Economy-wide Coal Subsidy Bill Passes Barbara Boxer's Committee

by: Matt Stoller

Wed Dec 05, 2007 at 23:49

A few weeks ago, global powerhouse consulting firm McKinsey came out with a study on the economic costs of reducing carbon output, and found that the costs wouldn't be particularly high.

The results are surprising. The report concludes that the U.S. can cut its greenhouse emissions in half from projected levels in 2030 at minimal cost. None of the steps would cost more than $50 per ton of carbon dioxide emissions avoided. Plus, 40% of the reductions would actually save money. That puts the overall cost at just a few dollars per ton of carbon dioxide-or in the tens of billions of dollars overall.

Moreover, it doesn't take any breakthroughs in technology. "Eighty percent of the reductions come from technology that exists today at the commercial scale," says Stephenson. And the remaining 20% comes from ideas already well along in development, such as hybrid cars that plug into electrical outlets and have batteries big enough to go 30 or 40 miles on electric power alone and biofuels made from cellulose (such as prairie grass) rather than foodstuffs like corn.

Instead of a top-down macro-economic model, what McKinsey did was look at different ways to reduce energy usage and/or convert to new power sources, and their relative costs.  Grist reproduced a handy chart of the different ways to reduce carbon studied by McKinsey.  Most of the cheap stuff is energy conservation, and that saves money.  Most of the expensive stuff is composed of things like carbon capture for coal plants, ie. clean coal.

Which brings me to Barbara Boxer, Joe Lieberman, and John Warner's bill.  This bill sets in place regulations for the entire economy and subsidize the coal industry in the name of carbon reduction.  It passes trillions of dollars to polluting industries to keep them in business, and pushes the costs of managing carbon reductions way up.  That means that if this bill goes through, we will have a much worse change of dealing with global warming than if we wait until 2009.

The bill passed her committee, 11-8.  Boxer voted against most of the amendments put forward by Bernie Sanders, and even Hillary Clinton put forward a bunch of good amendments Boxer voted against.  I'm going to start blogging a good deal more about those insiders building progressive power instead of politicians like Boxer and Kucinich, who, while sometimes useful in their policy roles, do not really strengthen the ability of progressives to affect legislative outcomes.

My read is that Boxer just doesn't get the game that's being played anymore, where old-school checklist style politics around degraded organizations like Frances Beinecke's starfucking obsessed NRDC and the utterly corrupt and industry-owned Environmental Defense don't work.  This was clear when I was in Connecticut and she stumped for Lieberman, calling him 'Sir Gallahad' after he said rape victims denied contraception at a Catholic hospital could just take a short cab ride to another hospital.

This legislation, and her poor way of handling it, is just another sign we need new progressives in the Senate.  Hopefully this bill will die the death it should, but in the meantime, if you want to know why serious action in DC against climate change isn't happening, you can point to Barbara Boxer, Environmental Defense, and the NRDC.  They have enraged a good number of economists and environmentalists with their support of regulating the entire economy for the benefit of coal companies.

On the bright side, and this is a very bright side, Hillary Clinton showed great instincts here with her amendments to use revenue (essentially) from carbon taxes for the benefit of the public.  And the energy bill pushed by Pelosi and Markey looks quite good, and that's going to take us where we need to go in moving away from carbon-based energy systems.