The House at the Center of the World

May 21, 2009

NI logoLately, every week is the most consequential in the history of climate change. This week was no exception. A House of Representatives committee slogged through its potentially game-changing climate bill. The White House struck a deal with auto manufacturers and California to raise fuel efficiency — and consequently reduce carbon emissions. Uneven signals from China promise hope for some kind of agreement but foreshadow a tough road to achieve it. These are all simultaneous episodes in a larger story of transformation.

The House at the Center of the World: The House of Representatives now sits at the epicenter. Rep. Henry Waxman’s Energy and Commerce Committee last Friday unveiled a full draft of the American Clean Energy and Security Act, cogently and quickly summarized by the Washington Post and Reuters. Democrats came to initial agreement on some of the thorniest issues, including how to allocate carbon credits to heavy polluters and other market participants, according to Greenwire. Among the major recipients of help, power companies will receive 35 percent of the allowances, natural gas distributors 9 percent, and energy-intensive, trade-sensitive industries 15 percent.

The committee is voting the bill Waxman co-sponsored with Rep. Ed Markey (D-Mass.) to the full House at this very writing. Through these minute-by-minute details, it’s easy to lose sight of the big picture.

Jargon Watch: Now and then, a word or phrase escapes the rarified journals and policy discussions where it was born, and greets an unsuspecting public. Such is the case with “cap and trade,” memorably deployed to mean “vague thing I’m supposed to understand but don’t” by the New York Times‘ Maureen Dowd in a March column. ClimateWire has had fun with variations of it.

Whatever you call it, it’s the centerpiece of the Waxman-Markey bill.

In the last week or two, commentators and columnists have taken to op-ed pages with arguments against cap-and-trade, for it, and, well, mostly against it. (Policy op-eds frequently challenge the dominant trend.) Remember that a national climate policy, be it cap-‘n-trade, or a carbon tax, or Cap’n-America, is not an end in itself, but a way to help us help ourselves. Climate policy is designed to fix “the carbon problem” in our markets: Polluting is free but eventually could have seriously undesirable consequences.

What “cap-and-trade” means, and where it could carry us, hasn’t yet penetrated the chatter. E&E News reported this week that “[O]verall support for cap and trade trails far behind backing for increased investment in renewable energy, improved fuel efficiency for vehicles, implementation of a renewable electricity standard and even increased offshore drilling.” A cap and trade system is supposed to nudge the market toward increasing demand for new energy sources. Climate policy is a lever that increases investment in renewables, fuel efficiency, and may or may not affect the economics of oil drilling at home. The relationship between a national climate policy and these desirable goals isn’t “either-or” but “if-then.”

White House firing on all cylinders (now with greater efficiency): While the Energy and Commerce Committee worked over the Waxman-Markey bill, the administration announced the first major climate rule in U.S. history. Much to the administration’s delight, no one leaked news about new auto fuel efficiency standards before President Barack Obama’s announcement on Tuesday. That means official sources were willing to play along, as reporters captured rich chronologies (called “tick-tock” in the biz) of the secret negotiations, particularly the Los Angeles Times (LAT) and ClimateWire. The LAT pins down insider details, such as Ford’s 3 p.m. Sunday call to the White House saying the deal was off, and the subsequent impromptu cell-phone negotiations, with participants phoning from the bathroom at a Washington National’s game and a birthday party in New York. The new Corporate Auto Fuel Economy (CAFE) rules will establish a nationwide standard by 2016 that should reduce carbon dioxide emissions from U.S. cars and light-trucks by 30 percent.

Scaling the Great Wall that divides us: Secret negotiations were a motif this week. U.S. and Chinese negotiators began meeting last July trying to bridge their differences on emissions reductions, symbolically at the Great Wall. The Guardian broke news of the meetings on Monday, reporting that senior Bush administration advisers and several current Obama advisers met with Chinese officials. The back-channel talks led in March to an unsigned memorandum of understanding, which participants hope will embolden the world’s two largest national emitters to find a common ground in addressing the causes of climate change. The news comes at a time when the international climate community is gearing up for negotiations in December in Copenhagen.

Obama on Monday picked Utah Gov. Jon Huntsman as his ambassador to China. A savvy selection, Huntsman is an up-and-comer in the Republican party, has served as Deputy U.S. Trade Representative, and speaks fluent Mandarin. The Nicholas Institute, which operates The Climate Post, has conducted modeling studies of Utah’s policy options on climate change, under Huntsman’s administration. Obama has indicated he expects climate change to hold a prominent spot in Huntsman’s portfolio.

Talks between developed and developing nations will continue to shape international climate politics (witness the Indo-Asian News Service’s interest in an amendment to a bill moving through a House committee). The secret talks reported by the Guardian are only one item of interest in a complicated U.S.-Chinese relationship. Chinese officials confirmed for the Alliance France Presse earlier today their negotiating position for the end-of-the-year Copenhagen talks:  China will ask that industrialized nations commit to emissions targets 40 percent below the amount they emitted in 1990 by 2020. The European Union has resigned itself to 20 percent reductions, and the House climate bill would reduce pollution 20 percent below 2005 levels.

Any unified global action must consider and guide international trade. The Washington Post showed just how complicated these relationships can be, in a front-page story Monday about the rise of China as a car-maker. Chinese companies have grown quickly, which means that their firms lack the technical expertise that can only emerge with time. “What they still lack is… being able to design new vehicles from scratch and get them to a manufacturing line,” Kelly Sims Gallagher of Harvard’s Kennedy School told the Post. A probable result: Chinese firms will try and buy ailing U.S. car companies — and their valuable human capital. Don’t miss Business Week‘s in-depth package on greening China.

Reporting? We don’t need no stinkin’ reporting!: Fortune magazine recently held its second Brainstorm Green conference, a star-studded event that brought together luminaries from the politics and business worlds. But editors undermined their expertise in climate issues — in business, politics, policy, and science — by publishing an article lacking the rigor and seriousness characteristic to the publication.

“What if global warming fears are overblown?” — the headline — is an important question to ask. Climate fears might be overblown. They might be “underblown.” But the risk of climate change — the consequences of catastrophic change times its probability — is serious enough to prompt global and quick action, a point the article fails to make. Instead, a financial writer, Jon Birger, asks “softball” questions of a University of Alabama, Huntsville, scientist, whose skepticism about the potential for severe global warming is out of step with the work of scientists who have re-examined his work in peer-reviewed journals (here, for example). Climate science is a vast body of physical, evidence, assembled by thousands of people, worldwide, over several decades. Putting eight questions to a scientist whose ideas were challenged professionally at least four years ago fails to communicate the preponderance of evidence that is driving the world to reduce the (rising) climate risk.