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How Obama and Congress Could Find Common Ground on Energy How Obama and Congress Could Find Common Ground on Energy

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Magazine

THE INHERITANCE: ENERGY

How Obama and Congress Could Find Common Ground on Energy

Despite divided government, the partisan impasse may be about to end on energy policy. The key lies in a grand bargain.

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Sunset for coal? EPA will unveil tough regulations next year.(AP Photo/Charlie Riedel)

In 2008, Barack Obama campaigned for the White House on the promise that he would pass a sweeping energy and climate-change law and move the country from dependence on fossil fuels to clean, renewable energy that reduced carbon pollution and addressed global warming. In his first term, Obama inched in that direction: The president rolled out regulations to reduce pollution from tailpipes and coal plants, and his stimulus program pumped $40 billion into clean-energy development.

But so far, he has failed to enact comprehensive reform. “Cap-and-trade” crashed in the Senate, energy and climate change became partisan fodder in 2012 campaign attack ads, and even minor energy bills stalled in the gridlocked Congress. Meanwhile, the U.S. still depends on fossil fuels for the vast majority of its energy needs, while the latest scientific reports show that the planet is speeding toward a temperature hike of 2 degrees Celsius or more, which scientists say will melt polar ice sheets, rapidly raise sea levels, induce more destructive storms and droughts, and turn vast swaths of land into places where crops cannot grow.

 

So what can Washington do on energy and climate change in the second Obama term? The president says that the problem is urgent—and that solving it is an important component of his legacy. “We want our children to live in an America that isn’t … threatened by the destructive power of a warming planet,” Obama said on election night. And at his postelection press conference, he said, “You’ll hear more from me in the coming months and years about how we can shape an [energy] agenda that gains bipartisan support and helps move this agenda forward.”

Meanwhile, the partisan impasse may be about to end. Quietly, lawmakers and lobbyists say they can envision a grand bargain on energy and climate change—cutting fossil- fuel use and investing in clean energy in exchange for new offshore drilling or approval of the controversial Keystone XL pipeline. The biggest if, and the heaviest lift, will be getting Congress to enact the policy that economists say would do the most to transform the nation’s energy economy: taxing or pricing fossil carbon pollution. A price on carbon, say economists across the ideological spectrum, will increase the price of fossil fuels and decisively drive the free market toward clean energy. Yet any lawmaker who supports the plan could be accused of supporting an energy tax.

Still, a combination of events—including more droughts, floods, and extreme weather like superstorm Sandy—has increased the sense of urgency. The recent explosion in domestic oil and natural-gas production has helped to create jobs and prop up the recovery while bringing together oil companies and the Obama White House in alliances that could pave the way for new agreements on energy policy. And as Washington grapples with the deficit, many in the capital are more open to the carbon tax as a way to raise revenue.

 

CLIMATE CHANGE

Over the past two years, Republican candidates increasingly denied the science of climate change, spurred by fossil-fuel-funded super PACs that attacked members of Congress for expressing belief in climate change and a desire to stop it. But the assault doesn’t seem to have worked. Despite all the money spent by the fossil-fuel industry in this cycle, the president won the election handily and Democrats gained two seats in the Senate. Meanwhile, a “Flat Earth Five” campaign run by the League of Conservation Voters to unseat climate deniers helped to defeat all but one of its targets.

That may be in part because voters are less likely to support candidates who deny global warming. In a September poll, the Yale Project on Climate Change Communication found that Americans’ belief in global warming increased from 57 percent in January 2010 to 70 percent in September 2012. The number of Americans who doubt climate change declined from 20 percent in January 2010 to only 12 percent today. The group also found that 77 percent of Americans say that global warming should be a “very high,” “high,” or “medium” priority, and 88 percent believe the United States should accept the economic costs to reduce global warming.

In the poll, 61 percent said they would vote for a candidate who supports a revenue-neutral carbon tax if it created more U.S. jobs in the renewable-energy and energy-efficiency industries. “Denial doesn’t work for us on climate change, immigration, people loving who they want to love, not on the fiscal cliff,” says Bob Inglis, a former Republican House member from South Carolina who has launched a campaign to build support among conservative voters and lawmakers for a revenue-neutral tax swap. “And that change is soaking into some conservatives.”

Meanwhile, the Obama administration faces a key international deadline on climate change. In 2015, the world’s nations will convene a summit to sign a global treaty requiring major cuts in global-warming pollution. The United States—historically the world’s largest contributor to global warming—will be the linchpin. If successful, the treaty will require other major polluters, including India and China, to cut their carbon output; it could represent a global turning point on climate change. But other nations are unlikely to commit to the treaty unless Washington can deliver on legislation at home. That means, if Obama wants to sign a global treaty in 2015, he must enact meaningful policy domestically beforehand.

 

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