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 title=Senators John Kerry (D-MA), Lindsey Graham (S-SC), and Joe Lieberman (I-CT) are floating what appears to be a trial balloon in the Washington Post: abandoning an economy-wide carbon cap and trade climate bill in favor of piecemeal caps and taxes directed at the electric utility, automotive, and industrial sectors of the economy.  In a nutshell:

Power plants would face an overall cap on emissions that would become more stringent over time; motor fuel may be subject to a carbon tax whose proceeds could help electrify the U.S. transportation sector; and industrial facilities would be exempted from a cap on emissions for several years before it is phased in. The legislation would also expand domestic oil and gas drilling offshore and would provide federal assistance for constructing nuclear power plants and carbon sequestration and storage projects at coal-fired utilities.

Call this the half-baked-and-twisted approach to climate.

 title=The bill appears to be both half-baked, in that it's not clear whether there's a final product or just a discussion draft, and twisted in its priorities.  

The bill would start off as an electric-utility-only cap plus some sort of tax on gasoline, exempting industry from the cap for several years.  Joe Romm at Climate Progress has a little more detail, but not much more:

Frankly, I’m not sure they have the winning proposal yet....

My sources say that what they’re proposing isn’t actually a carbon tax on gasoline, nor is it the original cap-and-trade proposal, but something in between.  Since the notion is complex and confusing — and no final decisions have been made — I won’t try to explain it fully here.

The Post story reports that cap-and-dividend, in which some but not all of the costs of pollution permits are rebated to consumers, may still be in the mix in order to persuade wavering Senators.  I've previously compared the cap-and-dividend approach to the Alaskan Permanent Fund.  The cap-and-dividend approach is espoused by a bill commonly known as Cantwell-Collins (also known as CLEAR), whose proponents praise its simplicity, but the Kerry-Graham-Lieberman divide-and-cap half-bill promises to be anything but simple.  

Carl Pope of the Sierra Club seems to favor the bill: "The Senate is understanding this is not a simple problem -- it's multiple problems, and it requires multiple solutions."  However, electric utilities will howl at what they'll see as discrimination.  Further, the petroleum industry's hired shills will screech about "gas taxes."  

 title=What's missing?  The bill's twisted emphasis.  Notice what's not being mentioned in the Washington Post story: any discussion whatsoever of renewable energy.  The Senators' half-baked bill appears to sing the same song as Obama's State of the Union address: lots of noise about the chimera of clean coal and the need to make hard choices regarding offshore drilling, no mention of solar and wind power.  A cap on utilities' emissions may force them to seek out renewable energy...or it may force them to use free money federal assistance for carbon sequestration and storage of coal.  

The WaPo story reflects an official Beltway trend-speak of "pricing carbon," but doesn't hint whether the bill would be effective in limiting carbon.  The ultimate test of a climate bill is whether it's effective in reducing emissions.  Anything half-baked and twisted simply doesn't solve our melting world.

Originally posted to RLMiller on Sat Feb 27, 2010 at 02:48 PM PST.

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Comment Preferences

    •  The real "trial balloon" (10+ / 0-)

      is our gamble that life can survive in a cipher no matter how hot it becomes. This is a closed-loop system.

      Until humans realize that Superman cannot fly down a rescue us by turning back time to give us a mulligan to do it all over, we are all just guinea pigs.

      The best way to save the planet is to keep laughing!

      by LaughingPlanet on Sat Feb 27, 2010 at 03:06:44 PM PST

      [ Parent ]

    •  Cap & Trade is still bad policy (0+ / 0-)

      The forces behind cap and trade (other than the naive academics) are the Wall Street firms who want to make billions trading and speculation in carbon credits.

      The early forces behind Cap & Trade included Ken Lay from Enron and today is lead by Goldman Sachs -- forces who have a terrible record regarding doing what is best for the average American, the country or the world.

      In addition, these same folks will setup carbon credits through entities that will either be doing the project anyway and be a constant source of carbon accounting fraud.

      International cap and trade will also lead to major losses of US jobs as money that would otherwise be invested in creating new US jobs goes to other countries.

      A far better approach are not providing any new permits for new coal fired power plants unless they also include full carbon capture from day one of operation (largely equivalent to no new coal power), and having a rising carbon tax on coal, oil & natural gas.

      The most important way to protect the environment is not to have more than one child.

      by nextstep on Sat Feb 27, 2010 at 05:05:29 PM PST

      [ Parent ]

      •  Ya gotta link for that? (2+ / 0-)
        Recommended by:
        SolarMom, RLMiller

        I am convinced cap and trade is the best policy. It worked in Europe. It worked for acid rain. The EPA administers it for acid rain and there's been no Wall street profiteering.

        But other combinations of carrots and sticks will add more renewable energy too.

        Stimulus funds carrots with renewable energy standards sticks is really getting more renewable power out there. (PG&E just bought a wind farm and was able to use the 30% tax credit now that Dems made it for not just homes and businesses, but also utilities)

        Because we have no Federal policy now, and half the states now have Renewable Electricity Standards (forcing utilities to buy more renewable energy) the Obama administration has done a tremendous amount for renewable generation by using stimulus funds.

        When all spent the Recovery Act will have added 16 Gigawatts of renewable energy to the US grid.

    •  Does this mean that the Dirty Air Amendment will (2+ / 0-)
      Recommended by:
      dotcommodity, SolarMom

      not be passed?

      I'd settle for a piecemeal approach so long as it doesn't restrict the EPA's ability to regulate CO2.

      Cold hearted orb/That rules the night/Removes the colours From our sight/Red is gray and/Yellow white/But we decide/Which is right/And/Which is an Illusion

      by KingofSpades on Sat Feb 27, 2010 at 05:25:43 PM PST

      [ Parent ]

  •  I'm hoping renewable energy (7+ / 0-)

    will be part of the next jobs bill--you know, panels, turbines, infrastructure, ans such.  

    "Nothing in all the world is more dangerous than sincere ignorance and conscientious stupidity." --M. L. King "You can't fix stupid" --Ron White

    by zenbassoon on Sat Feb 27, 2010 at 02:51:49 PM PST

  •  I don't know enough about it to have an (5+ / 0-)

    informed decision, however I am FOR anything, smmall or large, or steath, that gets the ball rolling.

    Since comprehensive obviously doesn't fly in America, incremental will have to do, as long as all the steps are taken incrementally at the same time.

  •  good report (6+ / 0-)

    details are a bit confusing and sketchy at this point.  at least they're talking about capping some emissions.  i'd take that as a start to build upon.  as far as renewables being excluded from this particular bill, i believe that president obama supports renewables so much that he'll be willing to get support to those industries by any means necessary.  examples:  remember his vote for that awful cheney energy bill just because he was able to get some renewables funding in there?  remember him saving the wind and solar industries from collapse last year through stimulus funding?  he will continue to fund renewables through other means if he can't get it in this bill.  the funding will probably be put into jobs bills and other budgetary areas.  the sierra club is a good voice of support to have out there?  no word yet on where others, like repower america, stand?  greenpeace will probably be against--they seem more purist, and understandably so.

    save our democracy!

    by thoughtful3 on Sat Feb 27, 2010 at 03:02:49 PM PST

  •  I want to be outraged about this (5+ / 0-)

    but for some reason I am suddenly really, really hungry.

  •  Read the Feb. Harpers Magazine... (2+ / 0-)
    Recommended by:
    Nulwee, RLMiller

    Conning the climate: Inside the carbon-trading shell game  (subscription required)

    which I am doing right now on the corruption of the execution of Cap and Trade.  They see it as promoted by financial firms that stand to make billions off of trading these new secularized CERs

    It has defects that are equal to the sub prime mortgage disaster.  I will be writing a diary on this shortly.

    •  The downside of any market is the ability to (6+ / 0-)

      manipulate the market.  That's true whether selling widgets or carbon.  The downside of abandoning the market-based approach is losing any ability to appeal to center-right supporters, e.g., Wall Street.  I don't like Wall Street but I felt that Wall St was one of the very few sectors able to best the petroleum industry.

      I've never claimed to be a leader of the DK eco community

      by RLMiller on Sat Feb 27, 2010 at 03:12:39 PM PST

      [ Parent ]

      •  I just renewed my subscription to Harpers... (2+ / 0-)
        Recommended by:
        Nulwee, RLMiller

        just to be able to excerpt this article.  I would say it provides a rare explanation of how the system works, and the vagueness that is an open invitation to corruption.

        The securitized carbon credits are wildly variable, and there is no way to change this.  People speculate on gold but ultimately it is a testable quantity of an actual mineral that is the basis.  It is 100% actual fungible material.

        The CERs, are more like 40-80% actual, the rest is guesswork.  This is not a trivial problem.  Try to get the article

      •  Judging by the WSJ, I see no support from (2+ / 0-)
        Recommended by:
        SolarMom, RLMiller

        Wall Street. Nobody makes millions off the cap and trade we already have, that the EPA administers.

        One good thing about the CLEAR Act is that only capped entities will be able to trade. The bad thing is it wont reduce emissions as fast and effectively as good old Waxman-Markey-Boxer will - per Senate bill S 2877 WRI Summary PDF

        I think that (that only the capped can trade) will be adopted in the new mishmash of cap and trade + carbon tax + a nationwide renewable energy standard. Thus ending the teabagger fearmongering about "Al Gore making millions!!!!!" and on the Left: "Fat Cat financiers using complex derivatives we don't understand!!!!!" that has so poisoned CEJAPA cap and trade.

  •  They had the resources to build a media machine (8+ / 0-)

    which could create a faux reality around climate change and are currently using it to great effect.

    Remember the Fox driven swift boating of Van Jones?

    The Murdoch media has just been successful in painting Australia's environmental protection minister as a ignorant monster personally responsible for the deaths of four young men in a stimulus package insulation scheme.

    The politics of personal destruction which Murdoch visits on us, will ensure people of sound character will find it difficult to commit to politics, science, fighting fires, standing up for our youth, poor and unemployed, environmental justice, civil rights, a green economy.

    "They said Mr Garrett's wife Doris was pushing for him to get out as she grew increasingly appalled at the humiliating treatment being meted out to him."

    We are heading for not just environmental degradation but a society completely intolerant of divergent, independent, responsible individual leaders. Rather all we will have are shell's of leaders who stand for nothing apart for those pulling the puppet strings behind them and filling their pockets with fools gold.

    Those folks who are trying to get in the way of progress - let me tell you, I'm just getting started. I don't quit. I'm not tired; I'm just getting started.

    by Unenergy on Sat Feb 27, 2010 at 03:08:28 PM PST

  •  This reminds me... (4+ / 0-)

    doesn't solve our melting world.

    I own the domain name

    Anyone have any ideas what to do with it?

    Anyone want it?

    I had lots of ideas but am not a great designer of web pages...

    The best way to save the planet is to keep laughing!

    by LaughingPlanet on Sat Feb 27, 2010 at 03:10:40 PM PST

  •  couple other questions (4+ / 0-)
    1. What have you heard about them supposedly crippling the Clean Air Act as part of the bill?  If so, I wouldn't be able to support it.
    1. Did you see Sec. Clinton's testimony to the senate foreign relations committee earlier this week on her department's budget requests?  A discussion came up in which she pointed out that the gridlock was really starting to hurt us around the world, and that the world expected us to lead on this issue especially, and how far behind we're going to fall economically by losing these clean energy jobs to other countries.  I'm thinking the president and administration is pressuring the senate to do something, anything, that would move us forward, for these reasons.  I think majority leader Reid also said he plans to push something through on this front this year (even though it is an election year).

    save our democracy!

    by thoughtful3 on Sat Feb 27, 2010 at 03:16:55 PM PST

    •  Answers: (7+ / 0-)
      1.  The Clean Air Act is under attack on many fronts.  The best known is Senator Murkowski's joint resolution disapproving EPA's ability to regulate greenhouse gases (e.g., carbon), which should be up for a vote in March.  The bill that passed the House in June required the EPA to give up its jurisdiction over greenhouse gases; the original Kerry-Boxer bill kept the EPA's ability to act, but rumor had the Senate bill also gutting the EPA's jurisdiction as someone's price to support the bill.  The WaPo doesn't say anything but I wouldn't be surprised if CAA is hogtied again.
      1.  I didn't see her testimony but it's completely not surprising, and completely correct.  

      A couple of days ago Reid told Kerry to get the bill finished in a couple of weeks -- Eclectablog had a diary earlier today.

      I've never claimed to be a leader of the DK eco community

      by RLMiller on Sat Feb 27, 2010 at 03:24:13 PM PST

      [ Parent ]

  •  Thanks for writing this (3+ / 0-)
    Recommended by:
    RunawayRose, Nulwee, RLMiller

    I saw a link to the story in an open thread.  I guess we'll have to see the specifics before we know how bad/horrible/catastrophic it really is.

  •  Carl Pope seems to like this approach (4+ / 0-)
    Recommended by:
    Nulwee, costello7, RLMiller, thoughtful3

    and really, all I want, is some visible progress at this point.

    Faby-o, downrec me again. You know I love it!

    by Cheez Whiz on Sat Feb 27, 2010 at 03:45:58 PM PST

  •  One decade of stagnant median wages, and.... (1+ / 0-)
    Recommended by:

    ...Dems are considering an energy tax.

    Not content with losing perhaps 40 seats, we're jockeying for a loss of 50 to 60 seats.

    What happened the last time the Dems proposed an energy tax, when median wage income had actually increased....

                     Veteran members of both parties vividly remember when many House Democrats, in the early months of the Clinton administration, reluctantly backed a proposed B.T.U. tax — a new levy on each unit of energy consumed — only to see it ignored by the Senate and seized as a campaign issue by Republicans, who took control of the House the next year.

                     "A lot of Democrat members got burnt on that vote," warned Representative John A. Boehner of Ohio, the House Republican leader, who called the climate change measure the defining vote of this, the 111th, Congress.

    Learn about Centrist Economics, learn about Robert Rubin's Hamilton Project.

    by PatriciaVa on Sat Feb 27, 2010 at 03:47:17 PM PST

    •  the very best thing that could happen to America (3+ / 0-)
      Recommended by:
      RunawayRose, Nulwee, thoughtful3

      is a $3:00 a gallon gasoline tax. That would save health care, save the planet and bring the nation into synch with the rest of the 'civilised' world.  In Europe petrol costs approx $10: an Imperial gallon.

      Will it happen. Not in my lifetime.

      •  I would be very happy to pay... (4+ / 0-)

        ...$10 a gallon for gas, if I knew the money was going to research and development of renewables.

        Our oil and coal addictions need to end.  This country is a junkie pawning its own possessions and stealing those of others in order to support its habit.

        Freedom isn't "on the march." Freedom dances.

        by WarrenS on Sat Feb 27, 2010 at 06:01:38 PM PST

        [ Parent ]

        •  $10/gal would sink our rural and poor (2+ / 0-)
          Recommended by:
          Whimsical, thoughtful3

          We do not have the population density or mass transit that Europe has, and our urban areas already can't fully support all the millions living there. At least in the near term, our solution is going to look somewhat different than Europe's.

          •  Give them tax breaks. Charge the... (2+ / 0-)
            Recommended by:
            soccergrandmom, thoughtful3

            ...billionaires $200 a gallon.  I don't care.

            But if we don't start actually paying something close to what oil costs (which includes the cost of cleaning up all the damage it is doing to our planet), we're completely fucked.

            Freedom isn't "on the march." Freedom dances.

            by WarrenS on Sat Feb 27, 2010 at 08:04:53 PM PST

            [ Parent ]

      •  Actually, that's one of the very WORST things (0+ / 0-)

        because it would lead to Republican takeover of Congress and the WH, who would then not only repeal it, but block progress on most other fronts as well.

        You'd have ceded control of the political system, given up any hope of progress on a number of important issues, and not done anything at all to combat global warming.

        For what? A tax that wouldn't survive the first year of a Republican administration.

        No thank you.

        Freedom of speech does not mean the freedom to lie without consequence; unless, apparently if you're a right wing talk-radio host.

        by Whimsical on Sat Feb 27, 2010 at 08:37:03 PM PST

        [ Parent ]

    •  Siting Boehner - nice (2+ / 0-)
      Recommended by:
      dotcommodity, RLMiller

      He always has great things to say. Always correct, too. I never read on this site any stupid things that Boehner has to say... oh, wait. Except every day.! The climate can't wait.

      by B Amer on Sat Feb 27, 2010 at 05:59:07 PM PST

      [ Parent ]

    •  And besides (3+ / 0-)
      Recommended by:
      dotcommodity, RLMiller, thoughtful3

      It ain't a real energy tax.

      The CBO claims these bills will cost the US taxpayers less than $200 a year. And create lots and lots of jobs. Worth it, IMO.! The climate can't wait.

      by B Amer on Sat Feb 27, 2010 at 06:02:13 PM PST

      [ Parent ]

      •  True (1+ / 0-)
        Recommended by:

        CEJAPA cap and trade has been carefully crafted to protect consumers from inaction by utilities.

        So if utilities are stubborn and keep burning fossils instead of investing in renewables, they'll pay more and the pollution fees will finance more solar roofs by people to escape from their high energy costs. And also, there are rules in Waxman -Markey and CEJAPA to prevent them passing down the costs. The poor in the cold coal states especially get a lot of help.

        That's why the fossil ind is now pretending it wants a carbon tax. Because cap and trade hurts them, not us.

  •  Does this mean that the Dirty Air Amendment will (0+ / 0-)

    not be passed?

    I'd settle for a piecemeal approach so long as it doesn't restrict the EPA's ability to regulate CO2.

    Cold hearted orb/That rules the night/Removes the colours From our sight/Red is gray and/Yellow white/But we decide/Which is right/And/Which is an Illusion

    by KingofSpades on Sat Feb 27, 2010 at 05:24:02 PM PST

  •  Ugh (1+ / 0-)
    Recommended by:

    The House bill was already sort of half-baked (although much better than nothing!) This sounds more like unbaked with a touch of salmonella. Thanks for keeping us up to date, gotta keep the pressure on our congresscritters.

    "Interesting. No, wait, the other thing: tedious." -Bender

    by patrickz on Sat Feb 27, 2010 at 06:40:10 PM PST

  •  Include water usage in any climate bill. (1+ / 0-)
    Recommended by:

    This entire process has been frustrating to me.

    I do think that the science is good and that the world is getting warmer.  I'd like to find a solution for that problem.

    That said, I feel that past versions of the climate bill penalize areas of the country with water resources vs. those that do not.

    There is a reason that places like Michigan have lots of power plants.  It's because we have the water needed to create steam and spin turbines.

    Now, let's say we pass a climate bill that only deals with carbon emissions.  Given the need for water in traditional power production, those places with good water resources will bear a higher impact.

    Also, it makes no sense to me that we create a climate bill that favors, say, solar power production in arid places with no water.  It will simply result in development in locations without adequate supplies of water.  Do we really want new cities in the desert lusting after the few remaining wild rivers?

    And many new forms of energy production require water.  Some solar techniques use large volumes of water directly.  And wind towers are often most effectively shipped over water rather than on land.

    Michigan also boasts the largest state forest system east of the Mississippi - 3.8 million acres.  We also have massive private commercial forests and large blocks of national forest land.

    These trees grow, in large part, because we have water.  They also grow because our state's taxpayers have supported these massive forest systems.

    Maybe I am simplistic, but I'd like to see a climate bill that rewards states with large forest systems that act, essentially, as carbon banks.

    There are many reasons why Midwestern industrial state senators opposed the climate bill.  Some of them were legitimate economic issues.

    But there were many environmental reasons to oppose a climate bill that skewed too much towards straight up carbon emissions rather than all the factors related to climate change.

    by DingellDem on Sat Feb 27, 2010 at 07:30:33 PM PST

    •  Interesting ideas. Some of what you're (1+ / 0-)
      Recommended by:

      describing re carbon banks was addressed in the House bill by the name of carbon offsets, which people love to hate.

      Incidentally, I believe MI is poised to come out way ahead in the clean energy economy, if it ever gets started -- it has a combination of sufficient water, sufficient wind, and industrial know-how.  

      I've never claimed to be a leader of the DK eco community

      by RLMiller on Sat Feb 27, 2010 at 08:09:22 PM PST

      [ Parent ]

      •  I agree. (2+ / 0-)
        Recommended by:
        RLMiller, thoughtful3

        And, honestly, we are seeing it already.

        The coal burner in my hometown - Monroe - now has massive, billion dollar scrubbers.  We have a new nuke plant on the way.  We also have a wind tower factory in the works.

        And we have been doing a great job redeveloping brownfield areas into new businesses and housing developments.

        We also have a new national park and a new national wildlife refuge, both along the western Lake Erie shore.  Ford just donated a 250 acre marsh to the project and it now includes thousands of acres.

        No one wants an economic downturn, but it does allow an area to reinvent itself.  I've been seeing a lot of good things lately.  And it looks like the worst scenarios will not be realized with the auto industry.

        by DingellDem on Sat Feb 27, 2010 at 08:32:17 PM PST

        [ Parent ]

      •  What RL said (1+ / 0-)
        Recommended by:

        Yeah, there's carbon offsets in trees, and good thing too. Trees attract more water too. Grow more of them.

  •  Piecemeal limits superior to cap and trade IMO (0+ / 0-)

    Cap and trade appears to me to be too complex, ill-defined, expensive to police, and easy to game. We've seen what Capitol Hill's servants of corporatism do when they get their fingers in the regulatory pie.

    Set hard limits and a year by which they must be met or exceeded. Easy to monitor/measure, easy to police, easy to call bullshit. Subsidize/incentivize as needed to help smaller players come up to speed.

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