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Climate Change & Jobs

June 28th, 2009

This is not a political blog.

The Waxman-Markey bill (formally, the American Clean Energy and Security Act) passed the House Friday.  This bill effectively sets up a carbon cap-and-trade system, putting a cap on CO2 emissions, and setting up a tradeable permit system whereby those who emit must purchase allowances (and those who can more cheaply reduce their emissions are able to sell their allowances).  Though the bill narrowly passed (and may face a steeper hurdle in the Senate), it is a huge step forward in addressing climate change at the federal level.

Environmentalists (me included) criticize the bill because the limits are set too low, and initially 85% of the allowances will be given away to the biggest emitters.  However, given the narrow margin of victory for the bill, it likely would not have passed if it were any more stringent.  Others (largely, though not entirely, conservatives) criticize the bill because (they argue) it will make the U.S. less competitive, and send jobs overseas, going so far as to say it will “destroy our standard of living” (according to Republican Congressman Lucas from Oklahoma).

In the Wall-Street Journal this weekend (well, at least the online version), the article “House Passes Climate Bill” describes the passage of the bill and some of the criticism surrounding its impact on the economy.  Somewhat ironically, in the June 27 WSJ, the article, “GE Picks Michigan for R&D Center” announces General Electric’s decision to open a facility near Detroit focused on “developing information-technology, clean-energy and transportation products,” and creating 1,200 jobs in the process.  So, I guess climate legislation such as Waxman-Markey will eliminate U.S. jobs… except for those 1,200 being created in Michigan?  Now, obviously, GE’s announcement isn’t a direct result of the House passage of Waxman-Markey.  But I find it doubtful that GE would be setting up such an R&D center if oil was cheap and stable, conventional energy sources were abundant, and we weren’t about to transition to a carbon-constrained economy.

As an aside, I’m all for considering all viewpoints in a debate such as the one surrounding climate-change legislation.  Much of the debate on this bill is regarding the cost.  YES, there will be a cost to climate change mitigation.  However, the cost of doing nothing will be unfathomable – if not for us, then for subsequent generations.  Since the cost of various mitigation measures (and the benefits of those measures) is quite uncertain, it is worthwhile to argue discuss “how much” and “at what cost” we should act.  However, another voice is also (still) present in the debate: those who believe climate change is in no way connected to man’s use of fossil-fuels.  Coincidentally, there’s an opinion piece in the June 26 WSJ, entitled “The Climate Change Climate Change,” in which the author suggests that more and more legitimate scientists are becoming skeptical of global warming.  These people are the fringe, and have no place at the table.  The science is proven – the only remaining question is the degree to which we will alter the climate system.

…I’ve got to stop reading the Wall Street Journal…

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