THE VINE JANUARY 28, 2009
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I have to admit, one of the more compelling voices on climate policy these days is Bob Corker, the junior Republican senator from Tennessee. Corker, recall, scooped up plenty of press coverage last fall thanks to his maniacal opposition to the Detroit auto bailout. (Paul Krugman slammed him as the "Senator from Nissan"—and, yes, a collapse of GM and Chrysler probably would've benefited some of the foreign car factories in Corker's home state.) But Corker doesn't go in for the traditional right-wing knuckle-dragging on climate change. When asked about the issue last year, he just shrugged and said, "I choose not to debate with scientists."
And then today, at Al Gore's hearing before the Senate Foreign Relations Committee, Corker sounded more like a Greenpeace activist than anything else. He told Gore that his ideal emissions policy would be a carbon tax whose revenues were either returned directly to taxpayers or used to reduce the payroll tax—a measure, Corker explained, that would be "transparent" and wouldn't burden taxpayers. That's something Gore himself has backed. Now, over at Grist, Dave Roberts has lashed out against conservatives backing a carbon tax, arguing that cap-and-trade is the only viable climate legislation in Congress, and anyone supporting a carbon tax is just being disingenuous and trying to forestall action. Maybe that's the case here. But I'm not quite convinced.
I say that because Corker then insisted that he'd be amenable to a cap-and-trade regime in which 100 percent of the pollution permits were auctioned off, rather than given away to companies for free. After all, those permits would be valuable commodities, and simply forking them over to emitters for free* would entail "a transfer of wealth from taxpayers to companies." He's right about that. As Peter Orszag has observed, a cap will raise fossil-fuel prices the same amount whether the government auctions off permits or doles them out to polluters for free, so why not do an auction and rebate the funds to consumers? Corker then went on to criticize the use of those ever-shady carbon offsets in any cap-and-trade scheme, arguing that many offsets fund projects that would've happened anyway—and no emissions actually get cut.
Those are all sharp points, and Gore largely agreed with him. (So do I.) Gore quibbled that a small portion of the revenues raised by a cap-and-auction should be spent on adapting to changes already occurring, as well as on research into new energy technologies, but that the vast bulk of revenue should be rebated to Americans. By the way, Gore also answered Corker's follow-up question about nuclear power by noting—quite rightly, I'd say—that while nukes should be an option, construction costs are wildly uncertain right now, and investors are wary of plunking down money for large new plants. Not sure Corker loved that answer, but the two Tennesseans kept their exchange quite cordial.
Again, it's possible Corker's playing some treacherous game here where he nominally supports cap-and-trade now but ends up screaming about any final legislation because it's not "pure" enough for him. I can't read minds. But Corker's stance strikes me as a fruitful conservative position—certainly more conservative than James Inhofe's willingness to experiment with large-scale changes in atmospheric chemistry. If we are going to rely on cap-and-trade to curb carbon-dioxide, then conservatives should, in theory, be demanding it be as simple and market-friendly as possible, without distortionary handouts for companies or devious offsets. Some liberals, like me, will counter that a price on carbon won't be enough, that we'll need additional regulations (for efficiency, especially) to meet our targets. There's ample room for sparring. But that debate would sure beat pointless bickering over whether the greenhouse effect is "real" or not.
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* Sorry, my description of the USCAP proposal was slightly awry. Tony Kreindler of Environmental Defense Fund writes in: "USCAP doesn't call for the distribution of allowances to businesses. Instead it calls for some allowance value to go to local distribution companies with the goal of offsetting costs to consumers, and a much smaller slice of the allowance value to some emitters on a temporary basis." (Corker has, however, explicitly criticized this aspect of the USCAP proposal.)
--Bradford Plumer
10 comments
Great post. Thanks for (seriously) avoiding the Mickey Kaus approach whereby every legislative tussle becomes a case of kabuki-in-reverse-fasterfeiler-with a double twist in the rearview mirror.. or not.
Lots of AGW skeptics have an open mind and will come around soon enough, provided that their motives are not constantly impugned. Case in point: people from Detroit and/or the auto industry aren't evil. Their world's collapsing. Please take their very real pain and needs into account and don't just bulldoze them or blow them off.
- teplukhin2you
January 28, 2009 at 1:52pm
A carbon tax that is refunded to the population is great, as long as it is done in a way that still encourages sensible behavior. You're rebate should not depend on how much tax you paid, otherwise, it's just an accounting gimmick.
I would favor the tax, rebated against the cost of energy efficiency - so tax carbon emitters and use the proceeds to pay for insulating homes, buying fuel efficient appliances and cars, etc.
- sdemuth
January 28, 2009 at 2:48pm
Tax stationary source emissions at a rate that encourages carbon capture and promulgate CAFE standards to reach 40 MPG by 2020. By doing so, we can cut CO2 emissions by 50% by 2030 latest. Ditch the Low Carbon Fuels Standard concept being floated by California. Ditch ethanol as well.
- r-ennis
January 28, 2009 at 4:22pm
r-ennis: Do you own a coal mine. Carbon capture seems to be your great passion.
- sdemuth
January 28, 2009 at 7:44pm
I wish I did own a coal mine. But I do know that carbon capture and nukes are the only two strategies that have even the slightest chance of actually delivering reduced COI2 emissions. No alternate energy schemes will actually be deployed fast enough to meet an aggressive schedule that seems to be desired.
- r-ennis
January 29, 2009 at 8:40am
The Charleston Gazette reports:
The Senate Appropriations Committee approved the legislation with several coal projects pushed by Sen. Robert C. Byrd, D-W.Va.
The Senate funding is nearly double the $2.6 billion included in a current House version of the legislation, meant to help boost the sagging economy across the country.
Details were still emerging Tuesday evening, but among the coal provisions outlined in a Byrd news release and a committee statement:
$2 billion for "near-zero emissions" power plants designed to capture and sequester carbon dioxide.
$1 billion for the Department of Energy's Clean Coal Power Initiative.
$1.6 billion for carbon capture at industrial plants.
"Clean, carbon-neutral coal can be a 'green' energy," Byrd said. "As Congress strives to develop a national energy policy that will break our dependence on foreign oil, it is crucial to ensure that coal, burned in more efficient ways, is part of our nation's diverse energy mix for the future." Byrd added, "These investments will help to bolster West Virginia's economic future."
- r-ennis
January 29, 2009 at 9:12am
r-ennis: Fair enough. I respectfully disagree that it is possible to know any such thing. I recall an analysis by IBM that was certain in 1954 that there was a market for no more than 100 or so computers in the world. I also recall that nuclear was known to be so efficient it would be "too cheap to meter," and about a thousand separate predictions over the last 40 years that practical fusion power is 20 years away. So much for knowing.
As for what Robert Byrd said: the coal miners own him, so I wouldn't believe his marketing of clean coal, any more than I believe my insurance company has my best interest at heart.
For my part, I think way too little effort is spent understanding what might be possible with an advanced distribution grid and localized, wind, solar, biomass and similar technologies. I don't know that it can be made to work of course, any more than anyone really knows that coal can be made reliably clean. Knowing is either cheap and worthless, or a long term exercise requiring actual demonstration and implementation. Only the latter kind counts. But there are good reasons to think that a million separately unreliable sources with a resilient grid might in fact be better than a thousand super-reliant large sources with a strictly hierarchical, one-way grid.
- sdemuth
January 29, 2009 at 11:44am
I apologise for the use of the word "know". You are right about that. Whether or not Byrd is owned by coal is of no consequence. Either coal can deliver carbon neutrality efficiently or it cannot. Put it to the test by taxing carbon. If wind, or something else turns out to be the winner, I'm OK with that. But don't stack the deck.
- r-ennis
January 29, 2009 at 12:37pm
r-ennis: I basically agree, if you throw in the assumption that regulation guarantees effective sequestration, the market can make this decision. I'm still a bit skeptical on that score. I also think there is a tricky part though in getting the transmission infrastructure right. Build one kind of grid, and you have an inherent bias toward central generation; build another and you may be equally biased toward distributed generation; build a third and you may be able to balance the two so that distributed and centralized compete fairly on price and quality of service. This is a question the market may struggle to answer without some sort of guidance and assistance. There is a lot of enabling investment required, and rules of the road to be set.
- sdemuth
January 29, 2009 at 4:31pm
just curious - if you don't mind, where do you guys work? great discussion, thx
- teplukhin2you
January 29, 2009 at 5:17pm