Go see Al Gore’s An Inconvenient Truth. It raises awareness about global warming and motivates searches for constructive policies. Unfortunately, the film also polarizes proposed “solutions.” Many urge CO2 emissions caps. Others, fearful of economic repercussions, seek delay.

Nobel Laureate and FREE’s 2003 Summer Scholar Thomas Schelling rejects the polarization: “It is not economic growth versus environment.” Professor Schelling has worked on climate change for thirty years and served on the CO2 Assessment Committee of the National Academy of Sciences. In 2005, he won the Nobel Prize in Economics. Instead of polarization, Professor Schelling proposes moderation, “growth with the environment taken into account.” (FREE and the President’s Office at MSU are honored to host Professor Schelling during his eleventh trip to Bozeman. Please join us for a public lecture at the Museum of the Rockies, Tuesday, August 15 at 8:00 pm.)

Successful solutions to global warming will recognize an important truth: The consequences hit the poorest hardest.

In developed countries, the impacts are buffered by wealth. “Within the U.S. we worry about the impact of climate change when we suffer from coastal storms like Katrina. But we have the resources to adapt,” notes Glenn Prickett, senior VP at Conservation International. Manufacturing, finance, health care, and education are resilient to minor changes in temperature. Rapidly developing Dubai even has indoor ski resorts -- despite temperatures thirty degrees hotter than Montana’s.

In the developing world, however, three out of every four people depend on agriculture. And agriculture is dangerously climate-sensitive. The UN projects that within a generation climate change will strip 65 developing countries of 280 million tons of cereal -- a loss of $56 billion. Poverty and poor technology limit adaptation.

With global warming, we truly are a global village; carbon dioxide has the same effect on the atmosphere whether emitted by the U.S. or China. The poor bear the direst consequences, but we all contribute to the problem. How might we contribute to the solution?

Consider an emissions limit set by international treaty. A panel of scientists could estimate what level of CO2 would avoid dangerous degrees of warming. That level could then be reached with carbon-trading. Chairman of the Chicago Climate Exchange Richard Sandor explains, “Markets work to solve problems. The sooner we admit that, and the sooner we get around to building [CO2] markets, the better.”

But might the consequences of mandated emissions reductions be more devastating than unmitigated warming? Professor Schelling projects, “[Developing nations’] best defense against climate change may be their own continued development.” In the developing world, industry is growing. This means more CO2. Yet growth also means wealth; and wealth fosters resiliency.

Here’s the good news: CO2 isn’t an all-or-nothing problem. Although we rejected the Kyoto Protocol, we are progressing with state and private programs. Seven Northeastern states implemented the Regional Greenhouse Gas Initiative; the Chicago Climate Exchange initiated private sector carbon-markets; and California Governor Arnold Schwarzenegger allied with Tony Blair to combat global warming. Moderate approaches follow Professor Schelling’s advice of reducing emissions when the benefits exceed the costs.

Many emissions reductions are worthwhile -- conserving gas, planting trees, and sharing eco-friendly technology, for example. But most developing nations, explains Schelling, believe “their best defense against climate change and vulnerability to weather in general is their own development, reducing their reliance on agriculture. Furthermore, they have immediate environmental problems -- air and water pollution, poor sanitation, disease -- that demand earlier attention.” Some funds potentially spent reducing greenhouse gases may be more productive when invested directly in preserving ecosystems, developing economies, or fighting disease.

We have insufficient resources to satisfy all compelling needs. And for each of what Bjorn Lomborg calls our “many inconvenient truths,” there are no perfect solutions. Al Gore noted years ago, “Wisdom requires balancing the good against the bad, to determine whether the overall result is positive or negative.” What is the cost of malaria-carrying mosquitoes at higher latitudes and altitudes; or of war perpetuated by ever scarcer Somali water? What is the benefit of manufacturing jobs in the developing world; or of the technology that development brings? These are challenging questions that deserve sound economics and science. It is our obligation to discover the most effective solutions. In a world of tradeoffs, moderation is key.