Effect of Global Warming on the US and the Global Economy - Case Study Example

Effect of global warming on the US and the global economy Week Six Progress Assignment Final Assignment Outline Working Title: “A project to point out the glaring impact of global warming on the United States and global economy.” I.    Background –Three important things you have found in the background to the problem.                A. The drastic weather conditions that affected productivity and created anxiety in the agricultural sectors of the economy.                               B. The rise in the sea levels and melting of ice has resulted to huge losses and increased amount of heat especially in the warm parts of the globe. This increment has created extra economic costs.                               C. The change in ecosystem due to interruptions in the weather patterns has threatened certain species of plants and animals with extinction. This calls for urgent solutions.                   II. Issues - Three important issues that are part of the problem.                A. global warming is set to benefit the cold parts of the world while affecting negatively the warm parts. This has caused the approach to global warming to lack unified approach.                                B.     there lacks any scientific evidence of increased global warming for the last ten years. This has put the pro-global warming lobby groups in an awkward position.                              C.    Global warming has resulted to health complications like asthma and bronchitis, which are respiratory disorders. This has coerced governments invest in the long-term solutions in health matters. Global warming becomes central in the global health policy.                 III. Complicating factors –three complicating factors that make solving the problem difficult A. There is a growing number of scientists who oppose the concept of global warming. B. The developed economies are sluggish in enacting carbon taxes and the process has taken a political twist.           C. The instability in the global economy has slowed down the process of shifting to renewable energy. Governments have a hard time funding transition from coal and oil to other forms of energy due to economic crunch.           IV.          Possible solutions – List three possible solutions to the problem The United States and global economies should invest in renewable sources of energy like solar, wind and bio-fuel. The carbon taxes should be enforced to compel nations like China and India among others to reduce GHG emissions. This should be made into a United Nations resolution. Technological innovation should be allowed to play a key role in resolving global warming. This might include changing the harmful gases into a less harmful form V. Analysis and recommendation –   Although there are complicating factors of opposition to global warming, disagreements on how to impose global carbon taxes, and slow transition to renewable energy], the problem of global warming might be solved, by unified scientific approach because of [scientists would agree on research solutions, governments would act unanimously on carbon emissions and renewable energy would be made accessible]. VI. Anticipated outcome – three things that will happen if your solution is implemented.    If global warming gets a unified global approach then The world shall reduce carbon emissions by 20 percent by 2020. The United Nations would enforce international subsidies for renewable sources of energy Scientists, the world over, would use technology to provide joint solutions to global warming. Executive summary Global warming has become a global phenomenon associated with adverse weather conditions. According to predictions by the United Nations, world economy shall be adversely affected if drastic measures are not taken now. Therefore, there is reason to find out the effects of the global warming on the US and the global economy. This is because the challenges of global warming have an economic bearing. This calls for concerted efforts in the search for solutions. Global warming has both market and non market effects. Nonmarket effects include health complications. Market effects include expected changes in the energy productions sectors. The issue has been complicated by stiff opposition to the possibility of global warming. There are views that there has been no evidence of global warming for the last decade. There have been requests to shift from non-renewable to renewable energy sources like solar and wind. The federal government of United States of America is being urged to subsidize renewable energy production and facilitate an energy policy shift. The international community is introducing carbon taxes from the leading producers of carbon emissions among other initiatives. Introduction The interest in the climatic change increased significantly in 1980s. Researchers were keenly interested in finding out the nature of impacts anticipated from the climatic change. According to a research by the Environmental Protection Agency (EPA), global warming of 4°C could cause adverse effects on water, biodiversity, agriculture and energy. According to research, the northern parts of the United States are expected to benefits from global warming especially because they are cold. The thesis of this research paper is that Global warming is not a regional problem, but a global issue. Its effects are being seen both physically and economically. Understanding how global warming effects all states should cause us to work together to try and minimize its impacts on the global stage. Research Question What effect does global warming have on the US and the global economy? Towards low C02 economy According to the report by the EPA, some economic sectors would be impacted more than others. This would result in substantial economic shift, in the United States and many parts of the world. There have been growing concerns on how to manage the global warming phenomenon to avert economic meltdown. The United States and other nations have been working on means of managing a transition to a low carbon dioxide global economy1. This is intended to manage the ongoing climate dynamics. There is an initiative to use generic policies to control global warming. This entails applying economic incentives judiciously to control the climatic possibilities. International governments are also coming up with technology-specific policies, which are said to have a direct impact in the emission of harmful gases by the leading economies2. Unlike the generic initiatives, technology-specific policies affect the dynamics of technology change. Some of the proposals under these policies include the use of electric cars. Generic polices incorporate carbon taxes. The idea behind climate-friendly technologies is that products could have devastating costs to the society if emission of the harmful gases is not controlled. Therefore, prices must factor in the environmental costs of production. Products that have a high economic cost to the society should be penalized highly. Generic policies suggest that prices must reflect the social costs. At the same time, externalities that are positive must be rewarded. When innovators come up with products which have social gains that exceed the gains of the innovator, then the products should be subsidized. Climate-friendly technologies and economies are characterized by such initiatives. Impact of global warming in the US The major effects of the concept of global warming include the rising levels of carbon dioxide emissions, the melting of ice and extremes shifts of weather patterns. Research shows that Maryland ranks seventeenth in the emission of C02 which is approximately 50 million carbon tons. The Herbert Wagner plant operated by Baltimore gas is the leading emitter of carbon with 12 million tons. According to EPA, the Maryland power plants i.e. BG&E Brandon and Gould plants account for 7 per cent of the greenhouse gaseous emissions in the United States. The power plants emit NOx which is responsible for smog or ozone when combined with organic compounds and high temperatures. Research suggests that 117 million Americans live in places with unsafe air to breathe as a result of ozone. Studies show that the health standard taken by the EPA in 1997 was broken by over 7000 times. According to EPA, Maryland is a representative sample of the United States, recorded (AQI) air quality index of over 100 for about a decade starting from 1990. The result indicated that over 180,000 asthma attacks of ozone nature were reported. This translated to 1290 hospital visits and 4000 respiratory complications. The effects of global warming to the economy of United States have been devastating. More than ever, Americans are exposed to shortness of breath, bronchitis, severe coughing and eye irritation due to rising ozone levels. Empirical studies conducted in Mendelssohn show that economic productivity is directly related to the absolute temperature. The climate change in an area considerably depends on the initial temperature of that area. The cold parts of the United States are likely to benefit from global warming. The warm parts are likely to experience damaging results. Therefore, it is increasingly becoming clear that, in the United States the impact of global warming on economic is tremendous. The water table is expected to fall due to the loss of soil moisture and regular droughts. The agricultural communities are expected to experience devastating economic impacts in the Great Plains3. The regional economics are expected to suffer direct impact of global warming. The timber industry is expected to suffer from increased pests like pine beetles. The frequent wildfires that are common in the United States and other economies like Australia are seen to be a consequence of global warming. A $1 to $2 billion decline of revenues annually is expected for producers. The resource dependent states are experiencing a gradual decline of businesses and investors. This has been brought about by changes in the hydroelectric energy which has been adversely affected by melting snow. States are facing credible policy risk as a result of increased carbon regulation. The carbon producing states are keen to ensure a shift of technologies capable of using carbon. The governments are required to promote new forms of energy and automobiles that need less gas to manufacture products of economic significance. The private sector in the United States is setting the pace to cap the greenhouse emissions. The companies that embrace the new technologies are likely to capture new markets in the United States. There are no federal mandates that seek to directly cap greenhouse gases, but the foundation for these policies is being laid. Global warming and the world economy Global warming is a potentially dangerous worldwide externality and is viewed as one the largest global collective action problems. The distribution of the causes of the global warming is uneven across countries. The effects of this phenomenon are likewise uneven across nations and generations. If global warming remains unchecked, the potential damages may be catastrophic. Research shows that some of the effects of global warming are irreversible. The cost of abating global warming is extremely high. There are indicators that the rate at which the global economy is growing has a direct connection to the effects of global warming4. There is an urgent need to shift to low-emission technologies across the world. The macroeconomic results of policies aimed at abating global warming can be immediate. However, these polices should be crafted with cautions. A good example is the use of bio-fuel. In the United States and Europe, the shift to bio-fuel had a negative effect on food prices5. This shift boosted inflation and pushed up the food prices. The central banks have a difficult time easing the monetary policy since they felt limited in the face of financial upheaval. Developed countries placed restrictions on bio-fuels imports. This constrained bio-fuel production is countries like Brazil which are considered to have low cost of production. Complicating issues; Opposition to global warming There are arguments that dynamic considerations are strong enough to check the importance of global warming and its effects. This means that technological change has the capacity to improve food production far more than the reduction anticipated through global warming. Technology is seen as strong enough to counter any negative effects of global warming. As a result, global warming effects, according to this argument, are overrated. The second complication arises from sentiments indicating that the concept of global warming is either farfetched or exaggerated. This has been consolidated by the fact that there has been a lack of global warming for the last ten years. There have been concerns that the United Nations projections by IPCC have not been manifested. Those opposed to the ideology of global warming accuse the climate change activists of taking advantage of every adverse weather condition to be attributed to the greenhouse effect. This argument states that carbon dioxide is not a pollutant; rather, it is a vital component of the life cycle of biosphere. Indeed, the number of scientists against the concept of global warming has been on the rise. Young scientists are afraid of criticizing the concept according to Lubbock Avalanche journal. A recent study by William Nordhaus indicated that the economy stands to grow tremendously after 50 years of negligible gas controls. However, according to pro-global warming scientists, the global climate is expected to continue to warm in the foreseeable decades. This is vastly contributed by the fact that a large stock of past emissions is responsible for global warming. The growth of GDP per capita and the population is said to directly increase carbon dioxide emissions which are responsible for greenhouse gas emissions. This is because the increase in population is directly proportional to energy needs. Economies that are growing fast, like China and India are said to be contributing most of the GHG emissions6. Changes in the use of land indicate that developed economies are responsible for half of the GHG emissions. Economic impact The economic losses are viewed in the light of GDP losses and temperature increase. The climate sensitive sectors are likely to suffer causing negative market impact from global warming. Some of these sectors include tourism, agriculture and forestry. The energy expenditure is expected to change with a growing need to refrigerate or heat. The water resources are expected to suffer from depletion and rise in sea-level in the coastal areas. The non-market implications of global warming include the spread of infectious diseases. This is due to decreased water resources and population increase. Leisure activities are likely to increase due to the rising temperatures necessitating recreational and outdoor ventures. The ecosystem is expected to be interrupted with a loss of biodiversity, some of which is a direct result of encroachment by human settlements. The estimated global damages indicate extreme variations in terms of regions and countries. The negative effects of global warming are expected to be intense in countries with high temperatures and low development7. A regularized rise in temperature, in countries with cold weather is expected to cause increased agricultural production. It is expected that countries with low temperatures expect less energy to be spent on cooling systems and fewer cases of death by colds. The warm countries expect high mortality and additional cooling costs. Summary Technology policies are going to play an increasingly prominent role in the expected changes affecting GHG emissions. The policies can have either short term or long-term effects based on the extent of analysis conducted. Innovations and technological change should not be separated from climate change. Research shows that small climatic changes are likely in impacts the United States positively, but large changes have a negative impact to the economy. Global warming has different impacts across many nations around the world. Regional climatic change predictions show that the forestry industry might need to use species that adapt to adverse weather conditions. Recommendations According to Clean Edge research, investment in renewable energy has been on the rise. In 2006, the investment rose by 40 percent. Other economic departments, especially the energy sectors, might be coerced to reduce overdependence on coal. Renewable sources of fuel are should be maximized. Over thirty states have (RPSs) which is renewable portfolio standards. The federal government of the United States is being pushed to spending from coal, oil and gas. It is recommended that the United States government subsidizes solar, biomass and wind to encourage production of renewable energy. Global energy production should to shift to renewable sources so that to cut carbon emissions by 20 percent by the year 2020. It is recommended that these measures be enacted by the international community. A good example is the United Nations international climate initiative which has set a target of GHG emissions reduction of 50 per cent by 2050. Bibliography Brown, Gordon. "Let’s Stick Together." The NewYork Times, November 30, 2012, GLOBAL AGENDA | ECONOMY section, http://www.nytimes.com/2012/11/30/opinion/global/gordon-brown-global-economic-problems-need-global-solutions.html?pagewanted=all (accessed December 23, 2012). Kok M., and V. Vermeulen,. Global Warming and Social Innovation The Challenge of a Climate-Neutral Society, 2nd ed. London: Earthscan Publications Ltd, 2002. Cline, William R. GLOBAL WARMING and AGRICULTURE Impact Estimates by Country, 1st ed. Edward Tureen,, 2007. Elgar, Edward. Global Warming and the American Economy A Regional Assessment of Climate Change Impacts, 1st ed. Edward Elgar Publishing Limited, 2001. Musil, Robert K. Hope for a Heated Planet How Americans are Fighting Global Warming and Building a Better Future, 1st ed. RUTGERS UNIVERSITY PRESS, 2009. Podesta, John. "John D. Podesta Speaks to National Association of State Treasures." Global Warming’s Toll on the Economy, September 17, 2007. Simms, Andrew. "Global Warming and the Wealth of Nations." In Ecological Debt, 2nd ed. PLUTO PRESS, 2009. Read More