Why do bad ideas linger with such persistence in the halls of Congress? This question came to mind when Senators John McCain and Joe Lieberman recently introduced legislation to reduce U.S. greenhouse gas emissions to prevent global warming.
President George W. Bush rejected the Kyoto Protocol for the control of greenhouse gas emissions arguing that the treaty was "fundamentally flawed," and not in the United States' interests. It appeared the Senate agreed with him, since in 1997 they had unanimously passed a resolution requiring the Clinton administration to not participate in any global warming agreement that would either (1) harm the U.S. economy or (2) fail to require meaningful participation by developing countries. Kyoto met neither of these conditions.
Perhaps in an effort to solidify the votes of the environmental community and kick start their campaigns for the presidency in 2004, Joseph Lieberman and John McCain have co-sponsored an anti-air pollution bill that is, in effect, an attempt to implement a modestly less onerous version of Kyoto – let's call it "Kyoto lite" – without Senate ratification.
Kyoto lite is similar to a bill Sen. Lieberman introduced in 2002 that would have lumped carbon dioxide in with mercury, nitrogen oxide and sulfur dioxide – air pollutants regulated by the Environmental Protection Agency – and demand that power plants reduce the emissions of these gasses via a "cap and trade" mechanism. However, McCain/Lieberman would go farther than the earlier bill by establishing greenhouse gas reduction targets for every major sector of the economy – energy, manufacturing, transportation, etc. – not just power plants. Cap and trade would work by setting a cap on total emissions, auction allowances to emit carbon dioxide to energy producers, and then permit them to trade these allowances between themselves.
Supporters of cap-and-trade approaches to reducing air pollution argue that emissions trading is a more cost effective way of reducing total emissions than either specifying a particular technological fix or taxing fuels based upon their relative emissions. They may be right. But there is no good reason for implementing a bad public policy, even if it is done in the least costly way.
Whatever the merits of using a cap and trade approach for reducing the emissions of mercury and sulfur dioxide, their argument is flawed when applied to CO2. Unlike the others, CO2 is neither a pollutant nor is toxic at any foreseeable atmospheric levels. Indeed, CO2 is critical for plant life and thus necessary for life on earth.
Since CO2 is not a pollutant, the only justification for forcing radical emission reductions on the economy is to slow or prevent global warming. But neither unilateral U.S. emissions reductions, as the McCain/Lieberman bill would demand, nor the international emissions reductions required by the Kyoto Protocol, would have any effect on future global warming. According to the National Center for Atmospheric Research, if all of the signatories meet their greenhouse gas reduction targets, the temperature difference would be so small it couldn't be measured by ground-based temperature gauges.
Indeed, since as much as 85 percent of the projected increase in CO2 emissions will come from developing countries exempted from the Protocol, including China, India, South Korea and Brazil, even if developed countries unilaterally stopped all their greenhouse gas emissions (something no one seriously proposes), total greenhouse gas concentrations would continue to rise.
In addition, America is in the midst of a serious economic slowdown. By forcing industry to cut CO2 emissions – which means reducing energy use – the McCain/Lieberman bill will only exacerbate our country's economic woes. In June of 2002, the non-partisan Congressional Budget Office (CBO) published a study analyzing various cap-and-trade proposals. The CBO's conclusion was clear. "[T]he economic impacts of cap-and-trade programs would be similar to those of a carbon tax: both would raise the cost of using carbon-based fossil fuels, lead to higher energy prices, and impose costs on users and some suppliers of energy." Raising energy taxes may never be a good idea, but during a recession it's just plain dumb.
How bad would it be? The numbers aren't in yet on Kyoto lite, but when examining the less comprehensive bill offered by Lieberman in 2002, the Environmental Protection Agency forecast that the bill would raise electricity prices in 2015 by 32-50 percent, while the Energy Information Administration concluded that it would reduce GDP by .8 percent in 2007, or about $100 billion with a loss of about one million jobs.
Whatever the cause of the earth's current warming trend, the McCain/Lieberman bill will not reduce the threat of global warming. It will, however, make a bad economic situation worse.