Monday, November 02, 2015

What We Worry? The Big Shrug Over Climate Change.

As climate change denial ramped up I began to wonder where the prudent worriers in our economy had gone. Foremost among this doleful and boring but responsible fraternity are the insurers. Where were they? Why weren’t they siding with the climate change scientists and giving economic muscle to the scientific warnings? It appears there was some translation of risk warnings into dollar terms, but the message was very muted. It seldom reached the public conversation, if ever.

The insurance industry has been slow to warn. Here's an article about this.

The Guardian did report as early as 2011 that Lloyds had begun warning about climate change risks, but 2011 was hardly early. In 2014 they warned again.

In this 2013 article Smithsonian described the insurance pivot as an adjustment, a subtle turn of the dial. This was before they were purchased by the fossil fuel billionaires, the Koch Brothers.

In 2014 MotherJones wrote about how the insurance industry was largely ignoring or downplaying climate change.

I suspected this broad diffidence was because the insurance giants had been bought up by financial giants who were not insurers. An investment company is inclined to think fossil fuel profits are sexier than climate change warnings. They are likelier to tell the killjoy divisions to shut up and quit spoiling the party.

I think it was another case of Moneythink overriding our rational mind. If you are a large financial company your fiduciary responsibility (I call it a fiduciary excuse) to earn maximum profits overrides your responsibility as a citizen, your responsibility as a member of society and a comfortable beneficiary of that society.

I’ve read more since I posted about insurers' climate change denialism, and learned more about the evasions and muted warnings from insurers. Insurance policyholders are as likely to be deaf to warnings as insurers are to be dumb about the risks.

Which is where the media’s deafness comes in. (The news media's denialism has had a neat bag of tricks, as reported recently in a CNN opinion piece––why does critical thinking get relegated to the opinion pages anyway?) The sad habit of evenhanded coverage hasn’t helped. There is a habit among news divisions to “play it safe” by giving both sides of an argument equal weight, regardless of the merits of the opposing arguments. It's a bit like warning people that "There may or may not be a tornado coming. You decide." Some risks are too large to play that way, and climate change is one of them. It has been described by scientists as an existential risk for decades and the pussyfooting of media has enabled fossil fuel companies’ PR departments to sow doubt and paralyze our response. I compare this to the appeasers and America Firsters of the 1930s. We will need a WW2 scale mobilization to confront climate change, where a decade or two ago we might have confronted it without as much disruption.

Or maybe disruption is something the corporate class has anticipated and planned for. Disruption gives greater opportunity for control to those who have the resources and the positioning. For example, have corporations been buying options on lands that climate change would suddenly make viable, and buying up technologies we would desperately need (enabling certain fossil fuel villains to hop on a white horse and rescue us all once they’d reaped the maximum profit from the long con of climate change denial. Is this the kind of calculation that the sharper minds have been deployed to figure out? Vs. the less sexy calculation of risk and avoidance of risk.)

These articles address the problem that kicks in when insurers decide to abdicate instead of confronting risk. (From and from Reuters.

Instead of helping our massive economy address the risks and helping us put policies in place that reverse the risks, what do insurers do? I guess they shrug and give up. They pocket their winnings and leave the game.

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