Blogs & Comment

Climate change is about to make a lot of people very rich

There's opportunity in the thaw

Seven years ago, McKenzie Funk, an American magazine writer and journalist, was floating in the Arctic Ocean watching Canadian soldiers shoot the Northwest Passage. They were lined up three in a row on the deck of the frigate Montreal firing over the water, he writes in his new book Windfall: The Booming Business of Global Warming, which comes out tomorrow. “They went from semiautomatic to fully automatic and shot more. They switched to pistols and then shotguns and shot until the deck was littered with shells.”

windfall-mckenzie-funkFunk was aboard the Montreal for Harper’s, reporting a story on the melting Arctic and the resource boom it was then ready to unleash. The article he produced made some light of the Canadian “arctic sovereignty” mission he observed. (The soldiers, he writes in his book “were trying their hardest to be fierce”, as if to make the world “understand that they were ready to fight for whatever riches the retreating ice revealed.”) But writing it also sent him down a reporting rabbit hole.

Climate change, Funk discovered on that trip, wasn’t only real, and for many disastrous—it was also big business. After filing his story, he spent the next six years expanding on it. He traveled the world, meeting Dutch seawall builders, arctic oil profiteers and many others looking to make a buck off the warming planet. The result is Windfall (Penguin, $32.95) a travelogue-cum-business book that runs down the hustlers, entrepreneurs and massive global firms all betting their futures on climate change.

One thing Funk didn’t find much of in his reporting was any lingering sense in the business world that global warming might be a hoax. “The business community, they have a real vested interest in understanding reality,” he says in an interview from his home in Seattle. “I was really surprised by how much the big oil companies had not just thought about climate change but also put it into their business calculations.”

Funk didn’t find much climate-change skepticism in his travels. “The business community has a real vested interest in understanding reality.”

Polar bear on ice floe

But resource companies aren’t the only ones buying into—and looking to profit from—global warming. All around the world, in all kinds of industries, people are finding ways to make climate change work for them. In the United States, to cite one example, insurance companies are devising new, more lucrative policies to keep wealthy clients safe in the face of extreme weather events. In one instance, Funk tagged along with a private fire crew hired by AIG to look after clients’ homes during a wildfire. In Europe, where global warming is devastating the ski industry, Funk found an Israeli company converting technology designed for desalination into next generation snow makers. In New York, he met traders gambling on rising food prices by buying up farmland everywhere from Ukraine to South Sudan.

For Funk, though, this is not primarily a business story. It’s a moral one. As he sees it, the people best positioned to profit from climate change are the ones most responsible for causing it—the already wealthy in the developed West. Those most likely to be hurt, meanwhile, are those in the global South who have done the least to make climate change a reality.  “That to me was the single most important thing I learned,” he says.

Funk also admits to being at least a little concerned that some will read his book less as a cautionary tale and more as a guidebook to getting rich. He doesn’t think most of the people he profiled are necessarily immoral. “By and large, if they’re talking to me, it’s because they truly believe they are doing good in their patch of the world,” he says. But he does have an issue with the larger moral calculation at play. If you accept that global warming is real, and that humans are causing it, you’ve accepted that millions, and probably billions, of the poorest people will suffer because of it. To look at that as a business opportunity and not, say, a call to political action could be seen as a particularly callous choice.

The flip side of that argument, though, is that politicians, faced with that same reality, have chosen over and over again to do nothing about it. The business of climate change is growing, in other words, at least somewhat because political action on climate change has so overwhelmingly failed. And “the more we fail,” Funk says, “the more, unfortunately, that looks like the way the world may go.”