Climate change? Forget it.

Let's stop focusing on a grand energy bill and start solving problems

November 14, 2010

With the November midterms past, scores of Democratic congressmen are preparing themselves to join the other 14.8 million unemployed Americans. This shift poses new challenges, but it also presents new opportunities. Just as striking as what Democrats accomplished in this productive, albeit controversial, legislative session is what they did not accomplish. In particular I am referring to climate change.

If ever there was a time for a sweeping legislative package that tackles carbon emissions to come out of Washington, this was it. With the most liberal U.S. government in decades, we still did not do it.

Now, maybe you think that climate change is a hoax and that we dodged a bullet by dropping the bill, or maybe you think that climate change will kill us all and that the do-nothings in Congress screwed up again. Whatever your views, though, climate change legislation is dead in the water for the foreseeable future.

Now that we've got that of the way, let's solve some problems. What people on both sides of the aisle too often ignore is that climate change is a sum of its parts. We cannot declare a war on the sun to topple a tyrannical atmospheric dictator that is heating us all under its abusive greenhouse regime. Rather, climate change is the result of a series of distinct processes that independently contribute to the steady rise in average global temperatures. So instead of trying to tackle these problems all at once, let's give this "climate change" talk a rest, and break the issues down into a series of actionable steps that have a chance of gaining bipartisan support.

My first proposal is to forget about putting a price on carbon. Instead, let's get rid of our massive subsidies and tax loopholes for fossil fuels. In his last two budget proposals, President Obama tried and failed to close tax loopholes that enable oil companies to move billions of dollars to havens overseas through subsidiary companies. In 2005 the Congressional Budget Office reported that capital investments for oil get taxed at 9 percent, far lower than the overall rate of 25 percent for businesses. They do this in part by transferring profits to other countries while reporting only losses in the U.S., and in part by a series of write-offs that have been ingrained in our tax code since 1913.

In June, the International Energy Agency found that the amount paid around the world to subsidize fossil fuels rose from $342 billion in 2007 to $557 billion in 2008. These massive subsidies and loopholes distort the energy market and artificially lower fuel prices. This protects big oil and big coal from paying the full costs of their dirty emissions. In a time of record federal deficits, cutting these subsidies is not just the environmentally responsible thing to do, it is sound fiscal policy.

Another actionable step is to handle renewable energy as its own issue. The Bush Administration and a Republican Congress passed the Energy Policy Act 2005. Among other things, the bill extended credits for renewable energy investments, created tax incentives for efficiency upgrades and provided billions of research dollars toward advancing emerging technologies. It did not solve our energy problems, and perhaps even exacerbated a few that I mentioned before, but it demonstrates that energy is a bipartisan issue.

It is worth noting that Republicans funded renewable energy by framing it as an energy independence issue rather than a strategy to mitigate climate change. By changing the terms of debate, it is possible to make meaningful progress while avoiding political polarization.

Undoubtedly, passing these measures will be difficult. Fossil fuel companies will say that ending their tax loopholes and cutting their subsidies will inhibit innovation and raise energy prices. To this I say that prices are already too low. Government price supports prevent the market from innovating its way out future energy shortfalls and cripple our nation with debt.

Some will also say that subsidizing renewable energy makes government pick winners and losers, giving too much power to bureaucrats. Energy independence, however, is a national security issue. It is not about picking winners and losers; it is about ensuring that America can meet both its future energy demands and its current demand in the event of an unforeseen crisis.

These are just a couple of examples but they demonstrate the kind of pragmatic approaches that will have to be taken in a two-party future. One of the most immediate victims of climate change is political civility. So please, let's skip the mess and focus on making smart choices.

James S. McGarry is a candidate for a masters in environmental policy at the University of Maryland. His e-mail is jmcgarry@umd.edu.

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