From the Wonk Room.
On Monday, May 17, MSNBC’s Chris Matthews erupted in anger at the oil disaster unfolding in the Gulf of Mexico. Matthews expressed his rage at the profits BP continues to reap as it fails to fix the growing environmental apocalypse. He also criticized the behavior of the Obama administration, which has let the foreign oil giant control much of the disaster response. Matthews wondered why President Obama doesn’t “nationalize that industry and get the job done” and noted that in the “brutal society” of China, “they execute people for this.”
It is maddening that our government is – everybody says, “Capitalism is great. Unbridled free enterprise is great.” Look at it!
Matthews decried the moral hazard created by privatized profit and socialized risk. Matthews concluded by calling out the “millions of people in the American right” who deny the threats of climate change and other environmental catastrophes from our dependence on fossil fuels:
Millions of people in the American right who sit around and say there’s no such thing as mankind destroying his environment through climate change or whatever – there’s an example of what we’re doing right now. We can destroy our habitat on this planet, and it’s the only one we got.
Rush Limbaugh fired back, saying Matthews is “basically asking for a dictator” with his “delusional, deranged” commentary. Matthews has repeated his criticism of BP and the administration, telling Jay Leno on May 21 that President Obama is acting like “a Vatican observer here.” On May 19, Matthews asked for “Harry Truman to come back and do the job” – making reference to Truman’s seizure of the steel industry in 1952.
I have a hunch that the reason they don’t want to fix this mess down there is because they would admit who did it if they fix it. Nobody is down – if this was a nuclear bomb ready to go off, we would be down there. I am so angry – I don’t even want to talk about it. I get so mad at this oil company. Why aren’t they fixing it, first of all?
You know, I have a suspicion – I will go back to it again – I don’t think they’re doing their best. I don‘t think there’s—the government is doing its best. Why doesn’t the president go in there and nationalize that industry and get the job done for the people? There’s a national interest in this, not just a BP interest. We’re letting BP fix a national problem.
In China, it’s a more brutal society, a more brutal society, Kate, but they execute people for this. Major industrial leaders that commit crimes like this. Failure like this.
This is a serious, serious problem. It is not over. It continues to destroy a part of our planet, basically. Part of our habitat, our American habitat. And everybody just sits and watches television every night and says, “Oh, well, that‘s interesting.” And these guys are still drawing their paychecks, still making their profits. The oil industry has been ballooning in profits this year, and nobody is doing anything about it, except – what are we, the Vatican observers now? We just watch? It is maddening that our government is – everybody says, “Capitalism is great. Unbridled free enterprise is great.” Look at it!
...Millions of people in the American right who sit around and say there’s no such thing as mankind destroying his environment through climate change or whatever, there’s an example of what we’re doing right now. We can destroy our habitat on this planet, and it’s the only one we got.
From the Wonk Room.
Last night, the Wonk Room published a summary of the provisions of the American Power Act, the comprehensive climate and clean energy legislation being introduced today by Sen. John Kerry (D-MA) and Sen. Joe Lieberman (I-CT). This post delves deeper into the legislation’s specific provisions. The following table compares key elements of Obama’s campaign promises from 2007 and 2008, the Waxman-Markey American Clean Energy and Security Act as passed by the House of Representatives, and the elements of the Kerry-Lieberman draft legislation, as based on leaked summaries.
The Kerry-Lieberman legislation has a 15-year transition period that supports state-level renewable and energy efficiency initiatives (which will create millions of jobs), invests in smart transportation, and rebuilds American manufacturing, much like Waxman-Markey, but with new support for nuclear energy and natural gas that reflects the interests of large blocs of senators.
Important scientific elements in Kerry-Lieberman are the rapid mitigation of super-greenhouse gases and black carbon, as well as natural resource adaptation programs. By the end of 2025 the legislation has shifted to resemble the refund-based auctioned-allowance system promoted by President Obama and advocates of cap-and-dividend.
The primary missing information from the summaries is the disposition of the allowances—how they will be distributed to polluters and how rapidly the auctioned pool grows. Details of the scientific review provisions were also not included.
Download the short summary as a readable PDF.
Download the section-by-section summary as a readable PDF.
|Overall Structure||Economy-wide cap and trade, plus renewable electricity and energy efficiency standards and clean energy investment||Utility, industry, and petroleum sector cap and trade starting in 2012, plus renewable electricity and energy efficiency standards and clean energy investment||Utility (2013) and industry (2016) cap and trade with linked refinery cap (2013), plus consumer rebates, support for state-level renewable electricity and energy efficiency standards, and energy investment|
|Emissions Targets||15% below 2005 (at 1990 levels) by 2020, 80% below 2005 (77% below 1990) by 2050||Capped Sectors: 17% below 2005 (3% below 1990) by 2020, 80% below 2005 by 2050
Overall economy goal: 20% below 2005 (7% below 1990) by 2020, 80% below 2005 by 2050
|Capped Sectors: 17% below 2005 by 2020, 80% below 2005 by 2050, plus accelerated mitigation of super-GHGs, black carbon|
|Scientific Review||Not discussed||Presidential plan in 2015 and every four years thereafter||TBA|
|Traditional Coal Plants||“Standards that ban new traditional coal facilities” if necessary, and “cap on carbon will make it uneconomic to site traditional coal facilities and discourage the use of existing inefficient coal facilities”||Price on carbon mitigated by free allocations based 50% on historical emissions; Clean Air Act performance standards in 2016 determined by EPA||Price on carbon mitigated by free allocations based 75% on historical emissions; Clean Air Act performance standards phasing in 2016-2020 determined by statute|
|Green Economy Investment||$150 billion over ten years, including workforce training, plug-in hybrids, renewable electricity, advanced biofuels, advanced coal technology, nuclear power, and smart grid||Approximately $100 billion over ten years, including workforce training, plug-in hybrids, renewable electricity, advanced biofuels, advanced coal technology, nuclear power, and smart grid||$70 billion for clean transportation over ten years, extensive support for nuclear, natural gas vehicles, same support for advanced coal as W-M, and support for renewables|
|Permit Allocation||Full auction||Allocations based on historical emissions and energy production with 20% auction at start, phasing to 70% auction by 2030||Allocations TBA phasing to TBA auction by 2030|
|Renewable & Efficiency Standards||25% renewable electricity by 2025, 100% new building efficiency by 2030, phase out traditional incandescents by 2014||15% renewable electricity + 5% efficiency by 2020, 75% new building efficiency by 2030, appliance and lighting efficiency standards||Support for state-level standards; if national standard based on Bingaman energy bill, weaker than projected business-as-usual|
|Consumer Protection||LIHEAP, low-income weatherization grants, a “dedicated fund to assist low-income Americans,” plus Making Work Pay tax cut||Over first ten years, 45% (approx. $30 billion) of allocated permits and auction revenues dedicated to consumer protection through rebates and efficiency measures, emphasizing low-income consumers||Working families rebate checks from start; Allocated permits dedicated to consumer protection through rebates and efficiency measures; Universal rebate checks from 75% of auction revenues starting in 2026|
|Market Regulation||Increased regulation of energy markets||FERC and CFTC regulation, no over-the-counter derivatives trading, increased regulation of energy markets||Prohibits derivatives, limits permit auction to covered emitters|
|Agriculture and Deforestation||Domestic and international incentives to sequester carbon and reduce deforestation, support for biofuels||Pool of offsets plus supplemental fund of 5% of permits for domestic and international incentives to sequester carbon and reduce deforestation, support for biofuels||Pool of offsets plus supplemental fund for domestic and international incentives to sequester carbon and reduce deforestation, support for rural energy program|
|Deficit Reduction||Not discussed||10% of permits auctioned (approx. $8 billion) over first ten years for deficit reduction||Obeys PAYGO; Starting in 2026, 25% of auction revenues for deficit reduction|
|Fuels and Transportation||Increase biofuels to 60 million gallons by 2030, low-carbon fuel standard of 10% by 2010, 1 million plug‐in hybrid cars by 2025, raise fuel economy standards, smart growth funding, end oil subsidies, promote natural gas drilling, enhanced oil recovery||Smart growth funding, plug-in hybrids, raise fuel economy standards||$7 billion a year for smart growth funding, plug-in hybrids, natural gas vehicles, raise fuel economy standards; offshore drilling with revenue sharing and oil spill veto, natural gas fracking disclosure|
|Cost Containment||International offsets||Offset pool, banking and borrowing flexibility, soft price collar using permit reserve auction at $28 per ton going to 60% above three-year-average market price||“Hard” price collar between $12 and $25 per ton, floor increases at 3%+CPI, ceiling at 5%+CPI, plus permit reserve auction, offsets like W-M|
|Clean Air Act And States||Not discussed||Only polluters above 25,000 tons of carbon dioxide equivalent a year, regional cap and trade suspended until 2017, EPA to set stationary source performance standards in 2016, some Clean Air Act provisions excluded||Only polluters above 25,000 tons of carbon dioxide equivalent a year, regional cap and trade pre-empted, establishes coal-fired plant performance standards, some Clean Air Act provisions excluded|
|International Competitiveness||Tax incentives for domestic auto industry||Free allowances for trade-exposed industries, 2020 carbon tariff on imports from nations without GHG reduction program||Free allowances for trade-exposed industries, carbon tariff on imports from nations without GHG reduction program|
|References: Barack Obama, 2007; Barack Obama, 8/3/08; Pew Center, 6/26/09; leaked drafts of American Power Act, 5/11/10.|
Download the short summary of the American Power Act as a readable PDF.
Download the section-by-section summary as a readable PDF.
From the Wonk Room.
USCG Cmdr. Adm. Thad Allen
There’s enough oil out there it’s logical to assume it will impact the shoreline. The question is when and where.
Allen said that the underwater sea of oil will keep growing until BP is able to cap it, a process that “could go for 45 to 90 days.” If oil continues to flow at current rates for that length of time, that would add up to about 90 million gallons of oil, on the scale of the largest oil spills in history. The winds are expected to shift, directing the spill towards the Mississippi and Alabama coasts over the next 72 to 96 hours. The extended network of floating booms being deployed and dispersants sprayed from C-130s will only mitigate, not stop, the oil’s impact.
Allen led a “2002 planning exercise in New Orleans for an oil spill in the Gulf Coast,” and is applying lessons learned from that exercise today. In 2005, Allen rose to public prominence when the hapless FEMA director Michael Brown asked him to take over the Hurricane Katrina response, a week after the global-warming-fueled storm had made landfall, killed thousands, and left hundreds of thousands of people homeless. It’s a good sign that Allen is being called in this time when this new fossil-industry disaster is just hitting our shores.