JP Morgan Chase is the world’s leading financer of fossil fuel projects. And according to a report from within the company, recently leaked to the press, the world is seriously underestimating the adverse effects of climate change.

The 22-page report, entitled “Risky Business: the climate and the macroeconomy” and dated January 14, 2020, has been reported by multiple outlets since Friday as containing a gloomy assessment of the risk presented by climate change in the near future. But it also offers a withering takedown of how economists in particular have tended to think about the climate crisis, criticizing findings from several of the field’s experts by name, including a recent winner of the Nobel Prize in economics. “We cannot rule out catastrophic outcomes where human life as we know it is threatened,” the report concludes. It’s a stunning bit of cognitive dissonance from a bank that is doing so much to fuel the crisis. It also shows a growing push for a more grounded assessment of the crisis than mainstream economics has offered in recent decades.



The report was originally obtained by Rupert Read, a University of East Anglia philosopher involved with the climate activist group Extinction Rebellion, after it was sent out to the bank’s clients. A spokesperson for JP Morgan Chase told the BBC that it was produced “wholly independent from the company as a whole.”

Essentially an informational document, the report—written by U.K.-based JP Morgan economists David Mackie and Jessica Murray—reviews a battery of academic literature on climate change. It examines several predictions of climate change’s impact on gross domestic product, including economist Richard Tol’s 2018 survey of 26 different climate models—one of the more comprehensive recent works. While Tol has links to organizations that have cast doubt on the scientific consensus around the climate crisis, as his own research has, the findings listed are not especially controversial. But the JP Morgan Chase report authors push back on those and other prominent predictions. “Most likely,” the authors conclude, “these estimates of the income and wealth effects of unmitigated climate change are far too small.”

The models Tol compiled suggest that warming of up to 2.5 degrees Celsius (4.5 degrees Fahrenheit; well beyond the guardrail laid out in the Paris Agreement) could even have a positive effect on GDP. With six degrees of warming—a worst-case scenario science writer Mark Lynas likened to “a meteorite striking the planet”—GDP would only be projected to suffer by 7 percent relative to that of an unwarmed world, according to one model. Other studies JP Morgan Chase examines found higher impacts—up to a 23 percent hit to GDP by 2100, though it notes that even this is likely too optimistic.