Wednesday, December 8, 2010

What's the Climate S-CHIP?

I'm not the first to say that the big losers in the Democratic coalition over the last two years are probably the environmentalists.  Well, immigrant advocates, and perhaps labor, might dispute that, but in my view both were fighting a serious uphill battle against strong opposition.  Environmentalists had plenty of opposition, too, but it's certainly possible that a different Democratic president might have chosen climate/energy, rather than health care, as a landmark issue and actually got it done.  As it is, they didn't get nothing, but overall it wasn't a great two years for them.

Where do climate activists go from here?  Brad Plumer says:
Here's a quick sketch of how environmental policy will get made for the next two years. Congress won't pass any new laws. The EPA will try to use the authority it already has to mop up pollution from coal plants, factories, and vehicles (and the agency has a fair bit of existing authority to do so). Industry groups, Republicans, and more than a few Democrats will moan about the costs. And the Obama administration will then have to decide just how much confrontation it can really stomach. Any bets on how this will all play out?
My emphasis; see also Kevin Drum's reaction.

Their concern is centered on EPA, but I want to question the premise, that new law is impossible.  I don't think that's necessarily correct.  After all, the Democratic climate/energy bill in 2009-2010 is a pretty good comp for the Democratic health care initiative in 1993-1994 -- indeed, climate/energy came a lot closer to the president's desk this year than health care did back then.  And certainly comprehensive reform was dead after the 1994 landslide until Democrats won back unified control in 2008.  But only three years later, Bill Clinton signed the S-CHIP program into law.  Moreover, once passed, S-CHIP expansion became a winning electoral issue for Democrats (well, at least everyone acted as if it was a winner for Democrats; it probably didn't actually move votes, but that's not always the important thing).

This suggests to me that it's in fact quite possible that a bill could be possible.  Sooner or later there's going to be another issue that Republicans want enough to cut a policy deal, and environmentalists, it seems to me, are well-positioned within the Democratic Party to claim dibs on a legislative opportunity. 

However, I know next to nothing about the wonkish side environmental policy, so my question is: what's the climate S-CHIP? 

And if there isn't one, yet, then it sure seems to me that climate issue entrepreneurs should start preparing one.  Yes, EPA is an alternate route, and yes, a lot of energy is probably going to be going into defeating GOP plans to cut off EPA or curtail current regulations.  But there's probably some opportunity to go on the offense as well in Congress, and climate activists should be ready for it.


  1. If you think environment interests have fared poorly over the last two years, then you have not been paying attention to the torrent of money that has been directed to energy and transportation research projects, primarily under the Recovery Act. These projects will ultimately help us transition to cleaner and more efficiency energy use and will have a enormous long term impact on the environment.

  2. Thanks a fair call, and I probably should have mentioned that in the post. Still, I think it's fair to say that climate activists are pretty disappointed in the last two years, no?

  3. There's also been a LOT of movement on vehicle emissions standards, and the DOI has done some impressive work stopping/slowing terrible projects. It's not nothin' by any stretch.

    Still, I think it's fair for environmentalists to be disappointed. Politically, we had the trifecta for the first time in over a decade, and a President who even said "Climate comes first". But still, no national energy plan, nothing combating global warming.

    Substantively- well, no national energy plan, nothing combating global warming.

    This is actually a pretty good microcosm of Obama's problem with his base- he's done A LOT, but not as much as they wanted/expected. On Climate, it's not nearly enough to really tackle the problem either, though.

  4. I'm happy to leave it with the EPA for now. As has been pointed out, there's a lot of investment in alternatives right now. And the Supreme Court has ruled that carbon emissions are a pollutant, and can be regulated by the EPA.

    I think we forget just how far down the road we went to not enforcing the environmental regulation we already had -- look at BP's wells -- from 2001 to the end of 2009. It's not necessarily a failure of laws, we've got some great environmental laws, as a failure of enforcement. Starting there, and seeing what we really need seems a fine course.

  5. My version of an environmental S-CHIP would be something like an "energy mortgage," a loan provided by the government to homeowners for energy improvements. My brother just started a solar panel business (installation), and he's had a hard time finding homeowners who can make $20K investment that would pay for itself in twenty years. If the government loaned homeowners the money at low or no interest, and allowed them to tie their "energy mortgage" into their utility bill, so it would be repaid over the life of their mortgage, we'd see a couple of things:

    1. Upfront stimulus for the construction industry that would be fully paid for over a twenty-year period.
    2. Significant reductions in energy consumption.
    3. A way to make people's houses more valuable without encouraging another bubble.

    The typical homeowner (say, me) would be able to borrow $20,000 for energy investments that could save $1,200 year. My payments would be $1,000 a year (or a little more) and I might also be eligible for existing state-funded solar credits. I have an extra $200 yearly in my pocket, which will go up when energy prices rise.

    I could even see Republicans getting behind such a proposal, as it will benefit the upper middle class the most (as they have larger homes), and will likely save taxpayers money by boosting the economy without raising the government's expenditures.

  6. @louis

    Check out PACE programs. They are similar to what you suggest. They've been highlighted by the CEQ and Biden and have gotten off the ground at the state/local level.

  7. I'm sure I first encountered the idea when reading about the PACE programs. However, I think we need a national financing system, and rule changes to allow such financing to take place. For example, according to this article:

    federal mortgage rules halted PACE programs in California, and if we wait for every municipality in the country to navigate the rules we'll be waiting a long time. I would prefer to see loans that are similar to student loans (easy to get, and next to impossible to get rid of), only in this case they could be passed off to the next homeowner as a condition of the sale.

    Politically, I see this as a win for everyone, and given that the government seems uninterested in spending enough money on public infrastructure to make up for the downturn in construction jobs, this plan would be the next best thing.

  8. This suggests to me that it's in fact quite possible that a bill could be possible. Sooner or later there's going to be another issue that Republicans want enough to cut a policy deal, and environmentalists, it seems to me, are well-positioned within the Democratic Party to claim dibs on a legislative opportunity.

  9. Their concern is centered on EPA, but I want to question the premise, that new law is impossible.


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