Finance
Addressing Climate Challenges: The Role of Research in Climate Finance
Threatening ecosystems, public health, and economic stability, climate change remains one of the biggest worldwide issues of the twenty-first century. Among the major hazards the United States faces are changing sea levels, more violent storms, and disturbances in food output. Managing these risks and enabling the shift to a low-carbon economy depend on targeted investments in mitigating, adapting, and resilient building—that is, climate finance. The economic effects of climate change on the United States are discussed in this paper together with a discussion of significant policy proposals and an emphasis on ongoing research and innovation in climate finance.
The Economic Consequences of Climate Change in the U.S.
Extreme weather events now occur far more frequently and with far higher intensity, resulting in significant financial losses. Rising sea surface temperatures helped Hurricane Harvey cause before unheard-of flooding in Houston in 2017. One of the most expensive natural disasters in U.S. history, the damages topped $125 billion (National Oceanic and Atmospheric Administration, NOAA.). Likewise, California’s ongoing droughts brought on by rising temperatures and less precipitation have stoked terrible wildfires that have destroyed infrastructure and displaced whole populations.
Without major adaptation strategies, yearly damages from hurricanes and coastal floods might reach $500 billion by 2025, according to a 2023 analysis in Nature Climate Change. This emphasizes how urgently studies on financial instruments meant to help reduce economic losses—such as insurance products and climate bonds—should be conducted.
Especially in places like California and the Midwest, climate change has upset established farming cycles. Extended droughts and severe storms have lowered crop harvests and raised manufacturing prices. For instance, the strong windstorm known as the 2020 Midwest derecho damaged about $11 billion worth of crops, including corn and soybeans (U.S. Department of Agriculture, USDA). Food security and affordability will remain at risk without focused investments in climate-resilient agriculture including enhanced irrigation infrastructure and drought-resistant crops.
Rising temperatures both directly and indirectly endanger health. Particularly among susceptible groups like the elderly and those from low-income areas, heat waves raise the frequency of heat-related diseases. Furthermore, moving to new areas as warming increases the habitat of disease-carrying insects are vector-borne diseases such as Lyme disease and West Nile virus. A report from The Lancet Planetary Health claims that tackling these increasing health hazards calls for coordinated plans combining public health preparedness and investments in green infrastructure meant to lower urban heat island effects.
Policy and Financial Mechanisms in Climate Action
To lower greenhouse gas emissions and advance climate resilience, the United States has instituted many historic laws. Allocating $369 billion to renewable energy and environmental projects, the Inflation Reduction Act (2022) marks the highest federal investment in climate change. Important clauses cover tax incentives for electric cars (EVs), renewable energy generation, and energy-efficient building improvements (Congressional Research Service, CRS). The Act seeks to hasten the acceptance of sustainable technologies by providing private sector innovation financial incentives.
The Biden government also rejoined the Paris Agreement, pledging a 50–52% decrease in greenhouse gas emissions from 2005 levels by 2030. Investments in climate adaptation, clean energy infrastructure, and carbon sequestration technologies have top priority among federal agencies including the Environmental Protection Agency (EPA) and the Department of Energy (DOE).
Advancement of climate action has been much aided by state and municipal governments. To cut carbon emissions and set a target of 100% renewable energy by 2045, California has instituted a cap-and-trade program aiming at growing the infrastructure supporting renewable energy, New York has started bold clean energy initiatives. Urban cooling techniques and flood fortifications have been used in cities including Boston and Seattle to shield citizens from climatic effects. These municipal initiatives show how important multilevel government is for tackling environmental problems.
With wind and solar power making up a rising portion of electricity generation, the United States has achieved notable advancement in the acceptance of renewable energy. Texas leads the country in wind energy; California stays at the top in solar power. Particularly in Massachusetts and New Jersey, offshore wind projects spread throughout the East Coast are expected to greatly increase the nation’s renewable energy capacity.
The energy transformation revolves mostly around technological innovation. While carbon capture and storage (CCS) technologies are being developed to lower emissions from industrial activity, advances in battery storage systems are improving grid dependability. Achieving net-zero emissions worldwide would depend on increasing CCS and hydrogen fuel technologies, per a 2023 International Energy Agency (IEA) assessment.
Opportunities and Challenges in the Green Economy
The shift to a green economy presents significant employment generation possibilities. Two of the fastest-growing jobs in the United States according to the Bureau of Labor Statistics (BLS) are solar panel installers and wind turbine service technicians. A McKinsey analysis projects that investments in renewable energy, sustainable agriculture, and energy-efficient infrastructure could provide nearly 9 million additional employments by 2030.
Moreover, green infrastructure projects—such as public transit networks and energy-efficient building retrofits—have the potential to boost local economies while lowering emissions. Through reduced energy expenditures and higher productivity, the U.S. Green Building Council projects that every dollar spent in energy efficiency results in up to four dollars in economic benefits.
Notwithstanding great progress, considerable obstacles still exist. While technological issues including the scalability of CCS and the intermittency of renewable energy sources must be resolved, political polarization has hampered the passage of comprehensive climate legislation. Another important problem is making sure workers in sectors dependent on fossil fuels have a fair changeover. To reduce social disturbances during the energy change, policymakers have to give labor retraining and social support programs top priority.
Regarding its approach to climate change, the United States finds itself at a turning point. Although obstacles still exist, the nation’s governmental systems, technological capacity, and economic resources set it in a position to spearhead worldwide climate action. The U.S. can not only lessen the effects of climate change but also build a more sustainable and fair future by encouraging research and invention in climate finance.
The expenses of inaction much exceed the expenditures required to reduce climate effects as extreme weather events and environmental hazards keep becoming more frequent. Now is the moment for audacious, well-coordinated action including civil society, the business sector, and all tiers of government. The United States can provide a strong model for the world in tackling the existential problem of climate change with the correct mix of ambition, creativity, and cooperation.
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Gov.-elect Abigail Spanberger has tapped Del. Mark Sickles, D-Fairfax, to serve as her Secretary of Finance.
Sickles has been in the House of Delegates for 22 years and is the second-highest-ranking Democrat on the House Appropriations Committee.
“As the Vice Chair of the House Appropriations Committee, Delegate Sickles has years of experience working with both Democrats and Republicans to pass commonsense budgets that have offered tax relief for families and helped Virginia’s economy grow,” Spanberger said in a statement Tuesday.
Sickles has been a House budget negotiator since 2018.
“We need to make sure every tax dollar is employed to its greatest effect for hard-working Virginians to keep tuition low, to build more affordable housing, to ensure teachers are properly rewarded for their work, and to make quality healthcare available and affordable for everyone,” Sickles said in a statement. “The Finance Secretariat must be a team player in helping Virginia’s government to perform to its greatest potential.”
Sickles is the third member of the House that Spanberger has selected to serve in her administration. Del. Candi Mundon King, D-Prince William, was tapped to serve as the Secretary of the Commonwealth, and Del. David Bulova, D-Fairfax, was named Secretary of Historic and Natural Resources.
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SEOUL, Dec 23 (Reuters) – South Korea’s central bank needs to remain wary of financial stability risks, such as heightened volatility in the won currency and upward pressure on house prices, a board member said on Tuesday.
“Volatility is increasing in financial and foreign exchange markets with sharp fluctuations in stock prices and comparative weakness in the won,” said Chang Yong-sung, a member of the Bank of Korea’s seven-seat monetary policy board.
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The won hit on Tuesday its weakest level since early April at 1,483.5 per dollar. It has fallen more than 8% in the second half of 2025.
Chang also warned of high credit risks for some vulnerable sectors and continuously rising house prices in his comments released with the central bank’s semiannual financial stability report.
In the report, the BOK said it would monitor risk factors within the financial system and proactively seek market stabilising measures if needed, though it noted most indicators of foreign exchange conditions remained stable.
Monetary policy would continue to be coordinated with macroprudential policies, it added.
The BOK’s next monetary policy meeting is in January.
Reporting by Jihoon Lee; Editing by Jamie Freed
Our Standards: The Thomson Reuters Trust Principles.
“I am running because the system needs to be fixed and I have the skills and mindset to do it…”
by MIKE BURKHOLD
***
Earlier this month, at the invitation of Virginia Secretary of Finance Steve Cummings, I spent a full day in Richmond meeting with leaders from across that state’s financial infrastructure. These were not ceremonial handshakes. These were working meetings — substantive, focused and highly instructive.
I met with teams overseeing budgeting, taxation, regulatory oversight, accounting and administration. What I found was a modern, integrated and disciplined approach to managing public money. And it made me even more certain of one thing: South Carolina is ready for change.
***
TEAMWORK AND TALENT MATTER
What stood out most in Virginia was the cohesion. From top to bottom, everyone I met shared the same mission — being responsible stewards of the taxpayers’ money. No silos. No blame games. Just a united focus on efficiency, transparency and performance.
That mindset doesn’t happen by accident. It is baked into the culture. The Secretary of Finance meets quarterly with department heads to review budgets, resolve audit findings and keep teams on track. There is accountability at every level. And it works.
That is what I want to bring to South Carolina. As Comptroller General, my job is to revitalize and modernize a critical finance function and to do it in close partnership with the legislature, the governor and the treasurer. I want to build an office that operates with precision, earns trust and gives lawmakers the clarity they need to govern wisely.
***
THIS IS BIGGER THAN ONE SEAT
I am not running for this office because I want a long political career. I am running because the system needs to be fixed and I have the skills and mindset to do it.
If part of that fix means rethinking whether this seat should remain an elected position then I welcome that conversation. In other states like Florida, voters elect a Chief Financial Officer with broad oversight. In Virginia, the Secretary of Finance is appointed by the governor and oversees all fiscal functions. Either model can work – but both reflect a commitment to modern coordinated financial management.
What matters most is that we have a structure that delivers results and earns the public’s trust. That structure needs to be part of a bigger conversation focused on delivering value to citizens – not maintaining fiefdoms or political turf.
***
RELATED | S.C. ‘REPUBLICANS’ REBUFF TRUMP ON REDISTRICTING
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PUBLIC SERVICE STARTS WITH LEADERSHIP
One of the most inspiring parts of my trip was seeing the caliber of leaders who had left high-paying private sector roles to serve the people of Virginia. They brought with them a culture of excellence and a belief that good government is possible when the right people step forward.
We have that kind of talent in South Carolina. We just need to encourage more of it. I am stepping up because I believe in servant leadership. I see a seat that has not been led this way in a long time and there is a lot to fix. Not just the systems and operations but also the teamwork and coordination across agencies.
My goal is not what is best for Mike. It is what is best for South Carolina. I want to rebuild the Comptroller General’s office into a trusted partner, a respected institution and a model for modern financial leadership. Then I want to help figure out what structure will best serve the next generation.
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A MOMENT OF OPPORTUNITY
The recent $3.5 billion error exposed just how outdated and fragile our current systems are. But we are not starting from scratch. We are starting from a place of strength. We have smart people, a strong economy and the will to do better.
Now we need to modernize our expectations. We need to align talent. We need to redesign the systems that manage $40 billion of taxpayer money. And we need leadership that sees the big picture, listens well and gets the details right.
South Carolina’s future is full of promise. But to get there, we need to treat government finance with the same rigor, discipline and urgency as any top-performing business.
That is why I am running. Not to keep a seat – but to serve the mission.
***
ABOUT THE AUTHOR…
Mike Burkhold is a Republican candidate for comptroller general of South Carolina.
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