By John A. Charles, Jr.
Relying on computer models to predict the future has always been risky. Now we know it’s the basis of climate change securities fraud as well.
The Competitive Enterprise Institute (CEI) recently wrote the Securities and Exchange Commission (SEC) that several California cities have claimed in lawsuits against oil and gas companies that those companies failed to disclose known climate risks associated with fossil fuel use. Yet those same cities have made bond offerings in which they tell potential investors that it is impossible to predict future risks of climate change.
For example, San Francisco predicts in its lawsuit against the oil industry that it will be subjected to as much as 0.8 feet of additional sea level rise by 2030, with short-term costs of $500 million and long-term costs of $5 billion. Yet the City tells potential bond investors, “The City is unable to predict whether seal-level rise will occur.”
The County of Santa Cruz claims in its fossil fuel lawsuit that there is “a 98% chance that the County experiences a devastating three-foot flood before the year 2050.” Meanwhile, in efforts to sell its own municipal bonds, the County reassures investors that it is unable to predict such floods.
This confirms what has long been suspected: Climate change alarmists just make stuff up to scare the public.
John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.