Explainer: Climate change proving costly for many. Let’s assess its impact on US citizens.
The brutal climate crisis has turned into one of the greatest threats to humanity – possibly the most dangerous. It is triggering disasters of unprecedented intensities and elevating average global temperatures to ruthless levels. This torture needs to end.
The planet is already proving expensive. Climate disasters in the US cost more than $617 billion between 2018 and 2022 – a record figure, as per the US Department of the Treasury. More and more people are likely to experience financial pain as the crisis deepens.
Every additional degree of heating is expected to bring more damage to the US economy. In fact, climate change could cost Americans born this year nearly $500,000, consulting firm ICF recently found in a report commissioned by Consumer Reports.
The damage could be caused through higher taxes and pricier housing and food, among other factors. Essentially, as climate change rages on, the basic building blocks of our financial lives – such as housing, taxes and insurance – are set to become more expensive or less valuable.
Impact of climate change on your basic necessities
Economists have already found a term to describe a hotter planet pushing up prices, ‘Climateflation’. Sadly, food inflation alone is likely to rise by as much as 3 percentage points every year over the next decade due to changes in the environment, reported CNBC.
1. Climate change changing housing market
The housing market is taking a serious hit. One survey by the US Census Bureau found at least 3 million Americans already report being displaced by a disaster. Insurance companies in several states are increasing their monthly premiums and rolling back coverage in vulnerable areas.
Globally, environmental disasters cost insurers $108 billion last year – sizeably above the annual average over the past 10 years of $89 billion, according to Swiss Re Institute. These losses could double in the near future. Eventually, the costs are likely to be passed on to consumers.
Swiss Re Institute has found that in the current scenario, insurers cover just approximately 40% of the expenses from natural catastrophes – meaning the remaining significant amount false on governments and individuals – clearly demonstrating the impact of climate change.
2. Healthcare costs soaring high
A hotter planet is hardly ever better for medical bills. Healthcare costs related to fossil fuel pollution and climate change already surpass $800 billion annually in the US, according to a report by the Natural Resources Defence Council.
3. Taxes, salaries and retirement savings
The climate crisis also has a substantial impact on your taxes, salaries and retirement savings. For instance, federal, local and state governments are likely to increase taxes as they try to address higher costs of a hotter planet and more demand for their services.
4. People changing careers?
The labour and education system are changing, too. In anticipation of much higher temperatures, people are leaving careers threatened by global heating, such as gas and coal, and a handful of colleges have started offering climate change studies as a major.
