Opinion

The Great Debate

Antisocial genesis of the social cost of carbon

The day after his 2009 inauguration, President Barack Obama committed to “creating an unprecedented level of openness in government.”

He vowed to build on “transparency [that] promotes accountability by providing the public with information about what the government is doing,” “participation [that] allows members of the public to contribute ideas and expertise,” and “collaboration [that] actively engages Americans in the work of their government.”

Despite these promises, and despite longstanding requirements of administrative law, the Obama administration is making significant regulatory decisions behind closed doors — without transparency or public involvement. Yet these new regulations could have enormous impact on Americans for generations to come.

The president’s ambitious regulatory agenda to address climate change relies on a “social cost of carbon” (SCC) — an estimate of the monetary value of eliminating one ton of CO2 emissions — to calculate the benefits used to justify a host of regulatory actions and government subsidies. These include renewable fuel and mileage mandates for our cars, water limits for washing machines and dishwashers and less visible rules that will likely affect the price of food and electricity.

Rather than working openly with experts and the public to develop this key metric, the administration quietly released a revised SCC in May as a fait accompli. The new SCC is $41 per ton — almost double the value that the administration set in 2010.

Public backs Obama on strong carbon controls

Southern Company’s Plant Bowen in Cartersville, Georgia, in an aerial file photograph, Sept. 4, 2007. REUTERS/Chris Baltimore

When President Barack Obama announces his new climate change plan Tuesday, he will be addressing a voting public that, despite conventional wisdom, is ready to embrace his key proposal: Environmental Protection Agency regulation of carbon emissions from existing power plants.

Since the failure to pass cap-and-trade in 2009, Washington conventional wisdom has held that any effort to curb the carbon emissions that contribute to global warming will be met by a skeptical electorate. But this misunderstands the public’s nuanced view.

Obama’s worthy EPA nominee deserves support

The era of “simple” environmental problems is over. Today the U.S. Environmental Protection Agency (EPA) and state regulators face issues, like climate change, that are complex from all angles: scientific, economic and political. At the same time, some of the EPA’s regulatory tools—like the Toxic Substances Control Act (TSCA), a law that was crafted decades ago—are cumbersome or inadequate. And there is virtually no chance that our gridlocked Congress will come to the rescue and agree on how to modernize reforms.

This complexity makes Gina McCarthy, President Obama’s nominee for EPA Administrator, precisely the kind of leader the agency needs. McCarthy is a strong environmental advocate, but she is pragmatic about how to achieve an end. She has worked across the aisle and with industry leaders to accomplish the EPA’s goals. As an executive at Intel, I’ve worked with McCarthy over the past four years, while she led the EPA’s Office of Air and Radiation. She is a problem solver who relies on science, economics and common sense.

One key example is the way she applied a Supreme Court ruling that the EPA can regulate greenhouse gases as pollutants under the Clean Air Act. Under McCarthy’s leadership, the EPA found a way to address the major sources of air pollution without regulating every neighborhood dry cleaner and gas station, as the act seemed to require. She focused the agency’s new permitting regulations on the bigger, more environmentally significant sources of greenhouse emissions—an approach that helped protect the environment while also growing the economy and encouraging innovation.

The best solution for climate change is a carbon tax

With Lisa Jackson, the head of the Environmental Protection Agency, stepping down, President Barack Obama is losing one of the few people left in Washington who was willing to speak up about global warming and to push for significant measures to curb its impact. During her tenure, Ms. Jackson was frequently denounced by GOP members of Congress and all too often reined in by Obama. Despite his and Congress’ failure to pass legislation addressing global warming, Ms. Jackson advanced a regulatory agenda to pick up some of the slack.

She managed to see that fuel efficiency standards will increase by 2025, enact stricter pollution controls that must be met before any construction of new coal-fired power plants, and established EPA’s “endangerment finding,” bringing carbon dioxide and five other greenhouse gases (GHGs) under the Clean Air Act. Her departure, however, highlights the failings of the Obama administration to address global warming in a significant way. In his second term, the president can change that by pushing to enact a carbon tax.

A carbon tax would place a fee on polluters that emit GHGs like carbon dioxide, methane, and nitrous oxide. It should be applied at major sources of GHG emissions: coal-fired power plants, petroleum refineries and importers, natural gas processors, and cement, steel, and GHG-intensive chemical plants. This tax would prod us away from dirty fossil fuels and toward clean energy alternatives to avert global warming while raising considerable revenue.

U.S. environmental agency walks a tightrope on CO2

John Kemp Great DebateThe Environmental Protection Agency (EPA)’s proposed findings on greenhouse gas emissions were a carefully worded attempt to appease climate-change activists while containing hostility from business and energy organizations or Congress.

The “endangerment” and “contribute” findings, that greenhouse gases posed a danger to human health, were designed to provide clear signs of progress on a signature issue for the administration while preserving maximum flexibility.

The Obama administration is struggling to reconcile high hopes of ambitious action with the need to formulate a policy that can be sold to the Democratic Party’s working-class base in the industrial Midwest and coal-producing states of Appalachia.

Obama mulls cap-and-trade by decree

John Kemp Great Debate– John Kemp is a Reuters columnist. The opinions expressed are his own –

Senior U.S. administration officials have indicated that if Congress does not pass comprehensive legislation providing for a cap-and-trade system to regulate greenhouse gas emissions they will press ahead unilaterally with proposals using the Environmental Protection Agency (EPA)’s existing authority under the Clean Air Act.

This is an attempt to gain political leverage after deep divisions within the Democratic Party appeared when 26 Democratic senators rebelled earlier this month and voted for an amendment to the budget resolution barring cap-and-trade being considered as part of the budget.

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