[Senate Hearing 118-9]
[From the U.S. Government Publishing Office]
S. Hrg. 118-9
RISING SEAS, RISING COSTS:
CLIMATE CHANGE AND THE ECONOMIC RISKS TO COASTAL COMMUNITIES
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HEARING
BEFORE THE
COMMITTEE ON THE BUDGET
UNITED STATES SENATE
ONE HUNDRED EIGHTEENTH CONGRESS
FIRST SESSION
__________
March 1, 2023
__________
Printed for the use of the Committee on the Budget
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
51-949 WASHINGTON : 2023
COMMITTEE ON THE BUDGET
SHELDON WHITEHOUSE, Rhode Island, Chairman
PATTY MURRAY, Washington CHARLES E. GRASSLEY, Iowa
RON WYDEN, Oregon MIKE CRAPO, Idaho
DEBBIE STABENOW, Michigan LINDSEY O. GRAHAM, South Carolina
BERNARD SANDERS, Vermont RON JOHNSON, Wisconsin
MARK R. WARNER, Virginia MITT ROMNEY, Utah
JEFF MERKLEY, Oregon ROGER MARSHALL, Kansas
TIM KAINE, Virginia MIKE BRAUN, Indiana
CHRIS VAN HOLLEN, Maryland JOHN KENNEDY, Louisiana
BEN RAY LUJAN, New Mexico RICK SCOTT, Florida
ALEX PADILLA, California MIKE LEE, Utah
Dan Dudis, Majority Staff Director
Kolan Davis, Republican Staff Director and Chief Counsel
Mallory B. Nersesian, Chief Clerk
Alexander C. Scioscia, Hearing Clerk
C O N T E N T S
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WEDNESDAY, MARCH 1, 2023
OPENING STATEMENTS BY COMMITTEE MEMBERS
Page
Senator Sheldon Whitehouse, Chairman............................. 1
Prepared Statement........................................... 29
Senator Ron Johnson.............................................. 3
Senator Charles E. Grassley, Ranking Member...................... 21
Prepared Statement........................................... 31
STATEMENTS BY COMMITTEE MEMBERS
Senator Patty Murray............................................. 13
Senator Tim Kaine................................................ 16
Senator Alex Padilla............................................. 18
Senator Mike Braun............................................... 22
Senator Chris Van Hollen......................................... 24
WITNESSES
Mr. Matthew Eby, Founder and Chief Executive Officer, First
Street Foundation.............................................. 5
Prepared Statement........................................... 33
Dr. Sean Becketti, Principal, Elliot Bay Analytics............... 7
Prepared Statement........................................... 56
Ms. Kate Michaud, Town Manager, Warren, Rhode Island............. 8
Prepared Statement........................................... 58
Dr. Jessica Weinkle, Associate Professor, University of North
Carolina, Wilmington........................................... 10
Prepared Statement........................................... 60
Dr. Marlo Lewis, Jr., Senior Fellow, Competitive Enterprise
Institute...................................................... 11
Prepared Statement........................................... 72
APPENDIX
Responses to post-hearing questions for the Record
Mr. Eby...................................................... 89
Dr. Becketti................................................. 91
Dr. Weinkle.................................................. 92
Dr. Lewis.................................................... 99
Charts submitted by Chairman Sheldon Whitehouse.................. 105
Documents submitted to the Record by Mr. Matthew Eby............. 107
RISING SEAS, RISING COSTS:
CLIMATE CHANGE AND THE ECONOMIC RISKS TO COASTAL COMMUNITIES
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WEDNESDAY, MARCH 1, 2023
Committee on the Budget,
U.S. Senate,
Washington, DC.
The hearing was convened, pursuant to notice, at 10:00
a.m., in the Dirksen Senate Office Building, Room SD-608, Hon.
Sheldon Whitehouse, Chairman of the Committee, presiding.
Present: Senators Whitehouse, Murray, Kaine, Van Hollen,
Padilla, Grassley, Johnson, Braun, and R. Scott.
Also present: Democratic Staff: Dan Dudis, Majority Staff
Director; Kara Allen, Senior Energy and Climate Advisor, Energy
Lead.
Republican Staff: Matthew Giroux, Deputy Staff Director;
Jordan Pakula, Professional Staff Member.
Witnesses:
Mr. Matthew Eby, Founder and Chief Executive Officer, First
Street Foundation
Dr. Sean Becketti, Principal, Elliott Bay Analytics
Ms. Kate Michaud, Town Manager, Warren, Rhode Island
Dr. Jessica Weinkle, (Via WebEx) Associate Professor,
University of North Carolina, Wilmington
Dr. Marlo Lewis, Jr., Senior Fellow, Competitive Enterprise
Institute
OPENING STATEMENT OF CHAIRMAN WHITEHOUSE \1\
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\1\ Prepared statement of Chairman Whitehouse appears in the
appendix on page 29.
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Chairman Whitehouse. The hearing of the Senate Budget
Committee will come to order. This is our first in our actual
room and the second in a series of hearings looking at the
effect of climate change on the federal budget. Senator
Grassley cannot be here because the Attorney General is in the
Judiciary Committee, and I will be spending some time there as
well with the Attorney General and Senator Kaine will take the
gavel from me when that takes place. And I want to thank
Senator Johnson for being here to step in for Ranking Member
Grassley.
After our first hearing's high-level budget impact
overview, today we begin looking at the specific ways climate
change will burden and indeed is already burdening our economy
and our federal budget.
We'll start with a look at our coasts, important to Rhode
Island. The U.S. has nearly 13,000 miles of coastline, 40
percent of our population lives along that coast, more than a
trillion dollars' worth of residential and commercial real
estate is coastal, as is much of our infrastructure--ports,
coastal roads, water treatment facilities.
Climate change threatens to upend life as it's now lived in
coastal communities and put immense burdens on government.
Rhode Island may be the smallest physical state in the nation,
but we have nearly 400 miles of coastline. In Warren, the
smallest town and the smallest in our five counties, some homes
have seen property values drop by one-third because of flood
risks. Sea level rise is projected to permanently flood coastal
portions of Warren over the next decade.
In 2017, Zillow's real estate database identified over 4800
homes in Rhode Island that would be under water with a
projected six feet of sea level rise, which is projected for
us. That's nearly $3 billion in Rhode Island home values. Our
coastal communities turn into a Rhode Island archipelago.
The situation is not unique to Warren or Rhode Island. For
most American households, their greatest wealth is their home.
As homes and businesses in coastal communities face more
frequent sunny-day flooding and wetter and more violent ocean
storms, insurance will become more expensive and harder to
find. Mortgages depend on insurance, so lending will suffer.
Coastal communities will become harder places to live and
work. And real estate values and local tax bases will decline.
Moody's is already looking at local municipal bonds in this
light. In emergencies, coastal communities will turn to the
federal government for financial assistance and federal flood
insurance costs will rise.
The consequences extend beyond real estate. Most of our
infrastructure, roads, bridges, Military bases and ports sit
along coasts. When critical infrastructure is lost to regular
inundation or to storm damage, local economies can suffer and
again the federal government has to foot the bill.
Unfortunately, the cost of these climate hazards is
projected to grow. First Street Foundation has a peer-reviewed
flood risk tool that shows significantly increasing risks to
residential properties over the next 30 years. Rhode Island's
own flood projections show similar risks. A study published
just two weeks ago estimates flood risks in real estate
markets, showing them overvalued now by $237 billion. Spoiler
alert. The worst property over evaluations are along our
coasts.
The study warns that coastal real estate values may plummet
and cascade into systemic risks for the mortgage market. I'll
interrupt my remarks here for one moment to point out that this
phrase ``systemic risks'' you'll hear a lot of in these
hearings. It was defined in the last one. It means when a risk
is so serious in one sector of the economy that it cascades
across the rest of the economy as we saw in the 2008 mortgage
meltdown, which hurt a lot more people than those with bad
mortgages.
Freddie Mac has made similar warnings. So, let me close by
quoting their former chief economist here today on the damage
climate change is likely to inflict as coastal property values
get hit. He said, ``The economic losses and social disruption
are likely to be greater, in total, than those experienced in
the housing crisis and Great Recession. A sobering warning for
those of us who lived through that. The only good news here is
that by acting now we can minimize the damage and costs to
households, businesses, and our economy.
Chairman Whitehouse. I'll turn to Senator Johnson for his
opening remarks and then I'll introduce the witnesses.
OPENING STATEMENT OF SENATOR JOHNSON
Senator Johnson. Thank you, Mr. Chairman. And it is true I
was asked to stand in as Ranking Member here to replace Senator
Grassley on Monday. So, I need to first state that the opinions
I express are those of my own, not Senator Grassley. I don't
want to get him in trouble. I also want to say I'm not a
climate change denier. I'm just not a climate change alarmist,
but I find the debate fascinating. I look forward to the
hearing.
I read a fair amount about it, a couple good books, The
Climate Changed the Facts, edited by Alan Moran. Apocalypse
Never is a more recent one. Subtitle there, Why Environmental
Alarmism Hurts Us All, by Michael Shellenberger, and then
anything that Bjorn Lomborg writes--and by the way, I think I'm
saying this right. Mr. Lomborg completely acknowledges manmade
climate change; just doesn't think we should spend anything
with limited resources. There are far better ways of spending
money to alleviate human suffering and I'm glad to see that Mr.
Lewis is citing Mr. Lomborg in his testimony a number of times.
But in my mind a good scientist is a very healthy skeptic.
You know always questioning, always seeking the truth. And to
me the term scientific consensus, I know there certainly is
some, but it's a very unscientific terms in many ways,
particularly when you're dealing with something that--you know
I think there's a lot of legitimate disagreement in terms of
climate change, but why am I skeptical? Now, I'm 67 years old.
I've lived through decades of malfeasanceism, doomsayers, and I
just asked my staff to get just a couple of the most delicious
predictions.
Not only were these individuals wrong, they were
spectacularly wrong. In 1970, Harvard biologist, George Wald
estimated that ``civilization will end within 50 or 30 years,
by 1985 to 2000, unless immediate action is taken against
problems facing mankind.'' January 1970, Life Magazine said
scientists have solid evidence to support the prediction that
by 1980 urban dwellers would have to wear gas mask to survive
air pollution.
In the spring of 1970, a issue of the Living Wilderness,
Dennis Hayes, the chief organizer for Earth Day, declared that
``It's already too late to avoid mass starvation.'' 1978 The
New York Times reported that a team of climate specialists saw
``no end in sight to a 30-year cooling trend in the Northern
Hemisphere.'' In 1980, ecologist Kenneth Watt predicted the
world would be four degrees colder in 1990 and 11 degrees
colder in the Year 2000. That, by the way, didn't happen.
1988 Maldives Director of Environmental Affairs predicted
that rising sea levels threatened to cover the Islands in the
next 30 years. In 1989, Noel Brown, a U.N. environmental
official said the entire nation is going to be wiped off the
earth if sea levels from global warming was reversed by the
Year 2000. 2004 a Pentagon climate change report said that
Britain will be Siberia by the Year 2020. I don't think that
happened. 2007 had a view in climate panel claimed that it
would be ``too late unless drastic action were taken by the
Year 2012'' and in 2008, Al Gore--by the way, anybody know how
much his wealth has grown off of climate alarmism? But he cited
a claim from another climate researcher that the North Pole may
be ice free by the Year 2013. That didn't happen either.
So, you combine those spectacularly wrong predictions time
and time again they're never held to account. Nobody ever fact
checks them. But also just take a look at some data, so
scientific data like the Vostok Ice Core Sample. More than
400,000 years of geologic history, 22.7-degree variation in
four to five cycles. Greenland ice core samples 6.7 degrees
variation.
This is one I always spring on crowds. Do you know much the
sea level has risen in the Bay of San Francisco since the last
glaciation period, 390 feet. So again, real or not, manmade
climate change I don't see how mankind can make even a
negligible impact with change in the climate which always
changes. It always does. So, I'm concerned that the cure is
worse than the disease and we would be wasting limited
resources, mortgaging our kids future, especially when China
and India are not exactly on board and they're going to
continue to provide power to pull their populations out of
poverty.
What this Committee should be focusing on is $31.5 trillion
worth of debt, a baseline budget that's gone from about $4.5
trillion prior to COVID to it appears to about $6 trillion and
nobody's even blinking an eye that we've increased that by
staff function, of about $1.5 trillion. The fact that our
interest rates are rising with every 1 percent increase in
interest rates our interest expense will rise by $315 billion.
If we just return to the interest rate we paid in the last
three decades this last century that would add $1.2 trillion in
interest expense to our annual budget. That's about what we
spend on Social Security. So, Mr. Chairman, again I look
forward to the hearing. I think it'll be interesting. I got a
lot of questions, but I really think the Budget Committee ought
to be focusing on the budget and focusing on that calamity that
is roaring toward us. Thank you, Mr. Chairman.
Chairman Whitehouse. Well, thank you very much, Senator
Johnson. And I think we are focusing on the budget by focusing
on the sea level rise calamity that is roaring towards us. I'm
pleased to have five witnesses here, including one from my home
state.
First is Matthew Eby the Founder and CEO of the First
Street Foundation, which is a research and technology nonprofit
that is defining America's climate risk. First Street began its
work by looking at flood risks and just this week published a
report on the rising cost of hurricane winds.
Next, we'll hear from Dr. Sean Becketti, a Principal with
Elliott Bay Analytics, which provides mortgage analytics,
consulting and advisory services. In his prior role as the
Chief Economist at Freddie Mac, Dr. Becketti wrote an article
foretelling the many challenges facing coastal real estate.
Following Dr. Becketti, Kate Michaud will testify. Kate is
the town manager for Warren, Rhode Island where they are
regularly dealing with the practical and immediate challenges
of rising sea levels and flooding.
After Ms. Michaud, we will be joined remotely by Dr.
Jessica Weinkle, an Associate Professor from the University of
North Carolina, Wilmington, who teaches coastal and ocean
policy and environmental politics and policy.
Finally, we'll hear from Dr. Marlo Lewis, Jr., who serves a
Senior Fellow at the Competitive Enterprise Institute, an
organization founded to reform America's so-called
unaccountable regulatory state.
Mr. Eby, you have minutes to begin your remarks. Please
proceed.
STATEMENT OF MATTHEW EBY, FOUNDER AND CHIEF EXECUTIVE OFFICER,
FIRST STREET FOUNDATION \2\
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\2\ Prepared statement of Mr. Eby appears in the appendix on page
33.
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Mr. Eby. Good morning, Chairman Whitehouse, Ranking Member
Grassley, and members of the Senate Committee on the Budget. My
name is Matthew Eby and I'm the Chief Executive Officer and
Founder of the First Street Foundation, a 501(c)(3) nonprofit
headquartered in Brooklyn, New York that is dedicated to make
climate risk information accessible, easy to understand,
actionable for citizens, businesses, and governments. I thank
you for your invitation and the opportunity to speak and
describe how the First Street Foundation is quantifying and
communicating climate risks for the United States and to relate
our findings to the Committee.
Today I will describe the highlight to the First Street
Foundation models related to climate risk as a combination of
the estimated exposure of each property and the vulnerability
of buildings on those properties in dollars and cents. We've
employed models of flood, wildfire, hurricane winds, and
extreme heat to create probabilistic estimates of exposure for
each of the approximately 143 million properties in the U.S.
My oral testimony will focus primarily on our flood work.
At the national level, the First Street Foundation flood model
identifies 14.6 million properties as having a 1 percent annual
risk of flooding. The same definition as the FEMA One-In-A-
Hundred Special Flood Hazard Area.
While the definitions are the same, our findings are not.
Our model identifies 5.9 million more properties across the
country to have this risk in or outside the FEMA Special Flood
Hazard Area. Of these properties, 4.3 million are single-
family, one-to-four-unit homes that are not built to a standard
to prevent flood damage.
These single-family properties face an estimated annual
loss of $4,694 per property for a total of $20 billion in
annualized damage today. These damage estimates are expected to
grow by 61 percent over the next 30 years to an estimated
annual loss of $7,563 per residential property, totaling $32.3
billion nationally.
Commercial properties are at risk of an additional $14
billion in property damage today, growing to 17 billion over
the next 30 years and account for a huge amount of indirect
community economic risk through the disruption of supply
chains, lost labor, and lost productivity. These indirect costs
associated with commercial building flood risks are around 50
billion today, growing to 63 billion in 30 years.
Along with that, the First Street Foundation wind model
finds around 18.5 billion in annualized property damage today,
growing to around 20 billion in 30 years, which we have yet to
calculate the downstream economic impacts of. Across the
country we have found 14 percent of residential properties, 17
percent of all social infrastructure, schools, places of
worship, libraries, et cetera, 20 percent of commercial
properties, 23 percent of all roads and 25 percent of all
critical infrastructure facilities--utilities, hospitals,
police stations that are all at risk of flooding and becoming
impassible or not operational.
All of these categories will face increased substantial
flood risks over the next 30 years, adding an additional 3 to 9
percent in exposure. The increasing exposure to the U.S. to
flood perils has an observable impact on property value by
looking at the universe of available real estate transactions
from the years 2005 to 2017 in coastal counties. We found a
quantifiable 15.9 billion in losses directly attributable to
properties exposed to mere tidal flooding. The over evaluation
of these properties is further exacerbated by the economic
damage associated with unknown flood risks and ultimately
amounts to approximately 200 billion in current real estate
market overvaluation. If this overvaluation is ever realized,
the impact would be dramatic.
In closing, the First Street Foundation is grateful to the
Senate Budget Committee to present our findings related to
climate risks and their economic impacts on the nation,
including our coastal communities. By creating property-
specific climate adjusted estimates of physical climate risk
exposures and related economic losses across the entire United
States First Street Foundation hopes to inspire informed action
by citizens, businesses, and governments.
We are proud to make our results publicly and freely
available to individual Americans and to democratize access to
key risk information that will support informed decision-making
and can result in communities that are more resilient in the
face of climate change. We remain optimistic by continuing to
be informed by the science that we, as a nation, can find ways
to address climate change and create more resilient communities
today and in the future. Thank you.
Chairman Whitehouse. Thank you very much, Mr. Eby, and
thank you for the support and guidance that you provide to
coastal communities to have access to your work. Let me turn
now to Dr. Becketti.
STATEMENT OF DR. SEAN BECKETTI, PRINCIPAL,
ELLIOTT BAY ANALYTICS \3\
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\3\ Prepared statement of Dr. Becketti appears in the appendix on
page 56.
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Dr. Becketti. Chairman Whitehouse, Ranking Member Grassley,
and Members of the Committee, thank you for inviting me to
address the way sea level rise and increasing flood risks
affect housing.
In 2016, while I was the Chief Economist at Freddie Mac, I
co-wrote an article about the potential impact of flood risk on
housing with a special focus on sea level rise. The article was
called Life's a Beach. I believe that article is more relevant
today than when it was published, and I would like to summarize
the key points for you.
Sea level has risen measurably over more than a century.
Between 1901 and 2018, the global average sea level rose by
between 6 and 10 inches and more precise satellite radar data
for the period of 1993 to 2017, indicates the pace of sea level
rise is accelerating. The rate of sea level rise varies
considerably across regions.
For instance, the sea level along the Eastern Seaboard of
the United States has been rising three to four times faster
than the global average. And in the Miami area alone, daily
highwater levels have been rising almost an inch a year. Floods
also have become more common and some cities on the East Coast
have experienced a tenfold increase in the frequency of
flooding.
In the years since the publication of Life's a Beach, the
National Oceanic and Atmospheric Administration recorded 12
floods that each caused more than a $1 billion damage. The
primary source of flood insurance is the National Flood
Insurance Program or NFIP. By subsidizing the premiums on the
insurance offers, NFIP actually encourages development in the
flood plan. Moreover, many of the NFIP flood maps are out of
date. Independent research suggests that many areas tagged as
outside the flood plan by NFIP, in fact, face a significant
risk of flood.
Finally, NFIP is expensive. In 2017, Congress forgave $16
billion in order to keep NFIP within its $30.5 billion debt
limit. And currently, NFIP accrues over a million dollars per
day in interest charges on its approximately $20 billion in
debt.
The increases in sea level and flood risks pose challenges,
both for homeowners and for the housing system, generally. Let
me list just five of these challenges. One, most mortgages in
the United States are 30-year loans. In areas where sea level
rise may make homes uninhabitable in 30 years or less, lenders
may become reluctant to offer 30-year mortgages.
Second, private insurance contracts are annual. As flood
risks increase, insurance companies may choose between steadily
rising premiums or simply failing to renew policies when these
risks become near certainties. Third, taxpayers may balk at
covering the escalating costs of the NFIP in light of the
predictability of the losses. Taxpayers may feel that the
affected homeowners ignored decades-long warning of the risks
they were bearing. Four, a large share of homeowner's wealth is
locked up in the equity in their homes. If those homes become
uninsurable and unmarketable, the values of the homes will
plummet and unlike the experience of 2007 and '08, these
homeowners will have no expectation that the value of their
homes will ever recover.
Finally, floods damage the infrastructure in the community.
As a result, even homeowners on high ground who avoid direct
damage may suffer losses as community services deteriorate and
businesses are forced to relocate, taking employment
opportunities with them.
These are just a few of the challenges posed by sea level
rise and flood risks. There are no simple solutions.
Nonetheless, the sooner the nation grapples with these
challenges the lower the costs and the lower the amount of
human suffering. The sea level will continue to rise regardless
of the course we choose. Thank you for your time and attention.
Chairman Whitehouse. Thank you. We will now turn to my
fellow Rhode Islander, Kate Michaud. I should say that my time
in Judiciary is about to begin. Senator Kaine is here, who will
Chair for me when I go down to Judiciary, which I probably will
at the end of Kate's testimony. I want to thank our
Appropriations Chair and President Pro Tempore, Patty Murray,
for joining us. And if I'm not back for the first round of
questions, I would let Senator Kaine and Senator Murray be the
two lead offs since they are here and then the list is Van
Holland and Padilla. With that, Ms. Michaud, thank you for
being here. Welcome to Washington.
STATEMENT OF KATE MICHAUD, TOWN MANAGER,
WARREN, RHODE ISLAND \4\
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\4\ Prepared statement of Ms. Michaud appears in the appendix on
page 58.
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Ms. Michaud. Thank you, Chairman Whitehouse and Ranking
Member Grassley, and to the distinguished members of the
Committee for allowing me to address you today. My name is Kate
Michaud and I'm the Town Manager of the Town of Warren, which
as Senator Whitehouse mentioned, is the smallest town in the
smallest county in the smallest state in the nation.
The Town of Warren is the location of the seat of the
historic region of Solomons where the Massasoit-Narragansett
once welcomed a delegation of Pilgrims, including Edward
Winslow and Stephen Hopkins. Warren's prime location featuring
18 miles of waterfront land allowed for a thriving shipbuilding
industry, commercial shell fishing, and other marine-based
businesses.
Over time, manufacturing has taken over as the town's top
employer with a diverse array of companies, including defense
contractors, composite industry leaders, and consumer goods
producers. Along with the rest of the state, housing density
has increased to provide for the workforce that has followed
job creation.
In 2022, Rhode Island was the second most densely populated
state with a majority of residents living near its 400 miles of
coastline. Warren is no different, but Warren is changing.
Warren's coastal proximity and flat elevation averaging seven
feet or less in the most densely populated areas of town has
rendered the town especially vulnerable to the effects of
coastal flooding and climate change.
What is happening and what is predicted to happen in our
most vulnerable coastal areas is significant and while
Warrenites are tirelessly self-reliant it is beyond our ability
to simply cope. In 2017, the Town of Warren undertook a major
wastewater treatment facility upgrade project to increase
capacity and improve water quality.
As the stewards of the taxpayers funds the town undertook a
cost benefit analysis of the equipment that was to be installed
to ensure that it would be viable for the life of the asset.
With assistance from our engineers, state agencies, the
University of Rhode Island, and utilizing NOAA data, a
conservative estimate of three feet of sea level rise was
adopted for the design horizon of 2065.
Facility upgrades were completed in 2022 at a cost of $21.7
million borne by the local taxpayers. Viability of the facility
beyond three feet of sea overrise is unlikely. As a result of
the study completed for the wastewater improvements, the town
determined that there was a pressing need to calculate the
future impacts of coastal flooding on our other critical
municipal infrastructure and on the town's tax base. Efforts
have focused on our Market Street area which is 184-acre
district containing approximately 700 housing units, mostly
multifamily rental housing as well as 30 businesses.
The area currently has a total asset value of $138 million
or just over 10 percent of the assessed value of the total
town. A no-action scenario was developed predicting what would
happen with no efforts to mitigate the rising waters. The data
analysis concluded that by the Year 2100, 306 of the area's 400
buildings could be lost permanently to the rising water with a
loss in value of more than $85 million in today's dollars or
more than 60 percent of the total assessed value of the area.
A 24-inch storm surge on top of the predicted sea level
rise, not extreme for a coastal hurricane or Nor'easter could
result in additional $52 million in flood damage and $126
million in lost business revenue. For reference, the hurricane
of 1938 brought to 10 to 12 feet of storm surge to Rhode
Island. With just three feet of sea level rise predicted to be
experienced locally within the next 30 years, three of the
town's major roads, including the primary evacuation route
would be flooded with salt water and impassible every day at
high tide.
These roads are already experiencing significant effects of
sunny day flooding occurring during the seasonal high tides in
the spring and fall. Storm water systems intended to drain
precipitation away from the populated areas are instead
operating in reverse, bringing tidal water into the inland
areas flooding roads, parking lots, and even homes. Underground
tidal action has washed out the road base on at least one local
road causing a partial collapse and hundreds of thousands of
dollars of damage to underground utilities.
While we are just starting to fully understand the
potential cost of damage to public assess, we know we will need
additional resources beyond what we can make available and we
are looking to federal resources to help us to assess and
prepare, including FEMA's Building Resilient Infrastructure and
Communities Program and the National Coastal Resilience Fund.
I've been invited here today not because Warren is unique
in its vulnerability, but because it is a microcosm of the
hundreds of small coastal communities in this country all
populated with hard-working residents and business owners.
Warren is not a playground of the rich. It is not a tourism
hotspot. The homes that line our shores are not vacation homes
of little consequence.
I am here not because I am trying to taking a cutting-edge
approach to local governance, but because one of my most basic
duties is to prepare my community for the realities of the
future. I am concerned about financial limits of the taxpayers.
I am concerned about the bonding agencies. I am concerned about
what happens when the financial industry that a 30-year
mortgage in my town is too great a risk to take.
I thank you for this opportunity to address you today and I
look forward to answering any questions that you may have.
Senator Kaine. Thank you, Ms. Michaud. The next witness is
appearing virtually and it's Dr. Weinkle. Please proceed and
correct me if I got your name mispronounced, please.
STATEMENT OF DR. JESSICA WEINKLE, ASSOCIATE PROFESSOR,
UNIVERSITY OF NORTH CAROLINA, WILMINGTON \5\
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\5\ Prepared statement of Dr. Weinkle appears in the appendix on
page 60.
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Dr. Weinkle. No, that was fine. Thank you. Good morning.
Thank you, Chairman Whitehouse, Ranking Member Grassley, and
members of the Committee, for enabling me to visit with you
today. It is a great honor.
Today I share my perspective of the interface of climate
change science, economics of coastal risks, and policy. As one
born and raised on Miami Beach and now living in coastal
Wilmington, North Carolina, coastal risk is a personal and
professional concern of mine.
What I have found in my nearly 20 years of research on the
interface of climate change science and policy is what most
people find in protracted areas of policymaking: money, power,
and a system of social relationships that creates a community
of mutually beneficial shared assumptions. Climate change
science is big business and big politics and it's used to
advocate for new ways of shaping the foundational components of
our economy.
And today it does not just engage with the biggest names in
finance, it engages with decision-making on the scaffolding
that is the institution of finance. This is not inherently
problematic. Expertise is invaluable for decision-makers to
understand public problems and develop a range of actionable
options to alleviate those problems. What is problematic,
however, is when scientific integrity is undermined in pursue
of financial and political gain. This is indeed what has
happened in the field of climate change science.
The most commonly used emission scenarios in climate change
research are grossly implausible or at the upper bounds of
plausible. By implausible, I mean that CO2 emissions
projections embedded in the scenarios do not reflect
observation or the state of knowledge about energy markets in
the global economy.
Today it's not easy to separate the going ons of climate
change research from the special interests of financial
institutions. As an analogy, we can say, and indeed we know,
much the same about the relationship between biomedical
research and the pharmaceutical industry. The landscape of
climate change research is made complicated by an out-copying
of a nonprofit advocacy organizations that double as analytic
consultants, hold contracts with private companies and
government entities, and engage in official government advisory
roles all while publishing in the peer reviewed literature and
creating media storms.
This is not really an issue of any one entity, though. It
is pervasive. And again, much like other areas of research,
such as pharmaceuticals, it's not inherently unusual. It is not
unusual, but it does require policymakers to take a step back
to understand what they were really looking at when they
receive information about the economics of climate change
risks.
Disclosure practices must be improved across the board from
climate science journals to scientific professional
organizations to the development of national climate assessment
reports and other places climate sciences are used in official
advisory positions to policymakers.
I have five points to share with the Committee. Number one,
at the outset, I affirm that climate change is real, and it is
important. Policies that reduce human impacts on local,
regional, and global climate demonstrate a commitment to the
well-being and security of our communities and future
generations.
Number two, social factors are the leading cause in
historical increases in the cost of coastal loss events related
to weather and climate extremes. Growth and population along
the coast, the associated concentration of wealth and inflation
explain the historical increases in the cost of coastal loss
events.
Number three, practical policy responses for reducing the
cost and human suffering associated with coastal disasters
would directly address underlying vulnerabilities in the built
environment and within the most vulnerable communities. This
approach also offers robustness and resilience to future
climate change. The decision to use climate change as a focal
point for discussing coastal disasters is a decision to deflect
attention from the social and political causes of vulnerability
and loss.
Number four, reducing coastal risks makes good sense and it
is also difficult. It is imperative that policymakers are
working with plausible scenarios of future risks. This is a
very basic rule of policy analysis. And finally, to reiterate,
climate change science demonstrates an underappreciated dynamic
system of conflicts of interests among climate change
researchers, advocacy organizations, and the financial
industry. Thank you.
STATEMENT OF DR. MARLO LEWIS, JR., SENIOR FELLOW, COMPETITIVE
ENTERPRISE INSTITUTE \6\
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\6\ Prepared statement of Dr. Lewis appears in the appendix on page
72.
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Dr. Lewis. Okay. Thank you, Senators, for inviting me to
testify today on behalf of the Competitive Enterprise
Institute. We're a nonprofit research organization with a focus
on regulatory policy and we are dedicated to promoting economic
liberty and free enterprise.
I was really impressed with the testimonies I've heard so
far and one theme that I think I heard in comments in all of
them, which was in my testimony and I'm quite pleased with this
because I'm not a professional civil engineer of any sort or
urban planner. It is the importance of adaptation. A lot of
attribution has been placed on climate change for these risks
to coastal communities by most of the witnesses. And I was
surprised, but also pleased that nobody decided to promote
emission reduction as a cure.
In fact, Mr. Becketti said the seas are going to rise
regardless of what we do. I guess I would qualify that just a
little bit in saying that when it comes to sea level rise
damages what's really more important than global sea level
rise, which as one of the previous witnesses said, I think it
was Dr. Becketti, has only been about 6 to 10 inches over the
last century, is relative sea level rise. The relationship
between the sea level and the coastline and this can be
massively influenced by changes in the level of the land, water
withdrawals, the withdrawals of fossil fuels from coastal
areas, all of those can result in a sinking or subsidence of
the land.
So can the rebound from the disappearance of the glaciers.
All of that can also raise the land level in relation to the
sea. But if it is, in fact, the case that sea levels, say, in
Rhode Island are going to rise by three feet in just the next
30 years that is not due to global climate change. Only a small
part of that would be. That would be due to more local factors.
One point I want to stress that is in my testimony is the
marvelous power of adaptation. Human beings have this
remarkable capacity for adaptation. And I would hope that this
would extend also to protection against the property damages
from relative sea level rise primarily, but also to some extent
just from global sea level rise.
What I'm talking about, for example, is that since the
1920s the average mortality, the average number of deaths
globally by decade from all kinds of weather-related hazards,
storms, snowstorms, heatwaves, drought--drought's the biggest
killer, but that has declined by 96 percent over the last
hundred years. That's really quite phenomenal.
And if you consider that there has been a four-fold
increase in global population, it actually means that the
average person in the world today has 99.4 percent less risk of
being killed by extreme weather than the average person in the
1920s.
Now, some people say, not at this panel, but I think we've
all heard people say that, well, the weather's becoming more
destructive and that explains why property damages are rising.
And in fact, usually that's due to a failure to normalize the
loss data for changes in population, for changes in property
values. For example, the Florida coastal population has
increased by something like 67 times since 1900. So, it stands
to reason that a hurricane that hits in Dade or Browder County
today would do a great deal more damage than one that hit say
only 40 years, the same hurricane, that is.
But this, I think, is a fascinating study that----
Senator Kaine. And Dr. Lewis, you're over your time, so if
you could try to summarize and conclude.
Dr. Lewis. Yes, I will. That there has been basically a
five-fold decrease since the 1980s in the relative impact of
extreme weather of all kinds, globally, and that also is a
testament to this amazing power of adaptation. And really to
sustain that adaptation we need to keep the economy growing. We
need to keep it dynamic. We need to keep therefore what moves
the economy, what powers it available and accessible and
affordable. Thank you very much.
Senator Kaine. Thank you. We will begin with questions, and
I will ask Senator Murray to start us off.
STATEMENT OF SENATOR MURRAY
Senator Murray. Mr. Chairman, thank you very much.
Appreciate that and I want to thank the Chairman and Senator
Grassley, Ranking Member, for holding this hearing and also to
our witnesses who are here today to talk about this.
I really do appreciate this hearing today. It's given us
the change to dive deeper into the budgetary costs related to
climate change because this is costing billions if not
trillions of dollars a year. Because let's be clear that
climate crisis is here. It's expensive. And that's just the
plain truth.
In my home state of Washington more than 65 percent of our
population lives in coastal areas and these communities are on
the frontline of this crisis. We've already seen in my state
rising sea levels, increased flooding, and storm surge risks
and it does real damage to our working waterfronts, to our
community infrastructure, to our housing supply, and the
coastal ecosystem that support our fisheries. And we know this
will be felt unevenly depending on where you live and what
resources you have available.
So, my first question is for you, Ms. Michaud, and thank
you for your testimony. Can you talk about the types of
investments that your town has already had to make to respond
and prepare for this coastal flooding and how those assessments
are impacting your current infrastructure decisions?
Ms. Michaud. Sure. I think that the biggest impact so far
has been to our wastewater system. I referenced the wastewater
treatment facility upgrade project, which was a $21.7 million
project, which may not sound like a lot of money, but our total
annual budget is just around $25 million and the debt service
on that debt for that wastewater project is approximately 18
percent of our annual operating budget, which is considerable.
We have recently entered into a public/private partnership
with a housing developer to upgrade one of our pump stations.
The cost to elevate and refurbish that pump station was right
around $4 million. We have 10 pump stations in total, so we
have some work still to do. And we are also performing a number
of what are called in-of-road retrofits, so we have roads that
formerly went to the coast, straight down the coastline.
They're now flooding frequently at high tides, so what we are
doing is working with engineers to pull the pavement back from
the edge of the road, create kind of a soft barrier to
eliminate the erosion that we're seeing.
So, those are costly projects and there are many of them.
We've completed I believe four and we have many more to go. So,
that's just a sample. We have a lot more infrastructure
projects that we need to take a look at and they do
significantly impact our budget and it's a budget that is, like
I said, very small. We're a small town, just over 11,000
residents and those residents are already bearing the burden of
that cost.
Senator Murray. Well, thank you for that. And as an
example, about most of this is actually straining communities
in Washington State and the difficult decisions that are having
to be made, the Quinault Indian Nation on the Olympic Peninsula
on my state has already begun to experience the effects of sea
level rise and those intense storm surges we're seeing.
They've had damaging floods and landsides and did a climate
vulnerability assessment and as a result of that the Tribe
developed a very comprehensive relocation plan and it involves
relocating the Tribe's lower village of Taholah to higher
elevation because of the impacts they're seeing. That's going
to involve an emergency evacuation center. It's going to move a
significant portion of the Tribal infrastructure inland away
from the Quinault River and the Pacific Ocean that the Tribe
has always depended on for their subsistence as well.
Last year they did get $25 million through our bipartisan
infrastructure law to begin this costly process and they are
not alone in having to take a really hard look at what the
current sea level risk is happening to communities around our
country. And I think a lot of people are asking how are we
going to be able to avoid the loss of life and property and be
able to make these investments.
So, Mr. Eby, my question actually I want to direct to you.
Talk to us about the budgetary impacts that such large-scale
relocation efforts in the future could have for our communities
and for our economy?
Mr. Eby. Thank you for your leadership on this question and
for the question, Senator. Unfortunately, as you mentioned, the
Quinault Indian Nation is not unique in this situation. The
managed retreat that's happening where they're moving to higher
land and the relocation of critical infrastructure and assets
is something that we're seeing in multiple states and something
that has to unfortunately take place when we look at the cost
benefit ratio of staying in certain places and the overall risk
that is faced.
Unfortunately, as this is not unique, it's extremely
costly. When we look at the critical infrastructure that's
involved as was talking about with Ms. Michaud and what's going
on in different counties and states across the state, it is
extremely costly to undergo these versus just building in the
first place to a standard that allows us to understand what
will happen from risks today and into the future.
So, while unfortunately I can't give you a specific number
on how managed retreat in these typical situations will cost us
as a country, I can tell you that it's much, much more
expensive to try and do these things retroactively, than to
actually manage these things from the beginning and use climate
adjusted forecasts and change building code standards or to
make these decisions forthcoming.
Senator Murray. Well, thanks very much. And again, Mr.
Chairman, thank you.
Senator Kaine. Absolutely. Senator Johnson.
Senator Johnson. Thank you, Mr. Chairman. Is it Mr. Eby or
Eby?
Mr. Eby. It's Eby.
Senator Johnson. Mr. Eby or Mr. Becketti, now, Mr. Eby
particularly, you've gone to great lengths of making all kinds
of cost estimates, pretty high detailed. Do either of you know
how much we've already spent in the U.S. and globally to combat
climate change, do you know what that number is?
Mr. Eby. I do not, Senator.
Senator Johnson. Anybody on the panel have any idea how
much we've already spent, how much we've committed, either in
the U.S. or globally? My point being is wouldn't that be an
really important number to know to compare to what the damages
might be?
Again, going to adaptation, Dr. Weinkle, I think you're the
only environmental scientist on the panel here. I mean I've
seen estimates that if we were to reduce or eliminate CO2 in
the U.S. or in the West you would have a negligible impact on
average temperatures over the next hundred years or so; is that
true?
Dr. Weinkle. That specific question goes well beyond sort
of my area of expertise in coastal risks. The cost of emissions
scenarios and all that.
Senator Johnson. Dr. Lewis has raised his hand, do you have
a----
Dr. Lewis. Yes, I do. Yes. In fact, in my testimony I
referenced a study done by Kevin Dayaratna of the Heritage
Foundation. He's a Ph.D. data scientist, a statistician. And
what he did is he just took the EPA's climate policy calculator
model, it's acronymed MAGIC, and decided to take a look at what
happens to global temperatures at various assumed climate
sensitivities. He went all the way from the assumption.
Senator Johnson. Can you get to the bottom line here?
Dr. Lewis. Okay. And basically, if you instantaneously and
completely eliminate U.S. CO2 emissions today and basically if
you take the middle range sensitivity assumption then you avert
about 2/10th of a degree Celsius of global warming by the Year
2100.
Senator Johnson. So again, I believe we've probably spent
hundreds of billions. I think we're contemplating spending
trillions of dollars to do something that we can't do. Again,
we recognize that in just 20,000 years or less, I mean it's a
blink of the eye in terms of geologic time, the sea level's
increased by 390 feet in the Bay of San Francisco. We can't
spend enough--we can't hold back the tides. So, this is where
the Bjorn Lomborg approach comes into effect. We're far better
off spending resources adapting as opposed to this insane quest
to conquer climate change, which we can't do again. Climate has
always changed; always will. So, let's spend the resources
properly.
I also want to talk a little bit about how the cure is
worse than the disease. I didn't get it done in time, but I had
a photo I was going to show of I don't know how many hundreds
of miners in the Congo mining cobalt and a lot of these are
children. Does anybody here have any estimates of how much more
copper we're going to have to mine, how much more cobalt we're
going to have to mine, how much more lithium we're going to
have to mine, how may rare earth minerals we're going to have
to mine? What's the impact to the environment of that? What
about the unreliability of our grid? Mr. Eby, have you done
calculations of that? Because wind and solar are not reliable
and you need backup, have you done any cost calculations of how
much it's going to cost when a grid shuts down because of
unreliability?
Mr. Eby. We focus on the economic damages of physical
climate change, so not the reliability of the grid or reliable
energy.
Senator Johnson. So again, we are ignoring the main factors
here. There's nothing we can do, literally, to combat climate
change, particularly when China and India aren't on board and
they never will be onboard. So, we could spend hundreds of
billions, have no impact, waste hundreds of billions, trillions
of dollars. We're far better off spending that money to adapt
and we also have to fully realize the cost, the environmental
cost of all the additional mining and understand that it's just
not possible to meet these climate--I mean you can't end fossil
fuels in 10 years. It's impossible. It would impoverish our
nation. Why are we even talking about it? Thank you, Mr.
Chairman.
Chairman Whitehouse. Well, for the record, let me just say
I have a different view than those statements and I think most
people do. Let me turn now to Senator Kaine and then we'll turn
to Senator Padilla. Senator Kaine is living with this as the
Navy looks at Naval Station Norfolk and the flooding in that
area and what it portends for his base, so I'm grateful to him
for being here.
STATEMENT OF SENATOR KAINE
Senator Kaine. Absolutely. Thank you, Mr. Chair and to all
the witnesses for being here. And I want to talk about Norfolk.
Before I do, though, I have a question for Dr. Weinkle.
I was reviewing your written testimony as well as your
verbal testimony, and your fifth point is a dynamic system of
conflicts of interest among climate change researchers,
advocacy organizations, and financial industry anchors the use
of implausible emission scenarios, and you have a quote in the
written testimony that I think all of us would agree with.
``Researcher conflicts of interest, especially when undisclosed
undermines scientific integrity and threatens public trust in
science.''
But as I read your testimony and listened to it, you didn't
mention anything about the fossil fuel industry. You focused on
the financial industry and advocacy organizations. Is there
some reason why you've omitted reference the fossil fuel
industry which often is involved in research that is frequently
undisclosed?
Dr. Weinkle. Yes. Thank you for that question. So, I do
link to that I have a reference to it in my written testimony
and one of the most notable works on that area, Merchants of
Doubt became a movie. It's not that I omitted it. What I said
and what I believe is that we've done a very good job in
pointing out these conflicts of interest in that area, but we
have a tendency to turn a blind eye to it when it's coming from
other areas.
Senator Kaine. All right. Well, I'm going to move onto
Norfolk now, but I just found it striking that your testimony
focused on the financial industry and climate advocacy
organizations and in my view omitted--you could characterize
differently--omitted reference to fossil fuel research which
has frequently undisclosed and has, I think, vastly dominated,
outnumber some of the other research, but let me move to
Norfolk.
The Hampton Roads area in Virginia there are 1.7 million
people. It's the second largest metropolitan area in our
Commonwealth. Historic area, very diverse, Jamestown Island
where English settlement of North America, no offense to the
pilgrims, the biggest Navy base in the world, Norfolk Naval
Base, the Chesapeake Bay, very dynamic economy and yet the sea
level effects in Norfolk are not future effects. We're seeing
them every day.
We have communities in the Chesapeake Bay like Tangier
Island, that could well disappear, but I have a question for
you, Dr. Becketti. According to a recent report by the Hampton
Roads Planning District Commission, the low estimates of sea
level rise indicate that approximately 59,000 residential homes
in the Hampton Roads region will be permanently or regularly
inundated by the end of the century.
And if you look at the high estimates of sea level rise
that are consensus in Virginia, including the Virginia
Institute of Marine Science, about 175,000 homes will be
permanently or regularly inundated. Your former employer,
Freddie Mac, has estimated that the total losses to coastal
real estate ``are likely to be greater in total than those
experienced during the housing crisis and Great Recession. What
would a drop in property values of this magnitude mean for the
financial situations of families living in these homes? And
this is just one metropolitan area in the United States.
Dr. Becketti. Well, obviously, it would be a very
catastrophic event. I think Mr. Eby presented some evidence
about property overvaluation, current overvaluation of coastal
properties where people are not realizing the risk that they're
facing in the future. And the question that stimulated me to
get involved in this area at all is we had just lived through
2007 and '08 and the many years of recovery in which we haven't
completely recovered from that yet and we had many years where
we said these house price rises can't be sustained.
People are starting to believe that they're printing money
and there's no risk and eventually for whatever reason that
triggered it, all of a sudden, the house of cards collapsed and
there is a fear that something similar could happen in this
area.
Senator Kaine. If I could, I have one more question I
wanted to get into Mr. Eby if I can.
Dr. Becketti. Sure.
Senator Kaine. So, with respect to our naval base, the
estimates on the Virginia Coastal Resilience Coast Masterplan
suggests that under NOAA's intermediate risk scenarios 25,000
acres of DoD facilities in the Commonwealth of Virginia will be
in the hundred-year flood plan of risk year and by 2080 that
number climbs to 31,000 acres of DoD facilities in Virginia.
Has the First Street Foundation undertaken an assessment of
flood risks for our nation's Military assets?
Mr. Eby. Thank you very much for the question, Senator
Kaine, and thank you for your leadership on the topic.
Unfortunately, the naval base and the assets in the region are
not unique in the sense that there's already 3,044 properties
that have a 1 percent annual chance of risk are greater today
in your state and that's growing by over 13 percent in just 30
years. And so, when we look at the actual infrastructure of the
Military, a lot of the things that we need to look at to
understand the inoperability or risk are confidential. So,
things like at what height would the docks be for the ships to
be able to actually be manageable and be able to go out to sea.
But what we can see are things like the single road that
goes to our naval base that becomes unpassable under certain
events today, let alone on how that's----
Senator Kaine. Yes. Not even during storm surge, just your
normal tidal action it's frequent and it's growing more
frequent. I'm over my time. Thank you very much. Yield back,
Mr. Chair.
Chairman Whitehouse. For what it's worth, the former
commander of Naval Station Norfolk, the naval officer who was
in charge of it, has actually predicted that that base will
have to go out of service for this very reason and that's
coming from the United States Navy. Senator Padilla is next.
STATEMENT OF SENATOR PADILLA
Senator Padilla. Thank you, Mr. Chair. Good morning to the
witnesses. My home state of California has one of the longest
coastlines stretching 840 miles from the Oregon border to
Mexico. And of the nearly 40 million people who live in
California, 26.3 million of them live in what are considered
coastal communities. And according to Coastal, California
employs more than 12 million people annually, which translates
into $2 trillion in GDP.
Those are big numbers, but I share that because all of that
is at risk with rising sea levels. And it's not just the
economic impact that we must grapple with. A recent study by UC
Berkeley and UCLA mapped the more than 400 facilities with
hazardous materials that will experience flooding events by the
end of the century, including powerplants, refineries,
industrial facilities, and hazardous waste sites, many of which
are located not just in coastal regions, but specifically in
disadvantaged communities in the coastal regions.
A three-foot sea level rise will flood 15 wastewater
treatment plants in California. Facilities in the San Francisco
Bay region are particularly vulnerable with rising groundwater
levels magnifying flood risks.
With all that being said, the question is for Mr. Eby. What
does your modeling demonstrate about the particular risk for
low-income or disadvantaged communities located near aging
facilities and infrastructure?
Mr. Eby. Thank you very much for the question. And as you
noted, California is particularly at risk with over a million
properties that have that similar 1 percent risk that I was
talking about, growing another 5.5 percent over the next 30
years. And unfortunately, with that comes the assessments of
those that are at risk.
So, to your question of are we seeing a higher instance of
vulnerabilities around the LMI population the answer is yes.
One of our partners, Redfin, a real estate company, used our
data in partnership to look at this exact question and found
that there's $107 billion in home value at risk of flooding in
formerly redline districts compared to $85 billion in home
value at risk from those that were deemed just kind of more
desirable for lending.
And what you're able to see when you look economic impact
per square foot or value of the home when you see lower value
homes and the cost of flooding that goes against them, you see
a higher percentage of the home value that is at risk than the
more affluent areas across the country. So, we see this time
and time again by looking at our data that the LMI population
is much more at risk and much more exposed and much less likely
to be insured, unfortunately, from these events as well.
Senator Padilla. Thank you. Welcome your input and feedback
as it pertains to as a result federal investments in some of
these areas to address, not just the issues of physical impact
to sea level rise, but the equity lens that should accompany
it.
We've also had our fair share of natural disasters in
California in recent years. The recent California flooding and
severe weather lead to anywhere between five and $7 billion in
total U.S. economic losses according to new estimates from
Moody's. [0:58:59.8#] a special kind of weather whiplash in
California where we cycle back and forth from the worst mega
drought in 1200 years, followed by storm events and extreme
flood impacts. You all heard about the blizzard warnings in
southern California this last weekend under scenarios of three
feet to six feet of sea level rise, up to two-thirds of
southern California beaches may become completed eroded also by
the end of the century.
The Army Corps of Engineers plays a particularly important
role in protecting communities from extreme floods and rising
sea levels, but also in beach nourishment projects that are
ongoing and require sustained federal investments.
Back to you, Mr. Eby, can you speak to the way your climate
modeling looks at risks collectively across fire, heat,
flooding, and wind, given that many parts of California
experience all of the above?
Mr. Eby. Again, thank you for that question. And with our
models we've created individual versions, so high resolution
models to be able to look at these exact questions. So, what is
the exposure to extreme heat, what is the exposure to hurricane
winds, what is the exposure to wildfires and flooding. And in
California, specifically, each one of those is represented
across the state as current and increasing risk from climate
change.
We haven't combined these into one overall score or risk or
quantification for the state, but I can tell you that
individually each one poses a risk overall. Similarly, with
flooding, especially with things like atmospheric rivers and
severe precipitation that we've seen this year that impacts all
of these homes that are outside the FEMA flood zone and the
FEMA special flood hazard area. These are just some of the
things that we're seeing today that we know are going to be
exacerbated in the future from all of these different perils.
Senator Padilla. Thank you very much for your expertise and
for your participation this morning. Look forward to following
up. Thank you, Mr. Chair.
Chairman Whitehouse. Thank you, Senator Padilla. I'll take
a few moments myself. And if you don't mind, I'm going to start
with Dr. Weinkle.
Dr. Weinkle, you live in North Carolina, I gather?
Dr. Weinkle. Yes, I do.
Chairman Whitehouse. And North Carolina's Coastal Resources
Commission has estimated a decade ago that the sea level along
the North Carolina shore would raise 39 inches in coming years.
Do you challenge that finding by your state Coastal Resources
Commission?
Dr. Weinkle. I'm not challenging their finding, but I am
saying that the emission scenarios that they've used in the
past, and they've been used by a lot of people and they are
commonly used, face a lot of challenges in that they've been
found to be largely implausible to really----
Chairman Whitehouse. But clearly, they've used other data
that you have confidence in if they've decided that they've got
39 inches of sea level rise and you're not challenging their
finding, right? So, you're challenging a segment of the data
that they used, but you're not challenging the 39-inches
finding; is that correct?
Dr. Weinkle. I'm challenging the wisdom of using the
emission scenarios that they used to find it.
Chairman Whitehouse. Some of them, the ones that you
contend are exaggerated.
Dr. Weinkle. Yes.
Chairman Whitehouse. Why is it that in 12 pages of
testimony in a hearing on the impact of sea level rise on local
communities and on the economy does your testimony never use
the phrase ``sea level rise'' or admit that your own state is
looking at 39 inches of sea level rise?
Dr. Weinkle. That's a good question and I----
Chairman Whitehouse. I know.
Dr. Weinkle. The reason is, is because it's--I know enough
to know that the science of sea level rise is nuanced. It is
increasing, but it--largely understanding it and understanding
its impacts on different areas requires a level of expertise
about sea level rise and the dynamics to do that.
Chairman Whitehouse. Do you think the Navy has that level
of expertise? Do you think the United States Navy had adequate
expertise to make determinations about the safety and future of
its own coastal bases?
Dr. Weinkle. I'm sure they have very intelligent people.
Chairman Whitehouse. Yes. Okay. To go back to Senator
Kaine's questioning, and just to be clear about this, would
funding of research or expert opinion by fossil fuel interests
implicate your concerns about conflict of interest?
Dr. Weinkle. It would, of course.
Chairman Whitehouse. Okay. And would the concerns about
conflict of interests be worsened if the fossil fuel funding of
the research or the expert opinion was undisclosed?
Dr. Weinkle. Yes.
Chairman Whitehouse. Okay. So, with that, let me turn to
Mr. Lewis, who is here on behalf of Competitive Enterprise
Institute. This is at least the fourth time, Mr. Lewis, that
you've appeared to bring climate skepticism on behalf of
Republican colleagues to hearings.
You have said in the past that climate change could
actually be a net good for people. You've also said, and I'm
quoting you here from an NPR radio show where the host asked
you in response to questions about climate change and sea level
rise the question to you was, ``So, you're saying move New
York, move Miami, move southern Florida, move Boston?'' And
your response was ``Yes.''
So given the kind of eccentric nature of your testimony,
I'm interested in following up on your other Republican
witness's advice and finding out how much fossil fuel funding
goes into the Competitive Enterprise Institute?
Dr. Lewis. Sure. Well, let me address that question first,
which is I don't know that.
Chairman Whitehouse. And you don't know that because it
comes through a group called Donors Trust, which hides the real
donor and screens who the original donor is, but if Competitive
Enterprise Institute wished to it could have a policy of
requiring that the actual donor be disclosed rather than the
identity laundering shop of Donors Trust. Correct?
Dr. Lewis. But our policy is that we protect the privacy of
our donors, whoever they are.
Chairman Whitehouse. Which runs right into the public
interest problem, right?
Dr. Lewis. You're asking us to violate our policy, which is
based on Supreme Court decisions.
Chairman Whitehouse. Seemingly convenient policy. My time
is up and it's now it's Senator Braun and then Senator Van
Hollen. Oh, I'm sorry. Senator Grassley. My apologies. And then
Van Hollen.
STATEMENT OF SENATOR GRASSLEY \7\
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\7\ Prepared statement of Senator Grassley appears in the appendix
on page 31.
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Senator Grassley. Dr. Weinkle, you're an environmental
scientist. A few questions for you. Have you found climate
change to be the primary cause of natural disaster damage on
our coast?
Dr. Weinkle. The primary drivers of loss along the coast is
the increasing population, the wealth that they bring with it,
and inflation.
Senator Grassley. Have you found--go ahead.
Dr. Weinkle. I would just add that those coastal areas are
engines of U.S. GDP. They're very valuable to us, but with that
comes a lot at risk.
Senator Grassley. Have you found an upward trend in extreme
weather events over time?
Dr. Weinkle. So, my personal analysis has been limited to
hurricane landfalls and over the long record, 1900 to today,
there is no long-term increasing trend in frequency or
severity.
Senator Grassley. I'm sorry. I didn't mean to interrupt
you.
Dr. Weinkle. No, that's okay.
Senator Grassley. Well, headline costs for extreme weather
events appear larger, to what extent is that attributed to more
buildings and wealth continuing to migrate to coastal
communities and have local governments exacerbated the problem
by encouraging that sort of development?
Dr. Weinkle. So, on the development issue, it's
complicated. Housing, development, all that is a very important
component to the U.S. economy, so we have a tendency to protect
it and pursue it. As we know, somebody had mentioned the crisis
in 2007, the housing crisis. When housing collapses for an area
or the state or the nation, it's a problem large scale, so we
support it.
And then as far as the rules around development there's a
lot of reasons why we develop as we do. There's a lot of
private property right protections that limit the ability for
the state to interact and restrict building, as well it's very
difficult to hold local planners accountable to national level
objectives because of our federalism system. And while it's
very valuable to us and while we hold that close to who we are
as Americans, it does create challenges in a system of
accountability.
Senator Grassley. Dr. Lewis, this Committee has heard from
proponents of instituting a carbon tax to address the
emissions. Could you share your perspective on a carbon tax and
its effect on Americans, the economy, and whether or not helps
the environment?
Dr. Lewis. Yes, well a carbon tax is either all pain for no
gain or it's a cure worse than the disease. There was a paper
in Nature Climate Change that came out last year by Pang, et
al., and this is not a fossil fuel climate skeptic. This is
someone who actually likes emission control policies and very
stringent emission controls, but he calculated that even if you
had a carbon tax in excess of $1500 a ton, you could only get
about 80 percent of the way to net zero emissions. And so, he
recommended a carbon tax that was even higher even though this
would represent basically a cost of 11.9 percent of GDP. It
would be a $4.4 trillion tax bill by the time you got to 2050,
which would translate into a burden on the average person of
something like $11,300. And so, that would definitely harm the
economy, which would harm our standards of living and basically
cripple the United States economically so that we could not
duplicate the marvelous feats of adaptation that has reduced
the average person's risk of dying from extreme weather by 99.4
percent over the last century, which was chiefly fossil fuel.
And just for the record, I'd like to point out that that
yes that I gave on MPR was not what I think Senator Whitehouse
understood me to say, which is that cities could just sprout
wings and fly. My point was that cities are dynamic
organizations, and they change and parts of the cities grow
where other parts can contract or can just be in terms of
population or where industry is located. They're quite organic
and so there's a lot of internal movement within cities and
around cities. That's what I was getting at.
Senator Grassley. I will submit the rest of my questions
for answer in writing.
Chairman Whitehouse. Thanks. Now, I messed up and jumped in
when I came back from the Judiciary hearing and I took your
spot, Senator Grassley, so my apologies. But that means that
it's now Mike Braun's turn for questions, followed by Senator
Van Hollen. My apologies for stepping in out of line.
Senator Braun. Mr. Chairman, you're forgiven. Okay.
Chairman Whitehouse. Thanks Mike.
STATEMENT OF SENATOR BRAUN
Senator Braun. Thanks for having the hearing. So, this is
the Budget Committee and I've got a couple questions. One for
Dr. Lewis and then for Dr. Becketti. But this is analogous to
other conversations we've had here in the Budget Committee,
which would not be directly related to our jurisdiction, and I
do what to cite that whatever we discuss here I'm very
interested in being in the climate conversation.
I think if we aren't on our side of the aisle that you're
probably just avoiding the issue. I've lived the life of a
conservationist and I think it's important, but I'll refer to
one of my favorite quotes I've ever heard here and it's
unrelated to this today, but it comes from Admiral Mike Mullen,
when he so succinctly said I'm more afraid of the red ink than
the red menace, okay. And that's got applicability right now as
we're looking at other issues out there.
The CBO, who I've gotten to know pretty well, worked with
them whenever I think they're not being forthcoming on how
things are trending. All I can tell you is we were five
trillion in debt I think in 2005. After the Bush stint, we were
10 trillion in debt. After the Obama Administration we were 16
trillion in debt and that takes us to 2016. 2018 we added
another trillion each year and now literally the wheels have
fallen off the budget train and it's said to think that we're
31 trillion in debt and there is actually a government estimate
in 2033 that we're 46 trillion in debt.
What I'm saying is regardless of what we talk about here we
ought to say we're borrowing it from our kids and grandkids if
we want to do anything on climate, we want to do anything on
anything in this government when each year we're borrowing now
close to 30 percent of what we spend in an operating budget.
Anybody could do that.
No other entity operates that way and I think that is going
to be the big issue in the long run because let's just say we
do nail down something where we'd need to invest some money,
we're going to have a balance sheet that's going to be
increasingly difficult to do it. And if you're good at math,
take 1 percent of 30 trillion, 300 billion, take 4 percent of
30 trillion, 1.2 trillion. That is what we're going t price
into the carrying cost of this dereliction of duty.
We need to keep that in mind and I do wish, Mr. Chairman,
that we would probably get back to some budget mechanics, some
type of regular order so that the end result each year isn't a
400-page bill that gets dropped into our lap with two days to
look at it or the just one-third of what we spend each year
that's even subject to a budget that we don't do.
So, my question now is on this subject, which I'm very
interested in. We're doing good things in this country. I think
we set the example. The EU is and maybe Australia and maybe
Japan. What sense does it make for us to do any of this which
does have an economic consequence when China, India, most of
the underdeveloped and undeveloped world is paying on attention
to it.
Doesn't make sense, especially when you can't nail down the
particulars of when all this is going to come in and have great
impact. We know it may someday, but the one thing that's
absolute we know is that if you do these kinds of things it is
our cost to our own economy. Please comment, Dr. Becketti, and
then Dr. Lewis, on why this makes sense when over half the
world, China, India, building coal-fired plants nearly weekly?
Mr. Becketti. Thank you for the question. Part of what
you're asking is outside my range of experience. And in fact,
the points that I was making in my testimony was how to adapt
to climate change that is going to occur over the next 30
years.
So, we know how costly the housing finance crisis was in
2007 and 2008, multiyear costs, many, many people suffered a
lot of damages. And as I look at the situation, you can predict
where stresses will occur in the housing finance system.
Housing finance system is a very complex way of making sure
that risks are allocated to the firms that can handle them
correctly and these are risks that they're not ready for.
So, from a budget point of view, the sooner we figure out
how to have a successful adaptation to something that we can't
avoid will save us money.
Senator Braun. Mr. Lewis.
Mr. Lewis. Hi. I think that's a very good answer. I would
say you've painted a picture that scares me more than climate
change, which is the unsustainability of----
Senator Braun. And that should be the point because it's an
absolute in the present.
Mr. Lewis. And it seems to me that, given the difficulty in
scaling back government programs, because as soon as you create
a program you create dependency on the program and that just
results in more lobbying for the program. That the only
solution, if there is one that eventually in the long term
prevents us falling off a financial cliff, a fiscal cliff is
economic growth.
And so, the government's top priority, top domestic
priority, I would suggest, is to economic growth, sustained
economic growth by trying to find every conceivable impediment
enterprise there is and abolishing it, deregulating it,
whatever has to be done. You can't do that if you're top
priority is reducing emissions by attacking the fossil fuel
industry.
You can't combine those things and I think it's a fool's
hope that somehow if we subsidize renewables enough they'll
become so competitive on their own that they will drive the
economic engine of this country.
Senator Braun. Thank you. And not to mention that the rest
of the world's not on the same page we are, and a few other
countries troubles me. Thank you.
Chairman Whitehouse. Thank you, Senator Braun. And a moment
of Chairman privilege. I do look forward to working with you
and Senator Van Hollen and Senator Kaine are also here and have
been very interested and helpful in trying to figure out we
reform the Budget Committee process to more clearly address the
concerns that you have at the moment. We simply are forbidden
to get the arithmetic right of the deficit and debt problems
that we face. We need to fix that and I intend to. Thank you.
Senator Van Hollen.
STATEMENT OF SENATOR VAN HOLLEN
Senator Van Hollen. Thank you, Mr. Chairman. And just
listening to the conversation, a couple points. I look forward,
to Senator Braun's point, to having a budget debate. President
Biden's budget will arrive here in Congress soon. He's
indicated that his budget will reduce deficits over ten years
by $2 trillion, so I look forward to alternative proposal from
the House or otherwise on that important issue.
Second, I was listening to some of the comments by Dr.
Lewis. I think it would be important to know that in the most
recent hearing we had in the Budget Committee on climate change
it was some of our Republican colleagues who said that they
didn't like the Inflation Reduction Act because they wanted to
approach the issue of reducing greenhouse gas emissions by
putting a price on carbon.
Something that I too support and of course that puts the
burden on those who are the polluters in dealing with what
economists calls externality that impacts everybody, as you
know. So, those were statements from some of our Republican
colleagues just in the last hearing.
I would like to say a word about China, who actually has a
ten-year lead on the United States when it comes to investment
in the batteries that are used for storage for electric
vehicles. They process more of the critical minerals that go in
electric vehicle batteries. The produce a lot of them. And
given the fact there's a growing market for that, I would hope
that we wouldn't want to fall behind China, who more than 10
years ago said that one of their number one priorities was to
be the dominant world player when it comes to clean energy.
So, we're talking about having to address the cost now of
doing nothing, right? The cost of emissions that are having
impacts in sea level rise and other areas and so I want to
start by thanking you, Ms. Michaud for sharing your experiences
about how you in Rhode Island have been navigating issues of
sea level rise.
In my state of Maryland, we're experiencing lots of costs
and impacts form climate change and sea level rise. There's a
small town in Kent County which is on Maryland's Eastern Shore.
It's called Betterton. It was once a really thriving little
town. The Baltimore to Betterton's beach fairies went back and
forth from the City of Baltimore to this town.
But right now they're having to spend a million dollars to
protect just 10 homes from literally falling into the Bay. And
the homeowners are putting in some, so were public entities
putting in some because this cost was no fault of the
homeowners. That's expensive. Can you just talk to the issues
you're facing when it comes to a small town trying to fight the
growing cost of climate change?
Ms. Michaud. Sure. Thank you for the question. I mean I
believe Warren is similar to many small towns around the
country in that we have increasing needs, not just climate
related, but also social related and economic development
related and it's very tough competition for the small amount of
funds that we have.
So again, we are spending considerably to protect our
coastal features and our coastal facilities, but sometimes it
is at the expense of other items, such as social services or
education or other infrastructure improvements that are needed
that aren't in the coastal areas. So, it's certainly a concern.
As I said, we are very small. The town hall in Warren we have
14 employees from the custodian to myself and think that we are
not dissimilar to many other communities that have limited
resources and limited staff to deal with those problems.
Senator Van Hollen. It sounds like the same challenge being
experienced by a lot of these towns on Maryland's Eastern
Shore.
Dr. Becketti, in your article entitled Life's a Beach, you
note that ``A large share of homeowners'' wealth is locked up
in their equity in them homes.'' And that the Union of
Concerned Scientists have also published a report called Under
Water, which I know you're familiar with.
That report, the Union of Concerned Scientists Report,
estimates that nearly 2500 homes in Somerset County, Maryland,
which is another county on Maryland's Eastern Shore, the 2500
homes with a market value of 200 million are at risk of chronic
flooding in 2030. Can you just speak to the impact of lost
property values in coastal communities like Somerset?
This is just one mall area. You magnify that across the
State of Maryland, across the country, can you just speak to
the magnitude of this challenge?
Dr. Becketti. Well, it's a particularly difficult challenge
because if we look back the housing crisis of 2007 it was a
long time before property values came back, but they did come
back, but this is a different type of dynamic where property
values are probably physically not able to come back and this
is equity that's lost forever.
It is extremely difficult to estimate all this nationally.
I'm not sure I have enough zeros to do it, but there's a real
struggle and a real challenge in figuring out for the most
severely impacted properties that are not savable what would be
the appropriate policy?
Senator Van Hollen. I appreciate that. I see my time is up,
but I think one of the purposes of this and other hearings is
just to underscore the cost of inaction and doing nothing,
which was why it was so important that we got started with
things like the Inflation Reduction Act with much more work
ahead. Thank you, Mr. Chairman.
Chairman Whitehouse. We have some time for another round if
any senator wishes to stay for another round. I'd like to ask a
few questions. First, since it's been mentioned in this hearing
that some of us actually support carbon pricing legislation,
I'll take it just as a point of personal privilege that I'm one
of those. In fact, I'm the author of a carbon pricing bill and
essentially nothing of what Dr. Lewis said about carbon pricing
is true as regards my bill, so you don't have to follow
whatever his path is if you actually look at my legislation and
I want to make sure that's clear in the record of this hearing.
Dr. Lewis, I also want to make clear your doctorate is in
government, right, not in science?
Dr. Lewis. Correct.
Chairman Whitehouse. Are you familiar with scientific
research related to climate tipping points?
Dr. Lewis. Yes.
Chairman Whitehouse. Do you understand that particularly as
regards sea level rise reaching certain climate tipping points
can dramatically increase the risk and the rate of sea level
rise?
Dr. Lewis. Yes, I'm familiar with that.
Chairman Whitehouse. I don't see that reflected anywhere in
your testimony. Your testimony makes no reference to hitting
tipping points, is that correct?
Dr. Lewis. No, it does not.
Chairman Whitehouse. Okay.
Dr. Lewis. If you recall, the----
Chairman Whitehouse. No, that's okay.
Dr. Lewis. I was gong to explain why I didn't think it was
particularly pertinent.e risk and the rate of sea level rise?
Chairman Whitehouse. If you keep it brief, go ahead, but
you're into my time and I have limited time, so go ahead
briefly.
Dr. Lewis. All right. In the fifth assessment report the
IPCC said it was exceedingly likely that we would see any kind
of ice sheet crack up in the 21st Century. So, we were dealing
with issues in the next couple of decades, I thought, and I
didn't see that it was entirely relevant. I did talk about tail
risk at some point.
Chairman Whitehouse. I'm going to reclaim my time here so I
can talk to Ms. Michaud, who's my Rhode Island friend here. If,
you could just speak into a little bit more detail because I
know a lot of people are listening to this who live in coastal
towns and have the experience that you're dealing with. You're
dealing with very specific and practical things.
You're dealing with Warren's waterfront economy, which for
anybody in Rhode Island is a really wonderful waterfront
economy with terrific restaurants and access points. You're
dealing with flooded roads and infrastructure. You're dealing
with emergency evacuation issues in other towns where the road
that would get you out of Warren in an emergency are themselves
likely to be compromised by that emergency.
And your biggest thing has been probably the water
treatment plant which because of gravity in a lot of places
along the coast is located down low right at the coast. Give us
a picture of how that all fits together for you and those will
be our closing words.
Ms. Michaud. Sure. So, thank you for the question. We are
dealing with a lot of those issues, especially the wastewater
management system is of grave concern. As you mentioned, due to
gravity it is located on the coast in the lowest point of the
town which is the case in many towns or most towns and the
situation that we're encountering is that we've just done this
major upgrade which has been very costly, but it's only
resilient to three feet of sea level rise.
And unfortunately, when we look at the projections long
term, looking at 2100 or even beyond then, once we get past
that three feet of sea level rise there really is no saving the
facility. You can't build an island in the middle of the ocean.
So, we're looking at some major changes in the future to what
our community looks like, not only moving that facility, but
also potentially buying out properties and moving the people
away from harm, which is going to be a significant change for
the town.
I think the great thing about living in a town like Warren
is the sense of community and I would say that there's
definitely a difference between surviving and living and people
want to live and they want to live in a community where they
can enjoy their neighborhood, they can enjoy their neighborhood
business and their schools and their houses of worship and
climate change is really a threat to that. It's the threat to
the sense of community that has existed in Warren for centuries
and we really want to see if there's anything we can do to
preserve that sense of community going forward while preparing
for the eventuality of climate change.
Chairman Whitehouse. Well, those are about as good a
conclusion as I could hope for, so I'll end the hearing there.
I want to thank the witnesses for appearing. The full written
statements of the witnesses will be included in the record.
For senators who wish to file questions for the record,
they're due by noon tomorrow. With signed hard copies delivered
to the Committee Clerk in Dirksen 624. Email copies will also
be accepted. And we ask the witnesses to respond to any
questions for the record within seven days of receipt.
Without further business before the Committee, the hearing
stands adjourned. Thank you.
[Whereupon, at 11:32 a.m., Wednesday, March 1, 2023, the
hearing was adjourned.]
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