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Biden’s not to blame?! The Atlantic warns of ‘Greenflation’: A ‘new era of climate-driven inflation takes hold’ in America

Extreme weather and energy uncertainty are already sending prices soaring.

By Robinson Meyer

Over the past year, U.S. consumer prices have risen 7 percent, their fastest rate in nearly four decades, frustrating households and tanking President Joe Biden’s approval rating. And no wonder. High inflation corrodes the basic machinery of the economy, unsettling consumers, troubling companies, and preventing everyone from making sturdy plans for the future.

For years, scientists and economists have warned that climate change could cause massive shortages of major commodities, such as winechocolate, and cereals. Financial regulators have cautioned against a “disorderly transition,” in which the world commits only haphazardly to leaving fossil fuels, so it does not invest enough in their zero-carbon replacements. In an economy as prosperous and powerful as America’s, those problems are likely to show up—at least at first—not as empty grocery shelves or bankrupt gas stations but as price increases.

That phenomenon, long hypothesized, may be starting to actually arrive. Over the past year, unprecedented weather disasters have caused the price of key commodities to spike, and a volatile oil-and-gas market has allowed Russia and Saudi Arabia to exert geopolitical force.

“The lumber-price story is a climate story,” he said. If a series of climate-change-aggravated disasters—including a multiyear outbreak of bark-eating beetles, back-to-back record-breaking fire seasons, and a massive November flood that washed out rail lines—had not struck British Columbia, “sawmills would be able to treat this market just like they did in 2006,” he said.

“There are people who say, ‘Climate change isn’t affecting me,’” Janice Cooke, a forest-industry veteran at the University of Alberta, told me last year. “But they’re going to go to the hardware store and say, ‘Holy cow, the price of lumber has gone up.’” Taken by itself, climate change’s role in driving lumber inflation would be a fluke. But worrying signs have started to appear that these dynamics are not limited to lumber. Both climate change itself and the inevitable policy response to it—the global energy transition to low-carbon fuels—are starting to drive up prices around the world. And the world may not have the right tools to deal with it.


Over the past year, unprecedented weather disasters have caused the price of key commodities to spike, and a volatile oil-and-gas market has allowed Russia and Saudi Arabia to exert geopolitical force. “This climate-change risk to the supply chain—it’s actually real. It is happening now,” Mohamed Kande, the U.S. and global advisory leader at the accounting firm PwC, told me. … The economy shows evidence of a new, more inflationary regime caused not only by climate change but by the fight over how to respond to it. …

In Canada, the worst single-year drought since 1961 doubled pea prices, sending them to an all-time high. France’s water-logged and record-breakingly hot summer also helped push up global pea prices. (Alternative-meat products have made peas more in demand than ever.) In Germany and Belgium, days of torrential flooding killed more than 200 people and severely damaged the potato crop, contributing to last year’s price increase of 180 percent. (Climate change helped make the rainfall that caused those floods more likely, according to the World Weather Attribution initiative.)

“Raising rates,” he said, “doesn’t grow more trees.” Nor does it grow more coffee, end a drought, or bring certainty to the energy transition. And if our new era of climate-driven inflation takes hold, America will need more than higher interest rates to bring balance to supply and demand.

Robinson Meyer is a staff writer at The Atlantic. He is the author of the newsletter The Weekly Planet, and a co-founder of the COVID Tracking Project at The Atlantic.


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