Climage Politics 101

Well there are a few balls rolling on climate politics. It’s a good problem to have, considering there hasn’t been a ball to speak of in recent memory.

The first to consider is the EPA.  In short, a 2007 Supreme Court case decided that the EPA should regulate greenhouse gases (GHG) if they were found to be toxic. Two years later, in April of this year, the EPA found that not one, but six GHG’s pose threats to environmental and (thus) human health.  After 60 days of public consultation, a final EPA decisions will be delivered.

Now there’s the legislation bit. The cap and trade scheme, outlined extensively elsewhere – including on this blog, is having a tough time getting through congress. While not directly working together, the EPA’s decision probably boosts the likelihood of cap & trade passing. Why? Because the EPA’s progres essentially allows the regulation of GHG’s within existing laws. The Supreme Court carved out a seat for the EPA, a powerful one. Businesses and policymakers like to have seats at that table – they want (at least) a chance to influence. Congresspeople are now more likely to consider a bill to negate existing laws – within which the EPA holds power. This is not to say they want to strip the EPA of it’s authority – but they’d surely like to be part of the decision.

Edward Markey, the co-author of the cap & trade bill in the House, said: “It is no longer a choice between doing a bill or doing nothing. It is now a choice between regulation and legislation”. Indeed, perhaps cap & trade was a non-starter on it’s own. But maybe a little friendly competitino was all we needed to get some serious heads on this.

Most Americans Oppose Farm Subsidies:

The report I’ve been waiting for: The World Public Opinion Organization conducted a poll on public opinion of farm subisidies. Even in farm states, the report found, people are in favor of eliminating subsidies to large farming businesses.

Eighty percent of US subsidies go to large farming businesses, however only 36 percent of Americans favor such subsidies while 61 percent oppose them. Opposition to subsidies for large farms was not substantively or statistically different among Republicans (62%), Democrats (60%), and independents (59%).

Here again views in farm states are not significantly different from the rest of the country. Only minorities approve of providing subsidies on a regular annual basis to small farms (39%) or large farms (13%). 

Seventy-seven percent of Americans do, however, favor providing subsidies to small farms (i.e. farms under 500 acres). Support is highest among Democrats (82%), followed by Republicans (73%) and then Independents (69%). Most small farms do not receive subsidies.

The public in farm states has views of farm subsidies that are little different than residents of non-farm states. In the 17 states that receive the largest amount of farm subsidies, just 35 percent of the public favors subsidies to large farming businesses, compared to 37 percent in non-farm states. There is support for subsidies for small farms in both farm states (79%) and non-farm states (75%).

Americans are also at odds with the way that farm subsidies are provided. Most subsidies are provided on a regular annual basis, independent of whether it was a good year or a bad year for the farmer. However only minorities of Americans think that subsidies should be provided on a regular annual basis, whether for small farms (37%) or large farms (15%).

There are two different realms of implication to consider. One is the alternative (local, organic, etc.)  food market, the other being international food markets. Interestingly, many objectives on both sides of the political aisle align with public opinion. 

On the one hand, the one-sided subsidies negatively impact small farmers, whose smaller scale is disfavored by traditional markets, policies, and infrastructures. In a system geared towards industrial, mass-scale production, smaller farmers need all the help they can get. And this isn’t just some specialty market to be left by the wayside. It is a thriving, growing sector to be taken seriously – and public opinion agrees.

And much to the contrast of local, small scale agriculture lies the international food arena. Many potential trading countries are opposed to trade agreements with the US on the grounds of inequitable agricultural systems. Best exemplified by Mexican corn markets post-NAFTA, it has become clear that the extent to which US agribusiness is bankrolled by the state is prohibitive in many sectors. 

While I’m not one to champion something for it’s free trade agreement (FTA) potential, I always love situations in which seeming opposites agree on the idiocy of the status quo. 

Obama has criticized existing subsidies, to the dismay of the strong farm lobby and it’s cornbelt funders. But this latest study does well to distinguish between monied interests and those of the general public. 

 

 

More on EPA, Climate Debate

I gather that the heart of conservative opposition to energy reform lies in the   fear of job-loss. As the argument goes, if we were to discourage the use of traditional fuels, the impact could be devastating across industries and geographies (within the US).

Scott Segal, director of the Electric Reliability Coordinating Council:

While EPA’s endangerment finding arises in the context of automobile emissions, the finding can have profound consequences for all industry in the United States.  Over 20 different industrial sectors are heavily dependent on traditional fossil fuels, and many more rely upon the products, feedstocks and commodities created by those industries.  The annual benefit of coal use alone has been estimated at more that $1 trillion in gross domestic product (GDP) and nearly 7 million jobs.

If reliance upon coal-fired generation were to diminish by a third as a result of EPA regulatory programs, GDP would be reduced by about $166 billion, household incomes by $64 billion, and employment by 1.2 million jobs.  To the extent green jobs are created, they would come only after severe trauma to the economy and would likely be lower-paying than the manufacturing jobs they displace.

Those in our economy least able to afford it would unfortunately be hurt the worst.  Americans living on fixed incomes, at or near the poverty level, pay a far greater percentage of their monthly income on energy bills.

While his is a reasonable reaction, I take issue with a couple of his points. First, he hardly acknowledges the focus of the EPA. The administration, quite clearly, is not interested in shutting down power plants, slashing GDP, and shipping jobs overseas.

The findings of the report, which comes after all major scientific orgs in the world have reported similarly, necessitate action. The approach is in the interest of transitioning from dirty, polluting, and indeed dangerous energy sources – to cleaner, more responsible, healthier sources. While many might argue that sheer levels of consumption is the culprit, those in power seldom dare suggest consumption cuts, especially in a recession.

So the figures of job loss and GDP reduction are unfounded, treating current sources as the only option, without which the country would crumble.

Segal goes on to comment on the burden placed on “Americans living on fixed incomes”. I’ve heard similar statements elsewhere with little explanation. There are programs in the proposed Cap & Trade scheme to ameliorate disproportionate energy price increases. I’ll look around for more on this, from either viewpoint.

Climate…. Confusion?

Lifted this precious little nugget from George Stephanopoulos’s show, via Grist:

Administrate or Legislate – Who Takes the Lead in Energy Politics?

Two years after the Bush administration ignored unanimous findings of a Supreme Court ordered EPA study on the effects of GHG’s, something is finally being done.The EPA is expected to declare that C02 threaten public health. While not exactly ground-breaking news, this is the first substantive step in the right direction of its kind in quite a while. NYT reports

But regardless of the EPA’s plans, the Obama administration has set forth ambitious plans, including the cap & trade scheme, which would preceed any EPA actionn.  Personally, I much prefer leglislating energy policy than trying to regulate consumption administratively. A combination is likely a wise approach.

The extent to which the EPA will involve itself in energy regulation is yet to be announced. Early speculations, such as the following by Roger Martella – genearl counsel at EPA during Bush – suggest a very prominent role in carbon control:

The proposal, once finalized, will give EPA far more responsibility than addressing climate change. …It effectively will assign E.P.A. broad authority over the use and control of energy, in turn authorizing it to regulate virtually every sector of the economy.

 

 

The Latest on Ethanol Economics

The Congressional Budget Office (CBO) relased a new report on “The Impact of Ethanol Use on Food Prices and Greenhouse-Gas Emmission”. The report found ethanol responsible for only 10-15% of 2007-2008 food price increases – this despite widely accepted claims of much greater impact. According to the Consumer Price Index’s “Rising Energy and Food Prices” report, US food prices increased 5.8 during that period.

Thomas Friedman on Cap & Trade

I tend to follow Thomas Friedman’s column, as he covers environmental issues from a different perspective than most. His latest column is about Obama’s environmental plans, particularly on Cap & Trade. The short post is definitely worth the read. Friedman has access to many players in the game, offering insight seldom found elsewhere.

http://www.nytimes.com/2009/04/08/opinion/08friedman.html?_r=2&ref=opinion

The Ball is Rolling on Ag Subsidy Reform

At least the ball is rolling on farm subsidy reform, though the opposition is mighty.

Obama’s 2010 budget contained cuts to directly-paid subsidies to farms earning more than $500,000 in income. Single, one time payments would be capped at $250,000. The cuts would save a projected $1 billion a year for 10 years.  This from White House statements:

Large farmers are well-positioned to replace those payments with alternate sources of income from emerging markets for environmental services, such as carbon sequestration, renewable energy production and providing clean air, clean water and wildlife habitat…

The Role of “Organic” in a Badly Bruised Food System

It’s gotten hard to keep up with the news on organic, local, healthy foods since Mrs. Obama stuck a shovel in the White House lawn.  Their garden will be organic – though I can’t even imagine all the chemicals used on that property in the past – requiring an assessment of organics’ role in our food system’s future.

New CAFE Standards and Subsidizing Consumption

Obama announced a plan to raise gas mileage standards for 2011 cars to 27.3 mpg, an increase from the 25.3. The small increase isn’t going to save the world, and we can only hope that this is but one of a series of new policies aimed at addressing the problem of our polluting cars.