CLIMATE:

10 Senate Dems link warming-bill support to trade protection

Ten influential Senate Democrats rolled out a list of demands today for global warming legislation by warning President Obama that their votes hinge on whether the bill will protect their states' manufacturing bases.

Sens. Sherrod Brown of Ohio and Debbie Stabenow of Michigan took the lead in the letter to the White House, which ticks through a number of items they consider critical in climate legislation to help their local industries that produce iron ore, cement, glass and other energy-intensive goods.

Among other things, the senators said they would seek a "border adjustment mechanism" that could slap trade sanctions on carbon-intensive goods from developing countries that do not have strong enough climate policies.

"In the absence of an adequate international agreement, a border measure could help to prevent countries from responding to climate change less rigorously than the United States and undercutting the effectiveness of our climate policy by shifting, rather than reducing, greenhouse gas emissions," the senators wrote.

They also requested "short-term transitional assistance" for energy-intensive and trade-exposed industries, as well as a more robust U.S. policy to measure, monitor and verify emission reduction plans from other countries.

The Democrats that signed onto the letter are Sens. Russ Feingold of Wisconsin, Carl Levin of Michigan, Evan Bayh of Indiana, Robert Casey and Arlen Specter of Pennsylvania, Jay Rockefeller and Robert Byrd of West Virginia, and Al Franken of Minnesota. All said that their concerns would need to be met in order for them to vote for the climate legislation on the Senate floor.

"We would find it extremely difficult to support a final measure that does not effectively deal with these important issues," they wrote.

The House-passed climate bill, H.R. 2454, would require emerging economies to set their own stringent global warming policies or purchase credits on the U.S. carbon market to cover some of their exports into the United States. It also sends 15 percent of the allowances for free to energy-intensive industries starting in 2014, phasing out after 2025.

But just days after the House vote in June, Obama told reporters that he disagreed with the House climate bill's trade provision, warning against "sending any protectionist signals out there" through a new global warming law. Senate Democrats from the Rust Belt immediately swung back (E&ENews PM, July 7).

"We only agree with the president 98 percent of the time," Levin told reporters last month. "Not on this one."

Senate Finance Chairman Max Baucus (D-Mont.) has said he will take the lead on trade and other international competition issues as he crafts climate legislation for consideration by late September. But EPW Chairwoman Barbara Boxer also plans to weigh in on the issue.

"We are working with them and will continue to work with them to address their concerns," an aide for the California Democrat said today of the 10 senators who sent the letter to Obama.

Pushing from the opposite direction, several business groups -- including the Emergency Committee for American Trade, National Foreign Trade Council, U.S. Chamber of Commerce and U.S. Council for International Business -- are urging the Senate to exclude the carbon tariff language, saying the provisions could spark a "green trade war."

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