Pakistan FloodingNo matter where you stand on the issue of global warming, there's no denying we've been having some weird weather lately: record high temperatures in Southern California, massive wildfires in Russia, mudslides in Mexico, deadly flooding in Pakistan (pictured) -- plus severe flooding all across the Southern and Midwestern U.S.

Climate change is also a political and economic hot potato this year. In a recent interview with Rolling Stone, President Obama said one of his top priorities for 2011 will be an energy policy "that begins to address all facets of our over-reliance on fossil fuels." Californians are scheduled to vote in November on whether to suspend the state's law curbing greenhouse gas emissions, in an effort to reduce unemployment. And soon after that vote, the U.N. is hosting a climate change summit in Cancun, Mexico.

Environmentalists hope the Cancun powwow will be more successful than last year's in Copenhagen -- where delegates failed to come up with a binding, wide-ranging global agreement on climate change. But there's already pessimism ahead of Cancun "[T]he financial commitments made by the developed countries at Copenhagen have not been fulfilled and are unlikely to be fulfilled in any substantial measure," India's environment minister recently lamented.

Damage Estimates -- and Questions About Them

Believers in climate change warn that its future expense could cripple national and international economies. A 2008 study by the National Resources Defense Council estimated that inaction on global warming could cost more than 3.6% of U.S. GDP -- or over $3.8 trillion annually -- in increased water, energy, insurance and real estate costs by 2100. And a German study estimates annual worldwide economic damage from global warming could reach around $20 trillion (in 2002 U.S. dollars) by the end of the century, or about 6% to 8% of the world's economic output.

But some observers remain skeptical about these numbers. "None of the data, none of the research studies or articles that I read are very clear on what the actual metrics are about costs," says Bruce Hutton, dean emeritus at the University of Denver's Daniels College of Business. Hutton has spent much of his career studying sustainable development, marketing research and corporate social responsibility. He believes some researchers are basing their estimates only on the negative costs -- without considering the increases in jobs, energy and economic performance expected from a growing renewable energy sector.

The current economic arguments over climate change, he says, are distorted by the "apparent fact-free political process we seem to be in, where it doesn't really matter what you say or what the truth is."

Not Waiting for the Final Answer


But Hutton says climate change is an industrial risk-management issue that cannot be ignored. "The World Business Council for Sustainable Development and some other organizations are having this conversation with businesses, about the idea of facing these mega-risks in our society," he says. "The question is: What happens if climate change is actually real and if it's somewhere in the vicinity of what most scientists say it's going to be? The question for a company -- or a community, for that matter -- is: What are the costs of that to me, in terms of how it's going to affect my business?"

Coca-Cola (KO) and other corporations, he says, are doing a lot of research on how to change their supply-chain structures and develop new processes for their products -- in Coke's case, using less water -- as a hedge against possible climate change risks. And for several years now, General Electric (GE) has issued its Ecomagination Challenge, awarding $200 million for ideas that "help us to change the way the world uses energy."

But Hutton doubts there's going to be a "gold rush" on sustainable energy in the near future. "Jeffrey Immelt at GE said we live in a kind of reset world now, from the financial markets going to hell to other stuff," he says. "We're not going to see what's been happening today as a cycle that's going to come back. We're in a time in which we have to create new stories."

"Creeping Crisis"

And he hopes it doesn't take some climate change "mega-event" to get American industries thinking, planning and preparing.

"The culture of the U.S. is we typically don't rise to the occasion until we're at the brink," Hutton says. "We have an amazing ability to respond to crises. The problem is that the issue we face today [is] a kind of [a] creeping crisis. It's a slippery slope problem. At some point we're going to have to adjust without the "defining moment" because the defining moment may be too damn late."

Adds Hutton: "So what I hope, personally, is rather than crying 'fire' and trying to create a defining moment -- which we don't respond to very well -- [that] we turn this conversation around climate change. . .into fundamentally good business practices."

Increase your money and finance knowledge from home

What are Penny Stocks

The lucrative and dangerous world of penny stocks.

View Course »

Forex for Beginners

Learn about trading currencies and foreign exchange transactions

View Course »

Add a Comment

*0 / 3000 Character Maximum

25 Comments

Filter by:
z4rock

Water is not destroyed when used. It cycles endlessly. Didn't you dimwits learn that in 6th grade science? You water a lawn. It helps the grass grow then evaporates to rain again.

October 03 2010 at 2:37 AM Report abuse +2 rate up rate down Reply
epolvi

The whole issue about climate change has taken a totally wrong turn caused by governments, corporations, and other organizations that see a benefit in using it in their scare tactics as an effect of a cause they want to control for their own benefit. However more and more people are becoming educated and can see through this kind of simple snake oil salesmen tactics and do not want to waste our money on false remedies. Climate change is real and if there is a real concern about its impact on our societies then we should acknowledge that it is caused by forces much greater than we can impact and rather than try to change the sun and other forces in our universe focus our efforts to what we can control and adapt to deal with the climate cycles that will happen in the future as well as they have happened in the past. Our homes and the infrastructure supporting our societies should be built to withstand the climate changes unless we are prepared to accept the consequences. Our food supply needs to be multi faceted so it can provide the needed nutrition during the different climate cycles. In spite there is no credible evidence that man made CO2 has any measurable impact on the climate change it is used as the villain in the global warming story to manipulate uninformed people to accept without questioning what the beneficiaries are doing. The only results of cap and trade and other schemes to grab control of our energy supply will be the lining of the pockets of the ones that can take benefit of the control and reduction of CO2 and consequently increase the population that can’t without distribution of wealth afford the increasing cost of energy and everything else that is impacted by the higher energy costs. There are real man made pollutants that are a danger to our health which must be minimized but CO2 is not one of them which is why the focus of the government’s involvement should be to stop the CO2 swindle and support the building up of a resilient society that can withstand the evolving climate change rather than waste our money on the hoax

October 03 2010 at 12:19 AM Report abuse +1 rate up rate down Reply
TRAVISSIGGLO

WE SHOULD CONSEVE WHATEVERR SURPLUS OF WATER MOTHER EARTH GIVES US, THE TIME WILL COME WHERE THE DUST BOWLES OF THE 1930'S MAY REACORE, WATER WILL BE GOLD. YES, WE ARE IN A DIFFERENT CENTURY, BECAUSE SOME OLD RECORDS WERE KEPT, THEY DID NO HAVE WHAT MAY HAVE HAPPENED A MILLION YEARS AGO, THIS MAY BE A REPEAT.

October 02 2010 at 9:01 PM Report abuse rate up rate down Reply
scottee

yes, the climate is going to change...it has been changing since the beginning of time. we can't stop it. and Gore got a gazillion dollars...why????

October 02 2010 at 8:15 PM Report abuse rate up rate down Reply
bonzodog40

so called climate change or global warning is a big BS scam for the the peole of the bus to pay more money for things when we are in a ression !!!!!

October 02 2010 at 7:57 PM Report abuse +1 rate up rate down Reply
yankeei

How humans adapt to the planet's climate change should be the focus. It's futile and a little presumptions to argue that humans are the cause. Wherever you fall on the argument, the truth is our planet's climates will change. Our planet tips a little way or the other; solar flares and orbit fluctulations - they're going to happen whatever we do. We can, however, make plans to adapt. This is the stuff I want see happening - not the blame game - let's get prepared.

October 02 2010 at 6:19 PM Report abuse -1 rate up rate down Reply
monseigneurdev

A broken down U.S economy will do its part for climate change. America will be swapping their cars for Chinese bicycles while a sole overlord jets overhead in his Gulfstream V. The Republicans had their WMDs in Iraq and the Democrats have their "man-made climate change." The former cost America hundreds of billions and the latter will cost America Trillions---most which Obama's team already spent.

October 02 2010 at 5:11 PM Report abuse +1 rate up rate down Reply
adeelman

Weather is unpredictable you can’t seriously even believe a weather man; science can try hard as they want but they only have theories to what’s really going. We have become a society of idiots we believe what we hear on the news which clearly doesn’t run off facts; it’s a whole bunch of bulls**t options"Period"

October 02 2010 at 4:19 PM Report abuse +4 rate up rate down Reply
mateus74

The instability will be caused by climate change policy, not actual climate change. The famine and refugee situations will be a product of restrictive "green" policies that limit all types of production, especially agriculture.

October 02 2010 at 1:59 PM Report abuse +4 rate up rate down Reply
markewhatl

The climate is always changing. This is BS. This is a ruaze to raise taxes and control your life. Why dont we all give $10,000 to politicains in Washington. And they promise the world's climate will not change. Sure. You do it!

October 02 2010 at 12:19 PM Report abuse rate up rate down Reply