CLIMATE:

Sen. Brown puts manufacturing issues at forefront of cap-and-trade debate

In the quest to secure 60 votes for cap-and-trade legislation, bill sponsors can point to almost any member of the Democratic Senate majority as a "must have" vote.

But, at least in the early days of the debate over the Kerry-Boxer climate change package, perhaps no single Democrat has received as much attention as Ohio's Sherrod Brown, who has become an absolute "make or break" vote for the majority.

The first-term senator is one of several Midwestern Democrats currently on the fence over the bill, and there are others on that list who have more seniority and, perhaps, more power to shape major legislation. The only committee on which Brown sits that figures to get a crack at the bill is Agriculture.

Nevertheless, Brown is a pivotal litmus test in the ability of Democratic leadership to bring other moderate senators on board.

"If we can't secure the support of somebody who is a committed progressive, who understands the potential of a clean energy economy and someone who understands the need to protect this country's manufacturing base, then I don't see this bill going anywhere," said Jesse Jenkins, director of energy and climate policy at the Breakthrough Institute, a nonpartisan think tank. "Senator Brown is much more committed to finding a bill that can work than potentially some other senators.

"If we can't get his support, I don't see any route to 60 votes," Jenkins added.

Indeed, Brown seemingly needs little convincing of the potential environmental and economic benefits of the cap-and-trade bill.

Outside of bill sponsors Sens. John Kerry (D-Mass.) and Barbara Boxer (D-Calif.) perhaps no other senator has as actively promoted the potential benefits of the legislation. In the wake of the bill's release, Brown held two separate events touting the bill -- a conference call with labor industry officials and environmentalists and a Capitol Hill press conference with business leaders.

"Clean energy legislation is not just about the environment, it's about creating jobs and revitalizing our nation's manufacturing basis," Brown said. "For a clean energy bill to be successful, it must also be a jobs bill that partners with the business community."

While Brown has not been shy about embracing the cap-and-trade policy, he also has not endorsed the bill.

Indeed, he has bluntly stated that unless the authors agree to a variety of manufacturing and trade provisions, there is little possibility that the legislation will get anywhere near enough support to clear the Senate. "There probably won't be 50 votes," Brown said last week. "There sure won't be 60 without taking care of manufacturing."

Brown's wish list centers on ensuring that even as the country moves toward a "clean energy" economy, it does so without decimating the energy intensive industries that are prevalent in Ohio and across the Midwest. And, Brown says, he wants to ensure that the Midwest manufacturing base is put to work making parts for the new economy.

One part of ensuring the well-being of manufacturing would be the inclusion of various rebates and loans to ensure that existing industries can produce goods for a carbon-constrained economy, Brown said.

One such item is the "Investments for Manufacturing Progress and Clean Technology (IMPACT) Act," which would create a $30 billion revolving loan fund that would help auto suppliers and other small and medium manufacturers retool their facilities to build clean energy technologies. The provision is already part of the House-passed version of the climate bill but was not in the early Kerry-Boxer measure.

More broadly, Brown would also like to ensure the creation of a large-scale investment in energy research and development and assurance that cap-and-trade legislation will not disproportionally burden Ohio -- perhaps in the form of rebates to manufacturers and consumers.

But perhaps the most contentious of Brown's demands is the inclusion of so-called border adjustment mechanism -- in essence a fee on the carbon content of imported goods from countries that do not have greenhouse gas regulations similar to those of the United States.

Supporters of manufacturing and their allies see such language as absolutely pivotal to not only getting their support for the legislation but ensuring that the bill has the desired impact. Border adjustment provisions are already part of the House bill, but Brown has said that he has concerns that the legislation offers too much presidential discretion.

"Presidents don't move very aggressively on protecting our national interests on manufacturing and trade," Brown said, adding that his concern was not so much about President Obama as about future presidents.

The border protection provisions have run into opposition from some multinational corporations, free trade advocates and lawmakers who fear that it would cause retaliation from some other nations and would stifled development of the technologies.

The Kerry-Boxer bill contains only a blank section that indicates the eventual inclusion of border adjustment language but no specifics. Both Kerry and Brown have indicated separately they believe that they can appease the manufacturing senators.

"They put an acknowledged placeholder into the bill and everybody from the drafters on down expect that Senator Brown will be a leading voice in designing those border measures," said David Foster, executive director of the Blue Green Alliance. "I don't have any doubt that the final bill that goes to the Senate floor will have a very strong piece that will deal with those issues."

One thing is for certain, observers say, a climate change bill without border adjustment language that meets the criteria set out by Brown and others has little chance of passage. "My impression is that this is important issue for a substantial number of Democrats from Midwestern states -- they're going to need every vote they can get on this bill," said Robert Scott of the Economic Policy Institute, a think thank that focuses on economic policy that impacts low- and middle-income voters.

Brown has said that he believes the fate of 10 or more votes -- including some Midwestern Republicans -- could hang on the border adjustment language and other manufacturing provisions.

Representing Ohio?

While Brown has projected an image on Capitol Hill of fighting for the manufacturing base of his home state, some of his critics argue that he is out of step with where most Ohio businesses and voters are on the issue.

"That is complete spin -- the people of Ohio do not want a bill," said Ohio Coal Association President Mike Carey. "They see what this -- it's a cap and tax. For all intensive purposes, this is a bad bill, this is a bad bill on many fronts."

Carey, who has spoken at a number of Tea Party protests against the legislation, added that concerns about job losses has overwhelmed all other issues in Ohio.

"If you haven't lost your job, somebody you know has and this is just the wrong time to be putting up something like this," Carey said.

Some businesses that operate in the state -- most notably General Electric Co. -- have specifically opposed the border adjustment language, arguing that it would create international trade problems and stifle production of new technologies.

Brown maintains that he is looking out for the interests of workers and not major corporations that have international interests. "I didn't know that what GE says is automatically in our national interest," Brown said recently. "GE is a great American company, and they've done great things for this country. But they have a lot of production in China. This bill isn't written for GE. This bill's written to deal with climate change, and it's written as a jobs bill."

Brown's supporters also argue that his position reflects what many believe to be best for Ohio industry and its labor force, noting that he has met for nearly a year with various Ohio industry officials in an effort to put together a climate policy that will benefit the state. Just yesterday, Brown met with officials from about 15 northeast Ohio manufacturers to discuss, among other things, the feasibility of retooling for a clean energy economy.

In addition, the National Association of Manufacturers, a group that often clashes with Capitol Hill Democrats, has thrown its support behind Brown's IMPACT bill -- a sign that the senator is carving a strategy that effectively balances environmental and business concerns.

"I think that Senator Brown really wants to get this right," said Jenkins of the Breakthrough Institute. "I think that Senator Brown understands the potential and seize that opportunity and not pass it by, and I think that's motivated him to be a proactive in this discussion."

Last summer, Brown voted against cloture on the Lieberman-Warner climate measure and penned a letter along with other Midwestern Democrats to Senate Majority Leader Harry Reid (D-Nev.) that outlined a list of concerns roughly similar to the same ones simmering around the bill today -- namely calling for more protection for existing manufacturing and increased investment in energy research.

"If your objective is to get a bill that can succeed in the current political climate, those concerns need to be met," Jenkins said.

Are voters convinced?

For Brown, the political implications of his climate change vote may not be felt in the short-term but they may be serious. Even if Brown manages to get everything he wants out of the climate bill, it remains unclear if Ohio workers and voters will embrace the legislation.

The state, which gets roughly 80 percent of its electricity from coal, has been at the center of the fight over the climate bill; nearly every major ad campaign from both sides of the issue have involved the state.

Brown won the seat in 2006 by a 56-44 percent margin over incumbent Sen. Mike DeWine (R) and is not up for re-election until 2012.

However, running as a freshman senator from what has become one of the major political battlegrounds in the country, he is certain to be a major target for Republicans. And since President Obama will presumably be running for re-election that same year -- the perceived success or failure of the White House agenda is certain to be tied closely to Brown's political fate.

In past years, Republicans have successfully used the specter of climate change legislation -- and the potential damage that it would cause to coal and other industries -- to rally opposition to the Democratic presidential nominee and other Democratic candidates. Some pundits have speculated that it cost both former Vice President Al Gore and Kerry a significant number of votes in the 2000 and 2004 elections.

Both sides in the debate argue that mainstream Ohio opinion is generally on their side and will trend even more their way as the debate continues.

"The folks out in the areas of coal country and folks in the large metropolitan areas are staring to understanding what it's going to mean to their wallets and they don't like it," said Carey of the Ohio Coal Association.

Advocates of climate change legislation counter that Ohio residents recognize that the economy needs significant changes in order to revive the state's manufacturing base and that simply hoping for the revival of old industries will not get the job done. "Labor unions are moving out in front of this issue -- there are going to be new sources of labor in the country, a new set of jobs," said Sara Letourneau, Ohio regional organizer for the Blue Green Alliance.

"I think union members are incredibly savvy people who understand that shipping jobs to China is not good for Ohio," Letourneau added.

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