“Working For The Same Boss”: The Coal Industry Is Imploding. Why Is it Still So Powerful in Washington?
As its battle against the Obama administration’s Clean Power Plan intensifies, Big Coal is getting a lot of help from friends in high places.
Leading the rush to the industry’s defense is Senate majority leader Mitch McConnell, who has launched an underhanded campaign to undermine the Environmental Protection Agency’s new rules for greenhouse gases from power plants. In a March 3 op-ed, McConnell suggested that states should refuse to submit a state plan for lowering emissions. A few weeks later he sent a letter directly to every governor in the country, warning that developing such a plan would allow “the EPA to wrest control of a state’s energy policy.”
To further encourage states to opt out of the rules, McConnell and co-sponsors Rob Portman, Roy Blunt, Tom Cotton and Orrin Hatch put forth an amendment to a budget resolution on Wednesday that would allow a state’s governor or legislature to duck the EPA’s authority if they determined that adopting a plan to reduce emissions would hurt their state. (A similar measure is pending in the House.) In order to opt out, according to David Doniger of the National Resources Defense Council, all a state would need to do is “to declare that meeting carbon standards would cost the polluters money.”
McConnell’s bases his appeal to the states on the claim that the regulations are “probably” illegal. In this argument he is is backed by “iconic liberal constitutional scholar Laurence Tribe,” who, McConnell practically crows, “was President Obama’s constitutional law professor at Harvard Law School.” In recent months Tribe has been busy writing legal briefs and op-eds and trotting himself out before the House Energy and Commerce Committee to make that case that the EPA’s attempt to regulate greenhouse gases under the Clean Air Act is an egregious act of overreach akin to “burning the Constitution.” Tribe goes well beyond questions of legality, however, as Jonathan Chait points out, defending coal as a time-honored home-dug alternative to foreign oil.
Tribe’s starring role in McConnell’s circus is unexpected, but it’s not hard to explain: They’re working for the same boss. Tribe was hired to assail the Clean Energy Plan by Peabody Energy, the nation’s largest coal producer—and also the fourth-largest contributor to McConnell over the course of his career, according to The New York Times.
There isn’t enough support in the Senate to override the inevitable veto of any legislation that undermines the power plant rules. That’s why McConnell is appealing directly to the states. A dozen have already sued to stop the regulations, and it’s these legal challenges that have the most potential to cripple, or at least slow down, the plan’s implementation. The coal industry and nineteen states are also using lawsuits to try to wriggle out of new limits on mercury, arsenic and other toxic emissions; the Supreme Court heard arguments against that rule on Wednesday.
All of this suggests that Big Coal’s star is as bright as ever in Washington. The persistence of its political influence looks increasingly odd, however, when held against the fact that coal industry is imploding. The global market research firm Macquarie Research warned investors on Monday that the future for US coal companies is “increasingly bleak,” and the sector is likely to see “a wave of bankruptcies.” A report released Tuesday by the London-based Carbon Tracker Initiative found that more than two dozen coal companies have recently gone bankrupt. Between 2005 and 2010 coal lost more than 10 percent of its market share in US power generation. Meanwhile, China continues its efforts to kick its own coal habit: This week officials announced that they will shut the last coal-fired power plant in Beijing in 2016. “This is an industry in crisis,” writes Ross McCracken of Platts Energy Economist. “Now it faces a slow King Canute style defeat.”
Why are coal companies having such a hard time? One reason is that it’s becoming too expensiveto mine coal for profit in some areas, now that the easy-to-reach reserves in Appalachia (if you consider blowing the top off a mountain easy) are tapped out. The costs of shipping coal are going up, while renewable energy is increasingly affordable. The Carbon Tracker report does point to EPA regulations, particularly on Mercury, as one of the significant challenges to the industry. But even more important is the 80 percent drop since 2008 in the price of natural gas. Coal just can’t compete anymore. “What is also striking is that these factors were not driven explicitly by carbon or climate considerations,” the report continues. “Without a global climate deal or a federal carbon price, US coal is already down for the count.”
Meanwhile the economy is growing (if horrifically unequally), indicating that coal isn’t nearly as relevant as the debate about the power plant rules would suggest. Giants like Peabody still have enough money to net powerful lackeys like Tribe. But at most McConnell’s campaign would amount to corporate life support, perhaps enough to keep Peabody alive. It’s certainly no plan to lift up the struggling coal regions he claims to be fighting for. McConnell isn’t fighting the “war on coal” just for Peabody’s sake, however. As a narrative through which to filter broader resistance to any challenge to corporate power made in the public interest, that “war” is far too useful to give up.
By: Zoe Carpenter, The Nation, March 25, 2015
“Destructive In The Long Run”: The Red State Economic Miracle That Wasn’t
For years progressives in blue states have had to put up with listening to conservatives in red states bray about their supposed economic “miracles” of low-tax, low-investment paradises of low employment in places like Texas and North Dakota.
The fact that these economies were creating mostly minimum-wage jobs with terrible safety nets and awful infrastructure fell on deaf ears. So did the response that those jobs were temporary and fossil-fuel based, and would not last. Undiversified economies based on a single natural resource tend to fare poorly over time.
And indeed it looks like progressives are getting the last laugh due to low oil prices:
States dependent on oil and gas revenue are bracing for layoffs, slashing agency budgets and growing increasingly anxious about the ripple effect that falling oil prices may have on their local economies. The concerns are cutting across traditional oil states like Texas, Louisiana, Oklahoma and Alaska as well as those like North Dakota that are benefiting from the nation’s latest energy boom.
“The crunch is coming,” said Gunnar Knapp, a professor of economics and the director of the Institute of Social and Economic Research at the University of Alaska Anchorage.
Michael Hiltzik at the L.A. Times had more on the topic earlier this week:
A greater danger to the state’s boom-era reputation is that the receding tide may expose a lot of economic wreckage to public view. One consequence of the state’s low-tax, low-service credo is that infrastructure spending has been starved, just at the moment when it’s most needed. As the Texas Tribune reported last year, local roads have become so damaged by heavy oil-patch traffic that in some districts the only option has been to convert paved roads to gravel — there’s no money for repaving, despite the state’s burgeoning wealth.
That shows how little pressure has been placed on the oil industry to carry its fair share of the public cost of the boom or contribute adequately to public investment. When the boom becomes a bust, there will be even less money, and you can bet that the oil industry will be pleading poverty.
When it isn’t simply padding the bottom lines of the wealthiest Americans, most conservative economic policy tends to be about taking the easiest, most aggressive and short-sighted approach to any problem. Eliminating taxes so you can entice corporate grifters may net some immediate transitory gains, but it’s destructive in the long run. Similarly, putting your eggs into the fossil fuel basket doesn’t just destroy your local environment and add to the climate change already ravaging your state, it also puts you at severe risk of economic seizures if fossil fuel prices decline.
By: David Atkins, Political Animal Blog, The Washington Monthly, December 27, 2014
“Theatrical Posturing, Not Much Lawmaking”: What We Talk About When We Talk About A Republican Senate
Presuming we have a Republican Congress next year, there’s going to be a lot of talk right after the election about what that will change 1) politically and 2) substantively. While I’m ordinarily an advocate of more substantive discussion and less political discussion (not that I have a problem with political discussion, since I do plenty of it myself, it’s just that it should be leavened with consideration of the things that actually matter), there’s a potential problem in the substantive discussion that I think we should be on the lookout for.
For instance, this morning on the radio I heard some energy expert whose name I didn’t catch say that if Republicans take over the Senate, we’re likely to see the government shift its focus toward fossil fuels and away from renewables. Which sounds perfectly logical until you ask how such a shift is supposed to take place.
This is what is often missing from policy discussion: enough acknowledgment of the institutional processes that determine how policies actually get set and altered. If you’re going to say that a Republican Congress is going to produce a particular policy change, you have to be clear that you’re saying the following events will occur:
1. Republicans will write a bill to do the thing.
2. The bill to do the thing will not only pass the House but more importantly garner 60 votes in the Senate, which means it will get the votes not only of Republicans but also of some Democrats, thereby overcoming a Democratic filibuster.
3. President Obama will sign the bill to do the thing.
It’s possible that that sequence of events could occur in some cases. For instance, Republicans have had a feverish desire to build the Keystone XL pipeline for some time, and they’ve come to attach an importance to it that’s way out of proportion to its actual impact. They seem to say with all sincerity that building the pipeline is a key to American prosperity, which is beyond absurd—building the pipeline would create a few thousand temporary jobs, and the number of permanent jobs maintaining it would literally be in the dozens. But President Obama never seemed adamantly opposed to the pipeline, and one could imagine him signing on if he got something in return. You could also see the pipeline getting a few Democratic votes from red state Democrats who want to show that they love the world’s dirtiest fuel (tar sands oil) and are therefore not hippies, so it could get 60 votes.
That might or might not happen, but it’s at least conceivable. It wouldn’t, however, represent some massive shift in our nation’s energy policy, whatever else you might think about it. And it’s an extremely unusual case.
On almost everything else Republicans want to do, either the bills they write won’t overcome Democratic filibusters, or they’ll be vetoed by the President. Much of the time, that will be because instead of embarking on a good-faith effort to find some accommodation with Democrats, they’ll just propose the thing they really want. It might be possible to forge a compromise on tax reform, but that would be a lengthy and involved process, so Republicans will just try to pass a bill slashing corporate tax rates, which won’t become law. There are ways the Affordable Care Act could be improved, but instead of working with Democrats to find them, they’ll be much more inclined to just pass repeal votes, whether it’s repeal of the entire law or repeal of individual provisions one by one (or, more likely, both).
In other words, we’re going to get an awful lot of theatrical posturing, and not very much lawmaking. We shouldn’t mistake the latter for the former.
By: Paul Waldman, Contributing Editor, The American Prospect, November 3, 2014
“Undermining Their Own Priorities”: When GOP Obstructionism Becomes Self-Defeating
The point of congressional Republicans’ obstructionism, which has reached unprecedented levels in the Obama era, is obviously to block Democratic priorities. GOP lawmakers could, in theory, negotiate with Democrats and work on bipartisan compromises, but in recent years, Republicans deliberately chose an unyielding strategy: no concessions, no cooperation, no tolerance for progressive goals.
On several key issues, most notably economic growth and job creation, the GOP tactic has proven to be quite effective. But what if the plan has quietly backfired? What if, by simply blocking attempts at governing, Republicans have undermined their own priorities?
On combatting the climate crisis, for example, GOP officials are obviously outraged by the Obama administration’s decision to use the Clean Air Act to impose new rules to reduce carbon pollution. But Jamelle Bouie raises an underappreciated point: “If Republicans are outraged by the announcement, they only have themselves to blame.”
In 2009, President Obama threw his support behind climate legislation in the House, and the following year, a group of Senate Democrats – including Kerry – began work with Republicans to craft a bipartisan climate bill. The process fell apart…. It’s not that EPA action wasn’t possible, but that the administration wanted legislation and would make key concessions to get it. In the absence of a law, however, the White House was prepared to act alone. […]
With a little cooperation, Republicans could have won a better outcome for their priorities. They could have exempted coal from more stringent spectrum of regulations, enriched their constituencies with new subsidies and benefits, and diluted a key Democratic priority. Instead, they’ll now pay a steep substantive price for their obstruction, in the form of rules that are tougher – and more liberal – than anything that could have passed Congress.
Congressional Republicans, through filibusters and obstinacy, can stop much of the governing process, but not all of it. When a policy runs into a choke point, its proponents begin looking for an alternative route to implementation.
In the case of climate policy, GOP lawmakers assumed they’d win by simply folding their arms and refusing to do anything. In practice, this often-mindless obstructionism simply forced the administration to begin to work on its own – without any regard for whether Republicans on Capitol Hill would like it or not, since the White House didn’t need their approval.
In other words, Republican tactics were self-defeating – GOP officials would have produced a more favorable policy, from their own perspective, if they’d only agreed to work a little with Democrats.
This keeps happening.
On judicial nominees, for example, Senate Democrats were reluctant to pull the trigger on the so-called “nuclear option.” Instead of leveraging that reluctance, Republicans did the opposite, vowing to block a series of nominees they found unobjectionable in order to force the issue.
Had the GOP minority been a little less ridiculous, Dems wouldn’t have pursued the nuclear option and Republicans would probably still be blocking a variety of judicial nominees right now.
The Affordable Care Act offers an even more striking example. President Obama and his team were desperate to strike a bipartisan deal on health care – they started with a Republican-friendly reform blueprint; they were prepared to bargain away progressive priorities, and they even signaled a willingness to incorporate conservative goals like “tort reform” into the legislation.
GOP lawmakers, under strict orders from party leaders, balked anyway, refusing any and all offers. No matter what the White House offered, Republicans said, the GOP would reject any attempts at reform.
But again, the obstructionism worked against Republicans – they didn’t stop the legislation; they simply blocked their own opportunity to easily move the legislation to the right.
We may yet see a similar dynamic unfold on immigration policy. House Republicans refuse to consider a bipartisan solution with broad support, pushing the president to consider unilateral action. If GOP lawmakers worked with the White House, they’d get a package that reflected their priorities, but by refusing to govern, they’re likely to end up with a presidential directive that gives Republicans nothing.
Bouie concluded, “[A]fter five years of relentless obstruction in the name of small government, Republicans may have helped set the stage for a world where government is much bigger – and expansive – than it is now. And if it happens, we should remember to thank Republicans for helping to make it possible.”
By: Steve Benen, The Maddow Blog, June 4, 2014
“A Very Sketchy Deal”: Mitt Romney’s Grab Bag Of Right-Wing Disasterous Bush Policies
Mitt Romney’s entire presidential campaign is premised on the idea that—as a former businessman—he is best qualified to fix the economy. It went unnoticed, but while talking tax reform, President Obama pushed against that with an effective attack on the shaky numbers behind Romney’s tax plan:
Now, Governor Romney was a very successful investor. If somebody came to you, Governor, with a plan that said, here, I want to spend $7 or $8 trillion, and then we’re going to pay for it, but we can’t tell you until maybe after the election how we’re going to do it, you wouldn’t take such a sketchy deal and neither should you, the American people, because the math doesn’t add up.
Since then, “sketchy deal” has become something of a catchphrase for the president; to wit, in an Iowa speech yesterday, he used it to contrast Romney’s plan with “deals” of the past:
Romney still benefits from a presumption of competence, and Obama would be well-served by hammering on the essential vapidness of Romney’s economic plan. It’s not just that his tax promises don’t add up—even with a $25,000 limit on deductions, there’s not enough revenue raised to pay for an across-the-board cut and cuts to taxes on capital gains and investment income—but that his five point plan to create 12 million jobs does nothing of the sort.
The definitive debunking was done by The Washington Post’s Glenn Kessler, who found that Romney’s numbers just don’t add up. On his website, Romney’s economic advisors say that “History shows that a recovery rooted in policies contained in the Romney plan will create about 12 million jobs in the first term of a Romney presidency.” Team Romney even goes as far as to cite exact job-creation numbers for each plank of the plan: 3 million from Romney’s energy policies, 7 million from his tax policies, and 2 million from cracking down on China.
But as Kessler shows, the Romney campaign has little evidence for any of its claims. There’s no study showing that the Romney energy plan would create 3 million jobs—at most, there’s a Citigroup report that predicts that rate of job growth over the next eight years as a result of policies already adopted (and opposed by Romney). The 7 million jobs number? It comes from a ten-year estimate of what might happen with Romney’s policies. And the 2 million jobs claim comes from a 2011 International Trade Commission report which estimates gains if China stopped infringing on American intellectual property. The problem is that the study was highly contingent on last year’s job market, which was far worse than the current one.
Perhaps the most damning indictment of Romney’s claim is the simple fact that “12 million jobs” is the current projection for job growth over the next four years under the current policies. In essence, Romney’s promise is to take credit for the results of Obama’s policies if he’s elected president.
“Sketchy deal” is the right way to describe Romney’s offer to the American public. Rather than put forth a plan to deal with our short-term economic problems, he’s offered a grab bag of right-wing proposals that are indistinguishable from the disasterous policies of the Bush administration. He’s betting that better packaging is all it takes to sell the public the same bill of goods. And judging from the close polls, he might be right.
By: Jamelle Bouie, The American Prospect,October 18, 2012
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