01/29/2013 03:01 pm ET Updated Mar 31, 2013

A Second Chance to Get It Right with Climate Change

"We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations. Some may still deny the overwhelming judgment of science, but none can avoid the devastating impact of raging fires, and crippling drought and more powerful storms." -- Barack Obama, January 21, 2013

Presidential second terms are times when it is sometimes possible to do things that are kryptonite for reelection chances. President Obama did the right thing by recognizing this opportunity at the first available moment: his acceptance speech on election night. He was right. National action mitigating greenhouse gas emissions should be Job Two, right after the most recent fiscal crisis is at least in its pajamas. In his inauguration speech, he gave additional hope that climate change would indeed be toward the top of his agenda.

Now, three months after Hurricane Sandy struck, the Northeast is still reeling from the damage. Sandy might wind up being one of the costliest storms in U.S. history. Not coincidentally, it also relit the pilot on public discourse about climate change. Meteorologists and climate scientists resist fiercely any temptation to attribute any specific event to climate change, but they are also quick to point out that storms like this one may not be once-in-a-century events any more, and even a single generation may now see several such disasters.

But one hurricane anecdote is a poor substitute for convincing evidence. For that, readers may consult the National Oceanic and Atmospheric Administration's Billion Dollar Weather/Climate Disasters webpage, which shows a generally rising trend in terms of number of events between 1980 and 2011 in the United States. Severe storms and tropical cyclones accounted for over 55 percent of these events, and nearly 60 percent of the inflation-adjusted damages. Elsewhere in the world the status quo is just as sobering; the Association of British Insurers (ABI), for example, estimated the financial impacts of climate change by looking under some very specific lampposts: inland floods in Great Britain induced by precipitation, winter windstorms in the UK, and typhoons in China. ABI concluded that insured flood losses on 100-year storms in Great Britain could rise by 30 percent, and insured losses resulting from typhoons in China could rise by 32 percent as a result of climate change. [1]

The danger signs are clear. Yet for years, climate change has been off limits for federal policymakers, who have been rendered nearly catatonic by the idea -- which, by the way, is unproven -- that dealing with climate change or any environmental problem would be too costly for a delicate economy. While it does often take work and investment to mitigate or eliminate environmental problems, this kind of work and investment pays off economically as well as socially, not to mention financially. A report from Deutsche Bank showed in 2010 that a portfolio with a heavier allocation to climate change would have outperformed a benchmark portfolio over the previous five years, indicating that climate as an investment was "not merely an investment sector that may hold future promise; it is a sector that has already delivered and is continuing to deliver."[2] Moreover, not fixing the problem is quite likely in the end to cost considerably more than addressing it, particularly now, while there is still time for us to avert even greater damage.

The choice we have now as a society was framed best by a 2007 report commissioned by the United Nations Commission on Sustainable Development titled "Confronting Climate Change: Avoiding the Unmanageable and Managing the Unavoidable." The problem we have, and have always had in climate change, is that those who make the investments to avoid the unmanageable are often the ancestors of those who have to manage the unavoidable. The United States, perhaps more than other societies, has become addicted to instant gratification. The cost of that addiction in federal policy is that it has become increasingly difficult to address long-term problems.

There will not be a million opportunities to avoid the worst of climate change. Greenhouse gases (GHGs) persist in the atmosphere for a long time -- around 100 years for carbon dioxide, the most pervasive of the GHGs emitted by human activity, and tens of thousands of years for some others, including perfluorocarbons and sulfur hexafluoride. Once we put those gases into the atmosphere, they will continue to affect the climate for generations. Appealing to intergenerational altruism has not proved to be a remarkably effective strategy in public policy. But geography may present some opportunities. If we overlay the electoral-vote map of 2012 with NOAA's map of the incidence of billion-dollar weather disasters, the overlap is noteworthy: 20 percent of the damage of those disasters occurred in the seven states with the highest disaster incidence, but those states account for 20 percent of the U.S. population. Every single one of them went for Gov. Romney in the presidential election.

Once climate change was not an issue that divided politicians by party, but it is now. But it may not be that way forever. Climate probably wasn't a terribly decisive factor in the 2012 election, but the greater the impacts, the more likely it is to become one in future elections. The map of weather disasters thus spells opportunity for the party most willing to step up to the plate and tackle greenhouse gas emissions in a way that has some impact in the real world. The more people are affected by climate change, the harder it becomes to deny it.

But even if that were not the case, we simply have to start making a dent in our contribution to this problem, which is already affecting us and can drastically change the lives of our progeny. Fiscal debates will probably become increasingly difficult, but even if the worst happens and U.S. debt is downgraded, the impact of it probably won't last for thousands of years. We will have numerous opportunities to get our economics right. But nature, unlike governments, doesn't pass out bailouts. The climate cliff may be farther from our current position than any fiscal precipice, but once we start down the road toward it, there will be no turning back.

[1] Association of British Insurers, "The Financial Risks of Climate Change," ABI Research paper No. 19, 2009.

[2] DB Climate Change Advisors, Deutsche Bank Group, "Investing in Climate Change 2010: A Strategic Asset Allocation Perspective," January 2010.