The Lieberman-Warner Conundrum

Recently, a debate among environmental advocates over global warming strategy has spilled out into the public arena, apparently triggered by signals from Senator Barbara Boxer (D-Ca), chair of the Environment and Public Works Committee, that she will try to move a bill to address global warming this year.

(For more details, see this recent story in the LA Times.)

The bill in question, the bipartisan Lieberman-Warner Climate Security Act, would ratchet down U.S. emissions by something on the order of 70 percent by the year 2050.

This it would do by establishing a cap and trade program, one in which most of the initial allowances or pollution permits would be given for free to industry, although the percentage of giveaways would decline considerably over time.

For environmental groups like Greenpeace and Friends of the Earth, the problem with this legislation is at least twofold:

1) not even 70 percent reductions by 2050 will be enough to save the planet;

2) the emissions permits are gonna be worth a whole lot of money, meaning giving them away to polluters is a huge sloppy kiss to the people who caused the global warming problem in the first place. (Think ExxonMobil.)

So instead, groups like Friends of the Earth want to see stronger emissions cuts, on the order of 80 percent by 2050–which is what Hillary Clinton and Barack Obama are calling for–and they want a 100 percent public auction of the initial allowances, with the funds raised then used for a variety of investments in clean energy.

But for more compromise-oriented environmental groups like Environmental Defense, there's a different calculus in play.

They want a workable bill that can pass Congress sooner rather than later, so that finally we set a price on carbon dioxide emissions and get out of the current tragedy of the commons situation, in which nobody pays to pollute the atmosphere. Moreover, they fear that an idealized 100 percent auction will outrage industry and lose its support for legislative action–and if industry goes, so do its congressional allies.

But here the debate takes another turn, because the environmentalists who don't want to see anything happen this year seem to be banking on the idea that the U.S. Congress we'll have in 2009–to say nothing of the new president–will be more inclined towards strong climate action. So why strive to pass a bill right now, in an election year?

Having considered all this, I have to say, I agree with bits from both camps. Let's see:

  1. Who cares whether the bill we pass now cuts domestic emissions by 65 or 70 or 80 percent by 2050? The difference is not going to save the planet on its own, not when we also have to worry about what nations like India and China end up doing. Moreover, once we get a bill in place we will have literally four decades to strengthen it, even as we watch non-carbon energy sources proliferate and become cheaper.
  2. A 100 percent auction would be really, really nice. It is the right thing to do, without a doubt. But the people I've been talking to in Washington think this is just a nonstarter, and will continue to be one well past 2009. According to an analysis (PDF) by Friends of the Earth, the current Lieberman-Warner bill gives away 79 percent of the initial pollution permits at first, but gradually decreases that to 31 percent in 2050. Perhaps in 2009 we could get a bill that's stronger, where the respective percentages have moved to, say, 60-40 giveaways versus auctioned permits. I don't know. But I really question whether we can afford to hold out for 100-0.
  3. However, I do think the political “climate” will be better for a climate bill in 2009, especially in light of the way things are shaping up politically right now. We're going to have a presidential race between John McCain and either Hillary Clinton or Barack Obama. Any of them would be better on global warming than George W. Bush; and any of them would be more likely to sign a serious climate bill into law. And as for changes in Congress–given the current momentum for global warming action, it is hard for me to see how we would get a new set of reps who are less inclined towards action than the current ones. In fact, congressional climate bad guy number one–Oklahoma Senator James Inhofe–may even be gone in 2009.

Where does all this lead? Well, it seems to me that a compromise position is possible, as long as you trust Senator Barbara Boxer and her Democratic colleagues in Congress.

After all, it sure looks to me like Boxer is testing the waters, to determine whether a strong bill can really pass this year. If it can't, she's said she won't try it. If it can, she's said she will.

And in light of the foregoing facts, isn't that the best of both worlds?

By going forward this year and seeing what happens, Congressional Democrats will gain valuable political knowledge about how (or how not to) get a greenhouse gas bill passed–who will vote for it, who won't, and what kind of compromises will be necessary to get legislation enacted. And, as long as they really won't settle for something too weak, where's the harm in that?

Then again, it all depends on whether you trust Congressional Democrats.


Thanks for your post. You make a lot of good points. You’re right that Congress may not be so different in 2009, and if we can pass a strong bill now we should. Moreover, the longer we wait, the more costly it will be to do what we all know we need to do. Waiting just two years doubles the annual cuts in emissions we’d have to make to get to the same place by 2020. We posted a detailed analysis of the price of delay on the Environmental Defense blog Climate 411:

Sheryl Canter
Environmental Defense

Inevitably a weaker bill passed this year will become an argument against a stronger one next year. I think that outweighs the benefits of passing a weaker bill this year.

It’s unfortunate, but government tends to work in increments. It would be best if government did what was needed immediately, but it just isn’t a reality. Therefore, better to pass this bill now and make improvements to it in the near future. It’s better than getting nothing done at all.

“…better to pass this bill now and make improvements to it in the near future.”

Exactly. As Chris says, we’ll have four decades to make improvements. An important strength of the CSA bill is its short-term targets, which are more aggressive than any other bill before Congress. That’s crucial - we must start as quickly and aggressively as possible.

Long-term targets can be strengthened as we go, and that happens frequently with bills. We also did a post on this:

Sheryl Canter
Environmental Defense

Three or four years of delay in getting a stronger bill passed will far outweigh the difference between this year and next year. Remember that the present bill will confer economic rights that the recipients will then act on. I find it hard to take seriously the idea that it wouldn’t be at least very difficult to partially or completely retract those rights just one year after they were conferred.

Indeed, political considerations aside, would not taking away those rights (to emit CO2, remember) amount to a taking? I can’t see why not.

I would be interested to hear how ED proposes to address this problem, though.

What Chris said about the Environmental Defense position is correct. We need to get started now - we cannot wait - and our immediate cuts need to be as aggressive as possible. That’s the “prime directive”, as they say in Star Trek. If we stall waiting for the perfect bill, we’ll be much worse off.

Sheryl Canter
Environmental Defense

The message seems to be that you’ll approve of pretty much any bill. IMHO that’s a pretty bad mistake in this case. If the Dems put forward a clear minimim standard for what they find acceptable in a bill, hopefully ED won’t press them to compromise even more (since of course their opening position will already be a substantial compromise relative to the need).

I’ve read various press accounts that the big emitters want a deal this year because they’ll ger a worse one (from their POV) next year. ED’s position seems especially blindered in light of those. Of course the emitters will also be looking for a bill that is as much of a poison pill as possible with regard to future stronger legislation. Is ED effectively assisting them in achieving that goal?

Everytime I hear the phrase Stop Global Climate Change I ask the speaker if possible the following question: How will we know when we’ve stopped it?. It rarely gets answered with any rational words.

I am firm believer in knowing where you are going before you begin the trip. John A. Warden III, a strategy expert wrote this piece about just that: Thinking Strategically About Global Climate Change. It is a provocative perspective that really makes one think about what everyone is trying to get all of us to do about Global Climate Change.