Several hearings we had discussing Climate Change focusing on current, future and Economic Impacts. I will defer to the Opening Statement for myself. When we spoke earlier in the holding area, i mentioned the fact that we would hopefully do a hearing. We do have time for your Opening Statements. What i would like to do is afford each of you the opportunity to do so so let me introduce the four of you and move to you, mister gomez. We have j. Alfredo gomez, Government Accountability office come a dave jones, senior director for in my mental risk and Nature Conservancy, institute for Economic Freedom and the heritage foundation, doctor Michael Michael greenstone, Milton Friedman, from the university of chicago and Stephen Benjamin mayor of the city of columbia, South Carolina. With that, director gomez, you are recognized to give an oral presentation of your testimony for five minutes. I am pleased to be here to discuss how to limit the federal governments exposure by better managing Climate Change. This is an area that has been on our high risk list since february 2013. The cost of recent weather disasters have shown us the need for planning for Climate Change risks and investing in resilience. My Statement Today discusses potential economic effect of Climate Change in the us, several areas where the federal Government Faces fiscal exposure from Climate Change risks and the extent to which the federal government has invested in resilience to these impact. Potential economic effects of Climate Change could be significant and unevenly distributed across mimic sectors in regions of the us. For example the southeast, the midwest and great plains regions will likely experience greater combined economic effects largely because of Coastal Property damage in the southeast, changes in crop yields in the other two regions. The estimates of these effects are imprecise, and limitations, it can help decisionmakers better manage Climate Risks. Early this year we also reported that the federal Government Faces fiscal exposure from Climate Change risks in several areas including disaster aid, federal Insurance Programs, federal property, and 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. According to Global Change Research Program disaster costs are projected to increase as certain extreme weather events become more frequent and intense due to Climate Change. In addition, the National Flood Insurance Program and federal crop Insurance Program are sources of federal fiscal exposure, due in part to the vulnerability of the insured property and crops to Climate Change. From 20132017, losses totaled 251 billion. As of april this year the National Flood Insurance Program was 21 billion in debt to the treasury. The government owns and operates hundreds of thousands of facilities like defense installations and manages millions of acres of land that could be affected by Climate Change. In september 2018 Hurricane Florence damaged cam. In and of the marine corps facilities resulting in a preliminary repair estimate of 3. 6 billion. One month later Hurricane Michael devastated Tyndall Air Force base in florida resulting in a preliminary repair estimate of 300 billion. One way to reduce fiscal exposure is to reduce or illuminate longterm risks to people and property from natural hazards. In september 2018 we reported elevating building codes presented greater damages in texas and florida during the 2017 hurricane season. Congress also passed the Disaster Recovery reform act of 2018 which enabled additional improvements at the state and local level. With regard to resilience the federal government has made limited investments but does not have a strategic approach for investing in Climate Resilience project. No one is in charge of identifying and prioritizing Climate Resilience projects across the federal government. No federal entities looking holistic we at how to strategically prioritize projects to ensure they address the nations most significant Climate Risks. In summary the federal government could reduce its fiscal exposure to Climate Change by focusing and coordinating federal efforts. We made a total of 62 recommendations, since december of last year 25 of these recommendations remain open. Some of these identify key government efforts to plan for and manage Climate Risks and direct federal efforts toward common goals like improving resilience and this completes my Opening Statement. You are recognized for five minutes for opening comments. My name is dave jones. Im senior director from financial risk and Nature Conservancy from 20112018, i had the privilege of serving as california insurance commissioner. Climate scientists concluded global temperature rises contributed to catastrophic weatherrelated events, sealevel rise, hurricanes, heavy precipitation, coastal river flooding, wildfires are more severe and more frequent by global temperature rise. These events result in loss of life, injury and distraction and produce economic losses. These losses are rising globally and in the United States. From 19802019 damage associated with extreme weather eventss cost 1 billion or more in damages across the us economy 1. 7 trillion. In 2017 Global Economic losses from natural catastrophes were 330 billion, total global insured losses were 138 ice losses in history. The United States, Insurance Companies responding to increased losses from Severe Weather events by raising premium prices and limiting coverage for certain risks when risk of loss is too high. Flood insurance is an important example how private insurance committees respond when they complete the risk of loss is too high decades ago. Insurance companies concluded risk of flooding in many homes as too high. They excluded coverage in all standard Home Insurance policies. I would like to focus on extreme wildfires as an example of climate driven paraphrasing shores. The Fourth National climate insurance stress is it is increasing in intensity, duration and frequency by midcentury the western United States expects 2 to 6 times more damage from wildfires. In 201718 california suffer the most Deadly Wildfires in its history, 150 lives were lost, tens of thousands of homes and other structures damaged or destroyed. In california alone, suffered 12 billion in losses in 2017 to be followed in 2018 by 13 billion in losses, the largest insured losses ever. Home insurers responded with higher losses at risk of wildfires raising prices for insurance by declining to renew their existing insurance policies or declining to write new policies for homes insured with high risk of wildfire. California is marching steadily toward and uninsurable future regarding Insurance Coverage for homes at risk of wildfires so what can we do . Greenhouse gas emissions need to be reduced dramatically to address the underlying driver of catastrophic weatherrelated risk. One of and often times overlooked way of doing so is Natural Climate Solutions which can provide 37 of carbon reductions needed to meet the goals of the paris agreement, we need more public and private investment as part of an effort to meet the target. To further reduce the risk of wildfires we need to address the need of communities and ecosystems in integrated fashion. Collaboration, fuel reduction, innovation, funding are the means for these, strategic fuel treatment have proven to be safe and Cost Effective way to reduce risk to communities and force forests in a more resilient condition. Funding for these and other programs is a continued challenge. 2018 helps stabilize Forest Service and budgets. However, that if it must be coupled with federally invested restoration programs. Insurers design and offer Insurance Products that account for Risk Reduction benefits of nature and pricing and underwriting. And innovative Insurance Products for areas at risk of wildfires that account for reduction benefits of ecological management of forests. Home insurance pricing and availability face increasing wildfire risks, when example of how insurers may respond to increased risks associated with Climate Change, wrecking risk, coastal flood risk, risk of droughts, all of these are examples of climate driven risks that can have consequences for pricing and developing of insurance. The insurance sector can play a role in helping to manage these risks fundamentally the underlying drivers of these risks need to be addressed, reducing Greenhouse Gas emissions dramatically including using Natural Climate Solutions and using naturebased solutions to reduce or adapt to risk. Otherwise we will find ourselves in increasingly uninsurable world. Thank you, mister jones. Michael greenstone recognized for five minutes of comments. I Milton Friedman professor of economic and director of the friedman instituting Energy Policy institute in chicago. The social cost of carbon or the sec is the cost to society of polluting an additional ton of co2 in the atmosphere. The sec enables regulators to account for potential benefits to society, lower Carbon Emissions and points to the optimal price on carbon required to address Greenhouse Gasy. Let me give a little history. In 2009 in the Obama Administration i convened an Interagency Working Group to determine governmentwide value to the social cost of carbon. In 2016 the United States government estimated cost of carbon at 50 per ton of co2. Since its inception the sec has been used as a foundational tool to sitting federal regulations that cover areas like Energy Efficiency and fuel economy standards. To date the benefits from us regulations written to include the cost of carbon total more than 1 trillion but there are several reasons the Current Administration of social cost of carbon is too low and as a consequence undermines the american people. In 2018 the Trump Administration institute smaller cost of carbon of 107 compared to 50 based on two faulty assumptions. First it uses an appropriately high discount rates that are not supported by economic theory or Financial Markets. Second it fails to account for damages that occur outside the United States. This discourages other countries who in total produce 90 of total co2 emissions from undertaking emissions cuts that would benefit us citizens. The United Statess special role in global diplomacy can produce to multiple benefits for us citizens and we are failing here. The absence of meaningful progress at the madrid climate talks is evidence of what happens when we retreat. Number to the social cost of carbon is no longer based on the frontier of Scientific Understanding as noted by 2017 reported by the Natural Academy of sciences. To fill this whole we started in the Climate Impact lab, implementing the National Academy of science recommendations to update the social cost of carbon. Primary climate and have impact lab finding, due to temperature changes alone will lead to a social cost of 24 per metric ton of co2. Let me put that in context. 20, the cost of carbon we compute 10 times larger than what the obama number has mortality cost. In fact it is almost half of the entire estimate and it is 320 times larger than the entire social cost of carbon. Number 3, estimating climate damage is a subject to uncertainty with climate models and estimations, this uncertainty strengthens the case of reducing emissions. People show a propensity toward risk aversion. My fellow witnesses entire industry of insurance depends on the idea that people dislike risk. They have a premium to employ certain outcomes. For this reason the governments estimates, social cost of carbon under all of this fails to account for this is likely too low. Given the scale of the climate challenge and urgent need for resources to address other pressing societal challenges it is critical policy delivers the cheapest reductions in co2 emissions today and in the future. The surest way to achieve this is to price co2 emissions with a carbon tax or by implementing a cap and trade program. If sent at the right level, the social cost of carbon, these pricing approaches solve the main problem that people and firms currently dont take account of the damages they caused by engaging in activities that release co2. This approachs great appeal, unleashes Market Forces to uncover the least expensive way to reduce emissions by incentivizing cheap emissions, families and businesses can reduce emissions and have money for other priorities. In contrast, current federal and state policy is a hodgepodge the target emissions in different sectors in different ways and with different degrees of intensity. A recent paper by colleagues at yale and harvard included the range of cost in mitigation policies, extremely wide from 10 per ton to over 1000 per ton and most of these costs, Emissions Reductions are relatively expensive and that they vastly exceed the us governments 2017 social cost of carbon. The point, we are getting unnecessarily small reductions given the amount of money we are spending. In contrast pricing carbon would prioritize activities for highest bang for the buck. Turning to future reductions the private sector will not invest enough in research, development and demonstration to uncover new approaches for co2 because many of these returns will flow to their competitors. The fact that private firms lack incentives to engage in energy is a market failure in the government can address this by providing subsidies for Funding Research directly. In conclusion the United States needs to balance the cost of mitigating Climate Change, the costs we incur with climate damages that are coming. Carbon pricing, reforming the social cost of carbon using the best Available Evidence along with robust funding will deliver the inexpensive reductions in co2 emissions that are necessary today and in the future. Mayor benjamin, you are recognized for 5 minutes of comments. Thank you, members of the subcommittee for the opportunity to testify. We have condolences on the loss of representative cummings, senator from South Carolina with second a route that we miss him a great deal, steve benjamin, the pleasure of serving for the last we 10 years as mayor of columbia, South Carolina, the center of our great state in addition of serving the State Government and we host 50,000 students at Columbia College to historically black colleges and the proud home to fort jackson, largest Training Center which trains 45,000 soldiers per year. Climate change is the biggest challenge we face. Im pleased the comedy is holding this hearing on the effects of Climate Change especially that the subcommittee wants to hear about its impact on local government budgets and local economies. They are already grappling with the impact of Climate Change over governance to mitigate those impacts and making the more resilient, hardening and modernizing our infrastructure. We need a strong federal partner. We hope this will we the First Amendment of the National Climate Action Program that recognizes and bolsters the efforts of mayors and cities addressing the 6 essential challenge. In columbia we witnessed how Climate Change is impacting cities and testing our infrastructure. In october 2015, the remnants of hurricane are joaquin stalled over central south, and inundating the carolinas with 11 trillion gallons of rain, 30 inches of rain in our great city. The impact was dire taking the lives of 19 s. Carolinians. The storm wiped out the Columbia Canal which serves as main Drinking Water treatment plant, ruptured dozens of water and remains, close 100 streets and our primary Fire Training facility bridge multiple dams and damaged 400 homes and 60 businesses which we had several major rain events though joaquin was a 500 year event, heavy rain is becoming the new normal. The aftermath became clear the recovery, resilience and mitigation against future storms, costly conditions on the ground and to the infrastructure, not only increased rainfall and more advanced storms, the New York Times report showed 1969 columbia would experience 46 days per year of above 90f. By the time i turned 80 we expect that to more than double. We see similar trends in Lake Elsinore not far from your home and not far from comeares hometown. The successive heat has adverse impact on everyone but certainly the elderly and decreased air quality. Last year through june of this year, representing fellow mayors as president of the conference of mayors, not a partisan organization of cities with populations of 30,000 or more. The chairman, a collision dedicated to preserving the Tax Exemption of Municipal Bonds as cochair of the sierra club, 100 energy, past, present, African Mayors Association at a time when mayors are taking renewed role on the National Stage at the forefront of National Policy innovation. Our 2015 plugs were call to action for columbia. My written testimony outlines those in detail, they were submitted for the record but we have used Energy Efficiency to help save our citizens millions of dollars updating infrastructure. One of my first initiatives when i took office was to upgrade regional transportation, we are moving significantly, took the next step setting a target of powering our community with 100 Renewable Energy by 2035. In addition to our Climate Change prevention efforts we have been actively addressing mitigation. We answered our first green bonds, improving stormwater system, 95 billion plan for the next four years addresses the citys flooding and storm water drainage issues. Local governments collect 15 of the nations tax revenue, we are expected to deliver a significant array of core Governmental Services that make up the heart of the Civilized Society of the western world. You cannot tackle the tasks of Climate Change on our own. We need a strong local partnership, the conference of mayors has issued a call for Climate Action including an attachment to my written testimony. I wont go into detail, but it lays out a significant number of proposals that could be implemented and produce quick results underscoring the x essential threat Climate Change is means to the world and the Economic Impact it has on our cities. We appreciate the opportunity to testify and thank you for your work on this major generational challenge. Let me emphasize the reason you are here, the subcommittee on the environment for oversight committee, we are very focused on the impact of Climate Change. This is the number one issue we are trying to tackle this year and next year, the 116th congress. We are looking at three phases of hearings each phase having multiple hearings and briefings, past, present and future. What did we know and when did we know what about Climate Change . We are ahead hearings where testimony and evidence was provided showing that shell and exxon new in the late 70s and early 80s about the impacts of extensive burning of fossil fuels and co2 emissions and impact on the environment as well is Climate Change, more Severe Weather events. In the present phase of these hearings and briefings we are in now our goal is to help the public as well as lawmakers understand the economic and human impact of Climate Change. Unfortunately as you just pointed out it is often quite easy to figure out the human impact of Climate Change. It is counting the number of people who have died from that event. We had testimony from others in talking about human impact from healthcare costs. That is more difficult to ascertain but quite important that we get to that information. The other aspect is the Economic Impact and that is what we are here 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 in our doorstep and moving to the third phase of hearings on the future, we will paint two different pictures. One nirvana and the other apocalyptic knowing if we do nothing what type of world we will be leaving for our children, grandchildren and future generations. On the other hand if we do take action now, how we can dramatically impact what our world will look like for future generations knowing also that if we take dramatic action now there is going to be impact from Climate Change that we cant stop immediately, we are going to experience negative consequences for our past in action. Being here today, extremely helpful in allowing us to educate the public and educate lawmakers especially those on capitol hill because it is certainly clear the states and mayors around our country have a better understanding of the impact of Climate Change and ways to address it. I will bounce around here a little bit and when we talk about Economic Impact, let me start with you. You talk about the social costs of carbon. I would like to continue down a little bit. From your comments, there is a wide range of estimates as to what the social impact is. I am curious, you have a hard number as to what the cost per ton should be . The best estimate we have currently is the one from the Obama Administration which is 51. In plain english or best i can for this every time we emit a ton of co2 in the atmosphere we are giving the world the gift of 51 worth of damages. It is true there is variability around that number but what is important to remember is when things are uncertain what people want to do is to buy insurance against that. That would tend to increase how much we would spend to protect ourselves. To be clear some of the things that would go into the calculation of that 51 per ton is shorten the lifespan and healthcare costs due to air pollution as an example. Thank you. There are several bigticket categories, human health is at the top of the list and the new research i was talking about which will cause us to revive social cost of carbon says we have been underestimating that but there will be large increase in mortality rates, people with shorter lives as a consequence of changing climate. There will be wide parts of the United States that are going to be subject to flooding and storm surge where we have to have populations move. It will involve complicated political decisions about which parts of the United States we will protect and which we wont. It will show up in crop yields. If i recall my number correctly, house bill 763 on the carbon tax which im cosponsor of the proposed legislation of tax and dividend. From an economic standpoint if implemented that needs to be brought in progressively or do we go straight to a 50 fee . The best estimate we have is 50. There is a good case for starting there but we need to get it above 0 but the exact number is not critical. One would want to end closest to that. My projection is if we learn more 50 will look small and we might want to have room for allowing to reflect that. The true cost of burning fossil fuels is underpriced by 50 and the social impact cost that occurs from it so those who create and burn and use fossil fuel should pay the appropriate price. Suggest a faster move to separate manufacturers and develop and implement this and move faster toward clean green industries. Very little innovation in the market. Until there is a price signal we are hoping for the best. They are extraordinarily effective in responding to it and im sure there will be new ideas flowing in and give us less expensive than we imagined. This is how capitalism is supposed to work. You mentioned cap and trade. You are not suggesting that they could work into them. Probably the best case would be to choose one and go down that path. 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 in directions of carbon tax. With your many years as insurance commissioner for the state of california lets talk about the Economic Impact on average citizens and homeowners as we experience more Severe Weather events and the underlying insurance, whether it is Flood Insurance, private insurance, can you speak to what we can anticipate if we do not provide a greater check to Climate Change for homeowners across america . It varies geographically as mister gomez pointed out but no question that the price of Home Insurance in certain geographies for certain risks is going to go up to the extent those risks are driven by Climate Change. You see this in california where as recently as 2017 the most recent we have data, there is a 50 on average difference in the price of Home Insurance versus those outside. That average masks homes paying 200, 300 more, facing high fibers than those that dont. There are 100 rate filings and those will be approved with the justification that insurers need to be there. We are also seeing an availability problem and at some point this applies broadly to all insurance. If the risk is so extreme there isnt a price the insurer can accept to cover the risk and we have seen that with Flood Insurance where 50 years ago or so Home Insurance decided Flood Insurance, flood risk was too high, standard home policies dont have that and you see that in california with regard to Home Insurance wildfire risk where we are seeing an uptick in nonrenewables, we are not writing new Home Insurance. Anecdotally we are hearing that is beginning to have an effect in Real Estate Markets in some of those areas we do with you dont have hard data on that. Is the price goes up it becomes difficult for those on fixed incomes and lower incomes to afford insurance and as consequences for their ability to have insurance and that means they may go without insurance, so if a catastrophic event occurs they have nothing to fall back on in order to help recover. All of those are consequences of climate driven risks. Along those lines, not long ago i was in miami and i saw firsthand the neighborhood i was in where groundwater was coming up and causing flooding on an average study day and the implications for the marketability of these properties you start to get a good sense of what could occur in many municipal fairies around the country. Can you speak a little bit too at the Economic Impacts would be for the Real Estate Market and the homeownership market in many parts of the country. From the study we look that there are some regions, coastal regions primarily zoo to flooding and sealevel rise. As mayor benjamin noted it is the cities, local folks that are seeing the impact because that is what is taking place. It is up to us to figure out how we can assist that, provide assistance whether through information, helping them to interpret and translate the information they can use to make better decisions whether it is to build a seawall higher, the building codes and standards so there are many opportunities for the federal government and we recommend many things the federal government can do to help state and locals. Elp the state and local. The state and what happens if due to some of these events with these wildfires with apocalyptic events and many people lose their homes we have seen church carriers go out of business because they cannot pay the claim for go the federal government acts as a backstop often. Is there a concern that we may come to a day where there are so many cataclysmic events that the federal government will not be in a position or unwilling to be in a position to backstop those situations . Thats a good question, at again, gao has many areas that we place on the high risk list. Those are areas we want to bring attention and one of the areas as we can document is the National Flood prevention program. It has its own high risk designation and its essentially because the program in the crop Insurance Program whenever designed to generate enough the expenses. For as i noted, the National Flood Insurance Program owes the treasury 21 21 billion curre. I believe that Congress Actually wrote off a similar amount recently. So yes these are growing federal fiscal exposures that the federal Government Faces and their unsustainable. Mayor benjamin, i want to circle back to a couple of comments from your narrative. One was, you talked about how you prepare and plan for greater Climate Change. Help me understand that. What do you and your city council, how do you budget and plan to address future Climate Change related events for your city . Sure. Thank you, mr. Chairman to. With increased focus on resiliency and medication we obviously run a tight ship fiscally. We finished seventh in seven of the nine last years. We recognized a smart investment in infrastructure that now becomes more expensive because we also want to invest in resiy and medication and thinking abouty the longterm cost of defeatingha that debt even in ts wonderful interestrate environment. All those costs have to be borne by our common taxpayers and ratepayers. Decided voted unaniy we dont on a lot of things ofiy a 100 Million Investment to address those flooding areas but over the last six years 750 million of consumer infrastructure to protect our three rivers but it has gotten that much more expensive as you build in the cost of resiliency and we have had the opportunity because of previous decisions made by the federal government to mitigate some of those cost meeting block grants are a significant opportunity that should be renewed we believe strongly in the program of focus targeted investment of resilient infrastructure as a smart move and certainly one of the major challenges we face i mentioned the role that we are allowed to make these investments with water and sewer and most of that investment almost 98 percent is borne by local governments not by the state or federal. We lost in the jobs act the ability to have the taxexempt debt getting that back someday is the case but now every single decision that we make since 2015 certainly includes an additional cost that it will have to be borrowed and fees over a period of time already affecting governments i will also say thriving on the American Economic experiment with the gdp of the metropolitan economies it would be wonderful to find creative ways as laid out in the statement to repatriate some of those dollars back home to make Smart Investments in infrastructure. Suffice it to say it would be helpful to have leadership from washington dc recognizing not just the impact and seriousness of Climate Change but also working to pass infrastructure bills to help local municipalities and states better address these issues quick. Absolutely since 2005 the federal government has spent 430 billion in Disaster Relief funding if we had that type of investment on the front and its in amazing but we can do to mitigate those damages to our homes and businesses. If you have information, my understanding is that wall street more and more looks at pricing in the impact of Climate Change into the price of bonds. I am curious if you have come across that type of information as well. Ultimately has the mayor talked about the green bonds his city has issued, if there is additional 25 basis points to be priced in at the municipal level the price dictated based on the geographical location, that is a cost ultimately passed on to the citizens of those areas doctor do you want to weigh in on that cracks. Thank you mister chairman. Let me start by saying we are not debate if we should have Climate Change we now have it. And the impacts on mitigated Climate Change is beginning to show up talking about the impacts in the city and you pointed to the Financial Markets. Importantly to show up with insurance rates that mister jones highlighted that causes people that there has been a growing recognition on wall street to show up in bond prices and a variety of other Asset Classes as well. But theres a big difference between the impact showing up versus policy that sends a clear signal which would also affect markets and that would affect markets in different ways and reduce the emissions that are occurring but the prices you point to are more or sending signals how they should adapt to treat that as if it cant be changed but sending a price signal to cap and trade or carbon tax would also affect Financial Markets and be very powerful at reducing the amount of Climate Change. I would agree with that we have seen that in the insurance sector for example , lots of activity in that area. One of the things i wanted to mention is a few years ago the comptroller general convened a forum of private Sector Companies to come to gao to what they were doing with the impacts of Climate Change. With oil and Gas Infrastructure where he was sourcing the materials from so they could not harvest some of those ingredients and to show how the private sector has been reacting so thats what we showed in that report to make the edgy 20 Financial Stability board in 2016 that Climate Change poses a Systemic Risk with led by the private sector 2017 which is a series of recommendations with regard to the real economy the first of those is disclosure thats not happening and second to recommend Financial Sector undertake stress testing of its portfolios with those transition and that is not happening. And another challenge is although a number of other International Financial regulators are taking up these recommendations in commercial and mortgagebacked securities and then to ascertain the differences of physical risk in each sector and there was a the rest of those impacts for not being borne out in price distinctions and Financial Markets and that has to do with the lack of disclosure, a lack of uptake of analysis by the Financial Sector. The rating agencies to the credit are beginning to take on capacity, look at these impacts but the yetut to mainstream ther ratings into Core Financial ratings. Currently the sec has cast a large cloud of doubt over whether mainstream Financial Filings should include reflection of these risks. I thinke thats a huge mistake. Then theres another set of risks we havent had chance to talk about yet which are transition risk, risk associate with markets, technologies and government moving away from a fossiledre fuelbased economy te which is not which is where we need to go. Dramatically. But that poses risks for assets in the sectors of the economy that are largely Gas Committee of that poses risks for investors that investing in the sectors and that is another kind of risk that investors need to be looking at and the engines companies are printable investors in this regard but banks lend into the sectors need to be looking at. We need to be doing a lot more with regard to these Financial System risks that we are currently doing in this country and thats a big area of exposure as well. Question as well. Thereve been a few ongoing battles between the state of california and one of those has been over the cafe standards at the emissions where california has had the ability to provide Higher Standards from auto manufacturers which 13 other states and the country of canada follow as well and the administration is trying to overturn the right as well as other states and canada certainly can make their own decision tha but will look to california for its leadership in this area. What is the impact for not just the people in those states but across the country and the world if that is enacted . I think the impacts are negative and multiple. One is more emissions generally but a sizable portion of what california is trying to accomplish is a significant reductions in Greenhouse Gas emissions which is one of the sectors. Undercutting californias ability to administer a separate standard will have significant negative consequences on the battle against Greenhouse Gas emissions. Its worth noting for the public, 40 of the imports in the United States that come in by ship coming through los angeles and long beach port. California certainly would like to continue to be able to monitor and set appropriate levels so those goods reach all 435 districts. You wanted to add a comment as well . Its only partially related d and i apologize if it is too far afield but i think that cafe is a terrific example of what i think of as the hodgepodge approach to regulating co2. To the solution to this would be able to have an economy wide price on carbon and instead we have these kind of sector by sector things that dont directly target carbon and in the case of cafe we are getting reductions probably at the cost of one to 200 per ton. If instead we were able to rely on clear price signals i think there are reductions available for ten or 15 a ton. We are paying about ten times what we would be able to pay for using a more direct mechanism. Votes are about to be called and i di would take this opportunito 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 a question gets asked that you were not able to respond to, and this is your chance to jump in and fill in any holes that you might have seemed. Thank you for the leadership and we look forward to continuing the conversation. I would add one thing im very well aware of pushing the Carbon Pricing that the bill does. The politics are that its complicated and one key got the nod as the concern about distributional issues and what will happen to the lowincome middleclass families and i just want to highlight which i know you know very well from the nature of your bill the carbon tax creates revenue that can be directly refunded to consumers and can actually improve the standing of lowincome and middleclass families. I think that while its often brought up it isnt a true impediment. At the portion of the legislation, thank you. Mr. Jones. We would like to thank you for your leadership, mr. Chairman, and think the committee for holding this important series of hearings. We would urge you to consider solutions to mitigat to mitigatn adaptinmitigate and adaptthem t. I would urge you to consider delving into the potential risk of the Financial System that we had a chance to talk about a little bit earlier. There is one bright spot among the financial regulators and that is the Trading Commission with the leadership of the subcommittee on climate risk that is going to be making a recommendation with regards to all u. S. Financial regulators on the steps they should take to address this risk and i think this would be an interesting subject for the committee to take up and finally, with regards to insurance, its a very important mechanism to help manage risk in communities and families, individuals, businesses recovering from catastrophic events but if we dont dramatically and quickly reduce the underlying driver of that risk, insurance isnt going to solve the problem it will be increasingly unavailable. We are always happy to assist congress and i want to thank you for bringing attention to our work and reports. I cant think each of you enough for attending the briefing and preventing your comments. At the end of the process of the official hearings we will be having addressing Climate Change and waiting out as i mentioned earlier one of two roads that 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 and th in thl box we can pull out to make a difference, recognizing that there is no single tool that is going to be the panacea for addressing this issue is going to take multiple tools to accomplish the outcomes that we desire. So your comments today will be a perfect 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 would hope that they would consider participating in doing so. Finally, along those lines as well as we continue to understand the true economic and human impact of Climate Change, we also need to further understand what are those tools, what are the emerging technologies that can help us in our quest and if you are aware of the emerging technologies or economic tools and incentives that should be considered under the tax code to move in the right directio direction to movr country in the right direction, please bring back to the committees attention. With that, again, i appreciate all of you taking the time to come to washington, d. C. To provide us with your knowledge and to this very important briefing. With that, with that this briefing is adjourned. Thank you. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] for 40 years, cspan has been providing america unfiltered coverage of congress, the white house, the supreme court, and Public Policy events from washington, d. C. And around the country so you can make up your own mind. Created by cable in 1979, cspan is brought to you by your local cable or satellite provider. Cspan, your unfiltered view of government. Next, discussion about defense policy and International Security with the first woman in u. S. History to lead a combatant command. Retired general Lori Robinson. From the Brookings Institution this is just over one hour. Good morning, everyone. Welcome to brookings. I michael ohanlon. I real honor and pleasure of welcoming general Lori Robinson back to brookings. Im glad youre here to
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