Obama plans further climate action but says a carbon tax ‘is hard’ to pass

Source: Evan Lehmann, E&E reporter • Posted: Friday, November 16, 2012

President Obama revealed yesterday that he’s searching for ways to address climate change in his second term by planning meetings with scientists and experts weeks after a re-election campaign in which he said very little about the topic.

But when asked directly about taxing carbon, he declined to endorse the idea, which has gained traction among a handful of conservative think tanks and free-market groups as a source of revenue that might help close the deficit.

“There’s no doubt that for us to take on climate change in a serious way would involve making some tough political choices,” Obama said in a press briefing yesterday. “And, you know, understandably, I think the American people right now have been so focused, and will continue to be focused, on our economy and jobs and growth that, you know, if the message is somehow we’re going to ignore jobs and growth simply to address climate change, I don’t think anybody’s gonna go for that. I won’t go for that.”

That assertion seems to diverge from past positions by the president, who argued during the cap-and-trade debate that increased energy costs on consumers would be offset through rebates derived from selling carbon permits. He also said then that the economy overall would benefit from using less fossil fuels as new technologies were created.

His comments yesterday coincided with new research showing that taxing carbon would affect lower-income households, which spend more money proportionally on energy and other goods than higher earners. A paper released this week by the Congressional Budget Office found that a carbon tax of $28 a ton would cost low-income households $425 annually, or about 2.5 percent of after-tax income.

But it says there are ways to avoid those price hikes, like by reducing taxes on income, payroll and corporations. Other options include providing rebates or increased payments through Social Security and programs that help people buy food. The CBO paper says that directing 27 percent of a carbon tax’s revenue back to the two bottom categories of households earning the least would offset their price hikes.

An ‘obligation to future generations’

The president’s lukewarm answer about addressing climate change in the near term sparked discontent among advocates who fear an absence of national climate policies is leading to irreversible environmental harm.

“We welcome his belated call for a national conversation about how to address climate pollution,” Brad Johnson, the campaign manager for Forecast the Facts, said in a statement.

“But the president’s assertion that addressing climate change should be secondary to concerns about the economy is a gross disappointment and an insult to the deep suffering of the millions of victims of climate disasters across this nation,” he added.

Obama made his remarks one day before he is scheduled to visit areas of New York that are still recovering from Hurricane Sandy, which caused $33 billion in damages, state officials estimate. New York City Mayor Michael Bloomberg became the highest-profile politician to address climate change before last week’s election by declaring that the problem must be tackled — whether it exacerbated Sandy or not.

“What we do know is the temperature around the globe is increasing,” Obama said yesterday, “faster than was predicted even 10 years ago. We do know that the Arctic ice cap is melting, faster than was predicted even five years ago. We do know that there have been extraordinarily — there have been an extraordinarily large number of severe weather events here in North America, but also around the globe.

“And I am a firm believer that climate change is real,” he continued. “That it is impacted by human behavior and carbon emissions. And as a consequence, I think we’ve got an obligation to future generations to do something about it.”

Obama didn’t identify any new policies he might pursue over the next four years. And he seemed to express doubt that a politically fractured Congress could find common ground on climate policy.

“I don’t know what either Democrats or Republicans are prepared to do at this point, because, you know, this is one of those issues that’s not just a partisan issue,” he said. “I also think there are regional differences.”

Still, Obama said he would try to overcome the gridlock in Washington to convince the American people that climate change can be addressed in a way that creates jobs and elevates the United State’s role internationally. But it will take time to “shape an agenda” that makes Americans confident of that success, he said.

“So, you know, you can expect that you’ll hear more from me in the coming months and years about how we can shape an agenda that garners bipartisan support and helps moves this agenda forward,” Obama said.

In the short term, the president plans to meet with scientists, engineers and lawmakers to identify “what more can we do to make short-term progress in reducing carbons.” He wasn’t specific about those potential policies, but he’s hopeful they will make “a serious dent” in climate change.

The opposition: Taxing carbon hikes energy prices

Even as Obama considers his next steps, scientists have issued a new alert about the impacts of rising temperatures on national security. A report released this week by the National Research Council, in response to a request by the U.S. intelligence community in 2010, warns of “climate surprises” that could affect American interests.

“Given the available scientific knowledge of the climate system, it is prudent for security analysts to expect climate surprises in the coming decade, including unexpected and potentially disruptive single events as well as conjunctions of events occurring simultaneously or in sequence, and for them to become progressively more serious and more frequent thereafter, most likely at an accelerating rate,” says the 280-page report.

Two Democratic congressmen wrote a letter yesterday to Rep. Fred Upton (R-Mich.), the chairman of the Energy and Commerce Committee, urging him to hold a hearing on the report’s findings.

“Understanding the complex relationship between global stressors and climate change is of the utmost importance to the future national security of the United States,” said the letter, written by Reps. Henry Waxman (D-Calif.) and Bobby Rush (D-Ill.).

Even as outside groups explore the machinations of a potential carbon tax, the political hurdles to passing a price on emissions threaten to trip up its prospects before it’s proposed. Advertisements flooded the presidential election claiming that Democrats were waging a war on coal. And the oil and gas industry also stands to be disadvantaged under a carbon tax that would benefit emission-free electricity and transportation fuels.

Visions of a ‘cost down the road’

“This election was not about the climate issue, though some would like to suggest that it was,” Jack Gerard, president of the American Petroleum Institute, told reporters yesterday at the IHS World Economic Outlook Conference in Washington. “So to put a carbon tax in now … the signal it sends is we’re going to charge consumers more for their energy. We will discourage the energy companies we’re trying to get to invest to create jobs away from that investment because you just increased significantly the cost of doing business in the United States.”

Obama, meanwhile, said that his emphasis will be on extending the George W. Bush-era tax cuts for all American households earning less than $250,000 a year.

“That should be easy,” he said, before adding that passing a carbon tax “is hard.”

“But it’s important, because one of the things that we don’t always factor in are the costs involved in these natural disasters; we just put them off as something that’s unconnected to our behavior right now,” Obama said. “And I think what — based on the evidence we’re seeing, is that what we do now is going to have an impact and a cost down the road if we don’t do something about it.”