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Senators to propose abandoning cap-and-trade

By Juliet Eilperin and Steven Mufson
Washington Post Staff Writer
February 27, 2010

Three key senators are engaged in a radical behind-the-scenes overhaul of climate legislation, preparing to jettison the broad “cap-and-trade” approach that has defined the legislative debate for close to a decade.

The sharp change of direction demonstrates the extent to which the cap-and-trade strategy — allowing facilities to buy and sell pollution credits in order to meet a national limit on greenhouse gas emissions — has become political poison. In a private meeting with several environmental leaders on Wednesday, according to participants, Sen. Lindsey O. Graham (R-S.C.), declared, “Cap-and-trade is dead.”

Graham and Sens. John F. Kerry (D-Mass.) and Joseph I. Lieberman (I-Conn.) have worked for months to develop an alternative to cap-and-trade, which the House approved eight months ago. They plan to introduce legislation next month that would apply different carbon controls to individual sectors of the economy instead of setting a national target.

According to several sources familiar with the process, the lawmakers are looking at cutting the nation’s greenhouse gas output by targeting, in separate ways, three major sources of emissions: electric utilities, transportation and industry.

Power plants would face an overall cap on emissions that would become more stringent over time; motor fuel may be subject to a carbon tax whose proceeds could help electrify the U.S. transportation sector; and industrial facilities would be exempted from a cap on emissions for several years before it is phased in. The legislation would also expand domestic oil and gas drilling offshore and would provide federal assistance for constructing nuclear power plants and carbon sequestration and storage projects at coal-fired utilities.
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“This is a different bill,” Lieberman said in an interview. “We haven’t abandoned the market-based idea, but we’re willing to negotiate with colleagues who have different ideas.”

Many lawmakers and lobbyists say even a radically different climate bill would face big hurdles to passage, given conflicting corporate and consumer interests, regional divides and a crowded Senate calendar. Energy industry lobbyists have turned much of their attention to proposing numerous variations of more narrow energy legislation.

But President Obama has continued to push for broad legislation that he says would make the U.S. economy more efficient, slow climate change and fulfill U.S. pledges in international climate talks in December to cut the country’s emissions by 17 percent by 2020. A U.S. failure to fulfill that commitment could undercut the determination of other nations to live up to their pledges.

Opponents of cap-and-trade, including GOP congressional leaders and some energy companies, have portrayed the House-passed bill as an energy tax in disguise that would hurt U.S. consumers and create a financial commodity that could be subject to manipulation. The measure also came under criticism because it gave away a large number of free allowances to coal users.

Environmental advocates, eager to pass comprehensive climate and energy legislation before the November midterm elections, said the shift in strategy represents the best shot at getting something done this year.

“The Senate is understanding this is not a simple problem — it’s multiple problems, and it requires multiple solutions,” said Carl Pope, executive director of the Sierra Club.

The change in policy, which might even include giving money raised through carbon pollution allowances directly back to consumers, a scheme known as “cap-and-dividend,” could appeal to some wavering senators. Senior Obama administration officials have also been studying the cap-and-dividend approach. But it remains unclear whether that would be enough to produce the 60 votes proponents need, especially when the Senate has yet to finish work on health-care legislation and a jobs package.

Powerful business leaders have their own priorities. Michael Morris, chief executive of American Electric Power, a heavily coal-based utility, said one much-discussed proposal for a cap-and-trade plan limited to utilities was “ridiculous” because it would place an unfair burden on coal-based utilities. He added that “cap-and-dividend would be equally inappropriate.” He said it would take money from “mom in the Midwest and dividend it to Paris Hilton.”

While Obama has continued to assert the need for any climate bill to raise the price of carbon-based fuels, the American Petroleum Institute has been running television ads during the Winter Olympics saying “Americans say no to raising energy taxes.”

Even some moderate Republicans, seen as possible supporters of a new climate bill, remain opposed to the idea of putting a price on carbon, which Lieberman still calls “sine qua non,” or an essential ingredient, of any such bill. Andy Fisher, a spokesman for Sen. Richard G. Lugar (R-Ind.), said the senator, who has opposed cap-and-trade and carbon taxes, could support pricing carbon “potentially at some point, but not at the moment.”

Senate Majority Leader Harry M. Reid (D-Nev.) told Kerry this week that he and his colleagues need to produce a bill as soon as possible to have any chance of passage in 2010. Jim Manley, Reid’s spokesman, said it is the majority leader’s “hope to bring it up to the floor for a vote,” adding, “But we’ve got a whole host of other things on our plate, and a Republican Party that’s making it difficult for us to pass all but the most routine legislation.”

Kerry said that although the package the three senators will unveil will not have 60 votes when it becomes public, he is confident that it will win over skeptical lawmakers.

“What people need to understand about this bill is this really is a jobs bill, an economic transformation for America, an energy independence bill and a health/pollution-reduction bill that has enormous benefits for the country,” Kerry said.

By Shailagh Murray
Washington Post Staff Writer
February 27, 2010

As Democratic leaders begin to negotiate what they hope will be a health-care endgame, House Speaker Nancy Pelosi said Friday that President Obama’s support for key House Democratic priorities had increased the likelihood that a version of the massive bill now stuck in the Senate could become law.

Pelosi told reporters that Obama’s 11-page blueprint for health-care reform, released in advance of Thursday’s White House summit, had provided the outlines of a final bill that could take shape over the coming weeks.

White House officials said Obama will announce next week how he wants Congress to proceed. Lawmakers would like to wrap up debate before Congress departs March 26 for the Easter recess, but some Democratic aides acknowledged that it might not be possible to do so.

Two questions will determine whether a health-care bill reaches the president’s desk: whether Pelosi can persuade her caucus to support the more conservative proposal passed by the Senate, and whether Senate Democrats can execute the parliamentary maneuvering required to modify that legislation to accommodate the demands of the House.

Obama’s decision to take a more prominent role could prove pivotal. Pelosi said the president’s blueprint, although thin on specifics, outlines solutions to sticking points between the House and Senate that have prevented the bill from advancing.

For example, House Democrats have opposed a provision that would create a tax on high-value health plans. The White House would reduce the number of middle-class families that would be affected by raising the value of the plans that are taxed.

And Obama proposed dropping a controversial Medicaid provision that benefits Nebraska, added to the Senate bill in December to win the support of Sen. Ben Nelson (D-Neb.).

“I believe that we have good prospects for passing legislation in light of the recognition the president gave to the concerns of the House members,” Pelosi said.

A day after the White House summit, Democrats and Republicans debated which party had gained the biggest advantage from the seven-hour session. GOP lawmakers boasted that they had forced Democrats to defend on live television a vast government expansion into health care that could drive up premiums and worsen the federal deficit.

“Americans have serious objections to this plan that will give government control over our health-care decisions,” Rep. Tom Price (R-Ga.) said in a statement.

But Democrats said internal canvassing suggested the summit had reassured lawmakers that an ambitious bill was the only way to tackle an array of serious problems — especially with Obama serving as chief spokesman.

Senate Democrats said they have identified only one path forward for the health-care bill. First, the House would have to pass the bill approved by the Senate on Christmas Eve. That bill has numerous provisions that House Democrats dislike — such as the Nelson deal that critics have dubbed the “Cornhusker Kickback.” So Congress would also have to approve fixes to the Senate bill under special budget rules known as reconciliation that would allow the fixes to clear the Senate with a simple majority.

Sen. Kent Conrad (D-N.D.), whose Budget Committee holds jurisdiction over reconciliation bills, told reporters this week that the fixes must start in the House because the House is responsible for initiating bills that deal with revenue matters. But House Democrats are highly reluctant to proceed without an ironclad guarantee that the Senate will pass the revisions.

Reconciliation was created in 1974 to make it easier for Congress to approve politically difficult bills to reduce the deficit, but it is frequently used by both parties to muscle through favored policies, including tax cuts and changes to the health-care system. For instance, reconciliation was used to create the COBRA provision to let people who lose their jobs keep their health insurance.

But although reconciliation bills are protected from filibusters, they are subject to numerous other restrictions. Under reconciliation rules included in the Democrats’ current budget, the package of fixes would have to meet an overall goal of cutting the deficit by at least $2 billion over the next 10 years. And Republicans can offer unlimited amendments — a prospect that could extend the health-care debate indefinitely.

Pelosi told reporters she was hopeful the obstacles could be overcome. “We’ll put something together,” she said.

Staff writers Perry Bacon Jr. and Michael D. Shear contributed to this report.

Huge 8.8-magnitude earthquake hits Chile
Saturday, February 27, 2010
Washington Post

A massive 8.8-magnitude earthquake struck Chile early Saturday, collapsing buildings and killing at least 16 people. President Michele Bachelet declared a “state of catastrophe” in central Chile and said the death toll was rising.

Tsunami warnings were issued over a wide area, including Chile, Peru, Ecuador, Colombia, Panama, Costa Rica, Antarctica and Australia.

The epicenter was just 70 miles from Concepcion, Chile’s second-largest city. In Santiago, the capital, telephone and power outages made it difficult to determine the extent of the damage.

For more information, visit washingtonpost.com:

Desiree Rogers to step down at end of month
Friday, February 26, 2010

White House social secretary Desiree Rogers will leave her post. Rogers was criticized by some lawmakers after an uninvited couple infiltrated President Obama’s first state dinner.

washingtonpost.com:

Still no relief?

It’s already been two months since 2010 began and there’s still no relief in sight for the lack of a cost-of-living adjustment to Social Security.

Costs of prescription drugs, utilities, and health care are rising, and Social Security checks are staying flat.

AARP Bulletin

By Shailagh Murray and Anne E. Kornblut
Washington Post Staff Writer
February 26, 2010

President Obama declared Thursday that the time for debate over health-care reform has come to an end, closing an unusual seven-hour summit with congressional leaders by sending a clear message that Democrats will move forward to pass major legislation with or without Republican support.

Democratic leaders face a heavy lift in reviving their stalled bill, a process that would involve intricate parliamentary maneuvering and carries no guarantee of success. But Obama signaled that if meaningful GOP cooperation does not materialize in the weeks ahead, he is ready to proceed without bipartisan support and risk the political consequences.

“The question that I’m going to ask myself and I ask of all of you is, is there enough serious effort that in a month’s time or a few weeks’ time or six weeks’ time we could actually resolve something?” Obama said. “And if we can’t, then I think we’ve got to go ahead and make some decisions, and then that’s what elections are for.”

The remarkable session at Blair House ranged from dull to pointed as it revealed the deep divide between the two parties over health care. It was the same philosophical gulf that led to the collapse of bipartisan Senate negotiations last summer, and the primary reason Congress has resorted to changing the health-care system piecemeal, rather than in broad strokes, over the years.

Republicans said that they share Democrats’ assessment that the health-care system is broken, but that they view the pending legislation assembled by Democrats as deeply flawed. They questioned fundamental elements of the Democrats’ approach, including whether it is appropriate for the government to set standards for coverage or require individuals to buy insurance.

Obama played the role of active moderator for much of the event, calling on participants to speak and interjecting when he disagreed on specific points. He chided members of both parties for lapsing into campaign rhetoric, but he saved some of his most pointed jabs for Republicans, his voice heavy with sarcasm when he accused GOP speakers of using “good poll-tested language” to describe the Democratic plan as “government-run health care.”

Some Republicans were more pleased with the session than others. Sen. Jon Kyl (R-Ariz.) complained as the GOP delegation left the White House that Democrats and Obama had consumed the vast majority of the airtime. But Senate Minority Leader Mitch McConnell (R-Ky.) described it as “a good discussion,” telling reporters, “I wouldn’t call it a waste of time.”

GOP lawmakers arrived at the table with two primary goals: to demonstrate that the party has its own health-care solutions, and to criticize the Democrats’ proposal as big-government overreach.

“We Republicans care just as much about health care as the Democrats in this room,” said Rep. Eric Cantor (Va.), the No. 2 House Republican. But he added: “There is a reason why we all voted no. And it does have to do with the philosophical difference that you point out.”

During a break in the session, Senate Majority Whip Richard J. Durbin (Ill.) deemed a bipartisan deal “a long-shot” prospect, but he told reporters that Democrats are undaunted in their quest to deliver a bill to Obama’s desk.

“If nothing comes of this, we’re going to press forward,” he said. “We just can’t quit. This is a once-in-a-political-lifetime opportunity to deal with a health-care system that is really unsustainable.”

Democrats are attempting a historic feat in seeking passage of a huge bill that aims to expand coverage to an additional 30 million people, reform insurance industry practices and curb rising health-care costs.

But polls show that voters are skeptical of the ambitious proposal, which carries a 10-year cost of roughly $900 billion and would institute the most far-reaching changes to the system since Medicare and Medicaid were created in 1965.
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During Thursday’s session, both sides expressed regret about the way the debate has unfolded. What started nearly a year ago as a good-faith effort to find broad agreement quickly devolved into a partisan grudge match, marred by favors to secure votes and deals cut by the White House and Democratic leaders on Capitol Hill with special-interest groups. As several Republicans noted, most key decisions were reached behind closed doors, a breach of Obama’s campaign pledge to make health-care negotiations transparent.

“Both of us during the campaign promised change in Washington,” Sen. John McCain (Ariz.), the 2008 GOP presidential nominee, said to Obama. “In fact, eight times you said that negotiations on health-care reform would be conducted with the C-SPAN cameras. I’m glad more than a year later that they are here.”

If nothing else, the session was an attempt to bring an air of civility and openness to the debate. “Unfortunately, over the course of the year, despite all the hearings that took place and all the negotiations that took place, and people on both sides of the aisle worked long and hard on this issue, and you know, this became a very ideological battle,” Obama said.

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Washington Post February 26, 2010
Dan Zak

Furious at the tempest over the Tea Party — the scattershot citizen uprising against big government and wild spending — Annabel Park did what any American does when she feels her voice has been drowned out: She squeezed her anger into a Facebook status update.

let’s start a coffee party . . . smoothie party. red bull party. anything but tea. geez. ooh how about cappuccino party? that would really piss ‘em off bec it sounds elitist . . . let’s get together and drink cappuccino and have real political dialogue with substance and compassion.

Friends replied, and more friends replied. So last month, in her Silver Spring apartment, Park started a fan page called “Join the Coffee Party Movement.” Within weeks, her inbox and page wall were swamped by thousands of comments from strangers in diverse locales, such as the oil fields of west Texas and the suburbs of Chicago.

I have been searching for a place of refuge like this for a long while. . . . It is not Us against the Govt. It is democracy vs corporatocracy . . . I just can’t believe that the Tea Party speaks for all patriotic Americans. . . . Just sent suggestions to 50 friends . . . I think it’s time we start a chapter right here in Tucson . . .

The snowballing response made her the de facto coordinator of Coffee Party USA, with goals far loftier than its oopsy-daisy origin: promote civility and inclusiveness in political discourse, engage the government not as an enemy but as the collective will of the people, push leaders to enact the progressive change for which 52.9 percent of the country voted in 2008.

The ideas aren’t exactly fresh — Tea Party chapters view themselves as civil, inclusive and fueled by collective will — but the Coffee Party is percolating in at least 30 states. Small chapters are meeting up, venting frustrations, organizing themselves, hoping to transcend one-click activism. Kind of like the Tea Party did this last year, spawning 1,200 chapters, a national conference and a march on Washington.

“It’s like trying to perform surgery in the dark,” says Park, 41, a documentary filmmaker. She’s exhausted, overcommitted, passing whole days on Facebook, not collecting a paycheck, hopping between conference calls, sending e-mails at 4 a.m., smoothing out conflicts over strategy. She has been swept up in this project, and so have others. Within two weeks of forming, the Los Angeles chapter produced a five-minute video in which citizens yearn for sensible progress and lament obstructionist truth-twisting.

Progress is patriotic, they tell the camera. Wake up. Espresso yourself. Something is brewing, America.

* * *

Need something to wash down that heaping helping of American angst? Tea or coffee? (Must we choose?)

Deep down, underneath the Tea Party’s Revolutionary War garb and the Coffee Party’s faded HOPE stickers, they seem to want the same thing. To save America. Which raises the question: “From what?”

The easy answer is “each other,” when really their complaints are similar and eternal: The political system is broken, elected officials ignore the people, and the media warp truths and pit sides. A recent Washington Post-ABC News poll shows that two-thirds of Americans are “dissatisfied” or “angry” with the federal government,” the highest level in 14 years, and many have sought solace in social networking. The Coffee Party, whether it grows or fizzles, is the latest effort to turn virtual disenchantment into real-world results. Its members are incited by Tea Party tactics, which they believe obstruct reform and discourage thoughtful deliberation, and the Tea Party — well, the Tea Party has not heard of the Coffee Party.

Says Robert Gaudet, 40, a software designer in Shreveport, La., who administers TeaPartyPatriots.org: “We don’t see cooperation with the government. We see ourselves monitoring the government. . . . As for shouting and obstructionism, absolutely not. The media is trying to define a movement and not being able to put their finger on it. There’s common-sense solutions we’re asking for: fiscal responsibility, free markets, limited government and lower taxes.”

Says Dave Henderson, 48, an automotive service adviser in Denison, Tex., who found the Coffee Party on Facebook: “The political mood right now is ‘blame Obama for everything.’ The Tea Party is overexposed but organized, and they have a poster child in Sarah Palin and Fox News. I’m extremely anti-establishment, and the thing that appealed to me about the Coffee Party is it is very grass-roots, there’s no official organization, and individuals can participate as individuals without having to see eye-to-eye on everything.”

The Coffee Party is not so much a party or movement as a slow-drip ripple through online nano-politics. Within the past 10 days, its Facebook fans rose from 3,500 to more than 9,200, which is far more than the 5,900 fans of the central page of Organizing for America, the DNC-funded group supporting President Obama’s agenda. What does that mean, though, when nearly 100,000 Facebook users have joined the Tea Party Patriots Facebook page and 1.5 million have joined a joke page titled “Can this pickle get more fans than Nickleback?”

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By Joshua Partlow
Washington Post Foreign Service
February 26, 2010

HERAT, AFGHANISTAN — As the Taliban commander in the Pusht-e-Zargon district of western Afghanistan, Abdul Wahab considered himself the law. A stolen sheep? He would choose the thief’s punishment: often a gunshot to the forearm or calf muscle. He was careful to avoid the bone.

When salaries arrived from the Taliban leadership in Pakistan — $100 a month per man — he doled them out. Thirty fighters moved at his command. “If I asked them to jump in a river and drown, they would,” he said.

Power and respect, this is what the Taliban meant for Wahab. A government job and protection from U.S. raids are what he thought he was getting when he agreed to lay down his weapons in November.

The United States, along with its NATO and Afghan allies, is trying to “reintegrate” militants like Wahab, offering them jobs on the assumption that they would rather earn a salary than spend their days fighting. The effort is a central pillar of the Obama administration’s Afghan war strategy.

Taliban leaders scoff at that notion, saying their loyalists are waging a determined holy war against the infidel armies of the West and can’t be bought off.

Interviews with Wahab and other fighters who recently left the Taliban as part of an Afghan government effort to lure them from the battlefield suggest that in many cases, U.S. policymakers may be on to something. Several ex-fighters said they joined the Taliban not out of religious zealotry but for far more mundane reasons: anger at the government in Kabul, revenge for losing a government job, pressure from family or tribe members — or simply because they were broke.

“Nobody goes to the other side for fun,” Wahab said. “There must be a pain in your heart.”

In the complex world of Afghan loyalties, some had fought both for and against the Taliban. The most fearsome Taliban commander in Herat, killed by a U.S. airstrike in October, used to be the mayor.

The diverse strands of the insurgency make it difficult to generalize about the motives of fighters across the country. Insurgents in Herat probably differ from those elsewhere, particularly in southern Afghanistan, where Taliban leader Mohammad Omar’s original following was born. But at least in this strategically important city on Afghanistan’s western frontier, there’s evidence of a deep pragmatism when it’s time to choose sides.

“The Taliban here are not ideological,” said Delawar Shah Delawar, Herat’s deputy police chief. “These people have lost something. They feel ashamed that they have no cars, no bodyguards. How can they face people when they walk in the streets?”

Nobody fit this description better than Ghulam Yahya Akbari, who served as Herat’s mayor in the early 1990s after the Soviet withdrawal. Back then, he was a staunch opponent of the Taliban, and he fled to Iran when the group came to power. After the U.S.-led invasion, he came back to run Herat’s Department of Public Works and helped develop one of Afghanistan’s most modern cities. But after a dispute with the previous governor, Akbari was fired in 2006.

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AIG loses $8.87B in latest quarter
Friday, February 26, 2010
The Washington Post

CHARLOTTE, N.C. — AIG says it lost $8.87 billion in the fourth quarter as it paid down some of the billions of dollars in bailout loans it received from the government.

The results were an improvement from the $61.7 billion it lost in the year ago period, but they were worse than analysts expected. They also followed two straight profitable quarters.

Investors weren’t happy with AIG’s news, and bid its stock down nearly 13 percent in pre-opening trading.

washingtonpost.com:

By reuters
Friday, February 26, 2010
The Washington Post

Secretary of State Hillary Rodham Clinton said Thursday that “outrageous” advice from former Federal Reserve chairman Alan Greenspan helped create record U.S. budget deficits that put national security at risk.

Appearing before Congress to defend the State Department’s $52.8 billion budget request for 2011, Clinton said the country’s massive foreign debt had sapped U.S. strength around the world.

“It breaks my heart that 10 years ago we had a balanced budget, that we were on the way of paying down the debt of the United States of America,” Clinton said. “I served on the budget committee in the Senate, and I remember, as vividly as if it were yesterday, when we had a hearing in which Alan Greenspan came and justified increasing spending and cutting taxes, saying that we didn’t really need to pay down the debt — outrageous in my view.”

During Clinton’s tenure in the Senate, President George W. Bush authored a massive tax cut while sponsoring a major expansion of the Medicare health program for seniors and spending billions on wars in Iraq and Afghanistan.

Clinton urged lawmakers to tackle the federal budget deficit, which reached a record $1.4 trillion for the fiscal year that ended last September.

“We have to address this deficit and the debt of the United States as a matter of national security, not only as a matter of economics,” Clinton said. “I do not like to be in a position where the United States is a debtor nation to the extent that we are.”

Having to rely on foreign creditors hit “our ability to protect our security, to manage difficult problems and to show the leadership that we deserve,” she said.

“The moment of reckoning cannot be put off forever,” she said. “I really honestly wish I could turn the clock back