Blog Post

Climate in the Second Inaugural: Don't Get Too Excited

Jan 23, 2013 | Clayton Munnings, Nathan Richardson

During Monday’s inauguration, President Obama once again acknowledged the threat of climate change and linked the transition to sustainable energy with economic opportunity. The front page of the New York Times claims the President’s aides plan to “build public support and head off political opposition,” with regulations from the Environmental Protection Agency for emissions from coal-burning power plants as their centerpiece policy. There is much excitement that the President is doubling down on climate action.

Yet nothing has really changed. Sure, it’s nice to hear the President publicly mention the issue, but his approach seems unchanged from his first term. Over that time U.S. emissions fell and commitments were made. But the reductions were largely due to secular trends in energy and the economy, and the Copenhagen commitments remain unfulfilled. EPA rules for power plants are important and can bend the emissions curve, but they’ve long been promised. So, what is there to be excited about?

During his first term, the President offered little help beyond rhetoric for a cap-and-trade bill even though economists widely believe carbon pricing is the most effective way to address climate change. Instead, members of the House of Representatives spent valuable political capital passing a bill virtually without assistance from the White House. This legislation would have traded away most of EPA’s existing authority over carbon emissions—the same authority the President and EPA are set to use in the coming term.

By focusing on EPA regulations, is the President once again foregoing an opportunity to lead on climate by pricing carbon? Or is he just facing the reality of Congressional obstruction and leading on climate with the only tool over which he has control?

Which view is correct depends greatly on the President’s choice of EPA administrator, and how that administrator will design the EPA’s new emissions regulations. Under outgoing administrator Lisa Jackson, President Obama’s EPA built a  framework for regulating carbon emissions. So far, this framework has survived legal challenges—in fact, EPA is legally bound by a settlement agreement with states and environmental groups to issue regulations. Looking forward, the most important decision for EPA is on regulations for existing power plants. An ambitious approach, like that recently advocated by the Natural Resources Defense Council carries high legal risk but might give large emissions reductions (up to 25%—though as Michael Levi points out, even this is not much more than reductions already predicted based on current trends). Or EPA could play it safe, both in terms of its emissions goals and innovation in regulatory tools (read: less flexibility). Intermediate approaches, like making the more legally-risky parts of the program severable, are also available (and are our preference).

But it looks increasingly like the President’s new EPA administrator will take a safe, minimalist approach. To understand why, look back at his first term. At the beginning of his Presidency, Mr. Obama’s priority list was, roughly: 1) fix the recession, 2) pass a health care bill, and 3) pass a climate bill. When push came to shove, the President spent political capital on health care, not climate, despite the fact a climate bill had already passed and a health care bill hadn’t been introduced. In retrospect, it appears there was only time and political space for two major pieces of legislation in the Obama presidency: the stimulus package and the health care bill. Since the 2010 midterm elections returned a divided Congress, no significant legislation has been possible. If that remains true, it doesn’t matter much what Mr. Obama’s priorities are. But if there are opportunities, either now or in two years, those priorities are crucial.

The address makes it clear that climate is back on the agenda, but it’s not clear that it’s any higher-priority than under his first term. Tax reform/fiscal issues, immigration, and gun control all appear to be at least as prominent. Will the President prioritize bold, smart action from EPA, or real support for legislation creating a carbon price? Maybe.

But the most politically expedient approach is minimalist EPA action while blaming Congress for not doing more on climate, even if that’s an over-simplification. This saves time and political capital for other issues. Getting meaningful climate policy through Congress will be incredibly difficult. It might be impossible in any case, but it certainly will be without strong Presidential leadership. The President’s speech is therefore exciting only if it’s a signal that, unlike in his first term, he intends to make that commitment. However much climate hawks enjoyed the President’s speech yesterday, there was nothing concrete to reassure them climate is not once again a low priority relative to other issues. Words are welcome, but political action is what matters.

A side note: if your biggest political issue is tax, immigration, or gun law reform, you probably find talk of presidential action on climate annoying, and “climate people” baying for priority probably sound greedy. Either secretly or openly, you hope your issue is prioritized over climate. Many climate policy advocates undoubtedly feel the same way about those issues. But it’s completely unreasonable that a President can only address one or two policy priorities in a term. That’s a product of Congressional sclerosis and partisan division which, it’s true, Mr. Obama has been unable to break in the last two years. Here’s hoping that changes, though I confess we’re not optimistic.