Senator Lieberman: Industrys Bag Man on Climate Change

John Passacantando

Climate Progress is happy to introduce John Passacantando as a new guest blogger. John is one of the top climate activists of the decade, having recently stepped down as Greenpeace USA’s executive director. You can read about his legacy (so far) here. I have known John for a long time, and he is not one to pull punches, as you’ll see. Welcome, John!

Why do crooks rob banks? Because “that’s where the money is,” according to the infamous 20th century bank robber, Willie Sutton. Today’s cash source for crooks is not the banks, but the American public. With every new revelation of million dollar bonuses and payoffs to big corporations, Americans feel like it’s the bankers who are robbing us blind.

Just in case the financial loss wasn’t distressing enough, some members of Congress are now supporting plans that would give big energy companies the next round of publicly financed bailouts, in the name of combating global warming. The leader of this approach is that perennial friend of corporate welfare: Senator Joe Lieberman.

Here’s the background: To reign in climate change we must limit the amount of carbon entering our economy from the oil, coal and gas industry. Capping carbon encourages users to conserve by making the cost of using it more expensive. President Obama promised to implement a carbon cap. This carbon cap is regulated by selling pollution permits to producers and importers for the amount of carbon they bring into the economy.

Those permit sales amount to trillions of dollars over the life of the program. The money received from the permit system can be spent in different ways. It can be largely handed back to the American people, which is what President Obama is advocating in his proposed budget. This would ease the financial burden for American families who are hit with higher energy costs.

The other way the money can be spent is by sending it to different industries, interest groups and even foreign countries. The theory behind this concept is to try and put the money into good causes – even drive some of the climate solutions that we need, like developing new energy efficient technology.

The problem with the latter approach is explained in a recent report released by The Center for Public Integrity. The report explains that “more than 770 companies and interest groups hired an estimated 2,340 lobbyists to influence federal policy on climate change in the past year [2008]… an increase of more than 300 percent in the number of lobbyists on climate change in just five years, and means that Washington can now boast more than four climate lobbyists for every member of Congress.”

I ran Greenpeace US from 2000 – 2008, I know about thirty of those lobbyists are from environmental groups who are pushing for various ways to genuinely solve climate change. That leaves 2,310 others who are primarily interested in one thing: scooping up the loot.

So now the giant money grab fest is on. Duke Energy, General Motors, Shell, Excelon, Conoco Phillips, Chrysler, BP and many more want us to give them the carbon permits. Free. These corporations argue that they will pass the savings along, helping out real folks. We are talking about utilities and oil companies here. The last believer in benevolent CEO’s is probably Jim Cramer in his Mad Money World.

The President’s budget director, Peter Orszag, said that giving away permits would be “the largest corporate welfare program that has ever been enacted in the history of the United States.” While the American people could use a bailout, we do not need a welfare program for energy companies.

Enter corporate bag man, Senator Joe Lieberman. Sen. Lieberman is assigned to feint concern for the little guy, while attempting to deliver trillions of dollars worth of public assets to these companies. Consider what he told the Washington Post last week:

The 25-member U.S. Climate Action Partnership, that includes major corporations and a handful of environmental groups, has its own plan that would give away 40 percent of allowances to local coal-intensive utilities that would then keep rates low. How fast those allowances would be phased out is something on which the group cannot agree.

[JR: See also “NRDC and EDF endorse the weak, coal-friendly, rip-offset-heavy USCAP climate plan“.]

That approach has the support of Sen. Joseph I. Lieberman (I-Conn.), co-sponsor of three earlier cap-and-trade bills that failed to win Senate approval. Lieberman plans to form a bipartisan group of senators with Sen. John McCain (R-Ariz.), who co-sponsored two of those earlier measures.

“I see myself as a coalition builder,” Lieberman said. “I don’t think you can have a 100 percent auction. For fairness and the political viability of a proposal, we have to give assistance to the industries most affected by the major change we’re proposing.”

[JR: McCain’s vote may well ultimately be needed to pass a climate bill, but the 2008 campaign showed McCain “is not serious about clean energy and he has increasingly walked away from the global warming issue.” Giving away the store beforehand is simply a losing negotiating strategy.]

When the big energy CEOs start talking about looking out for us, we grab our wallets. When Sen.Lieberman talks, you hold your wallet even tighter. He has repeatedly tried to deliver boondoggle global warming legislation, directing cash to all sorts of corporate constituencies. Lieberman has consistently built his efforts around greenhouse gas emission reductions that wouldn’t do enough to solve the problem.

For a generation, some of our largest corporations paid flacks to deny mainstream science and convince the public that global warming wasn’t happening. Fully documented at Major papers — like The New York Times and The Washington Post — dutifully reported the industry’s manufactured debate. Policy bogged down. Now, the stalling is over. We’re going to get real climate legislation. Of course, the big corporate company line shifts to meet the needs of this new day. What are they saying? It’s like something out of a bad 22nd century Western — Give us your money, or we kill the planet. If they don’t get the public’s cash, they say they won’t support cutting greenhouse gases, plain and simple.

Climate change cannot be solved by paying off utilities or major corporations. Sure, AIG wants bonuses and Duke Energy wants free pollution credits. However, we the people get to say “no.” We need a plan that supports the little guy financially, while also taking steps to save the planet.

We need Congress to reject this next round of corporate giveaways, and support a plan that returns the auction money to the American people, like President Obama’s budget proposes.

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21 Responses to Senator Lieberman: Industrys Bag Man on Climate Change

  1. Why don’t you propose a straightforward carbon tax? All these giveaway and lobbying pressure would evaporate, because, contrary to cap and trade, the tax rule is clear and simple. This is the price of a tough political choice.

  2. Joe says:

    I don’t understand why the carbon tax people think that there would all of a sudden not be any giveaways and lobbying pressure.

    You apparently are unaware of the history of the BTU tax.

    Various industries would demand exceptions to the tax or a share of the revenues or a phasing in period.

    And yes, industries would demand the right to purchase offsets rather than pay the tax.

    These are industries with tens of billions of dollars in revenue — they don’t just roll over because you think you have done an end run around them with a tax.

    Why do you think the tax code is so unbelievably complicated? Money talks.

  3. Rick C says:

    The only difference between cap and trade and taxing carbon is that James Hanson accurately labeled cap and trade as tax and trade correctly calling it a tax on the public disquised as a market trading mechanism. So why don’t we just tax it and deposit the money directly into peoples’ bank accounts. That way there is a deterrent against using fossil fuels excessively and they can keep what they save if they drive a more efficient vehicle, insulate their homes or stop using their cars altogether in favor of mass transit, walking or biking to work.

  4. Rick–that is exactly what most of us are proposing–term of art at the moment is ‘cap and dividend,’ and it’s where Obama seems to be leaning. Lieberman wants to spread the dividend to the polluters.

    John–excellent excellent summary! keep writing, man!

  5. Brendan says:

    Sweden instituted a carbon tax in 1991, but many industries are only required to pay 50% of the tax. Ironically, after the tax was but into effect, many companies saw their energy related tax burden go down.

  6. We’re seeing the same arguments in Australia by mining companies and other polluters who are striving to defeat a proposed emissions trading scheme:,23739,25205281-3102,00.html

  7. Harrier says:

    Lieberman is not to be trusted. He’s a simpering, two-faced snake who takes every pain to worm his way into the good graces of whichever interests can grant him power, and more importantly, attention. He can sometimes be useful, if you know how to wield him properly, but he should not be granted anything like a leadership position in the upcoming climate change debate. He’ll scuttle in for his own sycophantic ends.

  8. lgcarey says:

    C’mon, Harrier, tell us what you really think of Liberman. Can’t say I disagree with that rather blunt assessment, though.

  9. Harrier says:

    As an Obama supporter from the start, I’ll not soon forget the way Lieberman stabbed him in the back, even appearing at the Republican National Convention. He’s been meek and obedient since Obama granted him clemency, but his previous behavior still means that he’s not to be trusted. I’ll certainly not trust him to be the point man on such a crucial issue as climate change.

  10. Obvious solution:

    Go ahead and cap and t-raid. Give it a try

    But when CO2 concentrations touch 390ppm then heavy carbon taxes must start.

    When CO2 reaches 400ppm then taxes should double,

    When CO2 reaches 410ppm then triple.

    It’s not the calendar, it’s the concentration.

  11. Harrier says:

    Bah, of course it would be Evan Bayh spearheading a Senate equivalent of the Blue Dogs.

  12. hapa says:

    “Global street outraged as US takes 7 Gt carbon bonus after leading world into bankruptcy”

    The carbon intensity scandal is the most underreported story of 2008.

  13. bernardo says:

    Does it bode badly for the climate policy that will emanate from Obama’s EPA that David McIntosh, Lieberman’s former “lead legislative author on global warming issues”, has become “senior legislative adviser to U.S. EPA Administrator Lisa Jackson.”

    BNA notes that McIntosh “helped write the Lieberman-Warner-Boxer climate change bill.” Ironically, “an energy industry representative said that David McIntosh, . . . would be likely to play a major role on climate policy and implementation if either Obama or McCain won.

    Perhaps the the policy emanating from Lieberman while McIntosh handled climate matters for him is understandable considering that McIntosh joined Lieberman after spending five years with the utterly corrupt NRDC.
    (Re citation of “utterly corrupt NRDC”, well that’s just my viewpoint and I couldn’t link to a perfect cite for that.)

    It will be intriguing to see how whatever climate policy emanates from the Obama administration will substantively differ from what Lieberman et. al. have been pushing for years, which I though was quite contemptible and corrupt from the days that Lieberman was partnering with Chafee on legislation dubbed “early action”.

  14. crf says:

    I think the argument would more powerful if the author wouldn’t try to guess at Lieberman’s motivations.

    Also it’s “feign concern”.

  15. Gail says:

    crf, as a fan of “Eats, Shoots, and Leaves” I was tempted to make that correction myself but luckily looked it up and, like the preferred inflection of “under duress” which I once argued with a Brahmin friend and should have known better, I was proved wrong. Feint works as a verb with an object.

  16. Gail says:

    ps Nothing makes me crazier than people who can’t make the distinction between affect and effect. Oh god just thinking about it oh STOP!

  17. James Newberry says:

    US Climate Reduce Action Partnership – US CRAP

  18. Joe, you are right, I am not aware of the BTU history and I don’t know the US tax code. Are you progressive enough to read about something experienced in France?
    The fossil fuel tax (TIPP) is applied on every products at the output of the refinery. So it is paid by the customers of the refinery and the refinery owes the tax amount to the government.
    With this simple system, the tax is included in the price of all these fuel products, whatever the transformations made by the industries in the downwards cycle of economy.
    So the basic rule is the same tax paid, whatever the various uses of the products. OK, there are some giveaways: ie agriculture uses a specific fuel with a very low tax that was designed after WWII to encourage mechanisation and tractors, but this is an exception and that should change according to the target of huge CO2 cuts.
    Joe, my point is, a tax on fossil fuel is very easy to manage and by nature, it is quite lobbying pressure free.

  19. CTF says:

    A tax is straightforward, transparent and is called what it is: a tax.

  20. To Bill Mc Kibben, sorry to disagree with you (I am a 350 supporter), but your statement is misleading. First, you support Rick statement that clearly describes the Tax and Dividend and then you state that the up do date solution is Cap and dividend. These 2 solutions are not equivalent at all, this is the purpose of this thread.
    May I suggest to the readers to follow the thread about activists in Copenhague against Cap and trade. Their message is absolutly powerful:
    This is a perfect summary of the problem we face. Our Climate is our problem, it will not be solved by the indusrty alone, specially if we individuals are not invoved in it. As Steven Stoft clearly demonstrates Cap and trade discards the individual efforts of CO2 reduction, because their result is transformed in CO2 allocations available on the market, decreasing the cost of the permits and then being bought and used (not saved) anyway.
    Our Climate is our business, we have to face it.
    (Notre climat c’est nos oignons).