Climate Progress

I was at a small meeting on peak oil Friday — Executive Summary:  We’re peaking now!

James Kunstler, author of The Long Emergency, was there.  He is in the Mad Max/Lovelock/Wall-E school of dystopia, and so I have a number of disagreements with him (see “Why I don’t agree with James Kunstler about peak oil and the “end of suburbia“).

He did, however, say one thing that really strike a chord.  He said we should stop calling Americans “consumers.”  It pigeonholes all Americans and also becomes a self-fulfilling prophecy.

That seems to me a reasonable point, and I will endeavor to make a change.  Indeed, I had previously blogged that the U.S. savings rate was on the rise, it looks like U.S. carbon dioxide emissions peaked in 2007, President Obama was making a big ush toward making America a nation of creators as opposed to consumers, and I asked “Is the U.S. consumption binge over?”

The figure above is from the NYT business blog, Economix, which has a longer-term, glass-is-half-empty perspective in a post titled, “Savings Rates Rising Toward Mediocrity“:

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Some have asked whether I’m using too-tough language against those devoted to delaying or blocking action needed to stop catastrophic global warming.  Actually, most of the time I think it is too mild, a point underscored by a terrific NYT column from Nobel-Prize-winning economist Paul Krugman, “Betraying the Planet.”

Krugman’s writing on climate has gotten increasingly blunt (see Nobelist Krugman takes on the “fantasists” of the “burn-baby-burn crowd” for opposing climate action that costs Americans 18 cents a day.  And his blog, “The Conscience of a Liberal,” is becoming a must-read for those interested in seeing the record set straight on climate economics.

As an aside, the times this blog gets bluntest are when I think about how future generations will speak about us if we fail to spend the tiny amount of our vast wealth needed to prevent their decades and centuries of incalculable misery — see “Intro to climate economics: Why even strong climate action has such a low total cost — one tenth of a penny on the dollar.”  They won’t be calling us “The Greatest Generation.”  They will be cursing our name as “The Greediest Generation,” as the Bernie Madoffs of the global Ponzi scheme we created to enrich ourselves unsustainably at their expense.

Today’s column by Krugman takes that perspective, and I’m reprinting it below, with annotation:

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Denial makes strange bedfellows.

Two of the leading sources of anti-scientific disinformation on global warming — George Will and Anthony Watts’ blog WattsUpWithThat — have embraced a man, Robert Bradley, who proudly shilled for Enron CEO Ken Lay, who was convicted on fraud and conspiracy charges in 2006.

Watts and I, you may recall, got into a tiny dustup a couple weeks ago (see Exclusive: New NSIDC director Serreze explains the “death spiral” of Arctic ice, brushes off the “breathtaking ignorance” of blogs like WattsUpWithThat and here).   Since then, Watts has been throwing everything at me including the kitchen stink, with four full posts attacking me this month.  I was planning to ignore him, until two things happened.

First, Watts ran a truly nonsensical piece (here) by Bradley, who is now President of the Institute for Energy Research, which “has received $307,000 from ExxonMobil since 1998.”  Bradley is one of the Denier-Industrial-Complex Kooks (DICKs) — see, for instance, “Mysterious industry front-group affiliated with Ken Lay’s former speechwriter launches anti-Waxman-Markey ads with phony MIT cost figures.”

Second, George Will published a piece, “Tilting at Green Windmills” in which he uses a discredited Spanish “study” to claim clean energy investments don’t create jobs (for debunking by CP and the Regional Minister of Innovation, Enterprise and Employment for the Government of Navarre, see here and here and here).  Will’s piece is noteworthy for this remarkable admission:

[This] study was supported by a like-minded U.S. think tank (the Institute for Energy Research, for which this columnist has given a paid speech.

That’s right, George Will published an entire piece based on disinformation bought and paid for by a think tank that is bought and paid for by ExxonMobil and run by Ken Lay’s former top shill — and Will also took money from that think tank. At least editorial page editor Fred Hiatt required that much in return for letting Will publish his umpteenth article full of misleading and inaccurate statements.

Now you may say, wait a minute, Joe, sure Bradley served as Director of Public Policy Analysis at Enron, where he was a speechwriter for CEO Kenneth Lay,” who was “convicted on fraud and conspiracy charges on May 25, 2006″ — but how can you say he proudly shilled for Lay when he has wiped any trace of his connection to Enron from his IER bio here?

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The House GOP loves to repeat falsehoods about climate and clean energy action (see “MIT Professor tells GOP to stop ‘misrepresenting’ his work and inflating the cost to families of cap-and-trade by a factor of 10” and then again three weeks later, MIT Professor says GOP “misrepresentation” of his April 2007 study to project costs for Waxman-Markey is “inappropriate,” “silly” and “just wrong”).

If you are listening to the House floor debate over the “rule” that will set the terms of the debate for Waxman-Markey, then you’ve heard pretty much every Republican repeat the claim that the Congressional Budget Office found that W-M would add $.77 a gallon to the price of gasoline in the next decade.

That charge is false.  It comes from the American Petroleum Institute, (see here) which decided to ignore the actual CBO analysis and offer its own instead, claiming it is what CBO found.  The API is a strong opponent of the bill and has been pushing disinformation on global warming for more than a decade.

As a study by 5 national laboratories noted in1998, “$50 per tonne of carbon [$14 a tonne of carbon dioxide] corresponds to 12.5 cents per gallon of gasoline.”

To cause a $.77 increase in gasoline prices, the climate bill would have to result in greenhouse gas allowance prices of some $85 a ton of CO2. Now you can go to Table 3 of the CBO analysis yourself, and you’ll see that CBO estimates the allowance price will hit $26 a ton in 2019 – and that is in actual (not inflation-adjusted) dollars.  In 2008 dollars, that would be closer to $21 to $22.  So in fact the CBO estimates that gasoline prices in 2019 would be about 20 cents a gallon higher than today (in constant dollars). And that’s a lot lower than the price will rise if we don’t take strong action to jumpstart the transition to a cleaner, more efficient energy system.

In fact, CBO found, “Waxman-Markey cuts U.S. GHGs sharply but costs only a postage stamp a day — without counting the efficiency savings.”

The EPA has posted its detailed analysis of the American Clean Energy and Security Act (H.R. 2454) here.  The bottom line is that the total cost to consumers is low, just as CBO found — just as all major independent analyses of even strong action show (see “”Intro to climate economics“).  You can read the House Energy and Commerce summary of the EPA analysis here.  In this post from Wonk Room, guest blogger, Daniel J. Weiss, Director of Climate Strategy at the Center for American Progress Action Fund, discusses the EPA’s findings.  At the end, I discuss a few flaws in the analysis, as well as the implications of Waxman-Markey for coal.

The main argument conservatives and big oil and coal companies use against the American Clean Energy and Security Act (H.R. 2454) is that it would cripple American households with a crushing energy tax. To make that claim, they have distorted cost estimates from the Massachusetts Institute of Technology and conducted their own biased studies. Today, the Environmental Protection Agency obliterated these phony numbers with the release of its economic analysis of H.R. 2454. The EPA estimated the bill would actually lower household electricity bills:

As a result of energy efficiency measures, consumer spending on utility bills would be roughly 7% lower in 2020 as a result of the legislation.

That’s right — lower bills. In 2007, this would have saved the average residential user $84, or 23 cents per day. EPA’s analysis also found:

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Nobel prize-winning NYT columnist Paul Krugman has been doing some terrific writing on the economics of climate action (see Climate action “now might actually help the economy recover from its current slump” by giving “businesses a reason to invest in new equipment and facilities” and “Krugman strongly endorses Waxman-Markey“).

Now he writes on Friday’s important CBO study, which found a “cost to households of Waxman-Markey in 2020 at $22 billion — which, given a projected population of 335 million, comes to 18 cents a day.  [We've been using the household figure of 48 cents a day.]  He ends his column titled, “Climate change fantasies“:

The point is that we need to be clear about who are the realists and who are the fantasists here. The realists are actually the climate activists, who understand that if you give people in a market economy the right incentives they will make big changes in their energy use and environmental impact. The fantasists are the burn-baby-burn crowd who hate the idea of using government for good, and therefore insist that doing the right thing is economically impossible.

From a fellow climate realist — Hear!  Hear!

As clean energy and climate legislation moves through Congress, new data show that a $150 billion investment in clean energy — which the bill would achieve in its first 10 years — could create a net increase of 1.7 million American jobs and significantly lower the national unemployment rate. According to the analysis, shifting to a clean-energy economy will help millions of low-income Americans by creating more accessible job opportunities ─ with the potential for advancement ─ and by lowering utility bills and transportation costs.

Two complementary reports ─ prepared by the Political Economy Research Institute at the University of Massachusetts, Amherst (PERI), Center for American Progress (CAP), Green For All, and the Natural Resources Defense Council (NRDC) ─ outline how investment in a clean-energy economy will produce significant economic and job creation benefits. These include the generation of roughly three times more jobs than would be generated by the same investment in the existing fossil fuel infrastructure.

“Jobs are the cornerstone of any economic recovery, and these reports show that investing in the clean-energy economy will create 1.7 million new jobs across the country as well as cut America’s contribution to global warming and reduce our dependence on foreign oil,” said John Podesta, President of the Center for American Progress.

“The Economic Benefits of Investing in Clean Energy: How the Economic Stimulus Program and New Legislation Can Boost U.S. Economic Growth and Employment” from PERI and CAP explains how the combination of the American Recovery and Reinvestment Act (ARRA) and the American Clean Energy and Security Act (ACES) could serve as the foundation for bringing total clean-energy investments in the United States to approximately $150 billion per year. This public spending and private investment would produce a net gain of 1.7 million new jobs.

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The Heritage Foundation, the leading think tank of the conservative stagnation, is also a leading source of disinformation on climate science and economics (see “Heritage pushes ‘completely untrue’ attack on clean-energy jobs with a panel bought and paid for by dirty energy“).  They are so retrograde that they even oppose energy efficiency.  The Center for American Progress’s Daniel Sanchez has an update.

Last Friday Rep. Darrell Issa (R-CA) published an editorial in Politico criticizing the current House climate and energy bill. He claimed that it would increase energy costs and “kill approximately 1.1 million jobs by 2035.” Issa based this projection solely on a flawed study by the Heritage Foundation that is at best incomplete and at worst a distraction during this most critical period of debate. This is simply one in a series of distortions of the American Clean Energy and Security Act (ACES) by the right aimed at deceiving the American people and frightening them with cooked numbers, incomplete analysis, and selective economic models which bear little connection to reality.

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Climate legislation is a necessity for the agricultural sector to survive and thrive (see “Eight reasons for farmers to support global warming action“).  Yet many farmers mistakenly think that their sector would suffer from strong efforts to promote clean energy and reduce greenhouse gas emissions — no doubt because bill sponsors have not done a great job explaining things.  So I’m reprinting this post from WonkRoom. I have previously blogged on the new Brookings study and how it fails to model key features of Waxman-Markey that would reduce costs (see “New Brookings finds strong climate action would NOT hurt the economy“). Yet, “even without the inclusion of an offset program to allow the agriculture sector to benefit from carbon market, their analysis found the impact on agriculture to be minimal”:

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Less than a postage stamp a day.  That’s what it will cost the average American to cut US greenhouse gases 83% in four decades and give the world a chance of avoiding catastrophic global warming while jumpstarting the transition to a clean energy economy.

The right wing likes to take economic analyses that don’t model the House clean energy and climate bill and then misrepresent the results to attack the bill — see, for instance, Exclusive: MIT Professor says GOP, Weekly Standard “misrepresentation” of his April 2007 study to project costs for Waxman-Markey is “inappropriate,” “silly” and “just wrong.”

The latest hit job is by The Washington Times, which abuses a new study by Brookings in a piece whose headline is exactly backwards, “Study: Cap and trade would hurt economy.”  You can see for yourself the devastating economic harm that Brookings projects strong climate policy would cause:

Yes, you need a magnifying glass to find any impact on GDP growth for decades.

Now, Brookings could not be clearer that the study doesn’t model Waxman-Markey.  Note the very first bullet point of its presentation on the study Monday (here):

Not an analysis of particular bills.

The study models a variety of scenarios, centered around a 20% cut in U.S. energy-related carbon dioxide emissions by 2020, 40% by 2040, and 83% by 2050

But it doesn’t look at the various clean energy provisions in the bill (or in the stimulus, for that matter).  It doesn’t model any of the cost containment provisions of the bill.  It just looks at brute-force emissions reductions over time similar to what Obama and Waxman-Markey propose.  And that’s probably why Brookings predicts a rather absurdly high price for CO2 permits in 2020 — $50 a ton, which is double CBO’s projection and triple EPA’s!

Even so, as the Brookings graph above shows that the bill’s impact on the economy is negligible — and Brookings assumes no offsets whatsoever.  The 83% reduction by 2050 is achieved through domestic emissions reductions and with no noticeable economic impact.

But how does The Washington Times spin this as harmful to the economy?  Here is their lede paragraph:

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