Dear Congressman Hoekstra

Your recent "Perspective" is an interesting example of empty political posturing. You express your opposition to a cap-and-trade program that would regulate CO₂ emissions, which you call a "job-killing National Energy Tax." Yet you also want to promote renewable energy to reduce both our dependence on foreign oil and pollution to the environment.

I agree that we should encourage clean energy, but how exactly do you propose to do this? We could discourage carbon-emitting energy sources by taxing them or instituting a cap-and-trade program, but you clearly believe that would kill jobs. Alternatively, we could subsidize clean energy, but we would have to institute a "job-killing" tax to pay for it to avoid being irresponsible and increasing our national debt. Or we could mandate that utilities must produce a certain proportion of their electricity from renewable energy in a one-size-fits-all regulation. But that would ignore regional and other differences and would not allow companies to behave as rational, economic actors.

As your constituent, please tell me how you plan to promote clean, renewable energy. You don't get to have your cake and eat it too just because it's an election year.

Sincerely,

Wolverine

Note: This is not the first example of Hoekstra's disingenuousness.

The American Power Act

Much has been said about the American Power Act, introduced to the Senate on May 12. It would incentivize more offshore drilling and nuclear power. It would limit the EPA's capacity to regulate greenhouse gases under the Clean Air Act. And it does not nearly reduce greenhouse gas emissions enough.

Some of these complaints are misleading: For instance, the American Power Act only limits the EPA's ability to regulate under the Clean Air Act because it establishes a cap-and-trade system for large carbon emitters. EPA would deal with these emitters under the American Power Act, while still reserving the ability to regulate other emissions, like automotive emissions, under the Clean Air Act.

And in spite of these complaints, the American Power Act deserves our support. It finally sends a signal that the United States will regulate greenhouse-gas emissions. Such a signal is needed for entrepreneurs to invest in researching and implementing green energy. Indeed, it is precisely what they are waiting for.

And yes, it does not reduce greenhouse-gas emissions enough. But it is much easier to establish the cap-and-trade framework and adjust later on. And as Joe Romm reminds us, this is exactly what happened with the Montreal Protocol and the Clean Air Act(s).

Yes, the bill is flawed and we should lobby the Senate to improve it. But those flaws should not prevent us from taking the first real step to fight global warming and passing this bill.

Coming Up ACES...Almost

On June 26, the House passed the American Clean Energy and Security (ACES) Act (aka Waxman-Markey) by a vote of 219 to 212. ACES has come under fire from both the right and the left. Some environmental groups, including Greenpeace, oppose the bill because it does not go far enough. (While they have a point, I support the bill because it appears to be the best we're going to get and could spur better legislation in the future.)

The right has meanwhile responded with, "AARGH!!! THIS BILL IS GOING TO KILL THE AMERICAN ECONOMY!!!! APPLE PIE WILL NEVER TASTE GOOD AGAIN!!!"

Well, they're wrong. But let's look at their claims and take them apart one by one:

This bill will cost American families exorbitant sums of money. The CBO estimates that the average American household will have to pay an extra $175 per year by 2020 in direct costs, or about 0.2% of post-tax income. The EPA estimates it will cost $1100 per year by 2050. Even if you claim that those numbers would be higher, it's important to remember that Americans will be making and spending more by then anyways. ($164,348 per year in 2050)

It's important to note that the costs borne by households vary because of progressive subsidies and varying usages. The poorest fifth would actually receive a net $40, while the richest 20% would pay $245 in 2020. Costs also vary by state in ways that might affect Senate votes:

This bill will make manufacturing in the United States more expensive. Companies will outsource. First of all, it doesn't seem like companies are too thrilled to employ Americans in manufacturing in the first place. It's easy to make this claim and then blame all future outsourcing on ACES, though they might have moved even if ACES had not been passed.

More importantly, the consequent goal should not be to avoid adopting stringent environmental regulations in the United States. It should be to make foreign countries adopt more stringent environmental regulations. This will ameliorate environmental problems and level the economic playing field. Obama has an opportunity to do just that at Copenhagen. China and India, presumably the countries that has the right-wingers most concerned, have an incentive to do so: they will be hit hard by global warming.

Global warming is expected to reduce global GDP by only 5% anyways. GDP should not be our main concern. Nate Silver shows how 81 countries, accounting for 2.8 billion people, could be wiped off the face of the earth and the global economy would only suffer a 5% hit. These countries mostly lie in sub-Saharan Africa or the tropics, incidentally the same places that would suffer the most from global warming.

This bill will increase prices, reducing consumption and thus production. Yeah, well, that's the point. Currently, we produce too much greenhouse gas pollution. We do this because the cost of emitting is external to the company doing the emitting. The company accrues all the benefits of producing thingamajigs but the cost of the resulting pollution is borne by everybody. By internalizing these costs, i.e. making the company bear these costs, a more economically efficient amount of pollution will be produced. Cap-and-trade is an ingenious, market-based solution to a classic market failure.

Now, the bill moves to the Senate, where I'm hoping it will be improved. But that's like hoping that a tornado will come along and clean my apartment.

Changing Climate, Stagnant Politics

So, we haven't posted in a while, which of course means that nothing important happened in the past nine days.

Except the brief life of the Lieberman-Warner Climate Security Act. The act, which I first heard about on Monday, would have (1) created a cap-and-trade system for greenhouse gases--in my opinion, the best way to limit such pollution--and (2) allowed states to have tougher environmental regulations than the federal government, which California tried to do, but the Bush Administration's EPA denied California this right last December.

And now the bill has been filibustered to death. The supporters of the bill were 12 votes shy of the 60 necessary to invoke cloture and end debate. (Both Sens. Levin and Stabenow voted for cloture.) Senators will now wait until next year, when they will have a more supportive president and hopefully a more favorable legislature, until they try again.

Also on the climate change front, the NASA inspector general released a report stating that "political appointees in the space agency's public affairs office worked to control and distort public accounts of its researchers' findings about climate change for at least two years." Shock.

On a lighter note, there's a wolverine in Michigan's thumb!

The '01E Wolverine, North Campus, U-M, munching on the head of an Easter Bunny. (4/5/08)