11 October 2009

John Kerry Hits the Reset Button

Senators John Kerry (D-MA) and Lindsey Graham (R-SC) have co-authored an op-ed in the New York Times that indicates their willingness to work together to pass climate legislation. In his usual over-the-top fashion Joe Romm sees the op-ed as clearly indicating that a bipartisan deal can be cemented in November and passage possible by December, thus flip-flopping (again) on prospects for the Senate climate bill.

However, rather than reading the op-ed as Romm has as indicating that Senator Graham has capitulated to the provisions of the Kerry-Boxer bill, another reading is that the op-ed shows that Senator Kerry is willing is hit the reset button and fashion a new climate bill in accordance to what key Republicans are willing to support. Some hint for this comes from comments from Senator Graham's office as reported by Fox News:

Sen. Lindsey Graham, R-S.C., co-authored an op-ed with Sen. John Kerry, D-Mass., in The New York Times calling for action on legislation.

Kerry rolled out a Senate climate change bill alongside Sen. Barbara Boxer, D-Calif., late last month. A Graham aide said Sunday that the South Carolina Republican was not explicitly endorsing that bill, but stands ready to work with Kerry toward some version of legislation to combat global warming.

What does the op-ed suggest that Senator Kerry is willing to add or change in the bill? Here are some thoughts, based on excerpts from the op-ed:

We will minimize the impact on major emitters through a market-based system that will provide both flexibility and time for big polluters to come into compliance without hindering global competitiveness or driving more jobs overseas.

Flexibility and time are code words for tradeoffs with emissions reductions targets and timetables. The fact that no numbers are provided in the op-ed indicates from both authors a willingness to negotiate. As Senator Barbara Boxer (D-CA) recently explained, the 20% reduction target for 2020 is a "high-water mark." Flexibility combined with the idea of competitiveness and jobs implies that provisions like offsets and safety valves will be in ample supply, so that even agreed-upon targets and timetables may not mean what they say they mean.

Nuclear power needs to be a core component of electricity generation if we are to meet our emission reduction targets. We need to jettison cumbersome regulations that have stalled the construction of nuclear plants in favor of a streamlined permit system that maintains vigorous safeguards while allowing utilities to secure financing for more plants. We must also do more to encourage serious investment in research and development to find solutions to our nuclear waste problem.

While the provisions of a nuclear title to the bill are uncertain, there are some in the environmental community who are not going to like the idea of making it easier to build nuclear power plants (see, e.g., the NRDC position here in PDF).

For too long, we have ignored potential energy sources off our coasts and underground. Even as we increase renewable electricity generation, we must recognize that for the foreseeable future we will continue to burn fossil fuels. To meet our environmental goals, we must do this as cleanly as possible. The United States should aim to become the Saudi Arabia of clean coal. For this reason, we need to provide new financial incentives for companies that develop carbon capture and sequestration technology.

In addition, we are committed to seeking compromise on additional onshore and offshore oil and gas exploration. . .
A climate bill that opens up new offshore drilling and guarantees the future of coal mining, coal burning and coal waste?! I expect that many environmentalists are going to have to swallow hard to accept these provisions, and I'd bet on hearing some push back from that community (too bad for them because the legislation isn't much about the environment anymore). Since CCS doesn't even exist yet at scale it is remarkable to see Senator Kerry willing to bet emissions reductions success on a technology that requires significant technological innovation (Romm, who strongly opposes both CCS and the idea that technological innovation may be necessary, is strangely mute on the call for a massive commitment to a coal-fired future in the bill). It would be quite a coup, and bizarrely ironic, if Republicans can use the climate bill to ensure a fossil-fueled future for U.S. energy supply.
. . . we should consider a border tax on items produced in countries that avoid these standards . . .
This sort of talk will play well in the heartland, but is against the stated preferences of the Obama Administration and would be a deal breaker in international negotiations. If a bill does pass the Senate with such a provision (unlikely I'd guess) it would be very interesting to see what President Obama does to avoid a trade war. But I doubt it would get that far, based on the phrase "we should consider" in the op-ed.
. . . we will develop a mechanism to protect businesses — and ultimately consumers — from increases in energy prices. The central element is the establishment of a floor and a ceiling for the cost of emission allowances. This will also safeguard important industries while they make the investments necessary to join the clean-energy era. We recognize there will be short-term transition costs associated with any climate change legislation, costs that can be eased.
No surprise here, and nothing new. The costs of any such legislation, by definition, will not be high, even if that means gutting the bill's intended purpose.
Failure to act comes with another cost. If Congress does not pass legislation dealing with climate change, the administration will use the Environmental Protection Agency to impose new regulations. Imposed regulations are likely to be tougher and they certainly will not include the job protections and investment incentives we are proposing.
This threat is hollow. Like the Obama Administration is going to tank the economy? This sort of talk just emboldens Republicans to call the bluff by obstructing Senate action and seeing what happens in the months leading up to the 2010 mid-term elections.

What is missing in the op-ed? Well, among a few other things, any mention of the phrase "cap and trade." Senator Kerry recently said that he didn't know what that phrase meant and called the bill a pollution reduction bill. Now it seems to be about energy independence, jobs and the environment.

Overall, my judgment is that the Kerry-Graham collaboration represents a major stepback by the Democrats, who are showing a desire to pass something -- anything -- related to climate. Such a stance does not put the Democrats in a strong negotiating position. If my analysis is close to the mark, you can expect more concessions from the Democrats on a regular basis as the legislation moves forward.

5 comments:

Maurice Garoutte said...

The public has no taste for any form of cap and tax and Senator Kerry knows it. However; giving up on such a high priority policy would certainly be considered a defeat for the Democrats. So yes, there will be more concessions made to get as you say something – anything passed. Senators such as Graham believe that you have to give and take to work inside the beltway so the D’s will give and the R’s will take.

Meanwhile out here in the heartland we don’t believe that Senators such as Graham have any right to stay inside the beltway.

Any climate legislation that is opposed by James Hansen, the Competitive Enterprise Institute, Green Peace, and Senator Inhofe, needs to be dropped quietly in committee.

Eric144 said...

Excellent analysis Roger.

Environmentalists have only ever been useful idiots in the AGW political process. If they say the right things, they will be given publicity, same with scientists.

The reason they are retreating at high speed is (I believe)that the administration has a lot less credibility than they were hoping. From 3000 miles away, it seems that Amercicans voted against Bush, McCain(73) and Palin rather than for Obama's policies.

The dogged, no nonsense independence of American politicians who represent local interests has stopped British / finance industry / globalisation plans in their tracks. It's a shame British politicians don't have the same backbone.

Not Whitey Bulger said...

Years ago, there was a push to force businesses to write warrantees and contracts in plain English so that customers could understand their rights. Imagine if they thing couldn't be voted on unless each chapter and verse was paraphrased in plain English for voters to read?

Andrew said...

Mmm, all this and a protectionist sandwich? They shouldn't have!

No, they really shouldn't have.

Brian said...

Kerry is now in his "voting against" phase on Kerry-Boxer whereas before he was in his "voting for" phase.
Alternatively, Kerry for Kerry-Graham may be taking a page of the recipe for sausage lawmaking on health-care (i.e., a reported 75 Dem amendments added post-hoc to the vote by the Senate Finance Committee on a health care bill, only a DRAFT of which was available for scoring by the Congressional Budget Office). Of course, there is always RECONCILIATION of Congressional houses for the traditional late night add-backs of items previously voted down, and Chris Dodd no doubt can be counted on for those eleventh hour "touch-ups".
Graham must be asleep at the switch by considering working with the inconsistent, incoherent Kerry.

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