Greenwashing the Potemkin Village
As we have noted before, the Bush Administration's modus operandi on many pesky domestic issues is to build a rhetorical Potemkin Village of proposals that sound pretty good and that serve at least temporarily to neutralize political liabilities -- but that don't bear any serious examination. This is definitely the case on environmental issues, where the Bushies periodically try to "greenwash" their retrograde positions.
Now and then the Administration acts like it wants to do something on global climate change and the greenhouse gas emissions that contribute to it -- without, of course, ever clearly admitting there's a problem in the first place, lest offense be given to the conservative activists who think global warming is an environmentalist hoax and melting ice caps are an illusion. Yesterday the Administration officially rolled out its campaign for voluntary reductions in greenhouse gas emissions, under the tortured acronym, Climate VISION, or "Climate, Voluntary Innovative Sector Initiatives: Opportunities Now." Far from visionary, it is myopic. And coming after a two-year period in which the Administration unilaterally torpedoed the Kyoto Protocol on global climate change, and then abandoned the President's campaign promise to impose mandatory limits on carbon dioxide emissions, the voluntary limits represent tokenism at its worst.
The idea is to round up corporate leaders -- some of whom already have informal agreements with the federal government to clean up emissions -- and get them to agree to an 18 percent reduction in what is called the "intensity" of emissions: the ratio of emissions to total gross domestic product. But that translates into a 19 percent increase in actual emissions -- a not terribly ambitious goal that would probably be met without any government program whatsoever.
It's a classic example of finding a way to define slippage as progress, in order to justify fiddling while Rome burns. It clear enough that today's global emissions levels are doing damage already, so slowing their rate of growth isn't enough. The prudent course, given the already apparent consequences of receding mountain snowcaps polar ice caps, is to ratchet emissions down.
Moreover, a voluntary approach does not give affected businesses the certainty they need that their competitors will go along, or that their early efforts to rein in emissions will be rewarded. At the same time, the approach does not create any real incentives for financial markets to invest in the new technologies that could help reduce greenhouse gas emissions, and that could also create a huge U.S. comparative advantage in a rapidly growing world marketplace for such technologies.
In fact, many of the companies that are signing up for the Administration's voluntary program fall into two categories: those that want to reduce emissions anyway for their own business purposes, and those who assume that the federal government will eventually impose mandatory limits and give them credit for their head start.
In the Feb. 11 Wall Street Journal, for example, American Electric Power's senior vice president Dale Heydlauff said: "I am banking on the expectation that when the U.S. Congress decides to impose mandatory controls on greenhouse gases, they will look back and recognize that some companies acted early.... I'm not calling for a cap. But there are limits on how much we are going to spend on what is essentially a public-policy experiment. You just aren't going to spend tens of missions of dollars on a voluntary program if your competitors aren't doing likewise."
Mr. Heydlauff's explanation of the flaws in the voluntary approach, and his hint at the emerging consensus that Congress will eventually turn to mandatory measures is especially interesting, because his boss, American Electric CEO E. Linn Draper, was one of the leading cheerleaders Wednesday for the President's proposal.
Despite their coerced endorsements of a "voluntary" system many don't much believe in, smart business executives know which way the ill winds of global warming are blowing. Economists agree that the cleanest cheapest way to control carbon dioxide -- and other greenhouse gases implicated in climate change -- is not with voluntary measures but with a "cap-and-trade" system that harnesses the power of markets to spur energy-saving and pollution-reducing technologies. And such thinking isn't just the province of egg-heads and environmentalists. Many corporate actors, among them electric utilities, oil producers and chemical manufacturers, have embraced this very approach.
Unlike today's "command and control" regulations, cap-and-trade systems set a single mandatory limit, or "cap," on emissions from all polluters. That mandatory limit is necessary to set the market in motion: Mandatory caps give those who can control emissions cheaply the ability and the incentive to sell emissions trading allowances to those who find reducing emissions more costly. This combined approach is far less expensive than existing laws that regulate emissions separately from each source. And unlike voluntary programs, mandatory, enforceable caps insure that harmful emissions really do decline.
Fortunately, lawmakers in Washington have at least two proposals -- one pending and one already introduced -- to make a mandatory cap and trade system a reality. Later this month, Senators Carper (D-DE) and Chafee (R-RI) will reintroduce their "four pollutant" bill designed to reduce emissions of carbon dioxide, mercury, sulfur dioxide and nitrogen oxide from electric utilities. Like its predecessor in the last Congress, the Clean Air Planning Act of 2002 (S. 3135), it would limit carbon dioxide emissions from electric power generators, which account for 40 percent of the U.S. emissions implicated in global warming. From a political point of view, the bill is a "doable" compromise because it's bipartisan, and because it combines strong legal sanctions for emissions reductions with market-based mechanisms for achieving them. It is also worth noting that Sen. Jim Inhofe, (R-OK) the chairman of the Senate Environment and Public Works Committee, an emissions trading opponent, noted this week that the votes exist in the Senate to pass such a measure.
In January, Senators Joe Lieberman (D-CT) and John McCain (R-AZ) introduced their Climate Stewardship Act of 2003 (S. 139), designed to gradually reduce greenhouse gas emissions from the electric utility, transportation fuel, and manufacturing sectors to year 2000 levels by 2010 and 1990 levels by 2016 (Kyoto called for the United States to reduce emissions 7 percent below 1990 levels).
The Lieberman/McCain "cap and trade" system would apply not only to the electric utilities and large manufacturers that are the major "downstream" cause of emissions, but also to energy producers "upstream" who make and distribute transportation fuels. To the extent it targets transportation fuels that release carbon dioxide when burned, an economy-wide cap provides a powerful incentive to promote cleaner fuels and cars with better fuel economy.
The Bush administration proposal presents a false choice between economic growth and real emissions reductions. The private sector recognizes this, and appears ready to do well by doing good: to embrace a market-based regulatory approach that gives it the certainty it craves to invest in the technology to both reduce emissions at home and make America the leader in the emerging global market for emission reduction technology. That's a formula for both economic growth and environmental stewardship, a genuine "third way" forward in the long-polarized debate over climate change that has pitted industry vs. environmentalists and stymied progress.
It's time to knock down the Potemkin Village of the Administration's proposal and get on with the work of achieving an economically feasible answer to global climate change. Melting ice caps won't wait.