TCS Daily

Swiss Re-diculous

By C. C. Kraemer - March 12, 2004 12:00 AM

There are enough alarmists out there already spewing their sulfurous rhetoric about global warming without private industry chirping about it as well. So a report from Swiss Re, the world's second-largest reinsurer, that warns that climate changes are going to increase the costs of natural disasters is not welcome news for those who like to think their cooler heads will prevail on this issue.

Swiss Re's report is not a fresh development in the global warming wars, though. The Zurich-based company has been concocting scary climate change scenarios for more than a decade and trying to make a buck -- or Swiss franc -- off of it. It would be nice to think that the company had learned something in that time, but apparently not.

The report, released March 3, claims:

"There is a danger that human intervention will accelerate and intensify natural climate changes to such a point that it will become impossible to adapt our socio-economic systems in time.

"The human race can lead itself into this climatic catastrophe -- or it can avert it."

Swiss Re's point is that catastrophes caused roughly $70 billion in damage across the world last year, but only about $18.5 billion was insured, so everyone better get covered.

Some sales pitch. The dreaded insurance salesman has always warned prospective customers of impending doom so he can make a sale. The warnings were usually geared, though, toward personal and family disasters and accidents. Cautionary tales on a global scale have not traditionally been included in the training or the sales manual. They are now.

"Big European reinsurers (the people who insure the insurance companies), like Swiss Re and Munich Re, have been singing the climate change dirge for years," Patrick J. Michaels, a research professor of environmental sciences at the University of Virginia, wrote in the fall of 2002.

"It forms a convincing argument for raising their rates, and their pro-Kyoto (read: anti U.S.) governments are only too happy to nod in agreement."

Just in case there's a gap in knowledge out there, Swiss Re employs a climate expert to sort things out for the poor consumer who needs to know that man bears some of the responsibility for the $70 billion or so in damage caused by natural disasters last year because man is heating the planet.

How the Earth is warming -- if indeed it is -- is not so much of an issue for the insurance companies, however. But it is a political issue and when private industry makes claims, no matter how blatantly self-serving, that bolster the eco-activist lobby's world view, logic, reason and facts become scarce commodities. The claims also provide more sizzling lightning bolts for the anti-capitalist green groups to throw from their lofty moral perches at the commerce-driven wretches below.

If Swiss Re, Munich Re or other any other company truly believes that global warming is caused by man's activities and a resultant disaster is on the way, they are free to do so. But then so are critics free to point out what appears to be a sellout by private industry. It's an interesting place to be: A company using free enterprise to generate profits through an alliance with a movement that has on its agenda the elimination, or at least a profound restructuring, of the system that has allowed the company to prosper.

It's not the same as a Hollywood star or entertainment mogul criticizing the free-market framework that allowed him -- or her -- to get incomprehensibly rich. But it's close. The difference is the executives who run the private company generally have more sense. If it sounds like that makes them hypocrites, well, they should try a little introspection. Because from here, it looks like they are running a con.

But then perhaps they are true believers. If so, maybe they can do something about the mid-March heat wave that's scorching the Los Angeles area. Is there any way that raising rates can cool things off a bit?

C.C. Kraemer recently wrote for TCS about Man vs. Beast in California.


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