Tags: GOP | Obama | Push | Cap-and Trade

GOP Braces for Renewed Obama Push on Cap and Trade

Friday, 16 Jul 2010 01:15 PM

By David A. Patten

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The Obama administration, re-energized by the apparently successful test-capping of the BP oil spill in the Gulf, and its landmark legislative victory on financial reform, is marshalling its forces for one last push to squeeze a cap-and-trade energy bill through Congress.

The president took a cautiously optimistic approach to his comments about the latest efforts to contain the oil spill. Speaking from the Rose Garden Friday morning he acknowledged the outcome remains uncertain.

"But we are making steady progress,” he said, “and I think the American people should take some heart in the fact that we're making progress on this front.”

The House has already passed a version of cap-and-trade legislation. Sources say a less ambitious Senate version could come to the floor within two weeks.

"If not now, when?" Senate Majority Leader Harry Reid told The New York Times. "We have to move to do something about our dependence on foreign oil. That's what this legislation is all about."

The strategy for getting a new bill through the Senate is to pare it down, so that instead of targeting all carbon emissions it would seek to restrict only the carbon pollution coming from power plants.

To help sell the bill to skeptical senators, President Barack Obama will likely try to leverage ongoing public concern about the oil spill in the Gulf.

He took this approach in his June 15 speech from the Oval Office, when he cited the oil spill as urgent proof that Congress must act quickly and overcome what he called "a lack of political courage and candor."

"Today, as we look to the Gulf, we see an entire way of life being threatened by a menacing cloud of black crude," Obama said. "We cannot consign our children to this future. The tragedy unfolding on our coast is the most painful and powerful reminder yet that the time to embrace a clean energy future is now."

If the administration can get even a modest energy bill through the Senate, it would then head to a conference committee where it would be blended with the much stronger version of the legislation already passed by the House.

As long as millions of gallons of oil were bleeding into the Gulf, pivoting to climate-change legislation carried heavy political risks. But analysts expect carbon-pollution legislation to now emerge phoenix-like from the clearing plumes of oil near the Horizon Deepwater wellhead.

The crisis caused by the Gulf oil spill, in other words, is one the administration does not intend to waste.

"I think that's exactly the plan, especially if they're pairing this bill with some sort of penalty for the oil industry in the bill, whether stricter regulation or higher liability caps," Nick Loris, researcher in energy and environmental issues for the Heritage Foundation, tells Newsmax. "If they see members of Congress aren't supporting this bill, they're going to say they're front men for the oil groups."

Democrats are also presenting the new energy bill as somehow relevant to job creation.

"This, as I've indicated, is a huge jobs bill," Reid has said.

Obama has begun to link jobs and green energy with two energy-themed tours in as many weeks. On Thursday he visited a Holland, Mich., firm that makes electric-car batteries. Last week, he gave a speech at Smith Electric Vehicles, located in Kansas City, Mo. He used both trips to tout the economic advantages of renewable energy.

Rather than focus on all sources of carbon pollution, the bill to be submitted now that the BP oil spill appears to be coming under control will seek to limit carbon emissions from power plants only. Electric utilities are responsible for approximately one-third of carbon emissions produced in the United States.

The question is whether the administration can muster support for even a reduced carbon-tax bill in the waning months before the midterm elections.

Although three Republican senators – Scott Brown of Massachusetts and Olympia Snowe and Susan Collins of Maine – broke ranks with the GOP over financial regulatory reform Thursday, but sources tell Newsmax Republican senators have religiously stuck to the party line over carbon taxes due to their impact on the economy.

"They've been very united when it comes to energy regulation," Loris says. "This is an energy tax, and they know that with the November elections coming up, they know that rushing this legislation through Congress is not going to happen."

It is also an open question how many Democrats will support the Senate proposal. Democrats from coal-producing states, many of which have already been hit hard by the struggling economy, have joined together under the "Brown Dog Democrats" banner to defend their states' interests.

Politico.com has identified the following Democratic senators who are reluctant to vote for any legislation that would diminish the demand for coal:

Sens. Claire McCaskill of Missouri, Blanche Lincoln and Sen. Mark Pryor of Arkansas,  Byron Dorgan and Kent Conrad of North Dakota, Sherrod Brown of Ohio, Jim Webb of Virginia and John D. Rockefeller of West Virginia.

Senators from coal producing regions, especially those up for re-election in November, will be very skittish about putting their names to any legislation that could reduce the demand for coal or hurt their local economies.

Also, Republicans plan to question whether the benefit of restricting power-plant emissions would be worth the spike in the cost of all forms of energy that some analysts believe would result.

"We're talking huge economic costs for very little, if any, gain," Loris tells Newsmax.

The Heritage Foundation has cited studies showing that an across-the-board carbon-tax on all emissions would only reduce global temperatures by one-tenth of one degree Celsius by the end of the century.

Democrats are expected to introduce their more modest energy bill in the Senate the week of July 26.

"It's going to raise the price of energy across the board," Loris adds. "It's going to raise gasoline prices, and worst of all it's not going to make a lick of difference in terms of climate effects."

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