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October 10, 2024 - 6:30pm
Already reeling from two savage hurricanes in Debby and Helene, Florida was this week hit by Hurricane Milton before it had any chance to fully recover. As the state’s Governor Ron de Santis warned, debris that hadn’t yet been cleared would become projectiles. Rather than increasing arithmetically, the human and economic toll of this storm trio risked rising exponentially. With their estimated damages now exceeding $100 billion, the hit to the state’s economy is approaching a tenth of its annual output.
Were Florida an independent country, that scale of damage would make it collapse. It would probably produce a chain reaction of crises, with tumbling property values triggering a collapse in the banking system. Fortunately for Florida, it happens to be part of the world’s biggest economy. Federal funds will help residents avoid the worst forms of indigence, the central bank will ensure the financial system remains liquid, and the rest of the US economy will provide the economic demand that enables the state economy to rebound afterwards.
Still, the American economy is ill-prepared for the rising frequency and intensity of such compound weather events. Of the 10 costliest extreme weather events to have ever happened in the US, six occurred in the last decade, the result of climate change intensifying weather patterns. Scientists are expecting more of them in the future, some unprecedented in scale and character. For instance, there is the threat of a killer storm hitting during a heatwave and knocking out both the power supply and the windows. Apartment blocks built without adequate air flow on the assumption the air conditioning would always be running would then turn into potential death traps for their more vulnerable residents.
The economic hit to output from such events is normally brief, as the subsequent clean-up and rebuilding makes up for the lost output. But given their rising frequency, such events are now producing more lasting effects. Recurrent supply shortages are driving up prices, especially on food, and some economists expect the effect on inflation to become permanent. Insurance policies are being re-priced, and in some places properties are becoming unmarketable. Falling property values will then knock the chain of assets backed by them, such as banks and real-estate trusts. Equally, businesses which are themselves not prepared for such recurring events, say with inadequate infrastructure that will need upgrading, may find their own assets re-priced.
This won’t be sudden, and so won’t lead to anything like the financial panic triggered by the 1906 San Francisco Earthquake, which ultimately led to the formation of the Federal Reserve. More likely, it will play out over years, in the form of higher long-term interest rates and lower asset values — at least in relative terms. In the long run, though, that sort of frog-in-boiling-water scenario may be worse than a sudden fall that leads to systemic change. For instance, the vast pool of wealth tied up in pension funds, which themselves base their payouts on anticipated future returns that may not materialise, could one day face a moment of reckoning rendered more severe by its postponement.
America may ride out this storm, but there are many more to come.
John Rapley is an author and academic who divides his time between London, Johannesburg and Ottawa. His books include Why Empires Fall: Rome, America and the Future of the West (with Peter Heather, Penguin, 2023) and Twilight of the Money Gods: Economics as a religion (Simon & Schuster, 2017).
jarapley
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SubscribeThis is silly. The increased costs of storms has nothing to do with climate change. Hurricane frequency and intensity are down over the last few decades. The number of deaths is much lower than in the past.
Cost are up because the value of property is up. Florida property values have doubled in the last ten years, and construction costs are way up. Of course insurance claims from storms will be way up.
Did anyone else read the headline and just laugh?
Are we serious right now?
Now the weather can melt down the entire western financial system too?
I think we need to rethink the stability of our system.
I’m not sure there are words.
At least Ms Yellen Debtfire can take a holiday.
I think we need to rethink the stability of our system.
Or our minds.
Probably both.
Unherd. Come on. There is exactly ZERO data supporting the hypothesis that climate change (AGW) is causing an increase in the frequency and intensity of weather events. How could the author write the article without acknowledging this fact? It make him sound like an activist in his second year at a state university.
The report that’s linked is actually really poor. I will pull it apart because it is that awful I now feel I have no choice. Especially if this is the type of data they are basing the climate change theory on. The quotes are pulled from the linked report in the article and the comment above:
‘There were 28 weather and climate disasters in 2023, surpassing the previous record of 22 in 2020, tallying a price tag of at least $92.9 billion’
‘Adding the 2023 events to the record that began in 1980, the U.S. has sustained 376 weather and climate disasters with the overall damage costs reaching or exceeding $1 billion. The cumulative cost for these 376 events exceeds $2.660 trillion.’
So first of all, the records only start in 1980, that they are basing their conclusions on.
Note the language ‘at least 92.9 billlion’ – this means this an estimate not a solid figure, there is no reference as to how this has been calculated. Then only when you note the title of the graph:
‘The history of billion-dollar disasters in the United States each year from 1980 to 2023, showing event type (colors), frequency (left-hand vertical axis), and cost (right-hand vertical axis.) The number and cost of weather and climate disasters is rising due to a combination of population growth and development along with the influence of human-caused climate change on some type of extreme events that lead to billion-dollar disasters. NOAA NCEI’
So the report is very misleading if you read the graph properly, making you think the increases are due to climate change but:
– They are attributing the cost increase to MORE THAN JUST CLIMATE CHANGE – ‘due to a combination of population growth and development along with the influence of human-caused climate change’
So I would question how these costs have been calculated – if it is a combination of those things that have increased costs, it isn’t just climate change that they costed in, and there is no separation of the figures so it isn’t clear how much population growth or further development has increased costs and what proportion of the cost is actually because of climate change.
The next graph also only starts in 1980 and again is based on estimated figures:
‘Month-by-month accumulation of estimated costs of each year’s billion-dollar disasters, with colored lines showing 2023 (red) and the previous top-10 costliest years.’
If you go through it, it’s really not a very scientific report, it’s full of hyperbole too’ billion dollar disaster’ features frequently, cost increases are highlighted but it isn’t made clear until you check out the graphs the cost increases are due to a number of factors, not just climate change. There is no reference as to how all their cost estimates have been calculated.
Good work there. It’s often my experience in following links in Unherd articles (not just them) that they’re often very shallow or just another article that then has its own references and on it goes.
It’s not really the case here, beleive it or not that is from a government website:
NOAA Climate Program Office/Office of Oceanic and Atmospheric Research
About:
‘Americans’ health, security, and economic well-being are closely linked to climate and weather. People are looking for information to help them understand climate and make decisions on how to manage climate-related risks and opportunities. To meet this need, NOAA Climate.gov provides timely and authoritative scientific data and information about climate science, adaptation, and mitigation.
Our goals are to promote public understanding of climate science and climate-related events, to make NOAA data products and services easy to access and use, to provide climate-related support to the private sector and the Nation’s economy, and to serve people making climate-related decisions with tools and resources that help them answer specific questions. In short, NOAA Climate.gov’s mission is to provide science and information for a climate-smart nation.’
So rather worryingly, they are advising all sorts of people on all kinds of things, at government level.
The home page is just as bad. Most of the graphs the data has been collected from the 1960s onwards, the earliest data they have, for one graph is from 1880. So they are showing only a very short time period really, I think that’s a bit poor given the enormity of the subject.
And since stuff costs more, and fixing stuff costs more, the same actual damage will lead to far higher costs as years go by.
This article is like saying climate change is causing the prices of football players to rise exponentially, and will soon lead to a collapse of the sport, since the most expensive transfers in history have all happened in the last few years.
Nicely done
Unlike California, Florida consistently maintains a budget surplus. The Gulf of Mexico has, is and will continue to be a hurricane laboratory because of warm water conditions.
But rich people will continue to build there and get private insurance because rich people want coastal property. Since rich people will be there, stores and restaurants will continue to be there and they will continue rebuild in more “sustainable ways.” Insurance premiums were too low for too long but its a self-correcting problem once premiums are raised.
I’m sure places like Florida would be perfectly fine with the Federal Government decoupling its “interconnected” finances with the State.
Certainly the Gleissburg Solar Dust Cycle due in 2025. Perhaps it will temper hubris and make people return to fundamentals in all senses. We have been living in our heads for far too long.
I’m skeptical that extreme weather events like Helene and Milton (and I’m not saying this from a distance; my own town was hit by Helene) are going to be the decisive factor here.
Back when America was a vibrant, rapidly growing country with a semblance of good government, we shrugged off much worse disasters – things like the San Francisco Earthquake, which the author even mentions, or the 1900 Galveston hurricane which killed about 10,000 people, way more than all the extreme weather events since the turn of the century combined.
If AGW is making hurricanes more dangerous (which is very debatable) then satellite-based forecasts have already made them less dangerous by a bigger amount.
If the American Empire continues to decline over the next few decades, it will (1) decline slowly, and (2) decline mostly as a result of weak political leadership and NIMBYism, with weather playing only a marginal role.
But I’ve written about these themes before:
https://twilightpatriot.substack.com/p/honorius-and-the-slowness-of-decline
https://twilightpatriot.substack.com/p/the-democrats-lovehate-relationship
More astroturfed fear mongering claptrap from motivated climate porn evangelists selling a data free narrative.
There is only so long before sceptics realise what is looming upon humanity.
This is just one facet of the impacts of climate change. Drought, floods, crop failures, mass migration and civil unrest – that is the face of the problem over the next 50 years.
Dealing with the issue is going to be very expensive and take generations, that has been established. Ignoring or denying it will be far worse however.
The problem, Robbie, is that you, like the author, are confused about where your opinion ends and the facts begin. There is no data to support the claim that there is an increase in extreme weather events or that human co2 emissions are causing them. I’m sorry to be the one to break it to you but it was going to happen eventually.
There’s no confusion SJ. There are dozens of reports detailing how these storms are being made more powerful by climate change impacts. I doubt if you and the others are subscribers to New Scientist but there are many other sources if you take off your tin foil hats.
div > p:nth-of-type(2) > a”>https://www.newscientist.com/article/2451207-extreme-hurricane-season-is-here-and-it-is-fuelled-by-climate-change/
That’s paywalled. I don’t need dozens, I only need one. Please link one study that proves a link between human co2 emissions and the frequency and intensity of storms. When you’ve succeeded in this effort (you won’t, one doesn’t exist) then I’ll happily hand you a $100 bill and kiss your bare a**.
Dozens of self-referential reports, paid for by people profiting from climate fear, that ignore science, historical data and economics. All tailored to give gullible folks a sense of wisdom.
Let me invert your assertion and ask you how much longer before AGW zealots, like yourself, will acknowledge that there has been nothing significant happening in terms of ‘extreme’ weather events over the past few decades? Even the IPCC’s own data says that!
Censoring sceptics and attributing single weather events to your cause may keep you going a bit longer, but it’s a failed hypothesis. Only the vast juggernaut of financial self interest keeps the myth going- follow the money.
Adam,
The zealots,are predictable.