A Stealth Heat Tax Has Already Cost Americans $1 Trillion

A hotter planet is making life more expensive. There’s the big-ticket stuff, of course, like the property losses and higher insurance premiums that come with supercharged natural disasters. But a deeper look shows that climate change is steadily draining wealth in ways that aren’t as obvious, like the hidden charges car dealers add to pad out the cost of a sale, except these are permanent. Call it a stealth heat tax.

Temperature changes alone cut US incomes by 12%, on average, between 2000 and 2019, according to a study published in December by Derek Lemoine, an economics professor at the University of Arizona. Lemoine has previously estimated average long-term losses during that period of 1%, but that was based only on localized impacts of hotter weather. His latest research is the first effort to account for how temperature changes in one part of the US can affect people in entirely different parts. The difference is drastic.