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Climate bill shaped by compromise

Facing a mood unfriendly to sweeping changes in energy policy, House Democratic leaders and Obama had one thing that made interest groups more receptive: They were willing to negotiate.

June 28, 2009|Jim Tankersley

WASHINGTON — In mid-spring, when the prospect of a global warming bill passing Congress seemed like an Al Gore pipe dream, President Obama invited Rep. Henry A. Waxman (D-Beverly Hills) down to the Oval Office. "He realized that this was a very tough bill to get through," Waxman remembers.

At a time when some still saw Obama as too inexperienced to adapt to Washington's backroom ways, Waxman found the president perfectly ready to accept the only strategy that offered hope of success: Sitting down with each group affected by the bill and trading concessions for support.

That strategy yielded a narrow victory in the House on Friday. The question was, did Obama, Waxman and other supporters give away so much in the process that the benefits to the environment ended up being slim to none -- especially since the bill now goes to the even less sympathetic Senate?

"There's a point at which you've got to ask yourself, what are we doing here? What's the point?" said Elaine Kamarck of Harvard's Kennedy School of Government, who was a Clinton administration official and advisor to then-Vice President Gore.

So far, most of the major environmental groups are sticking with Obama. Most groups calculated that, in sum, the bill was worth moving, said Emily Figdor, the federal global warming policy director for Environment America.

"We think there's a lot of problems in the bill," she said, but "we need to take that first step. We're so long overdue."

If the bill makes it to the president's desk, said Rep. Edward J. Markey (D-Mass.), the measure's co-author, "we will have fundamentally changed our relationship with energy and how it's generated in this country."

"There is a new political recombinant DNA," he said, "working with business and consumer interests to create a pathway that works for both. This bill demonstrates that."

Even before Obama was inaugurated, Markey and Waxman had begun meeting with industry groups and others to feel them out on the issue.

In addition to farm groups, they talked to oil and natural gas executives, coal producers, officials of manufacturers and others who could face higher energy costs -- which could be passed on to consumers.

The goal of the bill they were drafting, embraced by Obama during the 2008 presidential campaign as one of his top priorities, was to establish government mandates and regulations that would ratchet down U.S. greenhouse gas emissions quickly and dramatically, through a "cap and trade" system of buying and selling emissions permits.

It would set strict energy-efficiency standards and a national requirement for renewable electricity use.

Such sweeping steps would mean potentially costly and unsettling changes throughout the U.S. economy -- changes that would begin at a time when American business leaders are struggling with a recession and an increasingly competitive global economy.

Against that background, Waxman, Markey and Obama's aides found that only one thing made interest groups receptive to them: The Democrats were willing to deal.

That approach is fast becoming an Obama hallmark, a blueprint for the administration's battles over healthcare, financial regulation and the climate bill in the Senate: It is a devotion to compromise, and finding a way to maintain strict discipline among hopeful but anxious liberals.

To attract House Agriculture Committee Chairman Collin C. Peterson (D-Minn.) and other Farm Belt representatives, Waxman and Markey agreed to sweeten the deal for farmers and other biofuel producers.

Then there was coal.

Waxman is an urban liberal, but his energy and commerce committee is stacked with Democrats from districts that produce or consume massive quantities of the No. 1 contributor to global warming. Without those Democratic votes, no climate bill could even clear the committee.

The key question was the cap-and-trade permits. Hundreds of billions of dollars were at stake. Coal and manufacturing groups wanted the permits to be free, at least in the early years.

Obama summoned energy committee Democrats to the White House in early May. He cast climate change and renewable energy as generation-defining issues, invoking President Lincoln and emancipation. He also made it clear he was willing to negotiate.

By the time the committee voted, shortly before Memorial Day, Waxman and Markey had agreed to give free permits to coal-burning utilities, oil refineries, automakers and manufacturers struggling to compete with China and India (and their cheap power and labor).

"That was an essential compromise," Waxman said. "It would be very disruptive to the economy had we not recognized that certain regions of the country were heavily dependent on coal."

Not everyone yielded to the Democrats' blandishments. Several industry groups opposed them, including the U.S. Chamber of Commerce and the American Petroleum Institute.

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