The Congressional Budget Office said Wednesday that the cap-and-trade climate change bill sponsored by Sens. John Kerry, D-Mass., and Barbara Boxer, D-Calif., would generate a $21 billion surplus over the period of 2010-19. The nonpartisan CBO also said that after 2019, the bill, S 1733, would continue to generate more money than it would spend.
Here is the Congressional Budget Office’s full analysis:
WASHINGTON, D.C. – Senators John Kerry (D-Mass.), Lindsey Graham (R-S.C.), and Joe Lieberman (I-Conn.) will hold a press conference today to discuss the Senate’s progress on comprehensive climate change and energy independence legislation.
Matt Yglesias flags an important aspect of this:
This seems like pretty much terrible news for the world. The most likely path between Point A and Senate passage of a reasonable climate bill is for McCain to rediscover his interest in the issue. But that’s not the sort of thing a Senator worried about a right-wing primary challenge is likely to do.
This is exactly right. And of course, a Politico story (where else?) provides the evidence:
Sens. Lindsey Graham and Joe Lieberman have been working overtime to craft a climate bill that can attract significant GOP support. But they aren’t exactly scoring points with their mutual best friend in the Senate, John McCain. “Their start has been horrendous,” McCain said Thursday. “Obviously, they’re going nowhere.”
This should not be a surprise for anyone who has been paying attention to McCain’s statements on climate legislation since last year’s election.
Steve Benen checked in with a McCain spokesperson on this and got an absurd response:
Asked for an explanation, McCain spokesperson Brooke Buchanan said, “This really hasn’t been done in a bipartisan fashion.”
I see. The climate bill is being pushed by a Dem (Kerry), a Republican (Graham), and an Independent (Lieberman), but the problem is that the effort is too partisan. Follow-up question for Brooke Buchanan: “Huh?”
Predictably, arbiter of conservative-leaning beltway conventional wisdom Chuck Todd blames President Obama for not reaching out enough.
There is a larger point to all of this though. Primary challenges are an extremely effective way to hold ‘moderate’ Members of Congress to the party line. Probably the single most effective way to do so, I’d say.
Arlen Specter is a great example of this (full disclosure: I can’t stand Arlen Specter):
Specter’s overall party loyalty score since becoming a Democrat — counting votes both before and after the primary challenge — is 87 percent. This contrasts with the 44 percent of the time that he broke ranks to side with the Democratic on Contentious Votes while still a member of the Republican Party. He’s basically been behaving like a mainline, liberal Democrat.On the other hand, it’s hard not to imagine that this process has been strengthened, accentuated, catalyzed, by Joe Sestak’s primary challenge. You can draw a pretty clear line in the sand from when Specter went from sorta, kinda Democrat to OMG totally! Democrat, and it coincides with the date that Sestak announced his challenge.
Continuing this trend, Specter called for an exit strategy in Afghanistan just yesterday.
This chart couldn’t make the Specter example any clearer:
The obvious lesson here is that Democrats should mount aggressive primary challenges against Democrats who are getting in the way of healthcare reform, clean energy legislation, the employee free choice act and job-creating stimulus provisions. Defenders of the status quo will maintain that this tactic is more effective in places like Pennsylvania than it would be in places like Nebraska, Arkansas, Indiana or Louisiana, and they are probably right. But the way we deal with such Senators now doesn’t seem to be working very well, so I’d be more than willing to give this other strategy a shot.
The US Chamber seems to be going to great lengths these days persuade Congress that it really wants to help pass climate legislation. But a very different message is coming through its blogs, tweets and unscripted comments.
We think everyone should know what else the US Chamber is saying, so we have updated our “WhoDoestheUSChamberRepresent.org” website with our latest Politico ad, which is running today.
Here is the ad:
“They don’t have a deal until they get the coal-state senators, and they are a long way from doing it,” said Sen. John Rockefeller (D-W.Va.). “They’re going to need us to pass a bill.”
Keep poisoning the children, Senator:
“Very young children are more sensitive to mercury than adults. Mercury in the mother’s body passes to the fetus and may accumulate there.
It can also pass to a nursing infant through breast milk. However, the benefits of breast feeding may be greater than the possible adverse effects of mercury in breast milk.
Mercury’s harmful effects that may be passed from the mother to the fetus include brain damage, mental retardation, incoordination, blindness, seizures, and inability to speak. Children poisoned by mercury may develop problems of their nervous and digestive systems, and kidney damage.”
How do you sleep at night, Senator?
“In its present form I would not vote for it,” he said. “I have some real questions about the real complexities on cap and trade.”
“That piece of legislation right now is something that is going to cause a lot of people a lot of concern,” he said.
He would much rather pass a nuclear subsidy bill, apparently:
On Monday, Webb and Sen. Lamar Alexander (R-Tenn.) proposed their own energy bill that would double the use of nuclear power through the country over the next 20 years.
The legislation would spend $20 billion over the next two decades to fund loan guarantees, worker training, research into nuclear power, advanced biofuels, electric vehicles, solar power, and nuclear fuel recycling. Both the senators’ home states – Virginia and Tennessee – have significant nuclear power plants.
Perhaps we should think more carefully about who we allow to stick that big D — and all of the $ and support that comes with it — next to their name.
We’re launching a new and interesting project over at the WhoRunsGov mothership — a vigorous effort to shed light on which special interests and key players are shaping and driving the behind-the-scenes debate on climate change.It’s called Who Runs Climate Change? And you can check it out right here.
The driving idea is that an enormous amount of the haggling, obstructing, log-jam-breaking, and all-around negotiating about climate change legislation — about the future of the planet — takes place out of sight, in the dark bowels of the legislative process. And it’s largely driven by powerful interests, forces, and key players you’ve never heard of.
That’s where you come in. In partnership with NewsTrust, which rates news stories based on usefulness, our new project hopes to enlist your help in finding, and rating, the most informative articles shedding light on who controls the levers of the climate change debate: Lobbyists, consultants, business groups, environmental advocates, legislative staffers, etc.
Then you’d enter new and relevant info about these players in their WhoRunsGov profiles.
The project runs from November 16th through November 22. We’ll highlight our top contributions and announce the most interesting Who’s Who results and findings on Wednesday, December 2.
Instructions on how to join up and chip in are right here. We hope you participate — and hope you find it useful.
Predictably, Senator Murkowski supports that approach. Here are some telling parts of her response:
Substance aside, the process was enough to kill the climate bill in the EPW Committee. Climate legislation will require support from both sides of the aisle, but the only bipartisan feature of that bill was the opposition to it. It’s past time to start discussing what comes next.
This sounds like a chicken and egg problem. Senator Murkowski can’t support the bill because it doesn’t have bipartisan support. It doesn’t have bipartisan support because… Senator Murkowski doesn’t support it.
As apparent as it has become that the Kerry-Boxer bill cannot pass the full Senate, legislation developed outside the jurisdictional confines of a committee system has not fared much better in the past either. Proposed immigration reform was developed through a model similar to that which Sens. Kerry and Graham are pursuing. Our immigration policies remain unchanged.
My concerns about these past efforts notwithstanding, they were at least bipartisan. Legislation to address global climate change this Congress has taken the opposite approach. This has resulted in an over simplification of an incredibly complex policy matter – either you support an introduced climate bill, or you’re against protecting the environment. This perception ignores the fact that senators from both parties are concerned about the protection of our environment and the strength of our nation’s economy
I’ve said it before and I’ll say it again. Senator Murkowski will not seriously consider supporting good climate legislation. If anything, she’ll offer her support as bait in order to attract concessions, only to withdraw her support before the vote.
Dear Majority Leader Reid:
We strongly embrace the promise of clean energy to make America more energy independent, create millions of new green jobs, and stave off the worst effects of global warming. In order to accomplish all of these goals, we need to begin to de-carbonize our utility sector and make the transition to clean energy. We were very pleased to see that the Clean Energy Jobs and American Power Act that was reported out of the Senate Environment and Public Works Committee protects the Clean Air Act’s requirements that existing coal-fired power plants, the nation’s biggest global warming polluters, meet up-to-date technology standards for carbon dioxide. We strongly urge you to ensure that these Clean Air Act protections remain in the energy and climate bill that receives consideration on the floor of the Senate.
America’s aging fleet of coal-fired power plants, more than three-fourths of which were built prior to 1980, are responsible for a disproportionate amount of the country’s air pollution, including toxic mercury, soot and smog-forming pollutants, and carbon dioxide. Indeed, coal-fired power plants emit one-third of the nation’s total carbon dioxide emissions.
America cannot achieve the reductions in global warming pollution that science indicates are needed to protect future generations and the planet from catastrophic and irreversible global warming if we do not begin to de-carbonize the utility sector today and start the march to clean energy. This transition will help rebuild our manufacturing base by creating jobs in clean energy technology, increase our energy security, and reduce global warming pollution.
Yet this necessary transition to clean energy could well be short-circuited if old and inefficient power plants continue to be favored in America’s electricity market. This would crowd out any sizable move to wind and solar power and other clean energy sources, since the U.S. Department of Energy projects that electricity demand will be relatively flat over the next 20 years (an annual average growth rate of less than 1 percent).
Regrettably, this crowding-out scenario appears all too plausible if, contrary to the Clean Air Act, a massive loophole is created for existing coal plants, such that they never have to meet performance standards for their carbon pollution. In the absence of such performance standards, utilities may very well continue to operate—or even expand—existing plants in the early years of the program rather than invest in cleaner sources of energy. This is in large part due to three key features of many legislative proposals during the program’s early years: the economy-wide cap on global warming pollution tightens slowly, allowances to pollute are largely distributed at no cost to the polluter, and carbon offsets can be liberally used in the place of actual reductions from covered sources. Further, in the medium term—as the economic realities set in of an emissions cap that is increasingly tightening and allowances to pollute that are increasingly auctioned rather than given away—those utilities that have delayed transitioning to cleaner sources of energy may confront the need to abruptly shutter aging coal plants that continue to provide the bulk of America’s electricity. In the face of potential brownouts or blackouts, tremendous political pressure would be brought to bear to weaken the cap, a result that would compromise our economic, national security, and environmental goals.
In order to prevent such a scenario from coming to pass, the cap on emissions must be paired with clean energy standards and Clean Air Act or equivalent performance standards for power plants that ensure that America moves to clean technology at a reasonable pace and can achieve the needed longer term cuts in pollution.
Such an approach—pairing a cap on emissions with performance standards for power plants—is the path Congress took in 1990 when it enacted the highly-successful Acid Rain Program, the nation’s first cap-and-trade program. At that time, Congress debated eliminating the Clean Air Act’s requirements that power plants meet source-specific standards, but Congress instead recognized that those standards are essential to drive technology improvements.
As strong supporters of clean energy, we urge you to ensure that energy and climate legislation builds on the existing Clean Air Act and does not create loopholes for old, inefficient, and polluting coal-fired power plants. Consistent with the approach taken in the Clean Energy Jobs and American Power Act, the bill should require coal-fired power plants—old and new alike—to meet up-to-date performance standards for carbon dioxide that will complement an overall cap on emissions and move America to clean energy.
Sincerely,
Robert Menendez
Today, fourteen Democratic senators, led by Sen. Tom Harkin (D-IA), affirmed their allegiance to the profits of polluting industry at the expense of the health and jobs of their constituents. In a letter to Senate leaders, a bloc of senators with powerful coal interests in their states called for “fair emissions allowances in climate change legislation.” Their definition of “fair,” unfortunately, turns out to be full taxpayer subsidies for global warming polluters. They call for the free allocation of pollution permits to electric utilities to be distributed “fully based on emissions.”
In the letter, the Senators write:
We believe it is essential that we strive to formulate legislation that equitably distributes transition assistance across individuals, as well as states and regions and economic sectors. We urge you to ensure that emission allowances allocated to the electricity sector – and thus, electricity consumers — be fully based on emissions as the appropriate and equitable way to provide transition assistance in a greenhouse gas-regulated economy.We thank you for your efforts to build consensus on the critical issue of energy and climate legislation.
The change we recommend would contribute to a more balanced and equitable bill for the Senate’s consideration, and a better strategy for America.
The Senators who have signed onto this inaccurate and deeply disingenuous statement are:
The signatories on the letter defending coal-heavy polluters are Senators Tom Harkin (D-IA), Al Franken (D-MN), Roland Burris (D-IL), Byron Dorgan (D-ND), Herb Kohl (D-WI), Russell Feingold (D-WI), Kent Conrad (D-ND), Michael Bennet (D-CO), Amy Klobuchar (D-MN), Mark Udall (D-CO), Robert Byrd (D-WV), Carl Levin (D-MI), Debbie Stabenow (D-MI) and Sherrod Brown (D-OH).
The provision these Senators are advocating would not ‘contribute to a more balanced and equitable bill’. It would line the pockets of coal companies and offer zero protections whatsoever for consumers.
But don’t take it from me. Consider this chart from the Congressional Budget Office (via David Roberts).
The option on the right, in which 80% of American households experience a decrease in income while the top 20% experience an increase, is what these Senators are fighting for. The option on the left — a 100% auction of allowances with dividends distributed equally to the American people — has not been seriously considered by Congress. This is due entirely to the corrupting influence of corporate polluters on our political process.
David Roberts explains the distinction between these approaches succinctly:
Auction-and-rebate is vastly more progressive, favoring low-income taxpayers, while freely allocating permits overwhelmingly favors the rich.
But suppose you don’t trust the non-partisan Congressional Budget Office. Surely someone else has weighed in on this.
In March of this year, 600 economists wrote a letter to Congress expressing their strong preference for a 100% auction of carbon credits. Specifically, they cited three reasons free allocation of allowances would “undermine the program’s long-term success”:
Free allocations will do little or nothing to protect families and businesses from higher energy costs.Free allocations will represent a significant and undeserved windfall to
utilities and other greenhouse gas producers.Free allocations will deny the government the necessary resources to
reduce the economic cost of combating climate change, and will thus
generate needlessly high costs of achieving any reduction target.
Congressional Budget Office: Check
Hundreds of Respected Economists: Check
Perhaps you need further evidence that these Senators are fighting for the coal industry at the expense of their constituents.
President Obama, during the campaign, advocated strongly for a 100% auction of allowances. During the primary, this was the key aspect of his plan that was superior to what candidates Clinton and Edwards proposed. During the general election, the Obama campaign attacked Senator McCain’s proposal to give allowances away as a huge government giveaway:
Obama’s camp attacks McCain’s program as a huge government giveaway. Says Jason Grumet, Obama’s principal advisor on energy and the environment: “McCain, in contrast to his self-description as a fiscal conservative, would give hundreds of billions of dollars of emissions permits away to the energy industry in the hope that they would pass the savings on to consumers.”
Even more tellingly, OMB Director Peter Orszag told the House Energy and Commerce Committee in March what giving credits away for free would amount to:
If you didn’t auction the permits it would represent the largest corporate welfare program that has ever been enacted in the history of the United States. All of the evidence suggests that what would occur is that corporate profits would increase by approximately the value of the permits.
So, the Congressional Budget Office, the Office of Management and Budget, hundreds of leading economists, and the Obama administration have all argued forcefully against giving away credits. The consensus is that this would be a massive giveaway to corporations and the wealthiest 20% of Americans at the expense of lower-income Americans and the middle class.
This leaves the 14 Senators who signed this letter in a precarious position. Are they actually disputing the arguments I’ve outlined above? I have offered each of them the opportunity to reconcile their claims with this evidence, along with an invitation to publish their response at EnviroKnow.com.
