Issue #21, Summer 2011

America 2021: What Next on Climate?

The effort to address climate change stumbled with the failure to pass cap-and-trade. What should happen now? Five experts discuss the future of U.S. climate and energy policy.

After November 2008, progressives believed that America was, at last, serious about tackling climate change and our dependence on foreign oil. But the years since have been discouraging. Cap-and-trade, the idea that progressives had coalesced around, collapsed. Worse, polling has shown that Americans have become increasingly skeptical about the very idea of climate change. As we head toward another presidential election year, prospects for a breakthrough on climate and energy policy seem remote.

In the wake of these disappointments, what should progressives do next? For this edition of “America 2021,” our roundtable series, we ask: Where will America be in ten years on the climate and energy front? What new problems will we be facing—and what old ones will still be plaguing us? And what policies and ideas do we need to enact in the intervening years to ensure that we’re in a much better place in 2021 than we are in 2011?

For this discussion, we brought together five distinguished experts: Joe Aldy, Vicki Arroyo, Alex Laskey, Manik Roy, and Lexi Shultz. Bryan Walsh, energy and environment reporter for Time magazine, moderated their discussion. Editors Michael Tomasky and Elbert Ventura also participated.

Bryan Walsh: It’s 2021. You’re in the Oval Office talking to the president. What are the priorities you’re identifying on energy and climate policy? What sort of actions will we be taking at that point?

Manik Roy: In the next few years, we will not be putting together the optimal climate policy. Instead we’ll be doing things in chunks. I’m assuming the EPA’s ability to regulate greenhouse gases under the Clean Air Act will survive, and we will do what we can under that law. But I don’t think our efforts will be as good as what many of us were trying to do. By 2021, we’ll recognize that what we’ve been doing is not the best approach for either the environment or the economy, and we’ll be trying to fix it.

Vicki Arroyo: I think I can paint an optimistic view, especially listening to businesspeople who are really doing great things in terms of promoting efficiency and renewables in electricity, or transportation, with investment in hybrids and plug-ins. Looking at that, we really could be in a different place in 2021.

But I could also imagine, having lived through the last decade or more working on this issue, that we’re stuck in an unhelpful pattern. We have a lot of regulatory uncertainty, which makes investment difficult. And there’s a boom-and-bust cycle when it comes to things like incentives, so we never really developed a coherent policy. Unfortunately I think that’s just as likely a scenario.

Joe Aldy: By 2021, I’m actually optimistic we’ll see a price on carbon. This is not because I think people are going to see the light on climate policy, but because at some point in the near future, we’re going to have to have a serious conversation about fundamental tax reform and the long-term fiscal outlook. When we start having that serious conversation, we’ll recognize we have to raise more revenues. And a price on carbon is one of the biggest revenue raisers that will be on the table, and the vast majority of the revenues from the price on carbon are going to be dedicated to tax cuts and deficit reduction. It’s going to be hard for people trying to solve the fiscal situation to walk away from that.

Is the price going to be at a level that really fundamentally drives a lot of innovation and a lot of new technologies? I think it’s going to be relatively low, and that’s one of the challenges: How do we scale it up to a level that’s appropriate to drive innovation and reduce emissions? That’s part of the challenge that the president a decade from now will have to confront.

The other thing is, by a decade from now, if the climate science is right, we’re going to see climate change have real, material, adverse effects on peoples’ lives in some parts of the world. It will start to become more and more of an issue in our security relationships and our military posture. That will be a greater part of the consideration in 2021.

Alex Laskey: I largely agree. There will be a price on carbon by 2021—there has to be, for economic and political reasons. It was Republicans who were initially in favor of cap-and-trade, so I think they will come around. But it’s going to happen incrementally. The price will be a low price by 2021, but that’s okay.

We need to stop looking only for a grand bargain on energy and climate policy. We don’t need to solve every problem all at once. I think this Congress would do well to look at a national energy efficiency standard that mandates specific energy-efficiency goals for electric providers, like conserving the equivalent of 20 percent of all power sold. Half the states have adopted these kinds of polices in the last decade, including states like Texas, Ohio, and Arizona. One advantage is that while there is enormous political disagreement about how to allocate the energy-generation pie—how much goes to solar versus nuclear versus natural gas—there is a broad consensus that no matter where the power comes from we need to waste less of it. And if we can encourage and achieve energy efficiency, it then increases the appetite to raise the price of power over time.

The reason I’m hopeful is all the scary things that Joe pointed to. Last year, some 19 countries set records for high temperatures. Months after the floods in Pakistan, millions are still homeless. The evidence is abundantly clear, and it will become clearer to more people over the next ten years. It’s a losing political battle to ignore it, so the people who are continuing to suggest that climate change isn’t real will either lose or change their minds.

Lexi Shultz: I’m going to split the difference a little bit. I don’t think we’ll have a price on carbon by 2021, but the pressures to get there will have really ramped up by then, so that hopefully, soon after that, we might actually have a real comprehensive climate policy. Also, hopefully, some of the issues around the deficit will shift away from slashing the funding needed to create jobs, which is really cutting off our nose to spite our face. There is already a big push for incentives for manufacturing and for the types of innovation that we really will need—on energy efficiency, on renewables, on clean cars—whether we have a price on carbon or not. By 2021, there will be enough pressure that we will see some real investments in those areas.

We’re already seeing the costs of climate change around the world. By 2021, the costs of those impacts in the United States will be quite high. With flooding, extreme storms, and lots of natural disasters, there will be an increased call for dollars to help those towns and areas deal with the aftermath and prevent those effects in the first place.

There are also going to be competing water needs. One of the effects of climate change is going to be reduced water supply, so it will be felt in areas that have been growing in population and will probably continue to grow. I do think some regulations will be in place and will start taking effect, and people will see that the world’s not crashing down because we’re starting to reduce carbon from a few sectors. There are going to be some incentives to create clean technologies, and we will have a robust industry around clean tech, though we will have need for a lot more.

Laskey: There needs to be some narrative connecting these natural disasters that are happening due to climate change. You could argue that the White House failed to tell that story. But I would make the argument that we failed as a movement to create a burning platform on this issue.

Roy: On this point about connecting the dots for people, I saw polling recently that the percentage of people in the United States who are alarmed about climate change is at about 14 percent. That’s comparable to the “issue publics” on both sides of topics like abortion and gun control. But the difference is that people who care deeply about climate change feel isolated—they don’t know that there are tens of millions of Americans who feel the same way they do.

Walsh: Can we weave together a narrative of attribution—rising carbon emissions, climate change, these natural disasters we see? Among scientists that I know, this is one of the most difficult problems that they face. And we’ve seen in the wake of “Climategate” a loss of faith, at least among conservatives, in climate science. Should this movement keep fighting on the science, or is it just going to continue in this circle?

Shultz: Those connections really haven’t been made. And that’s something we still have to keep doing. One of the reasons Climategate was so bad is that so many people had stopped talking about the science that it left a vacuum, and you can’t leave that vacuum again.

Arroyo: We work with a lot of governors, because our center is focused on states’ activities. And if you look at the leading governors who have really stepped up on these issues, it’s been more bipartisan than we’ve seen here in Washington. They’re closer to the impacts. They’re the ones who are having to declare states of emergency with unprecedented frequency. Washington Governor Chris Gregoire talks about climate change and the fact that she’s having floods and fires. Same thing with former Governor Schwarzenegger, a Republican. The fire season is now year-round in California, and its coasts are also vulnerable.

But these leaders couple these concerns with a message of opportunity. Maybe some groups stopped talking about the science because it can leave people feeling overwhelmed and helpless. If you look at these skillful politicians, they talk about the fact that you can address this problem while investing in a new energy economy that provides more homegrown sources of power that are safer and can create jobs.

Aldy: When we’re considering how we communicate on this issue, we should be able to make the case that even in the context of uncertainty, there are prudent things we can do that reduce the risk. People buy insurance against catastrophic events all the time, like homeowners’ insurance and auto insurance. We take those kinds of precautions. And we ought to consider, as a society, what are the appropriate actions to take to reduce these risks associated with climate change? What’s the appropriate premium we should be paying?

Roy: When we ask that question, we have in mind this sort of mythical “public.” But there is no “public”—there are people and each person has different concerns, interests, and beliefs.

It’s interesting to look at how the other side has worked this issue. They’ve created this overlapping series of misrepresentations: “Climate change isn’t happening.” “It is happening, but it isn’t human caused.” “It is human caused but it isn’t going to be a big deal.” “It is going to be a big deal but we can’t afford to do anything about it.” “Well, we can afford it but we’re not going to do it until China does something about it.”

They have these overlapping, mutually contradictory stories, each of which activates a different member of the public out there. We have to do the same thing, but with truth. We should be talking about science, about solutions, about competitiveness with other countries, about the benefits of reducing pollution. I don’t think we should stop talking about anything. The other side has shamed us, and we shouldn’t be ashamed. We have an accurate story to tell.

Walsh: At the same time, we’ve heard a lot of this before, in 2009 and 2010, during the effort to get cap-and-trade legislation passed. But despite a fairly positive legislative makeup that we’re not likely to see again any time soon, cap-and-trade did not succeed. Without getting into the magic of the filibuster, was cap-and-trade’s failure attributable to our politics, or was it indicative of something about that policy that needs to be changed?

Roy: A couple big things happened. One is that we had a terrible economy. It’s very tough to pass major environmental legislation in a bad economy. And the other thing is, frankly, it’s tough to pass major environmental legislation under a Democratic president, because the moderates of either party tend to run from their president when their president is in office. That tends to be true when Republicans are in office, which is why almost all of our major environmental laws—the Clean Air Act, the Clean Water Act, our hazardous waste laws—were passed under Republican presidents. And it has been true when Democrats are in office, which is why we rarely pass tough environmental legislation under Democratic presidents.

Shultz: You said that it was a really favorable political climate. I would argue that maybe wasn’t the case. This is an issue that is about party, clearly, but regional politics come into play. We have these very entrenched interests in some regions, like in the Midwest and Appalachia, where coal is dominant, or in the South, where oil is king. It is no secret that the Southern Company, the dominant electric utility in the Southeast, was lobbying delegations in its region hard to oppose any kind of constructive proposal on carbon. This made it extremely difficult to pass any kind of climate policy. It’s going to take awhile to get past some of those regional barriers.

Laskey: I think it was about not having constructed quite the right policy. These things are intertwined, of course, but it was the policy that went off track. We couldn’t get something passed because people like Arkansas Senator Blanche Lincoln couldn’t vote for the bill that was in front of them. But Arkansas just passed at the state level an energy efficiency resource standard. All the utilities in Arkansas are fully on board with achieving certain efficiency targets. Is the standard as high as it could have been or will be? No, but they’re on board.

Issue #21, Summer 2011
 
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AnonyMoo:

Laskey, do you need a "burning platform" to promote the KKK? Are you wanting to sell Acai berries smuggled from the Ivory Coast? The time to act against risk is always, for the gain is no less than civilization.

Jul 23, 2011, 5:52 PM

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