CONNECTING THE DOTS: CLIMATE CHANGE & ECONOMY

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Climate change impacts are affecting our economy.  From extreme algal blooms that impact our tourism and fishing industry, to our real estate, and infrastructure.  Climate change impacts all of us.  

United we stand to protect our economy.

Credit Risk

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  • Moody’s Investor Services Inc., one of the country’s largest credit rating agencies, released a new report warning U.S. cities & states to prepare for the effects of climate change or risk having their credit rating downgraded, & Florida cities are most at risk. 
  • Extreme weather events exacerbated by changing climate trends include higher rates of coastal storm damage & more frequent & severe droughts, wildfires & heatwaves. 
  • Climate change affects the economy across 6 impact channels: sea-level rise, human health effects, heat effect on labor productivity, agricultural productivity, tourism, & energy demand.

Agriculture

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  • Crop & livestock production  will be adversely impacted both by direct effects of climate change (such as increasing trends in daytime & nighttime temperatures; changes in rainfall patterns; & more frequent climate extremes, flooding, & drought) & consequent secondary effects (such as increased weed, pest, & disease pressures; reduced crop & forage production & quality; & damage to infrastructure).
  • Food & forage production will decline in regions experiencing increased frequency & duration of droughts & flooding. 

Real Estate

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  • Florida faces damage to coastal property due to rising sea levels & storm surge; & damage to property due to non-coastal events such as droughts, wildfires, floods & severe storms. 
  • In terms of insured U.S. coastal properties vulnerable to hurricanes, New York ranks number one with $2.92 trillion, followed by Florida ($2.86 trillion).  
  • Greater wind speeds from hurricanes & the resulting damages can make insurance for wind damage more expensive or difficult to obtain. 

Extreme Weather 2017

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  • Hurricane Michael (2018) cost 25.2 BILLION 
  • Hurricane Irma (2017) cost $50.5 BILLION.
  • Hurricane Maria (2017) cost $90 BILLION 
  • Hurricane Harvey (2017) cost $125 BILLION.
  • Southeast Freeze (2017) heavily damaged fruit crops across several southeastern states including Florida cost $1 BILLION (mid-March freezes are not unusual in the Southeast, however many crops were blooming 3+ weeks early due to unusually warm temperatures during the preceding weeks).

Tourism

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  • Losses of more than $80 million
    in state taxes & $70 million in
    local taxes were incurred due to
    out-of-state visitor declines because of Hurricane Irma
  • Florida is one of the 5 biggest contributors to ocean-based tourism and recreation, accounting for more than half of this sector’s total employment and gross domestic product. 
  •  Coral reefs directly contribute $8.5 billion each year & 70,400 jobs to the Florida economy, according to the Florida Keys National Marine Sanctuary
  • Florida's tourism industry could lose over $178 billion annually by 2100, according to The Union of Concerned Scientists.

Infrastructure

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  • Cities, roads, railways, ports, and water supplies in Florida are vulnerable to the impacts of extreme storms, flooding, and sea level rise. 
  • More than half of Florida’s storm water entities unable to  address all capital improvement needs.  Only 1 in 4 storm water utilities stated that today’s operation and maintenance capabilities were adequate only to meet the most urgent needs.  

Beer

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  • Climate change affects three of beer’s core ingredients: hops, water, and barley.   
  • Hops and barley are affected by heat and drought.  Water available for irrigating the hops largely comes from annual melting of winter snowpack from the mountains. A warming world means more rain versus snow in the winter, meaning irrigation may depend more on ground water, which has a higher mineral content and affects the beer’s taste.      
  • Beer is also big business. Increasingly, locally owned craft brewers are having an impact on the industry landscape and on the economies in which they are located. 
  • In 2016, sales of craft beer were up 10%, accounting for nearly a quarter of the total U.S. market. Local craft brewers contributed $67.8 billion to the U.S. economy in 2016, representing more than 456,000 jobs. 

Coffee

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  • Coffee vies with tea as the world’s favorite beverage and employs 100 million people worldwide in farming the beans alone. 
  • Climate change is coffee’s greatest long-term threat, killing plantations or reducing bean quality and allowing the deadly coffee leaf rust fungus to thrive. 
  • Without major action both in the coffee industry and in slashing greenhouse gas emissions, coffee is predicted to become more expensive and worse-tasting