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Robert Reich

Robert Reich

Posted: June 17, 2010 03:06 PM

The Obama Plot for a Carbon Tax

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Teachable moments are rare in America. George Bush missed the chance right after 9/11 to call for a new era of service to the nation; he asked instead that Americans do more shopping.

Tuesday night, President Obama did not call for a tax on carbon. He didn't even ask the Senate to pass the cap and trade legislation that emerged from the House. Instead, he said there were lots of good ideas out there and he's willing to consider any of them -- which seemed more like a way of declaring cap and trade dead.

But maybe the president has a more subtle strategy in mind. Here's what New York Magazine's John Heilemann thinks may be going on:

Lacking the 60 votes necessary for cap-and-trade, the administration plans to get behind a more modest conservation measure in the Senate, then push for a carbon pricing mechanism during the conference committee merger with the House bill -- and do so during a lame-duck session after the midterms, when victorious Democrats will find it easier to make a tough vote and losing ones will be freed of political constraints.


It's plausible. After all, the president has now gotten BP to agree to a $20 billion escrow fund. Maybe the MO of this president is, like Teddy Roosevelt's, to speak softly and carry a big stick -- make nice to adversaries in public and conceal his weapon until he gets them behind closed doors.

But if that's his strategy it's a curious one considering Obama's great gift (on display especially during the 2008 presidential election) to stir the nation and mobilize it behind him.

Furthermore, given the unprecedented power of large corporations to call the shots in Washington, aided by unlimited campaign contributions and platoons of lobbyists, surely the only way to advance the public interest these days is to rally Americans to a cause. Closed-door conference committees, back-room deals, and lame-duck sessions keep the public out. And when the public is shut out, the big guys have even more clout.

Yet hard-boiled Washington hands I talk with disagree. They point to the $80 billion back-room deal that bought off Big Pharma for health care. They claim there's no other way to do business in Washington now because public opinion is too easily manipulated.

They say Machiavellian (more accurately, Emanuelian) deal-making behind closed doors ain't pretty but the public can't be counted on. The only way to get close to a carbon tax or anything else that's good for America is to buy the bums off.

Maybe. But when the bums are paid off the public gets stuck with the tab. We'll be paying far more for our drugs under the new health care law than otherwise because of the deal with Big Pharma.

The $20 billion deal with BP was also crafted in secret, and we have no way to know what assurances were given the oil giant that might cost us later.

So too with the financial reform bill that's now being finalized in conference committee, and with any potential energy bill where the real deals are made in the back room.

Remember the back-room deal that bailed out Wall Street? We still don't have all the details but it's clear the public was taken to the cleaners, and the titans of Wall Street are beaming through their bonuses.

Call me old fashioned but I still think democracy is better than corporatist negotiation. And when we have a president as articulate and thoughtful as the one we now have -- more capable than almost any occupant of the Oval Office in modern times to educate the public about real challenges and real solutions -- he and his advisors do a disservice to the American people when they make the important deals in secret.

This post originally appeared at RobertReich.org
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