How Much Will Climate Change Cost The US? White House Says $2 Trillion A Year By 2100

The Biden administration issued a dire warning about the possible economic costs connected to global climate change on Monday. If left unchecked, it is estimated that the damages could amount to $2 trillion a year by the turn of the century.

In a blog post by two economists working for the White House’s Office of Management and Budget (OMB), the administration found that climate change could cost as much as $7.1% of the federal government's revenue by the end of the century.

Adding to the financial pains that are expected, the two assess that the government can be forced to spend an additional $25 billion to $128 billion each year on related expenditures like disaster and agricultural insurance, health insurance, wildfire suppression and flooding.

“Climate change threatens communities and sectors across the country, including through floods, drought, extreme heat, wildfires, and hurricanes that affect the U.S. economy and the lives of everyday Americans,” Candace Vahlsing, the OMB’s associate director for climate, and OMB chief economist Danny Yagan co-wrote in the brief. “Future damages could dwarf current damages if greenhouse gas emissions continue unabated."

This attempt to lay out the fiscal consequences of unchecked climate change follows previous reports by the Biden administration that demonstrate that costs will increase over time. For example, the administration released a report in January that found the U.S. experienced one of its most expensive and destructive years on record in 2021 with nearly 20 extreme weather events costing approximately $1 billion in damages.

The United Nations' Intergovernmental Panel on Climate Change (IPCC) also released a report that urged states to adopt "rapid, deep and immediate" cuts in carbon dioxide emissions if there is any hope to stave off the worst effects of climate change. The lead author of the report warned that the world is approaching a "now or never" moment to limit global warming to the desired 1.5C level recommended by experts.

President Joe Biden has made confronting climate change a hallmark of his presidency, but his attempts to do so have been challenged by a confluence of negative global trends, domestic problems and political opposition that have impaired his agenda.

As the COVID-19 pandemic recedes in many parts of the world, demand for energy has skyrocketed, driving up prices and inflation globally. Russia’s war in Ukraine has only thrown another wrench into Biden’s hopes for cutting emissions. Instead, the president has called for stepped up oil production to bring down inflation and provided a greenlight to new fossil fuel projects.

At home, Biden’s climate agenda has been resisted aggressively by Congressional Republicans and members of his own Democratic Party like Sen. Joe Manchin, D-W.Va. Last year, a landmark bill with climate provisions was torpedoed by Democrats’ inability to find a compromise that would secure its passage.