Climate Change Is Stunting Our Economic Growth

Imagine you were running for king of the world on a platform of slashing economic growth by 20% forever. You’d be lucky to get your own family to vote for you. And yet humanity insists on running the global economy on fossil fuels that are doing exactly that sort of damage. The good news is that we still have time to vote them out before they do even more.

The amount of planetary heating already in the pipeline as a result of a century of pumping greenhouse gases into the atmosphere will make global income 19% lower by 2049 than it would have been without global warming, suggests a new study from the Potsdam Institute for Climate Impact Research. This income loss will be driven mainly by rising temperatures, according to the researchers, which will affect agriculture, public health, productivity and more.

This will cost $38 trillion in lost income every year by midcentury, compared with the $6 trillion of investment the researchers estimate will be needed each year to meet the Paris climate accord’s goal of limiting warming to 2 degrees Celsius during that time. If we fail to mitigate heating by transitioning to renewable energy sources, then the economic damage will rise to more like 60% of global income by 2100.

“It feels starker than ever that the costs of doing nothing are far higher than the costs of doing something,” co-author Maximilian Kotz said in an interview.

The study’s damage estimates are much higher than those of previous efforts, a result Kotz chalks up to his group’s methodology, which he described as “conservative.” Regardless, the direction of travel is clear and consistent.