Shaun Donovan gave his first speech as White House budget director Friday, and he didn't even mention that Washington obsession of recent years, the $17.8 trillion national debt.
No, in the run-up to next week's United Nations climate summit in New York, the Obama administration is focused like a laser on a different threat to federal finances and the U.S. economy: the consequences of global warming.
"From where I sit, climate action is a must do; climate inaction is a can’t do; and climate denial scores – and I don’t mean scoring points on the board. I mean that it scores in the budget. Climate denial will cost us billions of dollars," Donovan said before a friendly crowd at the liberal Center for American Progress.
"The failure to invest in climate solutions and climate preparedness doesn’t get you membership in a Fiscal Conservatives’ Caucus – it makes you a member of the Flat Earth Society," Donovan continued. "The costs of climate change add up and ignoring the problem only makes it worse."
What is Donovan talking about? The White House has yet to do a particularly thorough job of translating the risk into cold, hard budget facts, but they've taken stab at it. So let's go to the numbers:
1) Research suggests that if warming reaches 3° Celsius above pre-industrial levels, instead of an international target of 2°, global output could suffer by roughly 0.9 percent. In the United States, that would amount to whacking GDP by roughly $150 billion a year. And as we all learned during the Great Recession, "even a small reduction in real GDP growth can dramatically reduce Federal revenue, drive up our deficits, and impact the government’s ability to serve the public," Donovan said.
2) Part of that cost would come from more extreme weather events that require federal disaster relief. As Donovan said: "Within the next 15 years, higher sea levels combined with storm surge and potential changes in hurricane activity are projected to increase the average annual cost of coastal storms along the Eastern Seaboard and the Gulf of Mexico by $7 billion, bringing the total price tag for coastal storms to $35 billion each year."
3) Then there are wildfires of the kind currently raging in California. According to the National Climate Assessment, released earlier this year, "climate change has made the fire season in the United States longer, and on average, more intense," Donovan said. "Funding needed for federal wildland fire management has tripled since 1999, averaging over $3 billion annually."
4) And then there's drought. Donovan: "In 2012, we experienced ... the country’s most extensive drought in more than 50 years, racking up $30 billion in damages. This year, California has been facing its third-worst drought in recorded history, with a projected cost to the State’s economy of $2.2 billion and more than 17,000 jobs."
5) Which means taxpayers are also shelling out more to farmers in crop insurance. In January, the Congressional Budget Office estimated that agricultural disaster assistance payments would cost about $900 million a year. But, "due to the severity of the drought," Donovan said, "the USDA has already spent $2.6 billion this year" — three times the CBO estimate. Meanwhile, he said, "payouts in the aftermath of the 2012 drought totaled more than $17 billion."
The White House is not just blowing smoke. The independent, nonpartisan General Accounting Office -- which exists to monitor government spending -- last year added climate change to its high-risk list, saying the effects "will result in increased fiscal exposure for the federal government in many areas," including damage to federal property and infrastructure, claims on federal insurance programs and increased disaster relief.
In the next few days, a host of administration officials are scheduled to hammer that point and to tout Obama's efforts to slow greenhouse gas emissions. The president is scheduled to attend the climate summit Tuesday with heads of state in town for a meeting of the United Nations General Assembly. For Obama, the summit is an opportunity to press toward a legacy-making climate deal during a conference set for next year in Paris.
To bolster the boss, Treasury Secretary Jack Lew on Monday will visit the Brookings Institution to argue that the nation can fight climate change and grow the economy, echoing a recent report from an international commission on climate change chaired by former Mexico president Felipe Calderon. Agriculture Secretary Tom Vilsack, Interior Secretary Sally Jewell, Environmental Protection Agency chief Gina McCarthy and Transportation Secretary Anthony Foxx are scheduled to spread the message, as well.
As White House budget chief, Donovan has the potential to play an outsized role in promoting policies to save federal dollars from the ravages of climate change. The former housing secretary also has some real-world experience in what it will take: After Superstorm Sandy devastated New Jersey and New York in 2012, Obama tapped Donovan to lead a 20-agency task force focused on rebuilding.
That experience, Donovan said Friday, taught him key lessons about how to fight climate change. "First, we made sure that science was at the heart of this work," he said. "It is our job to ensure the capacity to fund and demand data and data-driven climate action. We need to make sure we know that we’re rebuilding stronger. And we need to collect the data to verify our assumptions."
Second, Donovan said, that data must "be driven into our regulations and standards to ensure that we are appropriately pricing risk." For example, he said, the Sandy task force for the first time required that rebuilding projects funded with federal relief dollars take into account future flood risks, not just historic data.
"We want to level-set every investment we make to support climate action to maximize the taxpayers’ return on investment," he said, "whether it’s money spent on clean energy, forecasting capabilities or community preparedness."
All of which raises the tantalizing possibility of a new goal as Donovan assembles the penultimate spending request of Obama's tenure next February: a climate-change plan that would save the planet and reduce the budget deficit.