“When it rains, it pours”: How Climate Change Contributes to Wealth Inequality (also) in the Global North

After the floods in Central Europe, Florida was hit by two hurricanes, Helene and Milton. More recently, Dana struck Valencia, claiming over 200 lives. These extreme weather events are becoming more frequent and intense, a trend widely attributed to climate change, despite differing interpretations and models within the scientific community. The 2022 World Economic Forum Risk Report highlights that climate action failure and extreme weather are the two greatest risks facing Earth over the next 5 to 10 years.

When considering the impact of a temperature rise above 2 degrees Celsius, we often think of the severe consequences for the 16 tipping elements like the Greenland Ice Sheet or the Amazon rainforest, or the impact on developing countries such as Chad or Somalia.

These are among the nations that bear the brunt of global warming, facing desertification and water scarcity, despite contributing insignificantly to global GHG emissions. The world’s wealthiest 1% account for 15% of carbon emissions, more than double that of the poorest 50%. This blatant disparity persists despite the paternalistic and colonial attitudes of some global north leaders, like Prince William, who has linked African population growth to wildlife loss, even though his own family’s footprint is almost 1,600 times higher than the average Nigerian family.

However, even within the developed world, the situation is far from uniform. In Europe, for instance, the top 10% of individuals with the highest per capita carbon footprints contribute 27% of the EU’s total carbon footprint, surpassing the combined contribution of the bottom 50%. The top 1% of EU households have a carbon footprint of 55 tCO2eq per capita, emitting 22 times the per capita climate targets. The effects of climate change are also quite unequal, even in the global north.

For example, in the United States, the impact of natural disasters reveals a stark disparity. In 2015 alone, U.S. insurance companies and Federal Emergency Management Agency (FEMA) distributed $30 billion in recovery funds for weather and geological events. The 2017 hurricane season, with Harvey, Irma, and Maria, became the costliest on record, causing over $260 billion in damages. Even under optimistic scenarios, studies predict that property damage costs will double to quadruple by 2050, despite mitigation efforts, such as new warning systems and improved building codes.

These extreme weather events do not affect the whole population and social groups equally. Sociological research shows that less-privileged residents often suffer greater economic, social, and cultural losses, while more-privileged residents recover more quickly and may even benefit financially. Privileged residents and property owners often gain from federal recovery investments, low-interest loans, insurance payouts, and wealth transfer opportunities. In contrast, less privileged residents face job loss, relocation, higher rents, and depleted savings. Sometimes, government recovery programs even suspend legal protections for low-wage workers to expedite economic recovery.

A 2018 study by Junia Howell and James R. Elliott illustrates the racial disparity in hurricane impacts. From 1999 to 2013, whites in counties with minimal hazard damage gained an average of $26,000 in wealth, while those in high-damage counties gained $126,000. For blacks, those in low-damage counties gained $19,000, while those in high-damage counties lost $27,000. Latinos saw gains of $72,000 in low-damage areas but losses of $29,000 in high-damage areas.

Government aid from FEMA, which Republicans chose not to support in Congress just before hurricanes Helene and Milton hit the USA, also has an unequal impact. For black, less-educated renters with no wealth in 1999, increased FEMA aid led to a decline in predicted wealth by 2013. Conversely, white, more-educated homeowners with $100,000 in 1999 saw their wealth increase with more FEMA aid.

As data from the USA suggests, climate change exacerbates existing inequalities, making it crucial to integrate social equity into climate action plans. Therefore, it is increasingly necessary to implement measures that provide immediate relief and address the urgent needs of affected populations. For instance, reforming FEMA could ensure a more equitable distribution of aid. However, addressing immediate needs is not sufficient. In the long term, it is essential to tackle climate change from a broader perspective of social justice. This means creating policies that ensure the most vulnerable populations, both in the global north and south, do not bear the heaviest burden of climate impacts.

On the other hand, the economically wealthier classes, who are often the most responsible for emissions, should bear the highest costs for supporting climate policies. These measures include investing in resilient infrastructure, supporting sustainable livelihoods, and ensuring access to clean energy for all. By doing so, we can help mitigate the adverse effects of climate change on marginalized communities and promote a more just and sustainable future.

When the Titanic sank, most casualties were third-class passengers. This time, we should keep the climate vessel afloat or, at least, ensure lifeboats for everyone.

References / Used Sources

Ivanova, D. and Wood, R. (2020) The unequal distribution of household carbon footprints in Europe and its link to sustainability. Global Sustainability, 3, e18, 1–12.

Howell, J. and Elliott, J.R. (2019) Damages Done: The Longitudinal Impacts of Natural Hazards on Wealth Inequality in the United States. Social Problems, 66, 448–467.

Selinske, M., Dorward, L., Barnes, P., and Brittain, S. (2022) You are now one of 8 billion humans alive today. Let’s talk overpopulation – and why low income countries aren’t the issue. The Conversation, 15 November.

World Economic Forum (2022) The Global Risk Report 2022.

King, J. (2024) How Florida Republicans Who Voted Against FEMA Funding Reacted to Milton. Newsweek, 10 October. Available at: https://www.newsweek.com/reublicans-vote-against-fema-hurricane-milton-1967206

BBC News Website (2024) More than 200 killed in Valencia floods as torrential rain hits another Spain region. 1 November. Available at: https://www.bbc.com/news/live/cgk1m7g73ydt?page=2

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Author: Student of MBA Sustainability Management Class 2 (2024-2026)