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James K. Boyce

“For the sake of our children and our future, we must do more to combat climate change.” These words in President Obama’s State of the Union address came as music to the ears of environmentalists. Do they herald a real effort to break the climate policy impasse in Washington?

Obama urged Congress to pursue a “bipartisan, market-based solution,” citing as a model the cap-and-trade bill sponsored by Senators John McCain and Joseph Lieberman.

The McCain-Lieberman bill failed to clear the Senate in 2003. It failed again in 2005. So did two subsequent cap-and-trade bills, Lieberman-Warner in 2008 and Waxman-Markey in 2010. Any new effort to enact a national climate policy will be the fifth try.

Environmentalists blame Republicans and climate change deniers for the past defeats. But if there is to be any chance of forging a successful policy this time around, some deeper introspection is in order.

An insightful essay by Harvard political scientist Theda Skocpol offers a good starting point. Skocpol doesn’t downplay the role of fossil-fueled extremists in blocking climate legislation, but neither does she ignore the fatal weakness in the Democratic party’s past strategy: relying on insider bargains, lubricated by carbon permit giveaways to energy corporations, to get the votes needed to pass a bill.

This time, she argues, climate policy proponents should follow a two-pronged strategy that combines legislative initiatives with popular mobilization of public demand for proactive policies. Broad-based democratic mobilization (with a small ‘d’) was notably lacking in the efforts of the last decade. Instead pollsters and ad-writers were enlisted to design “messages” that were supposed to win voter approval for backroom deals reached in Washington. The public’s role was relegated, in Skocpol’s apt phrase, to a “background chorus that, hopefully, will sing on key.”

Opponents of climate policy avidly exploited this weakness. A well-funded campaign rebranded the legislation as “cap and tax,” claiming it could cost American families an inflated $3,100 per year in higher fuel prices. “By imposing a tax on every American who drives a car or flips on a light switch,” House speaker John Boehner declared, “this plan will drive up the prices for food, gasoline and electricity.” Editorial writers at the Wall Street Journal echoed the cry, warning that cap-and-trade would be “the biggest tax in American history.” Instead of confronting the fuel-price issue head-on, Democrats whined that the Republican numbers were wrong. They were, but the opponents scored a political bull’s eye regardless.

The result: “Opponents did a better job of scaring citizens than the proponents did of arousing enthusiasm.”

Skocpol’s critique has met a cool reception inside the Beltway, but climate policy proponents would do well to take heed. Public mobilization ought to be a centerpiece of the strategy, not an afterthought. History teaches us that the greatest changes in America do not come from the top down. The Social Security Act of 1935, for example, was not merely a product of visionary leadership: the path to it was paved by widespread public demand for Congressional action, illustrated by the petition in favor of old-age pensions that was signed by millions of Americans.

What sort of climate policy could win comparable public support? Skocpol points to the little-known cap-and-dividend bill that was introduced in December 2009 by Senators Maria Cantwell (D-WA) and Susan Collins (R-ME). Cantwell-Collins proposed to auction all carbon permits (no giveaways to polluters, no trading by speculators) and to return 75% of the money directly to the public as cash “dividends” that would protect the purchasing power of working families. A new version of this bipartisan bill is likely to be unveiled this spring.

Returning carbon money straight to the people – rather than turning it into windfall profits for corporations or tax revenue for government – also features in a new bill introduced this month by Senators Bernie Sanders (Ind-VT) and Barbara Boxer (D-CA), which would levy a carbon fee and recycle 60% of the money to the public.

The political appeal of these proposals goes beyond protecting family incomes. They also face up to a fundamental moral question: Who are the rightful owners of the environment? Who should be paid for the privilege of using it, subject to limits we set to safeguard it for future generations? To this question, both bills give a clear and compelling answer: We, the people. It’s an answer on which a bipartisan majority of legislators might be able to agree – especially if the people demand it.

James K. Boyce teaches economics at the University of Massachusetts, Amherst. His most recent book is Economics, the Environment and Our Common Wealth.

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2 Responses to “U.S. Climate Policy: Take Five”

  1. R Briggs says:

    I agree strongly with this post.

    James Hansen argues convincingly in his book “Storms of My Grandchildren” for a revenue-neutral carbon tax (100% of revenues returned uniformly to the people). The magic of this proposal is that it creates an enormous constituency to defend the policy. Also, when the majority of citizen’s will be getting more back in dividends than they will be paying in higher energy costs, it’s hard for the fossil industry to portray it as a “tax increase”—it’s more like compensation for damages.

    Wasn’t cap and trade always just a scheme to create a market in excuses for not actually taking action to reduce carbon emissions? Given the urgency to curtail emissions, even the theoretical resource allocation efficiency argument for carbon trading is starting to sound pretty silly. We need to be doing everything that may be effective in reducing carbon emissions—not just cherry-picking in the developing world.

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