Those are dynamics that we haven't even begun to understand yet-that are critical to what we're doing here.

Mr. SUNUNU. Well, I don't think it would be much of an exaggeration at all to suggest that, to the extent that the aluminum industry or steel manufacturing industry in the United States is decimated by a 20-30 percent in their energy costs, those jobs are going to go to Korea.

Senator HAGEL. Exactly right.

Mr. SUNUNU. Or to one of any number of countries that is not covered by the treaty, but that already has a strong or growing industry that competes for American jobs continually. Automotive manufacturing-we know that there's a growing and incipient car manufacturing industry in Mexico, or in China, or in any one of the 128 countries that aren't covered by the agreement.

Senator HAGEL. Well, and by the way, you-all States have some agriculture. My State, like Indiana, has a great amount of agriculture. One of the industries that would be most devastated is the agriculture industry because it's a very energy-intensive industry. I might add, Mr. Sununu when you really look at some consequences we've got this administration talking about helping the poor and feed the world. What you would do is go absolutely in the other direction, as you would take the productivity of our farmers and cut that in half at best; there'd be less productivity and less food.

I might also say I don't know of anybody who wants a dirty environment-who supports dirty water and dirty air, but if you're going to take fossil fuels out of the equation, then you'd better have an energy policy more than windmills. This administration has no energy policy. Nuke? No, no. We don't talk about nuclear. Dams, hydroelectric? Oh, no, we don't want to do that. It's going to take a lot of windmills to keep a lot of people in jobs. Mr. Sununu, I'm going to have to leave because of that vote, but I would be glad to come back

Mr. SUNUNU. Thank you, sir.

Senator HAGEL [continuing]. At some point and I'm grateful for what you're doing.

Mr. SUNUNU. Thank you very much, Senator. Mr. Chairman, if I could, as the Senator is leaving-thank you very much-emphasize one point that he made that I think bears repeating. That is that once the treaty is signed into effect, that future amendments would simply require the approval of three-quarters of those that are signatories. Which means that additional mandated reductions in emissions, additional mandates that would have very significant economic costs to any developed nations, would only require the approval of three-quarters of the signatories to the treaty which could completely exclude any of the developing nations. So those countries that are not affected by the mandates can simply agree to impose new mandates on developing countries. That would clearly represent a loss of American sovereignty, but also a loss of sovereignty of any of the developed nations that participate in the agreement without having any restrictions, any regulations, or any mandates applying to those lesser developed countries. Thank you. Mr. MCINTOSH. Thank you very much, Mr. Sununu.

Let us turn now to our second panel. I would call forward each of those witnesses, as I read off your names. Mr. John Passacantando who is president and executive director of Ozone Action; Mr. Daniel Lashof, senior scientist with the NRDC; Mr. Don Crawford who is an auto worker from Anderson, IN; Mr. Sam Darwin who is a farmer from Alabama; Ms. Joyce Brinner who's principal at the Standard & Poor's DRI; and Ms. Mary Novak who's a senior VP at WEFA, Inc.

Thank you all for coming today. Please come forward and the staff will put identifying nameplates in front of your seats.

It's the policy of the full Committee on Government Reform and Oversight to ask that all witnesses that come before us in any of our hearings take an oath. So I would ask each of you to as soon as your seated-to repeat after me. Let me ask the staff if you have a copy of that oath that we can read? Thank you.

Please rise and repeat after me.

[Witnesses sworn.]

Mr. MCINTOSH. Let the record show that each of the witnesses answered in the affirmative.

Let us first hear-and I would ask each of you please to confine your remarks to 5 minutes. We've got a long hearing today, and any additional remarks that you have prepared in writing will be submitted to the record for their inclusion therein. The first witness on this panel will be Mr. John Passacantando. Mr. Passacantando? I hope I'm pronouncing that correctly.

Mr. PASSACANTANDO. Passacantando, very close though. Thank you, Mr. Chairman.

STATEMENTS OF JOHN PASSACANTANDO, PRESIDENT AND EXECUTIVE DIRECTOR, OZONE ACTION; DANIEL A. LASHOF, SENIOR SCIENTIST, NATURAL RESOURCES DEFENSE COUNCIL; DONALD CRAWFORD, AUTOMOBILE WORKER FROM INDIANA; SAM DARWIN, MEMBER, BOARD OF DIRECTORS, AMERICAN CORN GROWERS ASSOCIATION; JOYCE BRINNER, PRINCIPAL, STANDARD AND POOR'S DRI; AND MARY NOVAK, SENIOR VICE PRESIDENT, WEFA, INC.

Mr. PASSACANTANDO. Greetings, Mr. Chairman and members of the committee. Thank you for this opportunity to address the question, "Is the climate agreement good for the United States?"

First and foremost, we must consider the overwhelming consensus that has emerged regarding the threat of global warming. The Intergovernmental Panel on Climate Change has determined that "the balance of evidence suggests a discernable human influence on global climate." Thousands of scientists, including hundreds of Nobel Laureates and members of the National Academy of Sciences, have lent their names to statements urging the United States to lead the world in averting climate change. Great substance, indeed.

I will not belabor the list of negative impacts, but, as a race, we are creating a global problem by our excessive burning of fossil fuels that experts tell us will throw a wrench into our blessedly stable climate for centuries, if not millennia. Impacts include the spread of infectious diseases, a rising sea level, disrupted agriculture, and increasingly severe weather.

Even more disconcerting than the threat of global warming is the response U.S. leaders have had to this threat. America is the land of optimism, of endless possibility. In times of adversity, Americans have always responded nobly, with leadership and ingenuity. When the astronauts of Apollo 13 thought they might not survive, NASA's smartest rolled up their shirt sleeves and found a way to bring them home. As evil rolled throughout the world in the 1940's, U.S. leaders did not sit back and wait for the developing nations to join the fight. We accepted the challenge, retooled our economy, and led the allies to victory, building the foundation for the greatest economy the world has ever seen. Yet faced with the threat of climate change, U.S. leaders are calling on developing countries to act.

Naysayers argue that reducing our greenhouse gas emissions will harm Americans, but historical evidence teaches us exactly the opposite. For the last 30 years, America has passed and enforced the best health and environmental laws in the world. Every time the naysayers said we couldn't have cleaner water, cleaner air, gasoline without lead, they have been proven wrong. Instead, we have built our economy in harmony with a cleaner environment. Nevertheless, the American Petroleum Institute can pay for countless studies that say our consumption of fossil fuels will make us less competitive with countries like Mexico or China. But think about it. If such stories were true, we'd have people swimming south across the Rio Grande and stowing away on boats to China. The real economic lesson is that we can protect the environment, create jobs, and improve our quality of life. It is not a zero-sum game.

Before the United States could even start negotiations in Kyoto, the Byrd-Hagel resolution on climate change was passed, as we all know, 95 to 0 by the Senate. The resolution set a dangerous new precedent for environmental protection. For the first time, United States environmental protection must wait for action from countries like China and Mexico.

The developing world requirement goes against a very American notion of sovereignty. Right now, the Senate seems to be held hostage to the whims of foreign leaders. Should United States leadership to reduce greenhouse gas emissions wait for President Ernesto Zedillo to clean the air in Mexico City or Prime Minister Zhiang Zemin to make the Chinese less reliant on dirty coal for energy? If we do, Americans lose the ability to set the standards that have made us the envy of the world.

Even with our standards, more than 20 million people in the United States with chronic respiratory problems live in places with levels of smog likely to trigger their illnesses. Asthma is the leading illness affecting our children, up 188 percent since 1980. An estimated 40,000 premature deaths occur each year due to air pollution. Consider also the unnaturally fast rise of the oceans, projected to rise 1 to 3 feet during the next 100 years. Sea-level accelerates the pace of beach erosion from places everywhere from Oregon to New York, Florida to California.

If we wait for developing countries, American workers will also suffer. Students graduating from college are not looking to oil companies for their dream jobs. Entrepreneurship and innovation are the real drivers for our economy, not oil companies.

Government does best when it sets high standards that stimulate innovation. But the fossil fuel industry has fought innovation every step of the way. Last fall, the auto and oil companies in the United States were determined to keep any climate treaty from emerging in Kyoto. One single campaign spent $13 million to convince the American public that U.S. emissions reductions without developing country participation will lead to our competitive and economic downfall. Exxon Chairman Lee Raymond became the poster child of hypocrisy, starting his day arguing against any climate treaty that lacked developing country participation at home, and finishing with a trip to China to threaten the Chinese not to sign on if they wanted foreign investment. The fossil fuel industry's position stands in sharp contrast with the majority of Americans, 74 percent of whom said they support the global warming treaty according to a December 17, 1997 Harris poll.

The treaty was struck despite these heavy-handed efforts, but it was a weak agreement. Nevertheless, the Kyoto Protocol still sent a strong signal. U.S. automakers are starting to see that the future belongs to the Japanese and the Europeans unless they can recover lost time. Time spent lobbying and advertising against change, time they couldn't recover in the 1970's after fuel prices shot up, and they only had gas guzzlers to offer the American public.

I believe it was Senator Byrd who commented that the Protocol is a work in progress. I agree but perhaps for different reasons. It is a bare minimum. We must aim higher. There is no going back. According to the best scientific estimates, we actually need to reduce emissions by 50 to 70 percent as soon as possible if we want to avert this threat. We must not delay. To wait for developing countries is anti-American and counterproductive. We need to create clear incentives to make U.S. industry more energy efficient. If our negotiators continue to push for loopholes in the Protocol, then they will jeopardize America's leadership position.

I believe the issue has been improperly framed as a competition between America and the developing world, a static analysis showing that any emission reduction by the United States and not mirrored by China puts us at a competitive disadvantage. Initial intransigence by the developing nations is understandable because we have broken all our previous commitments to reduce emissions, commitments signed by President Bush and ratified by the U.S. Senate. Nevertheless, developing countries will ultimately choose the most efficient path they can afford. In fact, they have already taken many steps, many more, in fact, than we have to maximize their efficiency. A good example of this is when Japan rebuilt after World War II, they built the most advanced steel mills in the world and leapfrogged United States facilities for many years. Many developing nations are currently putting up cellular phone towers and skipping the copper wire stage all together. Before long, the developing nations will be doing the same with energy technology. Mr. MCINTOSH. Mr. Passacantando, if I could ask you to summarize. I really want to keep to the 5 minutes on these so we can get toMr. PASSACANTANDO. Absolutely, I'll just wrap up. Mr. MCINTOSH. Great.

Mr. PASSACANTANDO. The one exception to what I've said here is the proud guild of coal miners. Approximately 25,000 people in this country are involved in extracting coal from the ground, our most polluting energy source by far. As we move away from this energy source, we accrue the benefits to the health of our country in many ways and to our economy. There may be miners whose jobs are at risk. Jobs of people who have kept our lights burning, our heat on, and our air conditioners running all these years and these people must be compensated. They deserve a just transition and full American support to move away from this technology. There is currently $1.5 billion in the Surface Mine Reclamation Fund which, if released faster, would greatly help this transition. Now more than ever, we need leadership from our elected officials. And now, more than ever, Americans are willing and able to address this challenge.

Thank you, Mr. Chairman.

[The prepared statement of Mr. Passacantando follows:]

53-426 99-3