Friday, November 27, 2015

Can a WA State climate policy train wreck be averted?

TOPICS: CLIMATE CHANGE, CARBON, GLOBAL WARMING, WASHINGTON STATE, JAY INSLEE, INITIATIVE 732, CAP-AND-TRADE, CARBON TAX, CARBON WASHINGTON, ALLIANCE FOR JOBS AND CLEAN ENERGY

A group of spunky citizens frustrated by the long-term failure to enact climate policy in Congress or the state legislature takes matters into its own hands and seeks to place a carbon tax initiative on the ballot.  As the signature gathering deadline approaches they close on their target.

Labor and social justice organizations that were once only marginally engaged in the climate issue elevate it to a top-priority concern.  They join in a new alignment to advance climate policy at the state level, emphasizing the opportunity to build equity in the process of reducing pollution.

These two developments in Washington state evidence a growing climate movement, one that now is spreading widely among progressive organizations and the citizen grassroots.  Facing accelerating climate chaos across the planet – from deep droughts to massive storms to polar ice loss – this is a movement that needs to inspire hope.  And its spread is one of the most hope-building trends around. The climate movement is finally growing to the scale of the climate challenge.

But more people coming to the table creates a profound challenge, now fully realized in the Evergreen State.  A movement that could once be coordinated by a small number of groups and players has grown beyond that possibility.  Multiple approaches and philosophies are in play.  With that have come conflict and division.   Prospects loom for snatching climate-policy defeat from the jaws of movement-growth victory.

TWO TRAIN WRECK SCENARIOS

The basic situation is that Carbon Washington has successfully mobilized a significantly volunteer effort for its Initiative 732 carbon tax.  As of this writing CarbonWA has gained 325,067 of the 330,000 signatures it targeted by Nov. 30 to assure enough names.  The number needed to qualify is 246,372.  CarbonWA has already turned in a substantial portion to the state.  If a sufficient number of valid signatures goes before the Legislature in January, that body has the option to pass the measure or put it on the November 2016 ballot. (Update - as of Dec. 2 the campaign exceeded its goal, reaching 334,000.  It is currently mounting a last month campaign to reach 350,000.  These numbers make ballot qualification highly probable.)  The Legislature could also accompany that with one of its own.

Meanwhile, the Alliance for Jobs and Clean Energy has built an alignment of progressive groups that backed Gov. Jay Inslee’s carbon cap and trade bill in the 2015 Legislature.  The Alliance has announced its intention to run its own carbon pricing initiative, but has not announced details. Alliance members, particularly groups representing communities of color, object to I-732’s design, recycling all revenues from a $25/ton carbon tax to tax cuts and credits. They maintain that a portion of revenues should be devoted to funding green jobs and other investments in just transition from fossil fuels, and that CarbonWA has not been responsive to their concerns, and was not designed through an inclusive process that would have incorporated those concerns.  The arguments and politics were covered in a previous post.

The Alliance has made multiple statements that it regards the presence of competing initiatives on the 2016 ballot as a recipe for defeat, and has committed in a joint statement with CarbonWA not to run two initiatives.  The Alliance also asserts that its polling indicates the revenue-neutral design of 732 is in itself a loser, and that people would actually be more willing to vote for a measure that invests in solutions. Now that I-732 appears to be headed to ballot qualification, at least two train wreck scenarios rise. 



Scenario #1 -  The Alliance goes ahead and files an initiative to the people that gains its signatures in 2016 and ballot qualifies (as opposed to CarbonWA’s initiative to the Legislature which needed to get its sign-ups in 2015).  The contest between the two initiatives turns nasty and fossil fuel interests leverage the conflict to discredit both in the public eye, resulting in defeat.  This poisons the well for passage of carbon pricing in Washington state for some time to come

Scenario #2 - The Alliance opts not to run an initiative, but it and its supporters stand aside.   Disunity in climate forces adds to the uphill challenges already faced by I-732.  The initiative goes down to defeat, also poisoning the carbon-pricing well. 

It is important to note that neither of these scenarios are inevitabilities in themselves.  Victory in an initiative fight will be determined by the degree to which the climate concerns of Washington citizens can be aroused.  A successful campaign will connect fossil fuel pollution with climate impacts on the state including record drought and wildfires, salmon death in overheated rivers, intense and sometimes unseasonal storms, and shellfish industry-killing ocean acidification. Success in elevating climate urgency might overcome the disadvantages of disunity.    The details of policy will come second.  

It should also be noted that many CarbonWA supporters push back on the idea that a ballot loss will be fatal to future climate policy passage. Better to take a swipe at bat and push the climate issue by talking to hundreds of thousands of people on the streets, they say. Whatever the case, if 732 goes on the ballot it creates facts on the ground with which the entire climate community must deal.  

Could this conflict have been avoided? And are there conflict resolution paths forward that improve the odds of victory? 

STRATEGIC MISCALCULATIONS, PREDICTABLE OUTCOMES

To answer the first question, yes, this could have been avoided.  A set of strategic miscalculations on the part of the state climate policy establishment set up this dilemma.  CarbonWA had been moving toward an initiative for several years, but would not have filed I-732 if the governor’s climate bill had been successful, or if the governor and/or the state’s climate groups had been ready with their own initiative.  It was clear almost from the day the bill dropped it was not going to pass.  It was also crystal clear that CarbonWA would file its initiative, as it did in April, when there was no other measure on the table. Though the Alliance was talking about an initiative then, CarbonWA leadership noted with some skepticism that climate groups had been discussing an initiative for years without taking action.  If the governor and the groups had been ready to fill the initiative space when they saw legislative failure looming, the situation now would be entirely different. 

The fact they did not occupy the initiative space immediately, and let CarbonWA seize it, leads to an unavoidable conclusion.  They miscalculated that a significantly volunteer effort without several hundred thousand dollars in the bank would not have the juice to gain the signatures.   In closing on apparent success CarbonWA has presented them with an unanticipated fait accompli. There was a critical disconnect in this, a lack of comprehension of the deep hunger and moral urgency of grassroots citizens to do whatever they could to address the climate crisis.  There was also a lack of appreciation for how frustrated people had become about repeated failures to pass meaningful climate policy.  They were no longer willing to trust professionally staffed groups or political leadership to get the job done.  These sentiments extended far past the core organizers of CarbonWA, as successful efforts to build a volunteer army and broad funder base prove. 

Cascadia Planet predicted this outcome last January. ". . . the climate and environmental community has greeted the governor’s plan with enthusiastic support.  This demonstrates a deep hunger for carbon limits of any sort. However, if the governor cannot pull one out of a hat and his package stalls, that same hunger will attach to CarbonWA’s proposal. The momentum created by the campaign for the governor’s cap-and-trade will transmit to CarbonWA’s BC-style carbon tax."

One reason that the governor and the groups should have been ready to fill the initiative space was to avert a climate movement split. The fractiousness to come could have easily been anticipated. Cascadia Planet forecast the split in a Nov. 25, 2014 post, "Climate Justice in collision with revenue-neutral carbon policies?"   Of course, CarbonWA made its own contribution to the situation. Before CarbonWA filed its initiative, communities of color representatives asked the group to adopt a policy that did not recycle all revenues, but direct some of the revenues to invest in transition from fossil fuels.  CarbonWA had already fixed its policy, and so a collision was coming.  Greater flexibility on the part of CarbonWA could have at least gone a long way to avert this.  But CarbonWA leaders are convinced that revenue-neutrality is necessary to attract bipartisan support.  So here is a place where differing approaches and philosophies are coming to the fore.  

Still, if there had been an alternative initiative on the table, the collision could have been avoided. A series of strategic miscalculations led up to that. The first was that the Washington State Senate could be flipped back to the Democrats in the 2014 election, opening the way for legislative passage of climate policy.  The assumption was that high-net-worth funder money from California billionaire Tom Steyer and others, coordinated with get-out-the-vote efforts, could overcome the traditional Democrat disadvantage in off-year elections plus the disadvantage the incumbent’s party has in the sixth year of a presidential term. Meanwhile, the governor’s Carbon Emissions Reduction Taskforce, which included core Alliance members Climate Solutions, American Lung Association, One America, SEIU and Washington State Labor Council, had spent months designing a legislative proposal in the expectation that the governor would have a Senate he could work with. Election day defeat effectively eliminated that possibility, leaving a Republican Senate led by oil industry minions. Notable among them was election target Doug Ericksen, chair of the Energy, Environment and Telecommunications Committee, a chokepoint for any climate legislation. 

Nonetheless, the governor went ahead with a bill.  Unfortunately, it bore little resemblance to what one would want in an initiative.   Focusing the lion’s share of carbon revenues on solving the state’s education and transportation funding crises, it devoted a relatively small share to the kind of just transition funding the Alliance is now demanding.  Ironically, the major portion of that was revenue recycling to lower-income families meant to buffer the impact of higher energy prices, along the lines of funding offered by 732.  The bill was designed for legislative passage in the forlorn hopes that a few Republican legislators could be peeled away to solve the budget crisis.  It was not designed to tee up an initiative.  

It was also a cap-and-trade, a policy design that draws skepticism from climate justice groups who label carbon trading as a “false solution” to climate change.  Among other reasons, they object to letting polluters buy offsets that allow high-emissions facilities to continue operating in low-income neighborhoods, as well as forest carbon purchases in developing nations that deprive traditional peoples of land rights. In October and November climate justice groups conducted two “no false solutions” workshops in Seattle to drive home their opposition to carbon trading.  Sponsors included Seattle Rising Tide, leader in the local direct action movement against fossil fuels; Bayan, a progressive Filipino coalition, and Alliance Steering Committee member Got Green.  To its credit the issue is being debated in Alliance ranks.  

In an alternative scenario, when it became clear the Republicans would hold the State Senate, making bill passage unlikely, the governor would have submitted a bill that reflected the content of a prospective initiative - With substantial funding for green jobs, clean energy and just transition, and a simple, non-controversial policy design that would draw widespread support.  If the bill was blocked, the governor and/or the groups would have been ready with an initiative to the 2015 Legislature, the same vehicle CarbonWA employed.  Who knows?  Maybe the threat to file an initiative would have given the governor more leverage with the Republican Senate. 

Why didn’t this happen?  In the final analysis, the governor and the groups did not want to commit to an initiative at that point.  Their own polling made them uncertain an initiative would pass, and they did not want to take the risk.  So when the governor’s bill hit the wall, CarbonWA literally took the initiative and captured the momentum. Its initiative to the Legislature kicked off the signature campaign in May. One can only think that if the governor and the groups had employed a different political calculus that correctly assessed the hunger of grassroots citizens to take action, and CarbonWA's ability to leverage it, they would have moved earlier with their own initiative, whatever the risks.  

ENVISIONING CONFLICT RESOLUTION SCENARIOS

By now, there is a lot of spilled milk under the bridge, a number of heated statements (which in the spirit of conflict resolution I will leave aside), a whole lot of hurt feelings, and high potential for a climate policy wreck on the order of an oil train explosion.  Assuming I-732 will gain enough signatures to qualify, are there scenarios that avert train wreck conflicts and lead to victory?  There are many moving pieces and complex nuances, some of which I find frankly boggling.  But here goes:

Scenario #1 – CarbonWA responds to pressure to not file its signatures, and instead unifies with the Alliance and its clearly superior connections and resources.  In return CarbonWA has a prominent voice in the Alliance initiative design.  But would CarbonWA be willing to do this, knowing many volunteers and supporters might be alienated by such a decision?  In any event, this scenario would require an absolutely solid commitment by the Alliance to run an initiative with agreement on mutually acceptable language.  This would likely have to happen in the next month because CarbonWA loses leverage past the signature-filing deadline of Jan. 1, 10 days before the next legislative session starts.

Scenario #2 – The Alliance opts not to go ahead with its own carbon pricing initiative, and also opts to put resources behind 732 despite its objections in order to put a basic carbon pricing framework in place.  Averting a carbon pricing defeat would be a powerful incentive. This is particularly the case because, as Cascadia Planet previously reported, inside players fear an initiative loss would also drag down Inslee’s 2016 reelection campaign.  But would Alliance members be willing to support a measure many consider a bad precedent that does not support a just transition?  If I-732 passes, it would not be set in stone forever.  After two years the Legislature could alter it with a majority vote (2/3rds before then).  The initiative's initial two-year $25/ton carbon charge can grow to $100/ton under the measure at 3.5% annually plus inflation. With legislative changes there could be funding for transition investments in the future.  The Legislature could also accelerate growth of the charge.  Nonetheless, supporting 732 would be a hard pill to swallow for many Alliance members, who could only consider it a last ditch to avert worse outcomes, and who did not feel included in the initial design.

Scenario #3 – The Legislature enacts 732 carbon pricing as a way to cover the one percent sales tax cut enacted by Tim Eyman’s Initiative 1336 passed in November.  The initiative orders the cut unless the Legislature puts a constitutional amendment before the voters mandating a two-thirds legislative vote for tax increases. Assuming a court challenge does not knock out 1336, a new carbon tax provides a way to preserve state revenues and avoid the amendment vote.  Denny Westneat speculated about this possibility in the Seattle Times.  There are difficulties because 732 phases in a one-percent sales tax reduction over two years, while Eyman’s initiative cuts sales taxes one percent over one year. If that could be worked out, it opens the way for the Alliance to run its own initiative.  But would the Republican State Senate have any incentive to go with this plan?  It seems unlikely. 

Scenario #4 – The Alliance files its own initiative and conducts a collaborative campaign with CarbonWA that focuses the debate on the disposition of carbon revenues.  Green transition investments or tax cuts?  Frame this as basic agreement on the need for carbon pricing while giving voters a choice on what to do with the revenues. In this case, it would be best to have the pricing side of the measures as parallel as possible.  A $25/ton carbon tax is a good place to start.  Cascadia Planet suggested this before. Could the groups come together?  Would this collaborative approach overcome fears that competing initiatives will cannibalize each other?  These are unknowns, but it seems reasonable to consider this option. 

Scenario #5 – The Alliance takes a different tack, leaves carbon pricing to 732 and approaches energy transition from an energy standard approach.  Paralleling the new Oregon initiative, which calls for coal plant shutdown and a 50% renewable energy share, a Washington initiative could ramp up the state’s renewables standard from the 15% by 2020 enacted through I-937.  If Washington reached 30% new renewables by 2030 - "30x30" - nearly 100% of the state’s electricity would effectively be wind, solar or hydroelectric. Washington could join the growing movement to 100% clean renewable energy, which Hawaii did recently when it mandated 100% by 2045. This would assure that replacement energy for coal plants including Transalta and Colstrip would not be natural gas. It would also create significant numbers of green jobs. One objection is that the measure would only cover the electrical sector while the state’s largest carbon emissions challenge is transportation.  But transportation is electrifying, and a regulatory carbon cap rulemaking that the governor has ordered the Department of Ecology to undertake will cover most transportation fuels used in the state. 

That was strengthened by a recent King County Superior Court ruling in response to a suit by youth plaintiffs.  They argued that the state is obligated to cap carbon emissions under constitutional and legislative mandates to protect natural resources.  Judge Hollis Hill agreed.  (Cascadia Planet will post on this highly significant ruling soon.)  Washington state will have a carbon cap, assuming the rulemaking stands up under the inevitable fossil fuel industry court challenge.  What it will not have, unless enacted by the Legislature or the people, is a carbon price.  This is why it is vital that the Alliance and CarbonWA find some way to harmonize their efforts, if this is possible. A price on carbon will move climate solutions forward.

We should regard it as a triumph that so many people and groups are coming to the climate table firmly committed to take action.  We should all acknowledge each other as people of good will, and seek the best possible outcomes.  We can ill afford a climate policy train wreck.  Let’s do all we possibly can to avert one.






7 comments:

  1. Patrick, I believe you've done real service shedding daylight on this tangled mess, and framing your analysis in a spirit of goodwill and hope for a positive resolution. We need carbon pricing in Washington State. I hope the various factions reading this as COP21 begins, and as the global Carbon Pricing Leadership Coalition (which supports both a carbon tax and carbon markets) is launched there Nov. 30, will see the need to come together. We have to have a win here in 2016.

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  2. A couple things: My reading of I-732 is that carbon tax is $15/ton Y1, $25/ton Y2, and +5%/yr up to $100/ton. Also, regarding Inslee's/Ecology's cap-and-reduce proposed rule, only transportation fuel made in AND used in WA (and exclusive of Nav and aviation fuels) would be subject (presumed necessary to avoid violating interstate commerce clause of US constitution).

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    1. You are correct on the growth of the 732 charge. And I have made a correction to the original post. The growth is not all inflation, but beyond $25 increases at a rate of 3.5% annually plus inflation to reach a maximum of $100. In terms of fuels, the Inslee plan would still cover most of the fuel used in the state. Western Washington is a shut-in market served by local refineries. Some fuel east of the mountains does come in from out of state.

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  3. This is an excellent piece, thank you. It's a brilliant idea to leave pricing to 732 and for the Alliance to focus on RPS with teeth that drive good, clean jobs and clean neighborhoods. I think the Alliance would even get a lot of CarbonWA volunteers psyched about working on that initiative. I also appreciate recognizing the damage that could be done for carbon policy in the long-term if we fight about 732.

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  4. Indeed, if The Alliance would focus on the transition elements, and leave the pricing to I-732, many of us who worked on I-732 will support them. With the passage of I-1366, the revenue from I-732, to backfill the sales tax cut imposed by the Eyman initiative, is essential for schools, health care, and other basic government service.

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