April 2007 Atlantic Monthly : Global Warming: Who Loses—and Who Wins?

Climate change in the next century (and beyond) could be enormously disruptive, spreading disease and sparking wars. It could also be a windfall for some people, businesses, and nations. A guide to how we all might get along in a warming world

Climate change could have a broad impact on industrial sectors, and thus help or hurt your stock investments and retirement funds. What types of equity might you want to favor or avoid?
Coastal cities inundated, farming regions parched, ocean currents disrupted, tropical diseases spreading, glaciers melting—an artificial greenhouse effect could generate countless tribulations.

If Earth’s climate changes meaningfully—and the National Academy of Sciences, previously skeptical, said in 2005 that signs of climate change have become significant—there could be broad-based disruption of the global economy unparalleled by any event other than World War II.

Economic change means winners as well as losers. Huge sums will be made and lost if the global climate changes. Everyone wonders what warming might do to the environment—but what might it do to the global distribution of money and power?

Whether mainly natural or mainly artificial, climate change could bring different regions of the world tremendous benefits as well as drastic problems. The world had been mostly warming for thousands of years before the industrial era began, and that warming has been indisputably favorable to the spread of civilization. The trouble is that the world’s economic geography is today organized according to a climate that has largely prevailed since the Middle Ages—runaway climate change would force big changes in the physical ordering of society. In the past, small climate changes have had substantial impact on agriculture, trade routes, and the types of products and commodities that sell. Larger climate shifts have catalyzed the rise and fall of whole societies. The Mayan Empire, for instance, did not disappear “mysteriously”; it likely fell into decline owing to decades of drought that ruined its agricultural base and deprived its cities of drinking water. On the other side of the coin, Europe’s Medieval Warm Period, which lasted from around 1000 to 1400, was essential to the rise of Spain, France, and England: Those clement centuries allowed the expansion of farm production, population, cities, and universities, which in turn set the stage for the Industrial Revolution. Unless greenhouse-effect theory is completely wrong—and science increasingly supports the idea that it is right—21st-century climate change means that sweeping social and economic changes are in the works.
To date the greenhouse-effect debate has been largely carried out in abstractions—arguments about the distant past (what do those 100,000-year-old ice cores in Greenland really tell us about ancient temperatures, anyway?) coupled to computer-model conjecture regarding the 22nd century, with the occasional Hollywood disaster movie thrown in. Soon, both abstraction and postapocalyptic fantasy could be pushed aside by the economic and political realities of a warming world. If the global climate continues changing, many people and nations will find themselves in possession of land and resources of rising value, while others will suffer dire losses—and these winners and losers could start appearing faster than you might imagine. Add artificially triggered climate change to the volatility already initiated by globalization, and the next few decades may see previously unthinkable levels of economic upheaval, in which fortunes are won and lost based as much on the physical climate as on the business climate.
It may sound odd to ask of global warming, What’s in it for me? But the question is neither crass nor tongue-in-cheek. The ways in which climate change could skew the world’s distribution of wealth should help us appreciate just how profoundly an artificial greenhouse effect might shake our lives. Moreover, some of the lasting effects of climate change are likely to come not so much from the warming itself but from how we react to it: If the world warms appreciably, men and women will not sit by idly, eating bonbons and reading weather reports; there will be instead what economists call “adaptive response,” most likely a great deal of it. Some aspects of this response may inflame tensions between those who are winning and those who are losing. How people, the global economy, and the international power structure adapt to climate change may influence how we live for generations. If the world warms, who will win? Who will lose? And what’s in it for you?