Our directory of things of interest

University Directory

Grappling with climanomics in a warmer world

  • Written by  Marco Magrini
  • Published in Climate
Grappling with climanomics in a warmer world
11 Feb
2019
Marco Magrini looks at the financial pressures spilling out into the world’s environment

Last year, an army of yellow-dressed civilians rebuffed the French plan to raise the price of petrol, a policy that was intended to discourage fossil fuel consumption in accordance with the Paris agreement on climate change. At around the same time, 13 US federal agencies unveiled a report that predicts a very grim future for the late-century American economy, due to a predicted growth in the number of hurricanes, floods, droughts and wildfires. How can we give up on oil and coal without disrupting the economy (and social order)? Shouldn’t we invest millions today to save billions tomorrow?

Voters and politicians alike seem to favour a short-term approach that, at least where the climate is concerned, is definitely a mistaken one. The few who look into the future by trade, such as scientists and reinsurers, argue that we should act more now and regret less later. Reinsurance companies, those who insure insurers, are scared. Swiss Re, the world’s second biggest reinsurer, estimated $337billion losses from natural and man-made disasters in 2017, a third of which were insured. Not only are these disasters projected to increase with rising temperatures, but AXA, the French insurer, has added that above a certain threshold (4°C of warming) just about everything will be ‘uninsurable’.

A 4°C increase may seem far-fetched. The planet’s mean temperature has risen by 1°C since the Industrial Revolution. The Paris Agreement vowed not to exceed the ‘dangerous level’ of 2°C. However, the Intergovernmental Panel on Climate Change recently warned that a 4°C spike could be reached by the end of the century with some ease – simply not swaying from the current track will be enough. 

No wonder then that Mark Carney, governor of the Bank of England, has suggested adding climatic risks to annual stress tests for banks, at least to make them aware of the troubles they may incur from climate issues, such as financing a coal plant that is doomed to be shut down before its typical lifetime.

States, financial and industrial companies have to readjust their business plans, at least those based on long-term thinking. But families and individuals will also have to do the same. Before buying a new house by the beach, as with almost any other investment, civilians now need to grapple with climanomics.

This was published in the February 2019  edition of Geographical magazine

geo line break v3

Free eBooks - Geographical Newsletter

Get the best of Geographical delivered straight to your inbox by signing up to our weekly newsletter and get a free collection of eBooks!

geo line break v3

Related items

Subscribe and Save!

geo line break v3

Free eBooks - Geographical Newsletter

Sign up for our weekly newsletter today and get a FREE eBook collection!

geo line break v3

University of Winchester

geo line break v3

EDUCATION PARTNERS

Aberystwyth University University of Greenwich The University of Derby

TRAVEL PARTNERS

Ponant

Silversea

Travel the Unknown

NEVER MISS A STORY - Follow Geographical on Social

Want to stay up to date with breaking Geographical stories? Join the thousands following us on Twitter, Facebook and Instagram and stay informed about the world.

More articles in NATURE...

Climate

Parkesine, celluloid and Bakelite – the first three kinds of…

Geophoto

Flat and level landscapes might not have much to offer…

Geophoto

Winning entries include meerkats, zebra sharks and courting nudibranches

Oceans

The UN’s World Ocean Day is a day to celebrate…

Nature

Breathe easier this World Environment day with this collection of…

Climate

A 50-year look at the activity of aphids, moths, butterflies…

Geophoto

The British Isles are packed with natural landmarks that serve…

Geophoto

The prestigious photography awards to go on display in some…

Tectonics

The discovery of a slow-motion earthquake near Istanbul, which took…

Oceans

The 2014 to 2016 marine heatwave, which took place off…

Climate

Marco Magrini discovers that hydrogen is back, but hopefully not…

Wildlife

 A ten-year analysis of chimpanzees has revealed that the presence…

Wildlife

The return of the pine marten to UK forests has…

Energy

A project in Orkney is converting excess wind energy into…

Geophoto

Mountains provide a dramatic sight at the best of times,…

Wildlife

A surge in reports of dead hares has resulted in…

Oceans

Four scientists have banded together to make the case against the farming of octopuses, arguing…

Climate

As planetary oil consumption hits the 100-million-barrel mark Marco Magrini…

Oceans

A ship that ran aground early in February has been…

Wildlife

Two whale populations on either side of the African continent…