INSIGHT: Obama and Congress at high-noon on emissions

25 February 2010 15:59  [Source: ICIS news]

By Joe Kamalick

White House and Congress in high-stakes game for emissionsWASHINGTON (ICIS news)--The Obama administration and Congress are moving ever closer to a high-noon showdown over whether the executive branch or the legislature should mandate US policy to reduce emissions of greenhouse gases.

The president and Congress are playing a game of high-stakes poker, each trying to bluff the other - except all the chips on the table belong to US industry and consumers.

When President Barack Obama and the 111th Congress were seated in January last year, the general understanding was that the legislature - with newly expanded Democrat majorities in both chambers - would enact a sweeping climate change bill that Obama would sign quickly.

Indeed, both Obama and his Environmental Protection Agency (EPA) administrator, Lisa Jackson, said then and several times since that they much preferred that Congress craft legislation that would force dramatic cuts in US emissions of greenhouse gases and simultaneously ensure an ample energy future for the nation.

A gordian knot, for sure, but Congress did try. 

The House narrowly passed a massive climate change bill in June last year, and a Senate panel only just approved a parallel measure in November - but that’s where the congressional effort on greenhouse gas emissions got choked up.

As the House climate change bill and the companion Senate measure drew more and more attention, both generated heated opposition - increasingly so in the wake of scandals that have cast doubt on the validity of data underlying the theory of anthropogenic global warming. 

Refiners, the bulk of the chemicals industry, other manufacturers, agriculture, electric utilities, just about every sector of industry and commerce started bombarding their representatives and senators with desperate complaints and alarms about the bills, warning that such draconian cuts in US emissions would kill production and jobs.

Indeed, even Obama and other proponents of the cap-and-trade emissions mandate conceded that it would perforce raise the cost of US energy across the board for refiners, manufacturers, pet stores, flower shops and households. It was the price we all had to pay to save the planet.

Having failed to complete work on a cap-and-trade or other sort of climate legislation in 2009, Congress kicked the can into this election year, not a good time for members of Congress - most of whom face re-election in November - to be voting for cost-raising, tax-raising legislation.

All along, the EPA and Administrator Jackson were holding what amounts to four aces.

In 2007 the US Supreme Court ruled (Massachusetts vs. EPA) that the agency had authority under the Clean Air Act to regulate greenhouse gases if EPA determined that they posed a threat to human health and the environment.

Shortly after the congressional climate change effort stuttered to a halt in November last year, EPA issued its controversial “endangerment finding”, saying that greenhouse gases are a threat to the environment and Americans health because they cause global warming.

With its December 2009 endangerment finding, EPA set out on its own path to regulate and reduce those emissions.

And Congress blinked.

Republicans and Democrats in the House and Senate - now bombarded anew by screaming constituents fearful of what the EPA would impose - began efforts early this year to thwart the agency’s plans.

Bipartisan bills and resolutions in both the Senate and House would either bar EPA from implementing its endangerment finding for greenhouse gases or simply nullify that rule.

Most recently, eight Senate Democrats, led by West Virginia Senator Jay Rockefeller, wrote to Jackson last week, expressing concerns that the agency’s plans to regulate industrial emissions would cause widespread economic harm to the nation’s manufacturers and jobs.

The eight Senate Democrats represent states with high coal production or manufacturing that is dependent on low-cost coal-fired electric power.

In her response to the eight Democrats, Jackson said on Monday this week that the EPA would gradually phase-in emissions reductions for stationary sources over a five-year period beginning next year and running through 2016.

In other words, she said EPA would press ahead with its plans, albeit slowly.

Republican Senator Lisa Murkowski of Alaska, the sponsor with 37 other Republicans and three Democrat senators of a joint Senate resolution (JSR-26) that would nullify EPA’s endangerment finding, said that Jackson’s promise to go slow was no solution.

“Congress is the appropriate body to address climate policy,” Murkowski said.

Citing Jackson’s go-slow letter to the Senate Democrats, Murkowski argued that EPA had nonetheless “restated its commitment to regulating greenhouse gases, down to the smallest emitters, regardless of the economic consequences”

“Such regulation, even slightly delayed, will endanger job creation, economic growth and America’s competitiveness,” she said.

In perhaps one of the few signs of congressional bipartisanship on climate issues, Murkowski got additional Democrat support from Rockefeller.

Rockefeller was among some of the Democrat senators - those who sent the worried query to Jackson last week - who indicated that they might support the resolution to bar EPA regulation of greenhouse gases.

After seeing Jackson’s response to him, Rockefeller said on Tuesday that “I believe we need to set in stone through legislation enough time for Congress to consider a comprehensive energy bill” that also would deal with emissions reductions.

“As I evaluate the EPA’s letter,” Rockefeller said, “I remain committed to legislation that would provide Congress the space it needs to craft a workable policy that will protect jobs and stimulate the economy.”

Senator Robert Byrd, like Rockefeller a Democrat from West Virginia coal country and co-author of the letter to Jackson, said on Wednesday that while he appreciated the EPA administrator’s go-slow response, he remains opposed to unilateral action by the agency in regulating greenhouse gases.

Senator Mark Begich, a Democrat from Alaska and another signer of the letter to Jackson, saw in her response “a willingness to give Congress time to act”.

Murkowski already has 41 Senate votes for her resolution to nullify the EPA endangerment finding. She may have picked up some additional Democrat votes this week, even if not yet explicit.

The nullifying resolution needs only 51 votes to get full Senate approval and a simple majority 218-vote authorisation from members of the House - not insurmountable goals in this election year.

Of course President Obama would likely veto the Murkowski resolution even if it passed both chambers.

But that would leave the way open for EPA to proceed on what everyone, even the EPA, thinks is an unwise course.

As energy analyst Kevin Book has noted, if the Murkowski nullifying resolution is either defeated or vetoed by Obama, that would leave Democrats in Congress “with the politically unflattering last resort of stopping EPA action themselves”.

That last resort option would require that Democrats in Congress deny funding for greenhouse gas regulation when the EPA’s fiscal 2011 budget measure is voted on in September - just weeks before the November election.

The next round of bluff and wagering could come early next month when Murkowski’s joint Senate resolution (JSR-26) could come up for a Senate floor vote.

The game is on.  Deal the cards, Ringo!

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy
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By: Joe Kamalick
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