We paid for dallying on the housing bubble. The climate crash will be much worse.
There is a time for weighing evidence and a time for acting. And if there’s one thing I’ve learned through my work in finance, government and conservation, it is to act before problems become too big to manage.
For too many years, we failed to rein in the excesses building up in the nation’s financial markets. When the credit bubble burst in 2008, the damage was devastating. Millions suffered. Many still do.
We’re making the same mistake today with climate change. We’re staring down a climate bubble that poses enormous risks to both our environment and economy. The warning signs are clear and growing more urgent as the risks go unchecked.
This is a crisis we can’t afford to ignore. We need to act now, even though there is much disagreement, including from members of my own Republican Party, on how to address this issue while remaining economically competitive. They’re right to consider the economic implications. But we must not lose sight of the profound economic risks of doing nothing.
The solution can be a fundamentally conservative one that will empower the marketplace to find the most efficient response. We can do this by putting a price on emissions of carbon dioxide — a carbon tax. Few in the United States now pay to emit this potent greenhouse gas into the atmosphere we all share. Putting a price on emissions will create incentives to develop new, cleaner energy technologies.
It’s true that the United States can’t solve this problem alone. But we’re not going to persuade other big carbon polluters to take the urgent action that’s needed if we’re not doing everything we can to slow our carbon emissions.
I was secretary of the Treasury when the credit bubble burst, so I think it’s fair to say that I know a little bit about risk, assessing outcomes and problem-solving. Looking back at the dark days of 2008, it is easy to see the similarities between the financial crisis and the climate challenge we now face.
We are building up excesses (debt in 2008, greenhouse gas emissions that are trapping heat now). Our government policies are flawed (incentivizing us to borrow too much to finance homes then, and encouraging the overuse of carbon-based fuels now). Our experts (financial experts then, climate scientists now) try to understand what they see and to model possible futures. And the outsize risks have the potential to be tremendously damaging (to a globalized economy then, and the global climate now).
Back then, we narrowly avoided an economic catastrophe at the last minute by rescuing a collapsing financial system through government action. But climate change is more intractable. The carbon dioxide we’re sending into the atmosphere remains there for centuries, heating up the planet.
That means the decisions we’re making today — to continue along a path that’s almost entirely carbon-dependent — are locking us in for long-term consequences that we will not be able change but only adapt to, at enormous cost. To protect New York City from rising seas and storm surges is expected to cost at least $20 billion initially, and eventually far more. And that’s just one coastal city.
When I worry about risks, I worry about the biggest ones, particularly those that are difficult to predict — the ones I call small but deep holes. While odds are you will avoid them, if you do fall in one, it’s a long way down and nearly impossible to claw your way out.
Scientists have identified a number of these holes — potential thresholds that, once crossed, could cause sweeping, irreversible changes. They don’t know exactly when we would reach them. But they know we should do everything we can to avoid them.
Already, observations are catching up with years of scientific models, and the trends are not in our favor.
Fewer than 10 years ago, the best analysis projected that melting Arctic sea ice would mean nearly ice-free summers by the end of the 21st century. Now the ice is melting so rapidly that virtually ice-free Arctic summers could be here in the next decade or two. The lack of reflective ice will mean that more of the sun’s heat will be absorbed by the oceans, accelerating warming of both the oceans and the atmosphere, and ultimately raising sea levels.
Even worse, in May, two separate studies discovered that one of the biggest thresholds has already been reached. The West Antarctic ice sheet has begun to melt, a process that scientists estimate may take centuries but that could eventually raise sea levels by as much as 14 feet. Now that this process has begun, there is nothing we can do to undo the underlying dynamics, which scientists say are “baked in.”
It is true that there is uncertainty about the timing and magnitude of these risks and many others. But those who claim the science is unsettled or action is too costly are simply trying to ignore the problem.
The nature of a crisis is its unpredictability. And as we all witnessed during the financial crisis, a chain reaction of cascading failures ensued from one intertwined part of the system to the next. It’s easy to see a single part in motion. It’s not so easy to calculate the resulting domino effect. That sort of contagion nearly took down the global financial system.
With that experience indelibly affecting my perspective, viewing climate change in terms of risk assessment and risk management makes clear to me that taking a cautiously conservative stance — that is, waiting for more information before acting — is actually taking a very radical risk. We’ll never know enough to resolve all of the uncertainties. But we know enough to recognize that we must act now.
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