Climate change taxes us all

Illustration: US food prices on the move, The Guardian, April 2025.

As temperatures boil wildly upward and leaders betray promises to reel in carbon emissions, the costs of climate change tax us all.

Because climate change affects everything, we cannot escape paying for it. Climate change is now responsible for $163 billion in crop losses every year. We pay for these losses at the grocery store. We pay for damage to our homes from wildfire and flooding. We pay the higher costs of insurance. These costs hit us daily, long after oil, coal, and gas cartels created them by profiting from profligate carbon use. It is high time that the cartels pay for the damages they have placed upon us.

Take the food problem for starters. As climate worsens, hurricanes, droughts, etc. disrupt crops, harvesting, and their transport. Food prices are rising. We now have worse inflation than in many years. What now drives food prices increasingly is demand and supply that is affected more and more by climate change, as argued by Prof. Mark Blyth and Nicolò Fraccaroli.[1]

On the demand side, the new Trump tariffs apply often to imported intermediate or raw goods, which include food. Those imports under Trumpian tariffs will push up prices for a long time, if not forever. The effects are worsened by a changing climate. For example, avocados are now increasingly imported into a region which once grew them, the southwest US. Placing tariffs on them will hardly shift production back to California or Arizona, given high land values, water shortages and drought, rising temperatures, and extreme weather disruptions. Such trees would need to be planted right now in order to begin producing fruit in five more years. Other countries will similarly retaliate by reducing US imports by tariffs.

Another climate cost that will raise prices and dampen consumer demand is a lack of affordable insurance. Insurance companies are pulling back from insuring big and small farmers because of the increased climate vulnerability of farms. Little or no coverage for food producers will mean farmers will need to raise food prices to protect themselves from the very same unprecedented climate events.

Supply side effects of climate change will grow, too, as global warming proceeds. Less land for cultivation because of rising ocean levels and salt water pollution, too much or too little water, hurricanes, extreme heat, stress, and even increased pestilence will cause food shortages. With each climate crisis, yields will fall and supply diminish.[2] Agricultural production is already seeing the dire consequences of both foreseeable and unpredictable climate events, resulting in enormous loss and damage. Prices on orange juice, olive oil, cacao, and coffee have jumped. 

A 2023 peer-reviewed Potsdam study entitled, “Global warming and heat extremes to enhance inflationary pressures,” confirms much of this in broader terms. “Higher temperatures increase food and headline inflation.”[3] Under temperature increases predicted to 2035, projected food inflation will rise .92 to 3.23 % per year and headline inflation (the total inflation within an economy) will rise .32 to 1.18 % per year on average across the globe. The study concludes that pressures are largest at low latitudes and show strong seasonality at high latitudes.

But these figures are likely on the low side. Add tariffs. Include the continued and escalating production of coal, gas and oil, driven by extremist politicians lusting to “drill baby drill.” Add in accelerated warming and drought. Food prices will end up higher, possibly skyrocketing.

We climate activists have notoriously failed in our climate messaging. We warn of climate dangers in the abstract, rather than communicate in real, down-to-earth terms.  Meanwhile, as coal, oil and gas cartels, backed by a relentless propaganda machine, have had their way, the resulting impacts amount to an onerous, taxation without representation now falling on all but most unfairly on lower and middle income groups–which we as climate concerned fail to oppose. Billionaires and their oil cartels are escaping taxation, backed by enormous political overrepresentation.  

At the grass roots, the alarm must sound that climate change will hit us in our stomachs and pocket books until we halt such emissions. We must start conversations, cite data, expose soaring price increases, engage local politicians, join the ever more frequent marches and public protests to ban fossil fuels, and build the Stop the Fossil Fuel Billionaires movement. We must call for taxation with representation and stop these culprits from growing richer off these destructive fossil fuel emissions. We must transition to what is within our grasp, cleaner, less costly, more efficient renewables.

[1] See https://www.theguardian.com/commentisfree/2025/apr/22/tariffs-inflation-climate-crisis See their forthcoming book, Inflation: A Guide for Users and Losers by Mark Blyth and Nicolò Fraccaroli

[2] See for example Michael Keane and Timothy Neal, Climate change and U.S. agriculture, Quantitative Economics 11 (2020), 1391–1429 1759-7331/20201391:

[3] See Maximilian Kotz et al., “Global warming and heat extremes to enhance inflationary pressures”, Communications Earth and Environment, 2023.