Stunning Climate Double-Talk From McCain Campaign

We've heard climate double talk from McCain on "mandates" and "dependence on foreign energy sources." Now, in a stunning interview with E&E News (subs. req'd), the McCain campaign seriously undermines its claim that the Arizona Senator could successfully take on the global warming threat.

As the reporter put it, "the Arizona senator's presidential campaign is trying to differentiate itself from its Democratic rivals by rejecting calls for additional climate-themed restrictions." This, however, is a potentially fatal difference.

I don't know which of three statements by "Douglas Holtz-Eakin, a McCain campaign policy adviser" is more wrong-headed.

1. "The basic idea is if you go with a cap and trade and do it right with appropriate implementation, you don't need technology-specific and sectoral policies that are on the books and that others are proposing simultaneously."

This statement could not be more inaccurate and naive. A cap & trade system without on aggressive technology development/deployment effort, especially in the transportation sector, will inevitably fail because it causes too much economic pain, as I explained at length in "No Climate For Old Men." And now we get the explicit statement that McCain opposes "technology-specific and sectoral policies that are on the books" if we have a cap & trade.

Does anybody who cares about climate change really think we are pushing clean technologies and clean transportation too hard? Other than Sen. McCain's campaign, that is -- we've already seen that McCain does not support renewable technology tax credits that have been "on the book" for years even before we have a cap & trade. This is an especially jaw-dropping statement given that even the delayers themselves have been saying we need a bigger clean tech push for years.

2. Holtz-Eakin ... questioned the candidates' [Obama's and Clinton's] calls for a new federal low carbon fuel limit, stronger fuel economy standards and policies to reduce U.S. oil consumption. Cap and trade, Holtz-Eakin said, is the ideal solution by itself.... Asked if this position meant McCain would block implementation of new corporate average fuel economy requirements that President Bush signed into law last December, Holtz-Eakin replied, "He's not proposing to eliminate those. He simply wants to check as time goes on if they become completely irrelevant. You might want to take them off the books [!!!], but we're not there yet."

He cannot be serious. We might "want to take [fuel economy standards] off the books" because a cap & trade system might render them irrelevant? Uhh, no. Let's go through this again.

In the Energy Information Administration's own analysis of using a cap & trade system to reduce U.S. emissions -- a very flawed study, but one that is a good economic model of McCain's strategy, since it doesn't capture technology deployment strategies or fuel economy standards -- the price of carbon hits politically impossible levels, $348 per metric ton, which, in the EIA analysis, doubles the price for electricity. But that price for carbon would raise gasoline prices by under a dollar a gallon and thus would not have much impact on average US fuel economy or the success of alternative fuels (much as the recent price jump from $2 a gallon to $3 didn't). Long before the carbon price hit that level, businesses and consumers would demand the price be capped, or the program shut down entirely ending the U.S. effort to stop catastrophic global warming.

3. "You don't need redundant policies that interfere with the flexibility that is the key to meeting these desirable goals at low costs...." Pressed to explain what beyond a cap-and-trade program would be needed, Holtz-Eakin replied, "He wants to see the use of nukes. The ultimate policy proposal will be designed to make sure that's true."

The hypocrisy is staggering. "Redundant policies" that push renewables or efficiency would interfere with flexibility that supposedly keeps costs low. Indeed, we can even take existing clean tech policies off the books once we have a cap & trade. But ramming expensive nuclear power plants down the public's throat -- that's fine.

Note, the nonpartisan Keystone report "Nuclear Power Joint Fact-Finding," from June 2007, found nuclear "power isn't cheap: 8.3 to 11.1 cents per kilo-watt hour." And as a study by Cambridge Energy Research Associates (CERA) found, nuclear power plant costs have soared in the last couple of years. And, of course, nuclear power has a major supply bottleneck, that will inevitably drive up costs for any country that wants to rapidly accelerate the construction of nuclear power plants.

The fact that this guy is a former director of the Congressional Budget Office means, of course, he is an economist, which is perhaps all you need to know about him. The fact he is acting as a senior advisor and surrogate for McCain is a very bad sign. Holtz-Eakin could easily end up as the head of McCain's Council Economic Advisers, National Economic Council, or, scariest of all, the Office of Management and Budget -- where he could (further) cripple clean tech programs for years to come (beyond the damage the Bush administration has already done).

This was one of the central points from my long analysis, "No Climate for Old Men": McCain would appoint all the wrong people to key positions, and they would undermine or block the key policies needed to tackle warming cost effectively. This stunning interview confirms my worst fears.

Here is the whole article:

McCain adviser questions Democrats' push for more than cap and trade

John McCain bucks the traditional Repandublican establishment with his support for cap-and-trade legislation, but the Arizona senator's presidential campaign is trying to differentiate itself from its Democratic rivals by rejecting calls for additional climate-themed restrictions.

"The basic idea is if you go with a cap and trade and do it right with appropriate implementation, you don't need technology-specific and sectoral policies that are on the books and that others are proposing simultaneously," Douglas Holtz-Eakin, a McCain campaign policy adviser, said in an interview yesterday.

Holtz-Eakin, a former director of the Congressional Budget Office, dismissed the presidential campaign platforms of McCain's two remaining Democratic rivals, Sens. Barack Obama of Illinois and Hillary Rodham Clinton of New York. Specifically, he questioned the candidates' calls for a new federal low carbon fuel limit, stronger fuel economy standards and policies to reduce U.S. oil consumption.

Cap and trade, Holtz-Eakin said, is the ideal solution by itself. "You don't need redundant policies that interfere with the flexibility that is the key to meeting these desirable goals at low costs," he said.

Asked if this position meant McCain would block implementation of new corporate average fuel economy requirements that President Bush signed into law last December, Holtz-Eakin replied, "He's not proposing to eliminate those. He simply wants to check as time goes on if they become completely irrelevant. You might want to take them off the books, but we're not there yet."

Both Clinton and Obama support setting up a mandatory cap-and-trade program to reduce U.S. heat-trapping greenhouse gas emissions 80 percent by midcentury. They are also identical in backing a 100 percent auction of the emission credits.

Unlike McCain, the two Democratic candidates would push their climate regulations beyond cap and trade.

Clinton, for example, would increase fuel efficiency standards to 55 miles per gallon by 2030 and cut foreign oil imports by two-thirds from 2030 projected levels. Obama says he would double fuel economy standards within 18 years and supports a federal low carbon fuel standard requiring suppliers to reduce the carbon their fuel emits by 10 percent by 2020.

Campaign aides for both Clinton and Obama did not return calls or e-mails requesting comment about the McCain adviser's efforts to contrast the candidates.

But their surrogates did defend the push for even broader climate policies beyond cap and trade during a panel discussion last week in Santa Barbara, Calif., hosted by the Wall Street Journal.

"He appreciates the problem of climate change is unlike anything we've ever faced before," Obama climate adviser Jason Grumet said. "It's going to require a kind of social commitment along the lines we've not seen in this country since World War II."

Added Gene Sperling, a Clinton adviser, "It can't be an all-or-nothing proposition. Senator Clinton has a lot of proposals about what you can do as the executive from day one going forward."

No position on Lieberman-Warner

McCain also is not wedded to the cap-and-trade bill he introduced in January 2007 with Sen. Joe Lieberman (I-Conn.) that seeks to cut U.S. emissions 60 percent below 1990 levels by 2050. "When he introduced that bill, the floor statement was pretty clear that this was an ongoing process," Holtz-Eakin said. "He wasn't so much committed to the bill as to an issue."

Several climate proposals have been introduced in Congress since Lieberman and McCain teamed up, including a more stringent Lieberman proposal that includes Sen. John Warner (R-Va.) as the lead co-sponsor. "The Lieberman-Warner is a good bill," Holtz-Eakin said of the legislation due on the Senate floor this June. "It's not his intention to suggest anything different."

But Holtz-Eakin said that does not mean McCain will be a guaranteed "yes" vote.

"We don't take positions on Senate legislation given it will change," he said. "He's going to realistically need to have time to study the bill. It's premature."

Turning to some cap-and-trade specifics, McCain does have concerns about the idea of using a complete 100 percent auction for emission credits. While McCain's views remain static on the topic, Holtz-Eakin said the Arizona Republican wants to make sure allowance distribution takes into account international competition for U.S. businesses and also how to distribute costs across the economy.

McCain also continues to support growth in nuclear power. Pressed to explain what beyond a cap-and-trade program would be needed, Holtz-Eakin replied, "He wants to see the use of nukes. The ultimate policy proposal will be designed to make sure that's true."
Post-Kyoto deadlines

McCain is planning several environmentally themed speeches later this year as the general election campaign picks up steam -- though no firm dates have been set.

The four-term senator also is trying to brandish his foreign policy credentials this week with visits to Iraq, Israel and Europe.

McCain, Lieberman and Sen. Lindsey Graham (R-S.C.) visited British Prime Minister Gordon Brown in London yesterday to talk about a number of issues, including international climate negotiations aimed at getting a new treaty that can succeed the Kyoto Protocol.

"I am convinced that if we work at it, we will be able to convince India and China that it is in their interest to be part of a global agreement to reduce greenhouse gas emissions," McCain told reporters outside Brown's 10 Downing Street office. "I believe that we can achieve a global agreement."

Keeping the focus on climate negotiations, McCain also visited with Stavros Dimas, the top European Commission climate official. And echoing aides to Obama and Clinton, Holtz-Eakin acknowledged that McCain is considering sending staff to the annual U.N. climate conference this December in Poznan, Poland, if he wins the election.

"We have certainly contemplated it," Holtz-Eakin said.

Climate negotiators have given themselves a 2009 deadline for completing a new post-Kyoto agreement -- a schedule some see as difficult to meet given the time it will take for a new U.S. president to get his or her staff and policies in place.

Asked to comment on the post-Kyoto deadline, Holtz-Eakin replied, "Saying anything very definitive about meeting a target that is 11 months into the first term when you don't have any control in between is really hard. We'll certainly be interested in moving this process forward as quick as possible."