WASHINGTON - The Biden administration is taking steps to address the economic risks from climate change, issuing a 40 page report Friday on government-wide plans to protect the financial, insurance and housing markets and the savings of American families.
The report specifies steps that can potentially alter the mortgage process, stock market disclosures, retirement plans, federal procurement and government budgeting.
It is a follow up to an executive order issued in May by President Joe Biden that essentially calls on the government to analyze how the world s largest economy could be affected by extreme heat, flooding, storms, wildfires and the broader adjustments needed to address climate change.
A February storm in Texas led to severe power outages, 210 deaths and widespread property damage. Wildfires raged in Western states. The heat dome in Portland, Oregon caused record-breaking temperatures in Seattle and Seattle. Hurricane Ida struck Northeast in August and caused devastating flooding in Louisiana.
The actions that are suggested by the Biden Administration reflect a major shift in the broader discussion about climate change, suggesting that the nation must prepare for the costs that families, investors and governments will have to bear.
The report is also an effort to show the world how serious the U.S. government is about climate change ahead of the United Nations Climate Change Conference that runs from Oct 31 to Nov 12 in Glasgow, Scotland.
Among the steps outlined is the Government s Financial Stability Oversight Council developing the tools to identify and reduce climate-related risks to the economy. The Treasury Department intends to address the risks to the insurance sector and availability of coverage. The Securities and Exchange Commission is looking into mandatory disclosure rules about opportunities and risks generated by climate change.
The Labor Department proposed a rule for investment managers to factor environmental decisions into the choices made in pensions and retirement savings. The Office of Management and Budget announced the Government will begin the process of asking federal agencies to consider greenhouse gas emissions from the companies providing supplies. Biden s budget proposal for fiscal 2023 will include an assessment of climate risk.
Federal agencies involved in lending and mortgages for homes look for the effects on housing market, with the Department of Housing and Urban Development and its partners developing disclosures for homebuyers and flood and climate-related risks. The Department of Veterans Affairs will also look at climate risks in its home loan program.
The Federal Emergency Management Agency is updating the standards for its National Flood Insurance Program and possibly revising guidelines that go back to 1976.
McCarthy said that we must now acknowledge that climate change is a systemic risk. It is essential that we look fundamentally at the way the federal government does its job and how we look at the finance system and its stability.