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.
Shultz: I don’t disagree—down the line we’re going to need technological breakthroughs—but we haven’t even come close to taking advantage of the technologies we have right now. We can go much bigger, 25 percent renewable by 2025, and 20 percent by 2021, and that’s probably not all we could do. We need to encourage electric utilities to provide long-term contracts for renewables like they have been offering fossil fuels for years. Some of this is, frankly, taking the thumb off the scale for oil and gas and coal. In a way, we’ve been picking winners for decades. It’s really more about leveling the playing field and allowing the marketplace to work.
Aldy: We’ve got two fundamental problems here. The first is that we have insufficient incentive for people to create new knowledge and undertake R&D in the private sector, and that’s why there is a very clear role for the government to step in. The second major problem is that a lot of the energy consumed in the United States today doesn’t bear the full cost that it’s imposing on American citizens and people around the world. If we were to take the monetized damages from climate change and apply them to coal, we would double the price of coal. That’s a sign of how large the implicit subsidy is—they’ve been able to effectively dump CO2 into the atmosphere for more than a century without taking on that cost.
The question for policy is: Can we design it in a way that avoids this problem of picking technology winners? Bryan, you were talking about the examples of medical and health research through the NIH. A better model for how we think about energy R&D is ARPA-E [Advanced Research Projects Agency-Energy, a new government agency set up to promote and fund R&D in energy technologies], which would focus on big technological breakthroughs for the long term, but have a rigorous, merit-based evaluation that allows us to find the most promising ideas. It would really allow people who are trying to think long term to be creative and to seek out the high-risk but high-reward technologies. If you do that, and if you have a policy approach on deployment that is technology-neutral, then you can avoid this problem of the government deciding who’s going to win the game.
Laskey: There’s another thing on the R&D side that is secondary to these issues. Foreign-born students are a big part of R&D and have historically been a big part of our country’s well-earned reputation as a center of innovation. We are making it harder for them to come and stay, and many are going back home. This has implications for our economy in the long run. What makes the United States a center for innovation is that we have both great centers of education and policies in place that allow for entrepreneurship and innovation. But there’s also the network effect of having people come from all over the world to be a part of that. As soon as we eliminate that possibility, centers of innovation are dispersed and they work far less well. And it makes no sense to educate engineers here, but have immigration and workforce policies that compel them to build businesses and create jobs oversees.
Michael Tomasky: I’d like to reverse-engineer our conceit. Instead of America 2021, think back to 2001 or 1991 or 1981. What’s the biggest mistake we made? When you lie awake at night, what idea do you think you should have accepted then that you didn’t accept, or what deal should you have taken? I have a friend who worked in campaign finance for many years who once said, “We spent the 1970s rejecting things because they weren’t good enough, and if we’d accepted all these things we’d have pretty strong campaign finance today.” Have you thought such thoughts on anything?
Arroyo: I think about the disconnect between the U.S. international posture and the dialogue here at home going back to Kyoto and even before. In the run-up to the Kyoto Protocol in 1997, there were heated discussions about including major developing countries in any agreement to cut emissions. The Byrd-Hagel resolution [which stated that the United States not be a signatory to any protocol that did not mandate emissions reductions from developing countries and that could harm the economy] passed the Senate, and the Clinton Administration didn’t fight that vote.
Aldy: It did go 95-0. That was a tough fight, as someone who was in the Administration at the time.
Arroyo: But they didn’t try. They gave it a pass, thinking that it was never going to matter, and it mattered hugely as it was for years the stated position of the U.S. chamber that ratifies treaties. And it’s been the story of our lives in many ways since.
Roy: Here’s an obscure one. Under George Herbert Walker Bush, Bill Reilly, the administrator of the EPA, did an exercise called “Unfinished Business.” What it did was look across the range of programs at EPA and see if we were spending enough on them. It’s actually a very thoughtful report, but most Democrats and environmental groups attacked it because it said we were overinvesting in Superfund, the government’s cleanup program for hazardous waste sites, and underinvesting in climate change. This isn’t an attack on Superfund, but I wish we had taken the opportunity presented to us by a Republican Administration to deal with this issue. I think it’s unfortunate that the environmental movement, unconsciously sometimes, becomes overly partisan, and doesn’t accept the efforts to lead by some very sincere Republicans.
Post a Comment