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The Emergence and Importance of President Obama's Climate Policy

When coupled with EPA's slow and steady progress to regulate greenhouse gas emissions under the Clean Air Act, this change in government's own operations begins to resemble a meaningful federal climate policy.
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In a quiet and low-key move last week, President Obama took what may turn out to be one of the most significant steps he has ever taken to reduce greenhouse emissions. As reported by Julie Hirschfeld Davis in the New York Times, the president signed an executive order directing:

...federal agencies over the next decade to cut their emissions by an average of 40 percent compared with their levels when he won office in 2008, and to increase their use of electricity from renewable sources by 30 percent.

This move is wholly within the president's power as the nation's chief executive and will have a significant impact on the market for energy efficiency and renewable energy goods and services. The federal government is the nation's largest organization. It employs more people and buys more goods and services than anyone else. It is also a powerful role model for the private sector. As Ms. Davis observes:

...because the federal government is the largest user of energy in the United States economy -- encompassing 360,000 buildings, 650,000 fleet vehicles and $445 billion in annual spending on goods and services -- it has the potential to influence private companies to step up their emissions-cutting targets.

When coupled with EPA's slow and steady progress to regulate greenhouse gas emissions under the Clean Air Act, this change in government's own operations begins to resemble a meaningful federal climate policy. At long last, the slow and lumbering machine of the federal government is finally approaching the starting gate on climate policy. This is an important step forward and, in my view, better late than never.

We should remember that while the George W. Bush Administration attempted to resist court-required regulation of greenhouse gases under the Clean Air Act, the Obama EPA embraced this requirement and has moved slowly but surely to put these regulations in place. In case you were wondering, the presidency matters. Just as President Obama has the power to move aggressively to use executive authority to reduce emissions, a third President Bush or a President Cruz or Christie could easily kill that effort. While I'm not sure that climate will become a major issue in the next election, climate policy advocates would be wise to focus attention on President Obama's emerging national climate policy and ask candidates to register their support or opposition for the policies now being implemented. Given recent poll data, the public will be very skeptical of efforts to roll back the modest moves now underway to reduce climate change. Independent voters who might otherwise favor a conservative candidate could switch their vote over climate policy.

The president's executive order is less controversial than EPA's greenhouse gas regulations because it does not require private firms to adhere to federal dictates. However, it will have an important influence on private firms seeking to do business with the federal government. Many well-managed organizations are already moving to make their operations more energy efficient as a way to save money and enhance profitability. While not all energy efficiency investments pay off quickly, many do, and from a strictly management perspective it is hard to argue that wasting any material resource is evidence of competent management.

Renewable energy is not always as easy a sell as energy efficiency, but in many instances it is an attractive way to smooth out volatile fossil fuel energy prices. In the case of some military operations renewable energy can help provide energy without the risk of blown up oil tankers. The significance of the president's executive order is the scale of change it brings about and the example it sets for the rest of society. Remember that the U.S. military began implementing racial integration well before the rest of society got around to getting started. The sense of inevitability set by federal actions should not be underestimated. If the federal government goes off of fossil fuels or buys a lot of electric vehicles, private energy practices will eventually follow.

President Obama's executive order also provides companies that sell energy efficiency and renewable energy services and technologies a huge, reliable market. This is especially true of Defense. While the rest of the federal government's budget is under relentless attack by congressional conservatives, Senator John McCain is leading a growing group of defense hawks that want to protect the military from the budget ax. Military purchasing alone can help create high tech industries. The Internet, cell phone and GPS are only the most visible recent examples of this phenomenon. It ought to be interesting to see what a federal renewable energy purchasing policy will do to advance solar cell and battery technology over the next several years.

The obvious question about this executive order is: What took so long? Why did it take the president six years to exercise the authority he had at the start of his presidency? The most obvious answer is that he is now relatively free of electoral constraints and is free to do the right thing. Another part of the answer is that since Democrats no longer control any House of Congress, nearly all of the president's policy initiatives are now focused on what he can accomplish through executive action relying on existing authorities.

Another factor behind the executive order is the growing urgency of the climate crisis, and the increased power of climate science deniers in Congress. It is sometimes hard to remember that in June 2009, the Waxman-Markey Cap and Trade bill passed the U.S. House of Representatives by a vote of 219-212. Fear of the economic dislocation that would result from rapid de-carbonization of the nation's economy has long been the true cause of the debate over climate policy. While climate science denial has been a convenient if slightly ludicrous storyline, the core issue has always been economic. But since Waxman-Markey, the economic argument has become more complicated. Renewable energy and battery technology continues to advance and is gradually becoming competitive with fossil fuels. Furthermore, many people believe that climate change impacts, such as drought and more intense storms, have already begun. Over the past seven years, the fear of economic dislocation caused by the need to adapt to climate change has provided an additional rationale for greenhouse gas reductions. The financial impact of Hurricane Sandy brought this issue to the center of the policy dialogue, particularly in the Northeast.

Finally, the air pollution crisis in India and China has created another argument to transition from dirty fuels to clean ones. The air pollution impact of coal has created increased support for pollution control measures that indirectly reduce greenhouse gas emissions. In order to provide support for pollution reduction efforts in China and India, America has to demonstrate leadership in this area as well. Since new federal legislation is not politically feasible, executive orders and EPA rules provide the president with a way to demonstrate that we are serious about transitioning away from fossil fuels to renewable energy--that we are determined to reduce our own greenhouse gas emissions and will match the actions taken by other nations.

When President Obama took office in January 2009, the political importance of the climate crisis was eclipsed by the meltdown of the world economy. Historians will see avoiding a second great depression and enacting national health care as the two signature accomplishments of the Obama presidency. With his executive order last week, the president may be building a case for adding climate policy to these other two historic accomplishments.