Failure to stop business-as-usual global warming will deliver a severe economic blow to Southern states, a recent paper by the Federal Reserve Bank of Richmond finds.
Remarkably, this ground-breaking study, “Temperature and Growth” concludes that “under the business-as-usual scenario, the projected trends in rising temperatures could depress U.S. economic growth by up to a third.”
As the Wall Street Journal summed up the findings: “Climate Change May Deeply Wound Long-Term U.S. Growth.”
The study focused on the impact of high temperatures in productivity and found that rising temperatures have their biggest negative economic impact in the summer — but that it’s not just outdoor work like farming and construction that suffers. Using historical data, the authors showed that the finance, retail, and real estate sectors also get hit hard during the hottest summers.
The authors note that a scenario of low CO2 emissions would sharply reduce the economic harm. But such a scenario requires far more aggressive action than the world embraced in the Paris Climate Accord.
In reality, the Trump administration’s policies — to abandon the Paris climate deal while working to gut both domestic climate action and coastal adaptation programs — make the worst business-as-usual scenarios for climate change more likely while undermining any efforts to prepare for what’s coming.
Significantly, the researchers from the University of North Carolina, the Inter-American Development Bank, and the Richmond Federal Reserve Bank found that “the temperature effects are particularly strong in states with relatively higher summer temperatures, most of which are located in the South.”
The estimated summer impact “for the ten warmest states is about three times as large as their whole-country counterpart.” This means those ten states would be economically devastated in the coming decades.
The study ranks the states by average summer temperature. The top ten, in order, are: Florida, Louisiana, Texas, Mississippi, Oklahoma, Alabama, Georgia, South Carolina, Arkansas, and Arizona. Besides all being in the south, they all also voted for Trump.
We’ve long known the southern U.S. would be hit the hardest by climate change. Back in 2011, the nation’s top climate scientist, James Hansen (then at NASA), warned “If we stay on with business as usual, the southern U.S. will become almost uninhabitable.”
And earlier studies have found that rising temperatures would hit worker productivity hard in peak summer months globally. For instance, a study done in 2013 by the National Oceanic and Atmospheric Administration (NOAA) concluded that “heat-stress related labor capacity losses will double globally by 2050 with a warming climate.”
NOAA found that business-as-usual policies cut labor capacity in half during peak months by century’s end.
But the Richmond Fed study is the first to focus specifically on this country: It’s “the first in the literature to systematically document the pervasive effect of summer temperatures on the cross-section of industries in the U.S.”
So it’s the first study to document that Trump’s climate policies will hit the states that voted for him the hardest.
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