A common point of view is that you have to choose between reducing your carbon dioxide footprint or helping the economy. As if global warming is not an economical issue, and some believe that it is so expensive to address that it will have to wait.
That is not true. Global warming is, in fact, a serious economic problem but it’s economic impact is infrequently discussed, and that could be partially due to the fact that an exact monetary price cannot be placed on it’s impact. Environmental and economic issues go hand in hand. Environmental issues such as increased flooding, drought, hurricanes, and tornadoes are economically destructive because they each cost billions of U.S dollars.
However, people often only discuss the environmental impacts such as the increased incidence of and intensified hurricanes, tornadoes, floods, and drought, and of course sea level increases. I discuss the economic impact of these further below to try to bring more light to these issues.
Increased trade deficit: A trade deficit is caused when the value of total imports exceeds the value of total exports. Global warming inhibits crop growth by causing longer droughts and more flooding, which are both destructive to farms. This means that more food has to be imported from elsewhere. In more extreme situations, in which an entire country is suffering from food shortages, food would have to be imported from another country, and the trade deficit would increase.
More expensive food translates to higher unemployment: Consumers spend more on food, therefore they have less to spend on everything else, intensifying their financial troubles.
Another repercussion of the above is that when people spend more on one thing, such as food, and spend less on other things, the industries which sell what consumers are buying less of/spending less on shrink due to decreased sales (decreased sales translates into decreased income). When they shrink and scale down production of their goods, close factories, and lay off employees that they no longer need, it increases the unemployment rate.
There are many other economic impacts of global warming as well, such as the increased need for seawater desalination due to freshwater shortages, but I won’t go into much detail about that at this time. You can learn more about the desalination issues here.
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- Amazon Gets Hit with Extreme Drought, Perhaps Worst Ever (Global Weirding?)
- What Is Nature Worth? Is Earth Past the Tipping Point? [VIDEOS]
Image via Mila Zinkova
I have a keen interest in physics-intensive topics such as electricity generation, refrigeration and air conditioning technology, energy storage, geography, and much more. My website is: Kompulsa.