National Review: Senator Empirical - Bob Corker takes on climate change

We thought the following piece, included in the May 19 edition of the National Review, would be of interest to you.

National Review: Senator Empirical - Bob Corker takes on climate change.
May 19, 2008
By Ramesh Ponnuru
(c) 2008 by National Review, Inc., 215 Lexington Avenue, New York, NY 10016. Reprinted by permission.

There's a question Republican senator Bob Corker likes to ask at town meetings when he is home in Tennessee. "I ask people to raise their hands if they know anything about 'cap and trade.' I'm lucky if I get a hand go up," he says. "But this is going to affect people hugely in their daily lives."

The Senate is scheduled to debate a "cap and trade" bill in June. It would fight global warming by setting a limit on the emission of greenhouse gases, such as carbon dioxide. That's the cap. Companies that got their emissions below their limit would be able to sell the excess emission rights to other companies. That's the trade. The theory is that the companies that could most cheaply reduce their emissions would have an incentive to do so. We would get the most emissions reduction possible for the smallest hit to the economy. "It's a market-based approach," says Democratic senator Joe Lieberman, who is sponsoring the legislation with Republican John Warner.

By June, Corker hopes, both his fellow senators and the public will know a lot more about cap and trade. He is becoming a leading critic of the bill -- and he may be the most effective one in the Senate.

Junior senators rarely play a major role on important legislation. Corker was elected only in 2006. (He was the only new Republican senator elected that year.) Corker had been a CFO for the state, a successful real-estate executive, and the mayor of Chattanooga when he jumped into the race for the seat Bill Frist was giving up. He was not considered particularly ideological. Two congressmen ran to his right in the Republican primary, bringing up, for example, that Corker used to be pro-choice. The congressmen split the conservative vote and Corker had more money, so he won. In the general election the Democrats nominated Rep. Harold Ford, a smart moderate who gave Corker a tough race.

Since winning, Corker has turned out to be more conservative than people expected, particularly on the economic issues that most concern him. Earlier this year, almost all of his colleagues voted for a stimulus bill and a housing bill. Corker, moved by the quaint theory that such bills ought to stimulate the economy and help the housing market, voted no.

Corker is the most pleasant surprise conservatives have had in the Senate since Georgian Paul Coverdell served from 1993 to 2000. Conservatives assumed that Coverdell would be a moderate, but he turned out to be a hard-working champion of free-market health care and school choice until his untimely death. Corker is also hard-working, which goes farther in the Senate than you might think.

Early on, Corker decided that global warming was one of the top economic issues he would consider during his career. Unlike many other conservatives, he does not deny that the globe is warming. Nor does he spend time on the debate over how much of that warming is man-made. (That debate is something of a distraction: Even if sunspots have caused the warming, it might pose risks that we have to do something about.) He does not even say that he opposes cap and trade. He presents himself as merely raising concerns about the current version of it. He wants a "more informed conversation" about the bill, so as to get "a better product."

That may sound like weak opposition. But the concerns he is highlighting could prove deadly to the bill. By abandoning his party's weakest ground, the insistence that warming isn't happening, he has enabled himself to take on the weakest points on the other side.

He can get a hearing that other Republicans cannot. He recently met with the editors of the Tennessean, the newspaper where Al Gore used to work. The meeting resulted in an editorial reiterating the newspaper's belief that action must be taken, but also saying that the costs of this action should be kept within reason -- and commending Senator Corker's efforts on the issue. Other newspapers in the state have also praised him. The Republican party, too, is moving in Corker's direction. When he talks to his Republican colleagues, he says, "I don't hear the 'hoax' word any more."

Most senators do not know much about global-warming policy. Senator McCain, for example, is an enthusiastic proponent of cap and trade. He sees it as an alternative to a carbon tax that would raise the price of gasoline, which he wants to lower. Actually, cap and trade would raise the price of gasoline too, and quite significantly, as oil companies passed along the legislation's costs to consumers.

Most economists, whether they favor cap and trade or not, see it as very similar to a carbon tax in its effects. The major difference is political. Senators know that voters would rebel against a direct increase in energy taxes. Cap and trade is an elaborately disguised version of the same thing. In addition, cap and trade would create more pressure groups with a financial interest in the government's policy.

Even former senator Phil Gramm, one of McCain's top economic advisers and a very smart man, does not see how similar cap and trade is to a carbon tax. While campaigning with McCain in New Hampshire, he told me that he does not support cap and trade, but prefers it to a carbon tax because it wouldn't raise money for the federal government. Actually, cap and trade would raise money for Washington, because it would be auctioning off many of the permits to emit greenhouse gases.

If you accept the estimates that Lieberman and Warner use for the cost of these permits, around $13 per ton of emissions, their bill would have the government raising $1 trillion through 2031. If you use a more realistic estimate -- in the EU's existing cap and trade system, a ton costs $40 -- that figure rises quite a bit. The bill stipulates how that money will be spent, and it removes that spending from the normal budget process. Whatever else it is, Lieberman-Warner is a bill to raise taxes and spending.

States would get emission permits too. They would be expected to sell them and then use the proceeds to promote energy efficiency, mass transit, and the like. Corker asks: If Congress is not willing to spend all this money directly on mass transit, what's the point of doing it indirectly? Other, that is, than to disguise the wealth transfers taking place?

Corker has been nearly alone in raising these points. "The level of understanding around this issue in the House and Senate is lower than any issue I'm aware of," he says. Even on an issue as complex as health care, he notes, elected officials have "some practical experience." They rarely do on energy policy.

Corker plans to offer several amendments to the bill. He wants any money raised by auctions to be returned to taxpayers. He thinks that other energy subsidies should be cut. If we are setting up a quasi-market to determine how energy sources should be used within our emissions goals, he asks, what is the point of spending money on particular energy sources as well? And he will support other Republicans as they make the case for relying more on nuclear power. If the amendments pass, he says, he will have improved the bill. If they do not, he will have educated people about its drawbacks.

So far, both conservatives and liberals have approached global warming as though it were a culture-war issue rather than an empirical one. Whether one "believes in" global warming has been treated as a theological dividing line. But determining whether it exists, and how bad it is likely to be if so, should be only the beginning of a process of figuring out a response.

Liberals want to jump directly from "it's a problem" to draconian reductions in carbon emissions. Over the last few years they have labeled those who doubt the existence of global warming "denialists" (an allusion to Holocaust deniers). Now those who concede it but balk at cap and trade are being called "the new denialists." But the existence of trade-offs can't be shouted away -- and it won't be if Senator Corker has anything to say about it.

(c) 2008 by National Review, Inc., 215
Lexington Avenue, New York, NY 10016. Reprinted by permission.