A newly published report paints a stark picture for every American child born in the year 2024: they could lose an astonishing half a million dollars over their lifetime as a result of climate change.

The study, which was conducted by ICF, a global consulting firm, and commissioned by Consumer Reports, suggests that without rapid action to cut carbon emissions, these children could face a bill of $500,000 to $1 million due to increased living costs and reduced earnings.

The $500,000 cost-of-living increase is a conglomerate of housing, energy, and food expenses—factors directly linked to the impacts of climate change. Housing, with a $125,000 increase, takes the largest hit due to higher maintenance, operating, and insurance costs.

This is followed by energy, which is projected to cost an additional $88,000 as a result of heightened gas and electricity prices coupled with increased consumption to combat extreme temperatures. Food costs are predicted to rise by $33,000 due to anticipated difficulties in agriculture affecting supply and market prices.

On the earnings front, income is expected to shrink by approximately $25,000 as a result of decreased labor hours owing to extreme weather, particularly for outdoor jobs, and escalating health risks.

Taxes too are projected to leap by 15 percent over a lifetime, subtracting around $200,000 from future paychecks. Governments will be grappling with the dual burden of escalating expenses from healthcare systems and infrastructure damage, and dwindling revenues from lower personal and corporate earnings.

Should current emission trajectories persist, the potential loss of investment income could double the total cost, particularly affecting retirement savings as climate change erodes the value of corporate securities.

However, the analysis also presents a silver lining. If prompt and effective measures to curb emissions are taken, the financial blow could be significantly softened. Under a scenario where emissions are drastically reduced, taxes would only mount by $5,200 over a lifetime—a stark contrast to the $200,000 under the high-emissions scenario.

But not all studies agree with this grim forecast. Some analyses, criticized for neglecting human adaptations to a changing climate, imply that the economic impacts of climate change have been overstated. They argue that societies are capable of adjusting to warmer climates, as evidenced by expansion into historically hotter regions such as the American South and Southwest.

Dissenting voices, like Dr. Steve Keen of UCL and Nobel prize critics, question the reliability of some economic models that downplay the impact of climate change, labeling them as too optimistic. They point out flawed methodologies, such as ignoring industries that aren’t directly exposed to the weather, thereby underestimating the potential economic damage.

The ICF report underscores the varied impact climate change will have on individuals, dependent on factors like geographical location, occupation, and socioeconomic status. For example, a construction worker in Florida could face increased housing costs from tropical storms, while an IT professional in Nevada might encounter heightened healthcare expenses due to worsened air quality from drought-driven wildfires.

This piece of research stresses the immediacy and personal nature of the issue, making clear that the choices made today will shape the economic futures of those born tomorrow. While the specific numbers may vary depending on future developments, the overarching message is unequivocal: climate change is likely to impose a hefty financial burden on future generations, unless decisive actions are taken to mitigate its effects.

Relevant articles:
– Climate Change Could Cost Each American Born Today $500,000, consumerreports.org
– Overheated: How Flawed Analyses Overestimate the Costs of Climate Change, Manhattan Institute
– Nobel prize-winning economics of climate change is misleading and dangerous – here’s why, UCL – London’s Global University
– More flaws in estimates of the economic impacts of climate change, LSE Home