Cap and Trade in Senate Limbo as Obama Makes All-Out Push on Health Care (original) (raw)

President Obama's energy and global warming agenda stands at a major crossroads as lawmakers return today from their monthlong summer break amid an all-out push to pass health care legislation.

Senate Democrats originally intended to roll out their version of a cap-and-trade climate bill this week, but they have since delayed that schedule until later this month in part because of the brewing battle over health care.

Gone is the immediacy for action on global warming, and there is even talk that passing a climate bill this year has faded to third place on the administration's agenda behind financial reform legislation that responds to last year's Wall Street meltdown.

Asked last week about prospects for the Senate climate bill, White House spokesman Robert Gibbs changed the subject and instead predicted a "major push" from Obama and Congress to pass a bill that heads off any future financial crisis.

"I think that will be a very important part of the legislative agenda moving forward in the fall in strong hopes that by the end of the year we have new rules of the road going forward so that something like this doesn't happen under the same circumstances again," Gibbs told reporters Aug. 31.

Yet significant questions remain about just how much success can be had on financial reform, let alone the health care bill that gets center stage tomorrow night when Obama delivers a nationally televised speech before a joint session of Congress.

All sides of the global warming debate will be watching Obama close to see if their issue even merits a mention.

"If I were betting, he'll probably slip in a line about climate change," said Jeff Holmstead, a former U.S. EPA air pollution chief for President George W. Bush. "Because there'll be some people who are core constituents who will want to see that. The political calculus is the president will need to show he's still interested."

Democrats have been juggling health care and climate change since Obama took office. Earlier this year, House Speaker Nancy Pelosi (D-Calif.) and White House chief of staff Rahm Emanuel agreed to take on both issues simultaneously, which helped result in a House-passed climate bill just before the July 4 recess.

But many moderate Democrats complained about that strategy, and sources tracking the debate say Obama's political advisers are now in agreement that the climate issue now belongs on the back burner.

Several Capitol Hill aides said last week that they were confused about their mission -- especially as they continue to get a push to act by some Obama Cabinet members and White House energy adviser Carol Browner.

"It seems like there's a little bit of a gap somewhere," said one Democratic staffer who is working on the climate bill.

U.S. EPA Administrator Lisa Jackson said last week that she did not have a problem with Congress putting its emphasis this fall on health care.

"Certainly, the Senate rightfully is spending an awful lot of time looking at that issue," Jackson said in an appearance Thursday on NPR's "The Diane Rehm Show." "Clean energy is no less important. But rightfully, they want to finish their work on health care.

"All along, we've understood that for something on the order of clean energy, but also health care, they probably needed to be done in sequence," Jackson added.

Environmentalists insist that Democrats and the White House should keep pushing for a climate bill given scientific warnings about irreversible global warming, as well as mounting international pressure headed into U.N. negotiations this December in Copenhagen.

"Congress is capable of and staffed to do more than two important things at once," said David Doniger, policy director of the Natural Resources Defense Council's climate center.

But Manik Roy of the Pew Center on Global Climate Change said that Obama and Congress need to resolve health care before anything else can get traction.

"They can't disengage on health care," Roy said. "Win, lose or draw, they have to see it through. And only once that has played out can we turn to other issues."

EPA chief 'not concerned yet'

All that said, climate change legislation remains on the radar for some important committees and lawmakers.

The Senate Agriculture Committee holds a hearing tomorrow on the regulation of carbon markets, with a panel of witnesses dedicated to the views of farmers and agriculture groups. The House Select Committee on Energy Independence and Global Warming also plans a hearing Thursday with Obama's State Department climate envoy, Todd Stern, on preparations for the summit in Copenhagen, Denmark.

And later today, Senate Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) and Foreign Relations Chairman John Kerry (D-Mass.) are scheduled to meet for the first time in person since the recess -- with an eye on mapping out the legislative road ahead.

The senators gave several reasons last week for why they delayed release of their legislation: Kerry's hip surgery, the death of Sen. Ted Kennedy (D-Mass.) and ongoing action in the Finance Committee to pass health care legislation.

Boxer and Kerry said they would use the extra time to "work on the final details of our bill, and to reach out to colleagues and important stakeholders."

Senate Majority Leader Harry Reid (D-Nev.) has scratched a Sept. 28 deadline that he had originally set out for work to be done on the climate bill in the EPW Committee and five other panels.

Reid spokesman Jim Manley said there is no new deadline for the committees to finish their work, only a call to pass climate legislation "as quickly as possible."

"They are working diligently to craft a well-balanced bill, and Senator Reid fully expects the Senate to have ample time to consider this comprehensive clean energy and climate legislation before the end of the year," Manley said.

Senate Democrats have twice this year pushed back their schedule for acting on a climate bill. Boxer had told reporters during the House climate debate that she would introduce a bill before the August recess. But she punted on that goal shortly after the 219-212 House vote.

Reid and other Senate Democratic leaders have also publicly acknowledged they are shy of the 60 votes needed to pass a bill -- with some of the pushback coming from within their own caucus.

Off Capitol Hill, perspectives vary on the significance of the latest Senate schedule change.

"I'm not concerned yet," EPA's Jackson said on NPR. "I think the delay announced this week is understandable. It is a piece of legislation that's very complex. ... I just think it needs a little bit more time."

"You can introduce a losing bill anytime you want," added Jeremy Symons, vice president of the National Wildlife Federation. "Introducing a winning bill, however, needs to be done at the right time after the right consultations. So the new schedule doesn't change the fact that all signs are pointing to Senate action this fall."

By contrast, EPW Committee ranking member James Inhofe (R-Okla.) predicted the climate bill's demise as Democrats battle amongst themselves over a costly new program.

"The delay is emblematic of the division and disarray in the Democratic party over cap-and-trade and health care legislation, both of which are big government schemes for which the public has expressed overwhelming opposition," Inhofe said.

Seeking cover for Copenhagen

Absent additional progress on Capitol Hill, Obama will need to turn to other aspects of his environmental agenda as he prepares for the U.N. climate negotiations. Sources tracking the issue say the administration has several obvious choices, starting with the clean energy components included in the $787 billion economic stimulus package.

Also coming soon: U.S. EPA rules to control greenhouse gas emissions from motor vehicles and power plants -- regulations that are more than a decade in the making and premised on the 2007 Supreme Court decision in Massachusetts v. EPA.

"You can take a big bite out of the U.S. global warming pollution under the existing law," Doniger said, who added that it would not be too difficult to quantify the emission reductions from combining the new federal rules.

Obama's diplomatic portfolio also may get a boost when he visits China in November as administration officials work behind the scenes to reach a bilateral agreement on global warming with Beijing.

Sen. Maria Cantwell (D-Wash.), touring China last week, told reporters she would put "higher odds" on a bilateral agreement than she would on a deal in Copenhagen, or on the Senate passing a climate bill.

"If you are producing 40 percent of emissions -- which is what China and the United States are together -- what a legacy, and what a great relationship you could create by saying that's what these two great countries stepped up to do," Cantwell said, according to Reuters.

EPA's Jackson said Obama would also prefer action by the Senate on cap-and-trade legislation before Copenhagen. But she also indicated that a law was not necessary.

"What we need to do is also keep our eye on the president's position," Jackson said. "Climate discussions have been part of the agenda on clean energy from the very beginning."

Most environmental groups would prefer a new U.S. cap-and-trade law before Copenhagen. But there is also significant apprehension that a losing vote in the Senate could be a huge blow to the international talks given the stock already placed in the United States returning to the negotiation table after eight years battling President George W. Bush.

"The real issue is showing progress and momentum," Doniger said. So while it is better if Obama has more concrete actions, Doniger explained that "a bad vote probably hurts the most."

He added, "And there's a lot of space in between."

Leave it to Reid

Boxer's Environment and Public Works Committee remains a key battleground as the climate debate advances. But there is now no clear timetable for when she will mark up a bill.

To date, Boxer has revealed a select number of details about what her bill will look like. She has said she is interested in setting a 20 percent limit on greenhouse gases for 2020 -- a more aggressive level than the House bill. And Boxer is also under pressure from environmental groups to keep EPA's authority for regulating power plant emissions -- something the House legislation surrendered.

From the other direction, Boxer before the August break said she would yield to an industry-driven demand for some type of price collar on greenhouse gas allowances.

Still, without legislative text, many different conclusions are being drawn about the direction Boxer wants to take the climate debate.

"On the issues most important to environmentalists, they'll go to the left," Holmstead said. "And on issues more important to business, she'll go to the right. People are interpreting that in different ways."

Andrew Wheeler, former Republican staff director for the Environment and Public Works Committee, said Boxer will need to make some tough decisions in the weeks and months ahead.

"You can't make it better for both sides," he said. "Somebody has to be told it's not getting better for you."

There are also number of unresolved issues still ahead.

Boxer and Finance Chairman Max Baucus (D-Mont.), for example, remain at loggerheads over who writes the allocation of hundreds of billions of dollars in emission allowances.

Reid is expected to play a key role in resolving the committee dispute, as well as other battles over nuclear power, international trade with developing countries and agriculture.

So with plenty of time still to go, few are showing all of their cards.

"This is at least a three-stage process," said Roy. "There's the EPW process. There's the majority leader's process. And there's what happens on the floor. People are planning with each of these events in mind."

Senate schedule: The Agriculture Committee hearing is tomorrow at 10 a.m. in 216 Hart.

Witnesses: Gary Gensler, chairman, U.S. Commodities Futures Trading Commission; Timothy Profeta, director, Nicholas Institute for Environmental Policy Solutions, Duke University; Joseph Glace, vice president for risk management and chief risk officer, Exelon Corp.; Dave Miller, chief science officer, Iowa Farm Bureau; Julie Winkler, managing director, research and product development, CME Group, also a member of the board of directors for the Green Exchange LLC; Fred Yoder, former president, National Corn Growers Association; Luke Brubaker, Brubaker Farms in Myerstown, Pa.; Frank Rehermann, chairman, USA Rice Producers' Group; Andy Beckstoffer, chairman and CEO, Beckstoffer Vineyards, Rutherford, Calif.

House schedule: The Select Committee on Energy Independence and Global Warming hearing is Thursday, Sept. 10, at 9:30 a.m. Room TBA.

Witness: Todd Stern, State Department climate envoy.