We’ve been hearing about global warming and climate change for the last 25 years or so. But the rubber may finally be reaching the road as this issue starts to affect our pocketbooks. The venerable Wall Street Journal covered the recently released National Climate Assessment and touched on some of the economic consequences to expect as this issue inevitably continues to move front and center.
As investors the potential ripples continue to widen and make themselves apparent as we consider the “new normal” imposed by a changing climate. From agriculture to shipping to manufacturing we’ll all get to consider new ways of doing things.
While the current administration is working within the regulatory framework in the absence of consensus in Congress we’d also expect economic policy to change and adapt as well. While it may be that the “cap and trade” approach of yesteryear is out of the picture we could start to see economic changes in the form of a revenue neutral carbon tax begin to win a serious place in the debate. While that may seem onerous to some such a system may just accelerate the incredible ingenuity and creativity needed to turn this big lemon into lemonade.
One thing is for sure, fortunes will be made and communities transformed, in good ways we would think, as scientists and businesspeople bring technology to bear in this new “gold rush” of adaptation and mitigation. As investors, we’ll continue to take a prudent, cautious approach and work within the disciplines that have served us so well in years past. But as citizens we’re incredibly excited about the new era dawning.