Will the Budget Battle Become a Climate Battle?

Bill Scher

Budget battles are inherently complex and President Barack Obama’s moreso. A budget encompasses everything government does, so multiple fights on disparate issues can be sparked, making it hard to communicate a simple overarching argument for passage.

And President Obama, not having the luxury of being able to choose policy battles when facing crises on numerous fronts, submitted a budget that doesn’t just provoke fights on budget numbers, but major fights on policy direction: from health care to food.

But it’s possible that the President’s decision to include a carbon cap policy — averting a climate crisis in part by fully charging polluters for polluting public sky — will dominate the budget debate.

Upon the budget’s release, conservatives sought to make President’s Obama “cap-and-trade” policy (in which a limited number of pollution permits are sold to companies, and cleaner companies can sell permits to dirtier ones, allowing flexibility without blowing the caps) the main target.

Led by Newt Gingrich, conservatives are repeatedly calling the plan an “energy tax” that “everyone” will pay. In reality, polluters are the ones who have to finally pay for the cost of polluting public sky, and as Grist’s David Roberts notes, “Obama specifically tied carbon revenues to a payroll tax that would offset the rise in energy costs for the bottom 60 percent of American income earners.”

The White House has opted to not engage conservatives just yet, often deflecting questions more than making point-by-point rebuttals. This has raised concerns on the Left, and criticism on the Right that Obama’s team doesn’t know how to defend it (which, of course, is eminently defensible).

But I suspect this has been deliberate strategy by the White House so the cap-and-trade battle doesn’t not overshadow its attempts to deliver an overarching budget message, which at first has been primarily centered on the long-term savings from health care reform.

And so far, that’s worked.

However, yesterday the Democratic chair of the Senate Budget Committee Kent Conrad told Obama’s budget director Peter Orszag in a public hearing that the budget currently does not have enough votes for passage, in large part because on the carbon cap. The Hill reported:

Sen. Kent Conrad (D-N.D.) said he has spoken to enough colleagues about several different provisions in the budget request to make him think Congress won’t pass it. Conrad urged White House budget director Peter Orszag not to “draw lines in the sand” with lawmakers, most notably on Obama’s plan for a cap-and-trade system to curb carbon emissions … Conrad said that it would be a “distant hope” to expect the climate change plan to pass unless it includes help for industries that would be hit hard by limits on carbon emission production.

Of course, that sure looks like Conrad drawing a line in the sand with the White House.

And if right-leaning Democrats make cap-and-trade an issue, then it will likely be the issue.

Which means it will be imperative for the both the White House and the rest of us to be prepared for the onslaught of misinformation, and explain that:

* Revenue from polluters will be rebated to consumers. largely offsetting the initial higher energy costs.

* The price of dirty energy will intentionally be marginally higher, but we’ll gain the benefit of no longer being at mercy of the oil companies. Clean energy will become more affordable and energy-efficiencies will help us use less energy, making our overall costs more stable and manageable.

* We will create clean energy jobs in the process with green investments, and have a negligible impact on the global economy.

* We will also avert an economically devastating climate crisis.

* Several key Senators nitpicking about the plan claim we need something similar, but are proven to be hypocrites when faced with a real proposal.

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