ozone action.

April 23, 1998

Testimony Before the Subcommittee on National Economic Growth, Natural Resources and Regulatory Affairs. Chairman David McIntosh.

Submitted by John Passacantando, Executive Director, Ozone Action

Greetings, Mr. Chairman, and members of this committee. I am grateful for the opportunity to share with you some thoughts on the international agreement forged in Kyoto, Japan last December on climate change. The question I have been invited to answer, "Is the climate agreement good for the United States," is a most appropriate one.

First and foremost we must consider the overwhelming consensus that has emerged regarding the threat of global warming. The Intergovernmental Panel on Climate Change (IPCC), comprised of more than 2,000 experts from around the world from government agencies, academia and industry have determined that "the balance of evidence suggests a discernible 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 U.S. to lead the world in averting climate change. In the peer-reviewed science journals, new research emerges weekly showing ever stronger evidence of human-induced climate change and the wide range of negative impacts to our environment and the health of our children.

I will not belabor the list of negative impacts. I will merely say that if you accept the science, as I do, you must acknowledge that we are facing an awesome problem. 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. More immediate are the direct, but externalized, costs from the burning of fossil fuels. Expressed in terms of present day dollars, these direct costs of burning fossil fuels may comprise 2 to 5% of our Gross Domestic Product.

More disconcerting than the threat of global warming is the response U.S. leaders have had to this threat because is completely out of character to the American spirit. America is a land of optimism, of endless possibility. We have the smartest engineers in the world. 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 shirtsleeves and found a way to bring them home.

As evil rolled throughout the world in the 1940s, U.S. leaders did not sit back and wait for 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.

Naysayers keep proselytizing that reducing our greenhouse gas emissions will harm Americans but historical evidence teaches us the opposite. For the last thirty 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, refrigeration without ozone depleting chemicals, gasoline without lead, they have been proven wrong. Instead, we have built our economy in harmony with a cleaner environment. We have an economy that is the envy of the world. Nevertheless, the American Petroleum Institute can pay for countless studies that say reducing our consumption of fossil fuels will make us less competitive with Mexico or China, but think about it. If such stories were true, given all our past environmental laws, we'd have people swimming south across the Rio Grande and stowing away on boats TO China.

I've had many interesting jobs in my career, but one of the most illuminating was as the director of marketing for Polyconomics, run by Jude Wanniski, the high priest of supply side economics. Now regardless of what you think about his theories, you must give him and the supply siders credit for one thing. When we had the high inflation and low growth of the 1970s and all the conventional economists resigned themselves to the belief that you had to choose one bad or the other, supply siders said that we could do better. They believed we could have an economic renaissance with strong growth and low inflation. Likewise, we can protect the environment, create jobs and improve our quality of life. It is not a zero sum game.

A funny thing happened on the road to the international climate change meeting in Kyoto, Japan this past December. Before the US could even start negotiations, the Byrd-Hagel Resolution on climate change was passed by the Senate 95-0. This resolution stated the US would not be a signatory to any climate agreement unless it "mandates new specific scheduled commitments to limit or reduce greenhouse gas emissions for developing country parties..." Interpretations of exactly what the resolution means vary as widely as the political spectrum. It is certain, however, that the Senate set a dangerous new precedent for environmental protection. For the first time, US environmental protection must wait for action from countries like China and Mexico. The developing world requirement goes against our very American notion of sovereignty. Consider the first global environmental threat that was addressed through an international agreement, ozone depletion. Negotiators for Presidents Reagan and Bush struck a series of agreements, beginning in 1987 that ultimately led to a ban on the production of most ozone depleting chemicals We did not wait for the developing nations. They came on board later and are still laggards. In the meantime, a critical, perhaps planet threatening, amount of ozone depleting chemicals was never produced and US companies became leaders in the production of more profitable replacement chemicals. Claims about job loss and damage to our economy have vaporized, as usual.

Right now, the Senate seems to be held hostage to the whims of foreign leaders. Shall US 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 living and environmental standards that have made us the envy of the world. More than 20 million people in the US with chronic respiratory problems live in areas with levels of smog likely to trigger their illnesses. Asthma is the leading serious chronic illness affecting our children, up 188% since 1980. An estimated 40,000 premature deaths occur each year due to particulate soot pollution. Consider also the unnaturally fast rise of the oceans, projected to rise one to three feet during the next 100 years from global warming. Sea level rise accelerates the pace of beach erosion, which threatens the lifeblood of entire coastal communities. New York, California, Massachusetts, Texas, Florida, Maryland, Delaware, Virginia and every other coastal state already spend millions of dollars, supplemented with taxpayer dollars, pumping sand back on shore, just to give us a day at the beach.

With the Senate's resolution, our economy and job base also become major losers. Students graduating from college are not lining up to interview at Exxon and the local coal mine for their dream jobs. The coal and oil companies want us to believe they are the backbone of the economy, when in fact, entrepreneurship and innovation are the real drivers. Government does best when it sets high standards that stimulate innovation. Management expert Michael Porter from Harvard has argued that "managers must start to recognize environmental improvement as an economic and competitive opportunity," rather than a cost. In fact, the countries that pass and enforce the strongest environmental laws develop the industries that lead in the exports of the regulated technologies. We witnessed the tiniest glimpse of such a useful prod to the US auto industry in early January.

Last fall, the auto and oil companies in the US were determined to keep any climate treaty from emerging in Kyoto. One single campaign spent $13 million to convince the American public that US 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% of whom said they support the global warming treaty according to a December 17, 1997 Harris poll.

A treaty was struck despite these heavy-handed efforts, but it was a weak agreement. Weak, as Abraham Lincoln once said, “as the soup made from the shadow of a crow that had died of starvation." Weak, in that if all nations comply with the commitments made, we will still have severe, human-induced climate change. Nevertheless, the Kyoto Protocol still sent a signal. European carmakers recently proposed voluntarily increasing their emissions standards by 25%. GM's Chairman and CEO John F. Smith overnight became a vocal promoter of Detroit's forthcoming high-mileage vehicles. US 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 1970s 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 minimally acceptable first step that must be strengthened considerably. We must aim higher because there is no going back if we make mistakes. According to best scientific estimates, we actually need to reduce emissions by 50-70 percent as soon as possible. We must not delay. To wait for developing countries is antiAmerican and counter-productive. We need to create strong enough incentives to make U.S. industry more energy efficient. If, in our weakness, our negotiators continue to push for loopholes in the Protocol, then, ironically, they will disadvantage the U.S. in the technology race of the future.

I believe the issue has been improperly framed as one of competitiveness between the industrialized world and the developing world – a static analysis showing that any emission reduction by the U.S. not mirrored by China, is a competitive advantage for China. Initial intransigence by developing nations is understandable because we have broken all our promises to them on this topic up until now. Nevertheless, they will ultimately choose the best technology, the most efficient paths they can afford. In fact, they have already taken many more steps than we have to maximize their efficiency. When Japan rebuilt after World War II, they built the most advanced steel mills in the world and, for a while, leapfrogged U.S. production facilities. Many developing nations are currently putting up cellular phone towers and skipping the copper wire stage altogether. Before long, the developing nations will be doing the same with energy technology. They will find that it is cheaper to bypass the more wasteful stage of energy use that current industrialized nations are just realizing they need to graduate from. The day is not long in the future when our mothballed coal-fired power plants are symbols of another era, like horses and telegrams are today.

So, if the Kyoto Protocol is constructed with strong enough incentives, if it encourages faster U.S. innovation of energy efficient technology and renewable energy sources, then with one exception, it will be a boon for the U.S. The one exception 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. Moving away from this energy source will benefit the health of our country in myriad ways, but the miners, who have kept our lights burning, our heat on and our air conditioners running all these years must be compensated in this new era. 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 than it is currently, would be a smart step towards transition.

Now more than ever, we need leadership from our elected officials. It will be hard work, but when has that ever stopped American citizens? Waiting any longer to take action will be a grave mistake, an irreversible decision to accept the adverse consequences of climate disruption.

Mr. MCINTOSH. Thank you, and what we'll do is we'll hear from each of the witnesses and then have an opportunity to question. Mr. Lashof.

Mr. LASHOF. Thank you, Mr. Chairman. My name is Daniel Lashof and I'm a senior scientist with the Natural Resources Defense Council, a national environmental organization with over 350,000 members nationwide.

I'd like to make two brief points about global warming science and then turn my attention to the opportunities that the United States has to reduce greenhouse pollution through an innovationled strategy.

Mr. Chairman, I believe first, the Kyoto Protocol is based on sound science. The world's top scientists have concluded that global warming has already begun, and that if present trends continue, its consequences could be severe including more heat waves, more infectious diseases, more flooding, and more severe storms such as the tornadoes that have struck Florida, Alabama, Tennessee, Arkansas, and Kentucky in recent weeks. These conclusions are based on the most detailed scientific assessment that has ever been conducted on an environmental issue performed by the Intergovernmental Panel on Climate Change which was, incidentally, initiated under the Reagan administration and began its work under the Bush administration because those administrations said that climate policy should be based on sound science and I agree.

Critics of the IPCC and its conclusions have totally failed to suggest a better alternative for reaching scientific conclusions on complex problems, such as global warming. Certainly, I don't think anyone would suggest that petitions are a substitute for a rigorous scientific assessment based on peer reviewed literature.

Mr. Chairman, you have suggested in a recent article in Roll Call that the former Chair of the IPCC, Professor Bert Bolin, believes that the Kyoto Protocol will not result in significant environmental benefits. I'm afraid that you may have been misled in this because Professor Bolin has been widely quoted out of context by many lobbyists.

Let me read from his article from the January 16th issue of the Journal of Science. "Because of the long residence time of CO2 in the atmosphere, even a modest reduction in the rate of increase of atmospheric CO2 could be of long term significance. It would still be an important first step and be increasingly beneficial during future decades even if the reduction would be far from what is required to reach the goal of stabilizing the concentration of CO2 in the atmosphere."

So you can see that, in fact, Professor Bolin believes, as I do, that the Kyoto Protocol will be beneficial but that additional action will be needed to solve the global warming problem. And I would refer to the full article and ask that it be included in the record.

My second point on the science is that uncertainty strengthens the case for action to reduce greenhouse pollution. Are there uncertainties about the complex climate system of the earth? Yes. But, in fact, the probability that global climate change threatens the security of the United States in the 21st century is higher than the probability ever was that the Soviet Union was planning an invasion of Western Europe or the United States. Mr. Chairman, the