Human response to climate change - The Global Climate System: Patterns, Processes, and Teleconnections - page 276

climate conditions included damaging weather in the southern and western
United States. The West Coast was assaulted by a series of coastal storms,
causing floods and agricultural damage, with California losses totaling
$1.1 billion. Losses in excess of $0.5 billion came from an unusual snow-
storm across the High Plains. Flooding devastated fruit and vegetable crops,
and national prices for fresh produce rose 7.9 percent in January, and then
rose 5 percent in March 1998. The nation's tourist business suffered from
a 30 percent drop in income. National losses from the winter events totaled
$4.2 billion.
In contrast, the mild, almost snow-free winter in the northern United States
resulted in several major economic gains. Abnormal winter warmth led to
major reductions in heating costs, creating national savings of $6.7 billion.
Little precipitation and high winter temperatures had a positive influence on
construction, retail shopping, and home sales, with total nationwide gain of
$5.6 billion.
The effect on the nation's economy included a 4 percent drop in produc-
tion at the nation's electricity and gas utilities. Inflation was zero during
January-March, the first time in 10 years, and the Consumer Price Index went
unchanged due to the falling energy prices. The GNP rose at a rate of
4.2 percent during the first quarter of 1998, as compared to the 3.4 percent
expected. Assessment of the national impacts, both losses and benefits,
revealed economic benefits of $19.8 billion outweighed losses of $4.2 billion.
Record warm winter of 2001-2
The winter of November 2001-February 2002 was the nation's warmest on
record since 1895 and led to reduced energy demand and kept natural gas
prices much below normal. Large parts of the nation had below average
precipitation, and snowfall was below normal throughout most of the northern
United States. Economic impacts included lower heating costs, reduced
transportation delays, lower road/highway maintenance costs, added con-
struction activities, reduced insurance losses, and increased retail sales,
home sales, and tourism. Expenditures for homes and retail products during
the November-February period were $5 billion above normal, and the winter
created an additional $2 billion income for the construction industry. The low
heating bills were a bonanza for consumers, but big utilities lost large sums.
One East Coast utility reported a revenue loss of $92 million, an 8.3 percent
decrease. However, consumer savings were $7.5 billion due to lower energy
costs (Changnon 2002 ). The total nationwide benefits were $20.6 billion,
whereas the winter losses were only $400 million. Some economists claimed
the mild winter and its impacts were a key factor in getting the nation's
economy out of an on-going recession.