Climate Order Will Undermine U.S. Financial Stability
Late last month, President Joe Biden issued yet another executive order related to fighting climate change that will effectively conscript the U.S. financial sector into the climate war.
This executive order sets out to effectively transform the nation’s energy sector and the economy, writ large, based on the vapid claim that “intensifying impacts of climate change present physical risk to assets, publicly traded securities, private investments and companies – such as extreme weather risk leading to supply chain disruptions.”
Specifically, the president’s order directs federal agencies that oversee the private financial sector, including banks, insurers and investment firms, to assess “climate-related financial risk” of the stability of the federal government and U.S. financial system. This arbitrary, bureaucratic assessment of financial risk will then set the table for massive federal intervention into the U.S. private sector for it to divest from fossil fuels and redirect to more “green energy” projects.
Nowhere does the order deign to provide evidence nor actual science to back up such sweeping climate change rhetoric, much less justify the government’s massive market intervention—without even a vote by Congress—to re-direct trillions of dollars in the private sector economy.
The causes, pace and effects of climate change are highly disputed, notwithstanding the mainstream media groupthink on the issue. Environmentalist dogma which asserts that “extreme weather” events are unique to the present day is unfounded, as is the notion that it constitutes a “risk” to the U.S. financial system.
For example, one look at data from the National Oceanic and Atmospheric Administration (NOAA) finds that landfalling hurricanes “‘show a slight negative trend’ since ‘late 1800s.’” Sea level rise has not accelerated rapidly either. As Former Obama-Biden federal scientist Dr. Steve Koonin noted, sea level is rising at the "rate of one foot per century and was doing it at about the same rate 80 years ago."
Nonetheless, the Biden administration is going full bore to remake the country’s financial system for the specious and highly debatable assertion that we face a climate apocalypse.
The United States government alone exceeds one-fifth of the nation’s economy; thus, it already holds considerable sway over private sector businesses. Along with its spending power, the federal government also has far-reaching authority through its regulatory power.
Through a federal entity called the Financial Stability Oversight Council, Mr. Biden’s executive order directs it to come up with “processes to identify climate-related financial risk,” force “enhanced climate-related disclosures” of private companies over which the federal government regulates and make recommendations on how such risk “can be mitigated, including through new or revised regulatory standards.”
President Biden and his administration of global warming generals would have us believe they are fighting a war to save Earth. Instead, it is ordinary Americans who are and will be paying for this pointless war with their jobs and livelihoods and even their retirement savings. All this, with zero guarantee it will impact the climate in any way. Compounding this futility is other large, fossil-fuel consuming nations like China, Russia and India, which have no such climate obsession.
Transitioning to “net-zero” greenhouse gas emissions by 2050, were it possible, is not cost-free, regardless how many illusory promises are made for good-paying green jobs. Every renewable energy source is produced and sustained by fossil fuels, which makes the “renewable” label a fallacy. Solar panels, wind turbines and electric car batteries cannot exist without oil and gas, including the ability to mine for the necessary raw materials to manufacture them.
President Biden’s executive order is the continuation of its war on traditional energy sources, which began on Inauguration Day when he shut down construction of the Keystone XL pipeline with a stroke of his pen. More than 1,000 Americans immediately lost their jobs, with another 9,000 future job opportunities canceled. Mr. Biden also halted new energy leases on federal lands, and just canceled leases for development of the Arctic National Wildlife Refuge in northern Alaska – a desolate place no one should conflate with the Grand Canyon.
As the Biden administration reduces the domestic supply of energy and weakens America’s energy independence, fuel prices are rising. The average price in the U.S. of a gallon of gasoline is now at a seven-year high and growing. A gallon of gas jumped in price by nearly five percent in the last month and by more than 50 percent in the last 12 months, according to AAA.
Cancelling pipelines and energy leases is only the beginning. The Biden administration is now set to force reduced private investment in an industry based on the groundless label of “climate-related financial risk.” This will ultimately be the death knell of products and workers tied to that industry – which is the point.
President Biden’s recent executive order will increasingly make safe, abundant and affordable energy cost-prohibitive to low- and middle-income families. Rather than ensuring a stable U.S. financial system, this undemocratic action will undermine U.S. economic competitiveness, national security and financial stability.
Peter Murphy is a Senior Fellow at the Committee For A Constructive Tomorrow (CFACT), a Washington, D.C. non-profit that supports free market and technological solutions to address issues of energy, environment and development.