the global economy. I couldn’t agree more. I have had that bill in the Senate for years, a carbon price with a border tariff. A later hearing brought conservative support for that kind of climate action from former Australian Conservative Prime Minister Malcolm Turnbull and former Republican Majority Leader Bill Frist.

Up against our serious, nonpartisan, and knowledgeable witnesses—among them witnesses with real fiduciary obligations and real economic stakes with every motive to get it right—the Republican witnesses often spouted fossil fuel disinformation, often funded by dark money industry front groups.

We heard some beauties—one witness, a former mouthpiece of the tobacco industry, stated that secondhand smoke was not a public health issue because “lung cancer and emphysema are not contagious,” like that is the problem.

One witness produced cherrypicked and misleading testimony so easily refuted that even the fossil fuel friendly Montana Attorney General dropped her off his witness list in the youth climate case he was defending, a trial that the young plaintiffs won against the State of Montana, by the way. Another witness informed us that sea level rise was nothing to worry about because New York, Miami, and Boston will all just move.

Republican witnesses spouted the usual debunked falsehoods, that renewable energy is expensive, that the fossil fuel industry isn’t subsidized, that the science around climate change is uncertain, that transitioning to clean energy will be bad for the economy. It is all nonsense, and they say it anyway. One witness even tried to accuse the financial services sector of having a conflict of interest behind what she called its climate alarmism. But then she had to admit, under examination, that the fossil fuel industry was the one with the economic incentive to minimize climate dangers and shouldn’t be trusted as a reliable source.

Many of the Republican witnesses have made careers out of being industry shills, sheltered in a fossil fuel funded array of front groups like the Competitive Enterprise Institute, the American Enterprise Institute, and the Heritage Foundation just to be trotted out for hearings like these. Well, our hearings began in February, and they got very often this response from the other side. But let us take a look at what we warned about and what happened since. Well, first of all, there is that accelerating cascade of climate disasters that I discussed at the beginning of the speech, so I won’t relitigate that. Let us go on to insurance.

Our hearings in February and March warned of turbulence ahead in the insurance industry. These predictions are already coming true—hearings in February and March. By July, insurers were exiting or reducing exposure in California, Florida, Texas, and Louisiana markets, and reinsurers exited Iowa—all citing exposure to climate-related losses. In Florida, homeowners’ premiums have spiked to nearly four times the national average with a 40-percent increase this year predicted. There are already signs that insurance affordability and availability are beginning to disrupt Florida’s real estate market, exactly as foretold in our hearings, and I doubt Florida’s State insurance fund is solvent.

And don’t think it is just Florida. Here is where climate risks are hitting home insurance markets. A lot of it is along the coast here, where hurricanes and sea level rise and increased storm and tide damage is putting homeownership at risk. You will notice that the entire State of Florida is covered.

But then out here, you get into wildfire-adjacent areas where the wildfire risk is already causing problems in the home insurance markets. In the face of these risks, all across the country, up against truly distinguished witnesses, real grownups who know what they are talking about, whose warnings are already coming true, Republicans frequently put up fossil fuel front group mouthpieces, paid not to understand the facts. Sadly, it is a sign that fossil fuel mischief persists.

So in our 11th hearing, we showed how the fossil fuel industry has known for almost seven decades about these dangers they deny. As early as the 1950s, industry scientists left records of their warnings about climate change. They were measuring and predicting it. Industry scientists were measuring and predicting it, and they knew their fossil fuel products were causing it.

In 1977, Exxon Senior Scientist James Black told Exxon’s management committee—I am quoting him here, “There is general scientific agreement that the most likely manner in which mankind is influencing the global climate is through carbon dioxide release from the burning of fossil fuels.” Nineteen seventy-seven, that is what Exxon’s scientists told Exxon’s management.

Well, other scientists noticed it, too. And Congress began pursuing legislation that would have addressed climate dangers. Big Oil responded with billions of dollars in fossil fuel funded disinformation, lobbying, and dark money election spending. They are still at it, as the more preposterous witnesses attested by their presence.

It wasn’t always so. During my first years here in the Senate, climate legislation was bipartisan. John McCain ran for President on a serious climate platform. But in January 2010, the Citizens United decision set loose a barrage of political spending by the fossil fuel industry. Worse, the Court allowed that spending to be secret, to hide the identity of the spender.

The fossil fuel industry was ready with unlimited dark money and—and—with the secret threats and promises that the ability to spend unlimited dark money allows you to make. And between the spending and the threats and the promises, the fossil fuel industry snuffed out bipartisanship on climate like that. From January of 2010, the date of Citizens United forward, no Republican has gotten on a serious climate bill in the Senate.

Collectively, fossil fuel interest through trade organizations and through their dark money front groups have spent billions of dollars that we know of so far on ads, on lobbying, on campaign contributions, and on super PACs. Super PACs, by the way, didn’t exist before Citizens United. That monstrosity is a creation of Citizens United and dark money. The delay in climate action that those billions of dollars bought has directly caused the economic perils that our hearings have spotlighted.

Organizations like the Cato Institute, the Heritage Foundation, the American Enterprise Institute, the Competitive Enterprise Institute, by 2021 had received over half a billion dollars from fossil fuel and other dark money interests.

This is the web of various fossil fuelfunded front groups, with the bulk of the funding unidentified. That is the dark money blob in the middle of this web. Here are some of the key groups into which political money flowed to support climate denial and climate skepticism. Political money flowed through anonymizing intermediaries into Republican super PACs. Lobbyists from industries and trade associations crawled around this building. They spent a fortune.

But for all the billions that they spent, this political and propaganda effort was a bargain—a corrupting bargain but a bargain. The International Monetary Fund calculates, using a peer-reviewed procedure, that we subsidize fossil fuels by $760 billion—billion—annually in the United States alone. Seven hundred and sixty billion dollars is the subsidy the IMF points out that the fossil fuel industry floats on in this country. So let’s say the fossil fuel industry spent $7.6 billion on political influence and secret corruption schemes every year. They would be pocketing a subsidy dollar for every political-influence penny that they spent if they protected their $760 billion subsidy.

It is the best money they could possibly spend. It is more rewarding than drilling for oil. But while corrupting Congress may have been a bargain for them, the price of a corrupted Congress was very high for everyone else.

We lost an essential decade from the Citizens United decision in January of 2010 and our passage of the IRA—the first serious piece of climate legislation passed by Congress. More than $10 trillion of our national debt stems from the 2008 financial crisis—a warned-of economic shock—and the COVID pandemic—another warned of shock. Those trillions of ‘‘shock debt’’ amount to 40 percent of our total national debt. Climate disruption shocks are looming, predicted, clearly predicted, just like climate change and its consequences were predicted, clearly predicted.

Now, as we have seen, the climate change consequences are here. The shocks are still looming. I will close by saying that the threat from climate change to the Federal budget is probably the least of our climate worries as we think about the damage we are doing to the natural systems that have made Earth habitable for humankind; as we think about new diseases and dangers and destruction; as we think about wars and suffering as resources shift and global scarcity replaces global abundance; as we think about the lost species, the lost places of beauty, the lost natural harmonies, the lost human traditions, the trout stream you can’t teach your granddaughter to fish at because the trout aren’t there.

By some measures, the money is the least of it. But here in Mammon Hall, we seem to care most about the money.

So our Budget Committee hearings have made clear that warnings abound of what droughts, floods, wildfires, and heated, rising seas will do economically to American families and businesses and to our Federal budget. The long-predicted damage has already begun. It has gone beyond science predictions.

It is now within the fiduciary horizons of businesses that are having to report to shareholders on climate risks because it has become so real and so immediate that their fiduciary obligations demand that reporting. That is why the fossil fuel industry cooked up this whole phony anti-ESG show that they have put on to try to push back against the fiduciary obligations that so many corporations are feeling obliged to meet. These looming, systemic, economywide threats are real.

Nothing says that it is going to be either the coastal crash or the wildfire crash or the carbon bubble crash. Nothing says that all three can’t happen. If we are to be serious about debt and about deficits and about federal spending, we better damn well be serious about climate change.

It is, as my trusty old graphic says, time to wake up.

I yield the floor.