Transcripts For CSPAN Hearing On Climate Change The Economy 20240713

We are going to get started. The subcommittee hearing will come to order, without objection, the chair has authorized to declare a recess of the committee at any time. This briefing extension of several hearings we have had, discussing Climate Change. We are focusing on the Economic Impacts of global warming. I will defer the Opening Statement for myself. When we spoke earlier in the holding area, i mentioned the fact that we would be trying to do a hearing. This is a briefing. We do have time for your Opening Statements. What i would like to do is afford each of you the opportunity to do so. Let me introduce the four of you and then we will move to you, mr. Gomez. We have alfredo gomez, director, Natural Resources environment team, Government Accountability office. Dave jones, senior director for environmental risk at the Nature Conservancy, institute of Economic Freedom and the heritage foundation. Dr. Michael greenstone, Milton Friedman distinguished Service Professor of economics at the university of chicago, and the honorable stephen benjamin, mayor the city of columbia, south carolina. With that, director gomez, you are now recognized to give an oral presentation of your testimony for five minutes. Mr. Gomez thank you, mr. Chairman. I am pleased to be here to discuss our work to limit fiscal exposure by better managing Climate Change risk. This has been on our list since february 2013. The cost of recent disasters have shown us the need for planning for risk in investing in resilience. My Statement Today discusses potential economic effects of Climate Change in the u. S. , several areas where the Government Faces exposure from Climate Change risk and the extent to which the federal government has invested in resilience. The potential economic effects of Climate Change could be significant and unevenly distributed across the United States. For example, the southeast, midwest, and great plains regions will like experience greater combined economic effects largely because Coastal Property damage in the southeast and changes in crop yields in the other two regions. While the estimates of these effects are imprecise, the estimates can help decisionmakers better manage climate risk. Early this year, we reported the federal Government Faces fiscal exposure from Climate Change risks in several areas. Including disaster aid, federal Insurance Programs, federal property land. The rising number of natural disasters and related federal assistance are a key source of federal fiscal exposure. Since 2005, federal funding for Disaster Assistance is at least 450 billion dollars. According to the u. S. Global change research program, disaster costs are projected to increase as certain extreme weather events become more intense. In addition, the National Insurance program and the federal crop Insurance Program are sources of federal fiscal exposure, due in part to crops of crops vulnerability in Climate Change. From 2013 to 2017, costs totaled 53 billion. As of april of this year, the National Flood Insurance Program was 21 billion in debt to the treasury. With regard to federal property, the government owns and operates hundreds of thousands of facilities, such as defense installations and manages millions of acres of land that could be affected by Climate Change. For example, in september 2010, Hurricane Florence damaged camp lejeune and other facilities in north carolina, resulting in a preliminary repair estimate of 3. 6 billion. One month later, hurricane devastated the air force base in florida, resulting in a repair estimate of 3 billion. One way to reduce federal fiscal exposure is to reduce or eliminate longterm risk to people and property from natural hazards, for example, in september of 2018, we reported that elevating homes and strengthen building codes preventing greater damages in texas and florida during the 2017 hurricane season. Congress also passed a reform act of 2018 that enabled additional improvements at the state and local level. With regards to resilience, the federal government has made limited investments, however, it does not have a strategic approach for investing in Climate Resilience projects. No one is in charge when it comes to identifying and prioritizing Climate Resilience projects across the federal government. No federal entities are looking holistically at how to strategically prioritize projects to ensure they address the nations most significant climate risks. In summary, the federal government could reduce its exposure to Climate Change by focusing and coordinating federal efforts. We made a total of 62 recommendations and as a december of last year, 25 of these recommendations remain open. Some of these identify key governmentwide efforts needed to help plan for and manage climate risk and direct federal effort to a common goal, such as improving resilience. This completes my Opening Statement. Rep. Rouda thank you. Mr. Jones im dave jones and i served as the senior director for conservancy. From 2011 to 2018 i had the privilege of serving californias insurance commissioner. Scientists concluded global temperature rises contributing to catastrophic weather events, sea level rise, hurricanes, coastal river flooding, wildfires are made more severe and more frequent but global temperature rise. These events are resulting in lossoflife and destruction. These events produce economic and insurance losses. These losses are rising over time. Associated with extreme weather events causing 1 billion or more in damages across u. S. Economy. In 2017, Global Economic losses from catastrophes were 33 0 billion. Insured losses were 138 billion. The highest in history. In the u. S. , Insurance Companies responding by raising prices and excluding or limiting coverage for certain risk when the risk of losses to highpriced let insurance provides an example of how Insurance Companies may respond. Decades ago, home Insurance Companies have excluded coverage for flood risk. That is for all Standard Insurance policies. Today, i would like to focus my testimony on extreme wildfires. The Fourth National climate us messes assessment stresses that fires are increasing in intensity and frequency. By midcentury, the western u. S. Will have 26 times more wildfires. In 2017 to 2018, california suffered the most destructive wildfires in history where 158 lives were lost, homes were destroyed, and assure suffered insurers suffered in thousands of dollars of losses to be in millions of dollars of losses. Home insurers have responded to the losses by raising prices for insurance and declining to renew their policies, or declining new policies. California is marching steadily toward an uninsurable future regarding coverage for homes at risk for wildfire. What can we do . Greenhouse gas emissions need to be reduced drastically. One important overlooked way of doing so is Natural Climate Solutions, which can provide 37 carbon reduction to meet the goals of the paris agreement. We need more investment in these approaches to meet the targets. And to further reduce the risk of wildfires, we need to address this in an integrated fashion. Innovation and funding are the means to resilient landscaping communities. Fuel treatments have proven to be a safe and costeffective way to reduce risk, and removing overgrown brush and trees. Funding for these and other programs to reduce wildfire risk is a challenge. The 2018 fire fix help to stabilize the budgets, however, that effort must be coupled with the reinvestment and restoration Risk Reduction programs. Insurers can play an Important Role by offering products in their pricing and underwriting and offer products and areas of risk of wildfires, which take into account this reduction benefits. Home insurance pricing and availability in the face of increasing wildfire risk is an example of how insurers can respond to risks associate with Climate Change. Hurricane risk, coastal and flood risk, droughts, all of these are examples of climatedriven risk that have consequences for insurance. This sector can play a role to manage these risks more fundamentally it is the underlying drivers of these risks then need to be addressed. That is including Greenhouse Gases and including using Natural Climate Solutions and using naturebased solutions to build resilience. Otherwise, we will find ourselves in an increasingly uninsurable world. Rep. Rouda thank you. Dr. Greenstone you are recognized for your comments. The social cost of carbon or the sec is the cost of society approved to seeing sec to the atmosphere. It enables regulators to account for potential benefits to lower carbon emissions. Let me give you some history. In 2009 while working in the Obama Administration i convened a group to determine a Government Social cost of carbon. As of 2016, government assessed the cost of carbon. Since its inception, they have been used as a foundational tool setting regulations to cover areas such as Energy Efficiency and fuel economy standards. To date, the cost written total more than 1 trillion, however, there are several reasons the current administrations cost of carbon is too low, and as a consequence, undermines the wellbeing of the american people. 2018 the Trump Administration instituted a smaller social cost of carbon based on faulty assumptions. It uses high discount rates that are not supported by economic theory or Financial Markets. Second, it fails to account for damages that occur outside of the u. S. This failure discourages other countries, who produce 90 of co2 emissions, by undercutting that would benefit citizens. For can produce benefits u. S. Citizens and we are failing here. The absence of meaningful progress of the madrid talks as evidence of what happens when we retreat. Number two, the social cost of carbon is not based on the frontier of scientific and economic understanding as noted by the 2017 report. That was issued by the national. Partially to fill this hole, i am coleading an impact lab to update the social cost of carbon. The primary finding is that it change the mortality rate due to temperature changes alone will lead to a social cost of 24 per metric ton. That is 10 times larger than what the obama number had as a mortality cost. It is almost half of the entire mortality estimate. It is three times to 20 times larger than the Trump Administration entire cost of carbon. Number three, while estimating climate damages is subject to uncertainty with climate models and estimation, this uncertainty strengthens the case for reducing emissions. Economics and casual observation revealed that people show a propensity for risk aversion. My fellow witnesses entire industry and insurance depends on the idea that people dislike risk. They are willing to pay a premium to avoid uncertain outcomes. For this reason, the u. S. Governments cost of carbon failed to account for this risk aversion is too low. What to do . Given the scale of the climate challenge is the urgent need for resources to address other pressing societal challenges, it is critical that policy delivers the cheapest reductions in co2 emissions today and in the future. The surest way to achieve this expenses today is to price admissions with a carbon tax or implement a program. Its set at the right level, the pricing approaches solve the main problem, which is people and firms dont take account of the damages they caused by engaging in active these that activities that release co2. This approach unleashes Market Forces to uncover the least expensive way to reduce emissions by incentivizing switches to cheap cost to beissions, there will benefits. In contrast, current, federal and state policy is a hodgepodge that targets emissions in different sectors in different ways with different degrees of intensity. A recent paper by some colleagues at yale and harvard concluded the range of cost of co2 mitigation policies is extremely wide, from less than 10 per ton to over 1000 per ton and most of these costs, most of these Emission Reductions are expensive in the sense that they vastly exceed the u. S. Governments 2017 social cost of carbon, so we are getting small reduction in co2 given the amount of money were spending. In contrast, pricing carbon would prioritize activities with ang for the buck. Turning to future reductions, the private sector on its own will not invest enough in Resource Development and demonstration to uncover new approaches to reducing co2 because many of the returns of those investments would flow to their competitors. The fact that private firms lack incentives to engage in Energy Research and development is a market failure and a government can address this by providing subsidies or Funding Research direct. In conclusion, the United States needs to balance the cost of mitigating Climate Change today with the climate damages coming. Bestn pricing using the Available Evidence along with Robust Research and Development Funding will deliver the inexpensive reductions in co2 emissions necessary today and in the future. Thank you. Rep. Rouda mayor benjamin, you are recognized for five minutes of comments. Mayor benjamin chairman, i want to thank you and the members of the subcommittee for the opportunity to testify. Obviously, you have our condolences for the loss of Congress Member cummings. We all miss him a great deal. My name is steve benjamin. I have the pleasure of serving for the last 10 years as mayor of columbia, south carolina. In addition to serving in government, we also host nearly 50,000 students attending the university of south carolinacolumbia. The proud home to fort jackson which trains approximately 45,000 shoulders soldiers a year. Climate change is perhaps the biggest challenge we face and i am pleased that the committee is hosting this hearing. Mayors are grappling with the impacts of Climate Change and local governments want to mitigate those impacts and make our communities more resilient. We cannot tackle this alone. We need a strong federal partner. I hope thisll be the first step in developing a Robust Program that bolsters the efforts of mayors in cities that will address this existential challenge. In columbia, we witnessed firsthand how Climate Change is already impacting infrastructure. Over three days in october of 2015, the remnants of Hurricane Joaquin stalled over central south carolina, inundating the area with 30 inches of rain in our great city. The impact took the lives of 19 precious citizens and the storm really wiped out our canal which services are main Water Treatment plant. It closed over 100 streets and damaged over 400 homes and businesses. Since then have had six other major rain events. It would not only increase rainfall and more storms, but a report in 2018 shows columbia will experience about 46 days per year of above 90 degrees fahrenheit. By the time i turn 80, that is expected to double. We have seen those trends not far from your home the doubling , of the number of days above 90 degrees. This excessive heat has adverse impacts on everyone, but certainly the elderly, manual laborers and impacts food protection and air quality. Last year, i represented my colleagues, serving as a chairman for coalition dedicated to preserving of Municipal Bonds. I have been fortunate to do this at a time when mayors are taking renewed prominence on the National Stage to report Public Policy and innovation. Our floods then were a call to action for columbia. My written testimony outlined those in detail and have been submitted for the record. We have used grants to help save our citizens millions of dollars by updating our infrastructure. My first initiatives when i took office was to upgrade our transportation system. We are moving significantly. We have moved to the next step of setting a target of powering our community with 100 Clean Renewable Energy by 2035 in addition to our efforts, we have been addressing mitigation. Last year, we made history by issuing green bonds and improving the storm water system. This is to address our citys flooding and storm water drainage issues. Local governments collect about 15 of our nations tax revenue. With that 15 , we will levy core expected to deliver services that we all understand make up the heart of the Civilized Society of the western world. We cannot tackle that task of slowing Climate Change on our own. We need a strong federal low local partnership. A call foreen Climate Action i have included an attachment, so i wont go into detail. But it lays out a significant number of proposals that we believe could be implemented and produce quick results underscoring the existential threat that Climate Changes Economic Impact. We appreciate the opportunity to testify. Rep. Rouda thank you, mayor. Thank you to all of you for participating in this briefing. Let me emphasize, part of the reason you are here is the subcommittee on the environment for oversight committee, we are very focused on the impact of Climate Change. In fact, this is the number one issue we are trying to tackle this year and next year in the 116th congress. In that process, we are looking at three phases of hearings, each phase having multiple hearings and briefings. That is past, present, and future. Past, what did we know when we do we know about Climate Change . We have had hearings and testimony and evidence was providing showing that shell and exxon knew in the late 1970s and early 1980s about the impact of extensive burning of fossil fuels would have in co2 emissions any impact on the environment, as well as Climate Change in more Severe Weather events. Present, the present phase of these hearings and briefings, which we are in right now. Our goal is to help the public as well as lawmakers understand both the economic and the human impact of Climate Change. Unfortunately, mayor benjamin as you pointed out, it is often quite easy to figure out the human impact of Climate Change. It is literally counting the number of people who have died from that event. We have also had testimony from others in talking about the human impact from a health care cost. And that is certainly more difficult to ascertain, but also quite important that we get to that information. The other aspect is the Economic Impact of Climate Change. And that is what we are really here today to help the public better understand that Climate Change, more Severe Weather events, causes much greater damage and greater Economic Impact than we would experience without having Climate Change at our doorstep. Then we will move into the third phase of the hearing, and that will be nirvana and a pop and thatic, and will be on the future and quite early, we will paint two different pictures. One, nirvana and one apocalyptic, knowing if we do nothing, what type of world we would be leaving to our children and future generations. If we do take action now, on the other hand, how we can dramatically impact what our world look like for future generations, knowing also that even if we take dramatic action now, there is going to be impacts from Climate Change that we cannot stop immediately. That we are going to experience negative consequences for our past inaction. So, you being here today is extremely helpful in allowing us to educate the public and educate lawmakers, especially those on capitol hill, because it is clear that the state and the mayors around our country have a better understanding of the impact of Climate Change and ways to address it. Lets dig into a few questions. I am going to bounce around a little bit. When we talk about Economic Impact, dr. Greenstone, you were talking earlier about the social cost of carbon and i would like to try and pin you down a little bit because from your comments, there is a wide range of estimates as to what the social impact is from carbon. I am curious, do you have a hard number as with the cost per ton should be . Bestreenstone i think the estimate is left over from the Obama Administration which is about 51 per ton. In plain english, what that tons is every time we met a of co2 in the atmosphere, we are giving the world the unfortunate gift of 51 for the damages. It is true that there is a variability around that number, but what is important to remember, when things are uncertain, what people want to do is actually buy insurance against that. That would increase how much we would want to spend to protect ourselves. Rep. Rouda the 51, just to be clear here, some other things that were going to the calculation of that 51 per ton is to shorten lifespans in Health Care Costs due to air pollution as an example. Is that correct . Dr. Greenstone thank you, mr. Chairman. There are several bigticket categories. Human health is at the top of the list. And this new research i was talking about which will eventually revise these costs says we are and domestic aerating underestimating it, but there will be there will be large increases in mortality rates. There will be wide parts of the United States that are going to be subject to flooding and to storm surge, where we will have to populations move and will involve very thorny situations and what parts of the u. S. We will protect in which ones we will not. It will also show up in crop yields. Rep. Rouda if i recall my bill number correctly, it is the it is the house bill on the carbon tax, which i am a cosponsor. In your mind from an economic standpoint, does that fee, if implemented, need to be brought in progressively, or do we go straight to somewhere around a 50 fee . Mr. Greenstone the best estimate we have is 50. There is a goods case a good case for starting there. The most important thing is getting it above zero, which it is right now. Fighting about the exact number is not critical, but my projection is as we learn more, the 50 will look a little small and we might want to have room for allowing it to increase to reflect that. Is. Rouda the sense here that the true cost of burning fossil fuels is underpriced by at least 50, therefore those who create and burn and use fossil fuels should pay the appropriate Price Associated therewith, which also suggests a faster move by those same operators and manufacturers, and companies and develop and implement this, that they would move faster towards green Clean Industries and fuel, correct. Dr. Greenstone there is very little innovation in response to no market. Until there is a price signal, i think were just hoping for the best in terms of innovation. Once there is a clear pricing, price signal, the American Economy are effective at responding and i will have little doubt that there will be whatdeas that will give us we can imagine rep. Rouda this is how capitalism is supposed to work . Dr. Greenstone yes. Rep. Rouda you are not suggesting that it could work in tandem, correct . Dr. Greenstone it could. The best case would be to choose one and go down that path. Rep. Rouda ok. Dr. Greenstone i think a lot of that probably depends on what one wants to do with the revenues, and it can often be easier to direct the revenues. Rep. Rouda mr. Jones, with your many years with the state of california, lets take a few minutes and talk about the Economic Impact on average citizens and homeowners as we experience more Severe Weather events and the underlying insurance for homes, whether it is Flood Insurance, property insurance and so on. Can you speak a little bit to what we can anticipate if we do not provide a greater check to Climate Change for homeowners across america . Mr. Jones certainly. I think barrys geographically, mr. Gomez pointed out, there was no question that the price of Home Insurance in certain geographies, for certain risks, will go up. Those risks are driven by Climate Change. You see that in california, as recently as 2017. We have some data that there was a 50 difference in some of those areas. Paying 350 more for insurance if there facing a high fire risk. The department of insurance shows that they have had 100 rate filings this year. Those will be approved in all likelihood because of the justification due to extraordinary losses in 2017. We are seeing an availability problem as well. At some point, this applies broadly to all insurance, if the risk is so extreme that there isnt a price that the insurer cant accept in order to cover that risk, and we have seen that with Flood Insurance in this country. 50 years ago or so, home insurers stopped writing for those risks. Standard home policies do not have that. We are hearing that is beginning to have an impact in Real Estate Markets in those areas. We dont have data on that yet, but the implication is there. As the price goes up, it becomes difficult for those on fixed incomes and some lower incomes to afford insurance. That has consequences for their ability to have insurance. That means they may go without insurance, so if a catastrophic event occurs, they have nothing to fall back on to help recover. All of those are consequences of climatedriven risk that play out through the insurance sector. Rep. Rouda along those lines, mr. Gomez, not long ago, i was in miami and saw a neighborhood where the groundwater was coming up and causing flooding on an average sunny day. The implications from Flood Insurance, from the marketability of these properties, you start to get a good sense of what could occur in many municipal areas around the country. Can you speak a little bit to what the Economic Impact would be if we see a deterioration of the Real Estate Market in many parts of our country . Mr. Jones from the study we looked at, there are some regions of the country like the coastal regions, they will have high Economic Impacts, primarily due to flooding and sea level rise. Were seeing that from the studies that are telling us that. Really, i think as mere benjamin noted, it is the local folks that are seeing the impacts because that is what is taking place. From the federal perspective, it is up to us to figure out how we can assist that and provide assistance, whether it is through information, helping them interpret and translate the information that they can use to make better decisions, whether it is to build a sea wall higher, or building codes and standards. There are many opportunities for the federal government and we recommended many things that the federal government can do to help state and locals. Rep. Rouda lets take this step further. What happens if due to some of these events, like we have seen in california with the wildfires where you have an apocalyptic event and many people lose their homes. Often the federal government is a backstop for those situations. Is there a concern we may come to a day where theres so many cataclysmic events that the federal government wont be in a position, or unwilling to be in a position to backstop those situations . Mr. Jones that is a good question. Again we have many areas we place on the high risk list, areas we want to bring attention, and one of the areas that we have been talking about is the National Flood Insurance Program. It has its own high risk designation because that program and the crop Insurance Program were not designed to generate enough revenues to pay for the expenses. I noted the National Flood Insurance Program, they owe the treasury one 1 billion already. Congress wrote off an amount recently. These are exposures the federal Government Faces and they are unsustainable. Rep. Rouda mayor benjamin, i want to circle back to a couple of comments from your narrative. You talk about how you prepare and plan for Climate Changerelated events. Help me understand that. What do you and your city council, how do you budget and plan to address future Climate Changerelated events in your city . Mayor benjamin sure. Thank you, mr. Chairman. With increased focus on resiliency and mitigation, we run a tight ship fiscally. We finished the last nine years with a balanced budget. We have clean books. We recognize that a smart investment in infrastructure, that now becomes more expensive because we also have to invest in resiliency and mitigation, and thinking longterm, the cost of that debt. All of the costs have to be borne by our taxpayers and rate payers. We decided and we voted unanimously on this investment addressing the top flooding areas in our city, but the constant investment over the last six years, we have invested 750 million in water and sewer infrastructure protecting our rivers, but it has gotten more expensive as we build in the cost of resiliency and mitigation. We have had the opportunity because of previous decisions made by the federal government to mitigate some of those costs. I mentioned the block grant. It is a significant opportunity. We believe strongly in the program and target investments in climate infrastructure, being a smart move. Certainly, one of the major challenges we face is the role that Municipal Bonds allow us to make investment in infrastructure in water, sewer, storm water. Most of that investment is borne by local governments. Not by the federal government. Every single decision we make since 2015, certainly includes an additional cost that will have to be borrowed over some time affecting local governments. That is driving the economic experiment. It will be wonderful to find creative ways and laid out in our statement. We would like to repatriate some of those dollars back home to make smart investments. Rep. Rouda it would be helpful to have leadership from washington, d. C. Recognizing, not just the impact and seriousness of Climate Change, but working to pass infrastructure bills that can help local municipalities and states better address these issues . Mayor benjamin absolutely. Since 2005, the federal ernment spent over 400,000 400 billion in relief funding. If we had that investment on the front end, it would be amazing we could do to mitigate damages. Rep. Rouda dr. Greenstone, and others can weigh in on this as well, my understanding is wall street is looking more and more at pricing in the impact of Climate Change into the pricing of bonds. Im curious if you have come across a type of information as well because ultimately, as mere as the mayor talked a minute about the green bonds that his city has issue, if there is additional 25 basis points that have to be priced into bonds at the municipal level, the pricing might dictate based on the geographical location, that is a cost that is passed onto the citizens of those areas, so dr. Greenstone, would you like to talk about that, and mr. Gomez, as well . Dr. Greenstone thank you, mr. Chairman. Climate change is here. We are not debating whether or not we should have Climate Change anymore. We now have it. And the impacts on mitigated Climate Change are beginning to show up. The mayor was talking about the ways it impacts a functional city and you pointed out how it showing up in Financial Markets. Importantly, it showing up in insurance rates, as mr. Jones highlighted, and that is causing people to make different decisions. Now, there has been a growing recognition of wall street, and it is showing up in bond prices and will show up in other Asset Classes as well. There is a big difference between the impact showing up versus policy sending a clear signal, which would also affect markets. That would affect markets in different ways. It would reduce in missions emissions that are occurring, whereas the prices you are pointing to are all more sending signals for how people should adapt to Climate Change and treat it as if it cannot be changed, but sending a price signal would also affect Financial Markets, and will be very, very powerful at reducing the amounts of Climate Change we have. Rep. Rouda mr. Gomez . Mr. Gomez i would agree with that. In the insurance sector, for example, were seeing lots of activity in that area. One thing i wanted to mention is years ago, our comptroller general convened a forum of privatesector companies to talk about the adaptation side, what were they doing to do with the impacts of Climate Change because it is real. This is a variety of privatesector companies. We had oil and gas, food and beverage, Insurance Companies, all talking about the kinds of things they were doing because they were already seeing the impacts, whether it was oil and gas, or food and Beverage Companies figuring out where the materials were coming from. It was really to show how the private sector has been reacting to these impacts. That is what we showed in that report. Rep. Rouda mr. Jones . Mr. Jones the stability board in 2016 concluded that Climate Change poses a risk to the Financial System, and it was led by the private sector which issued a report in 2017 said with regard to what they should do when it comes to exposure, that is not happening sufficiently. Second they recommended that the Financial Sector undertakes stress testing and analysis of its portfolios to test the robustness of physical transition risks associated with Climate Change. That is not happening with sufficient uptake. Another challenge we have in the United States, although a number of other International Financial regulators, including central Bank Regulators like the bank of england and others, or taking of these taking up regulations. Blackrock issued a report in march or april of this year, they undertook to look at the at three regulators and were able to ascertain the differences in physical risks of the assets underlying in each of those sectors and there was wide variance. The utility on the coasts is facing extreme risks of flooding, inland, not so much, but yet, the fiscal risks were not borne out in any discernible price differentiation in each of those three sectors. That is a big problem. Certainly, the Nature Conservancy supports a carbon price, a carbon tax, mechanism to adopt that, but Climate Change is already baked into our system. Physical impacts are already occurring. And those risks of those impacts are not being born out with Financial Markets and that has to do with the lack of disclosure, a lack of analysis. The rating agencies are beginning to take on capacity to look at these impacts, but they are yet to mainstream their ratings into core, financial ratings. There has been a large cloud cast over whether the filing should include these risks, and that is a huge mistake. There is another set of risks we have not talked about yet, what are transition risks, which are associated with markets, technologies, and governments moving away from a fossil fuelbased economy. That is where we need to go. That poses a risk for asset in the economy that are largely Greenhouse Gasemitting. That poses a risk for investors that is another kind of risk than investors need to be looking at an Insurance Companies need to be looking at. So we need to do a lot more with regard to the financial risks. This is a big area of exposure. Rep. Rouda while you have the microphone, allow me to ask you this question as well. There has been a few ongoing battles between the Trump Administration and the state of california, one has been over the tailpipe emissions, where california has had the ability to demand Higher Standards from auto manufacturers, which 13 other states and the country of canada follow as well. And the administration is trying to overturn californias right as well as those other states, and canada can certainly make their own decision. What is the impact for not just the people in those states, but across the country in the world with the increased pollution we would be looking at, if that is enacted . Mr. Jones the impacts are negative and multiple. One impact is more emissions generally with the related health effects. A sizable portion of what california is trying to accomplish through those standards is a significant reduction in Greenhouse Gas emissions in the transport sectors. So undercutting californias ability to administer a separate standard will have significant negative consequences on the battle against Greenhouse Gas emissions. Rep. Rouda it is worth noting for the public, 40 of the imports of the United States that come in by ship come in by los angeles and long beach ports. 25 of our exports go out. California would like to continue to be able to monitor and set appropriate levels for admissions, if those goods reach all of the districts in the u. S. Dr. Greenstone, would you like to comment . Dr. Greenstone i apologize if this is too far afield, but this is a terrific example of what i think is a hodgepodge approach regulating co2. The textbook solution to this, which the bill reflects, which would have an economy wide price on carbon. Instead, we had these kind of sector by sector things that dont directly target carbon. And in the case of cafe, we are getting reductions of co2 at the cost of 100 to 200 per ton. If if instead, we were able to rely on clear price signals. I think there are reductions of cot available that cost 10 or 15 per ton. We are paying 10 times what we would be able to pay for using a more direct mechanism. Rep. Rouda votes are about to be called and i will take this opportunity to ask all four of you, is there anything else you would like to add . Often, in these hearings and briefings, you hear somebody else Say Something or question was asked that you were not able to respond to, so this is your chance to jump in and fill in any holes you mightve seen. German. Pushingwell aware of carbon prices, which your bill does, the politics of that are complicated, and one key pickup in that is an important concern about distributional issues and what will happen until lower middleclass families. I want to highlight one thing. The carbon tax creates revenue that can be directly refunded to consumers and can actually improve the standing of low and middle income class families. While often that is brought up, i think that is not a true impediment. Rep. Rouda the dividend portion of that legislation, thank you. Mr. Jones . Mr. Jones we would like to thank you for your leadership, mr. Chairman, and thank the committee for holding this important series of hearings. We urge you, as you have historically, to consider natural climate and naturalbased solutions to mitigate the climate crisis. I urge you to consider delving into the potential risk to the Financial System that we talked about earlier. There is one bright spot among u. S. Financial regulators, and that is the interest training trading commission. They have established a subcommittee climate risk and will be making a recommendation with regard to all u. S. Financial regulators as to what steps they should be taking to the risk. Finally, with regard to insurance. Insurance is a very important mechanism to help manage risk and to help communities and families and individuals and businesses recover from catastrophic events. But if we dont dramatically and quickly reduce the underlying driver of that risk, insurance will not solve these problems. Rep. Rouda thank you. Mr. Gomez . Mr. Gomez mr. Chairman, i want to thank you for bringing attention to our work. Rep. Rouda thank you. Again, while we were not able to have an official hearing, i cannot thank each of you enough for attending and providing your comments. At the end of this process with the additional hearings addressing Climate Change, and weighing out one of two roads we are faced with, our hope is to provide concrete recommendations as to how we can achieve a road that reduces the impact of Climate Change. What are the tools in the toolbox that we can pull out and make a difference . Recognizing that there is no single tool that is going to address this issue, but it will take multiple tools to accomplish the outcomes we desire. So your comments here today will be apart of that final report that we take forward. In addition, dont be surprised if we may call on you again to attend another hearing down the road, and we certainly hope you will consider participating in doing so. Finally, along the lines as well, as we continue to understand the true Economic Impact of Climate Change, we need to further understand what are those tools, what are the emerging technologies that can help us in our quest . If you are aware of emerging technologies or economic tools, incentives that should be considered in an effort to move us in the right direction, move our country in the right direction, please bring that to our committees attention. With that, i appreciate all of you taking the time to come to washington, d. C. With your knowledge on this important briefing. And with that this briefing is adjourned. Thank you. [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap. Org] [inaudible conversation] campaign 2020, our team is traveling asking voters what issues should candidates address. Issue that is important to me is the environment, and i would like to see more protection of the beaches, and i isnk the social media talking about this and i want to see action on this. One issue that i would like currentddressed is the injustice going on in our onntry, whether its videos instagram are even in the white house. I think those issues need to be addressed. Climate change, because i want to be able to visit coral reefs and not have them be bleached. One thing as the lack of the inaction in our government and how we are just as important as hbcus in our country. Health care and , health care ie think we should move more towards improving we are not fully seeing the vision of universal health care. I would like to see it expanded to some sort of singlepayer system. System to address issues of too much money right now in politics. Road ons from the cspan. 2020 democratic president ial candidate joe biden holds a town hall today in new hampshire. That is live on cspan, online at cspan. Org or listen free on the cspan radio app. Fonda and theane Louis Tomlinson along with along withmlin environmental activists spoke at the u. S. Capitol on Climate Change, as part of weekly demonstrations, occurring through the end of january called fire drill fridays. After remarks, the speakers marched to the Capitol Steps in which several people, including lily tomlin, were arrested during the protests