Brian and I have agreed to try running some posts as short conversation starters instead of the much longer posts we have both produced in the past.
This conversation post was prompted by “The climate change panic button is coming” by Allan Kohler. It looks at climate change from a financial risk perspective, in particular how the rising number and size of climate change disasters is making is making it harder and harder for the insurance industry to the point where more and more insurance will become unaffordable. Banks will not lend money to projects that cannot be insured.
This post asks you to discuss what might be done to avoid or survive a future of shrinking insurance, shrinking loans and a deteriorating environment.
It is suggested that you read the Kohler article before commenting.
To quote Kohler:
This week it’s floods in Germany, 170 dead and terrible devastation.
A few weeks ago people were dying from the heat in Canada, which reached about 49 degrees Celsius in Lytton, British Columbia.
This is from the global warming that has already occurred, which is about 1.2 degrees above the pre-industrial age.
Then think about bushfires and the impact of sea level rise on assets, insurance and investment.
The world is now trying to stop the temperature from going above 1.5 degrees higher than present by getting emissions down to net zero by 2050.
Even if we succeed in that, which is far from guaranteed, the extreme weather events will be significantly worse and more frequent than they are now.
But at what point will governments hit the real panic button?
Because net zero by 2050 is not it.
Kohler goes on to point out the limitations of simply keeping the temperature below the 1.5 deg C target by 1950. 1.2 deg higher is already causing damage that is adding to the problem by pushing more greenhouses gases into the air, killing vegetation and reducing the area of snow available to reflect heat back into space.
By the time we have reached the 1.5 deg higher more greenhouse methane from melting permafrost will have got into the atmosphere. (Kohler thinks 1.5 deg by 2050 will end up driving us to 2 deg even if humans have reached net zero. (See: ‘Delay is the new denial’: Why the 2050 net-zero fight is missing the real danger.))
Kohler concludes with:
What does the panic button look like?
I’m not sure, but here are some thoughts: Fossil fuels would be suddenly and totally banned, or made prohibitively expensive, and oil, gas and coal would instantly go bust; physical tourism would be banned and air travel confined to essentials and rich elites so the airline industry would collapse; the lithium battery and hydrogen would suddenly boom.
And so on.
Life would change more completely than it has during the pandemic.
In short, it would look like war.
So what do you think? What might we do to:
1. Slow or reverse climate change?
2. Reduce our and other species risk of extinction?
3. Live with sea level rise?
4. Look after our descendants?
5. Manage the economy and the environment?